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1、,Chapter Eleven,Distributive VS Integrative Types of Negotiation,Chapter ElevenDistributive VS,Win or lose?,Win Win?,Negotiations can be categorized into two types by how people looking at the results of negotiations: the distributive, representing win-lose result and the integrative, representing w
2、in-win result.,Win or lose?Win Win?Negotiatio,Distributive Negotiations,Win,Lose,Relationship: simple and secondaryIssues: simple and tangibleReward system: win or loseAssumptions: only present interests,Distributive NegotiationsWinLo,Strategy used,To reduce others resistance to making of concession
3、,To reduce others estimation that you will concede,To exploit others trust, low skill and inexperience,To exploit information asymmetry,Strategy usedTo reduce others,Price Negotiation and Cost Analysis,Two basic cost functionsvariable costs: raw materials and laborFixed costs: supplier has to bear i
4、rrespective of whether it manufactures anything or not, such as rent, rates, insurance, wages,Price Negotiation and Cost Ana,Fixed Cost Elements,planning and production expensesexpenditures on plant and equipment, and such administrative costs as salaries, insurance, depreciation and interest on ove
5、rdraftsmarketing and distribution costscost of running the marketing operation (including the sales force), provision for retailer support,Fixed Cost Elementsplanning an,Variable cost + fixed costs= cost of product+ profit margin= selling price,Equation of cost structure,Profit,Variable cost Equatio
6、n of c,Negotiations on Price,Price Zone,Buyers negotiation zone,First offer,Bottom line,First offer,Sellers negotiation zone,150,180,170,200,Buyer,Seller,Zone of possible agreement,10,Negotiations on PricePrice Zon,Integrative Negotiation,The word integrative by concept implies some cooperation, or
7、a joining of forces to achieve something together. Integrative negotiation usually involves a higher degree of trust and a forming of a relationship.,Integrative NegotiationThe wor,Integrative Negotiation Basics,Multiple IssuesInformation sharingProblem SolvingBridge Building,Integrative Negotiation
8、 Basics,Strategies for Integrative Negotiation,Gain first hand informationPlay FairPresent Multiple OffersThird Party Assistance,Strategies for Integrative Neg,Negotiation Simulation,Used Car Seller,Requirement for negotiation: Read buyer and sellers part in the book respectively;Discuss with your p
9、artner your negotiation strategy, including your first offer, bottom line, and the zone of possible agreement,Ralphs Manual of used car prices,Negotiation SimulationUsed Car,Case Study,How did the buyer find out the price of the equipment was over valued?Point out those factors which make it possibl
10、e for the buyer to make the cost analysis.,Case StudyHow did the buyer fi,Case StudySarah Meets WalMart,(1) What is the most important point for Sarahs success dealing with WalMart?(2) How did Sarah turned a distributive negotiation into an integrative negotiation?(3) Why did Sarah suggest that “Trying to bluff Walmart buyers is never a good idea”?(4) Why did Sarah suggest that “Try not to let Walmart become more than 20% of your companys business”?(5) Why is it important to “go into a meeting with a clear negotiation agenda”?,Case Study(1) What is the most,
