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1、1,International Business Negotiation,2,Chapter6 Counter-offer and its strategy,3,Teaching Objectives,After studying this module, you should be able to know: In this chapter you will learn 1.What are counter-offers? 2.Tactics and skills for making counter-offers 3.How to make concessions 4.Tactics an
2、d skills for making concessions 5. How to deal with the deadlock in international business negotiation?,4,Introduction of counter-offer,How to make concessions,dealing with negotiation deadlock,4,1,2,3,Contents,bargaining tactics,5,6.1 Introduction of counter-offer,In general practice, when an offer
3、ee has received an offer, he usually would not accept it immediately, instead he would try to amend or alter some terms of the offer. In doing so, he would make a counter-offer. Counter-offer is a reply to an offer that adds to, limits, or modifies materially the terms of the offer. It is a new offe
4、r made by the offeree.,6,6.2 bargaining tactics,6.2.1bargaining power The following are some of the factors that you should consider as you assess the bargaining strengths and weaknesses of each party involved in a particular negotiation: Competition. Knowledge. Time Constraints. Bargaining Skills.
5、Importance of the Contract to Each Party.,7,6.2.2 How to set a price range of a counter offer?,With regard to the items concerned in the counter offer，there are three categories：bargain item by item，bargain by classifications and bargain as a whole Generally speaking，bargaining item by item favors t
6、he buyerBargaining by classifications is often acceptable to both sidesAnd bargaining as a whole appears to be more convenient and simplebut is more beneficial to the seller,8,6.2.3 How to make a counter-offer?,(1)Dont set a firm minimum counter offer at the starting point. (2)Try to get a sense of
7、the buyer (3)What if youre close together in price? (4)What if youre far apart? (5)Is There a Time to Walk Away?,9,6.2.4 Tactics during the counter-offer stage,(1)Patience and silence (2)Arguing unexpectedly (3)Threats and warnings (4) Pay attention to interests rather than positions (5) Know their
8、current non-settlement alternatives. (6)Focus on the concession patterns,10,6.3.1 Preparation for making concessions,(1)Cause & effect of making concessions (2)Lets Be Fair,6.3.2 general principle for makin concessions,(1)Do not make a senseless concession. (2)Do not make concessions blindly. (3)Sei
9、ze the big “fish” and release the small one. (4)Choose the right time.,11,(5)Keep the bottom line a secret. (6)Do not automatically accept a bid to match concessions by an equal margin . (7)Look before you leap. (8)Do not make it too easy for the other party to gain what he wants. (9)Take back an im
10、proper and ill-conceived concession . (10)Let the other party do it first and then follow suit.,6.3.2 general principle for makin concessions,12,(11)Firmly control the times and margin of your concession (12)Dare to say“no” (13)Quantify a concession (14) Have the overall situation in mind (15)There
11、is no need for giving a plum in return for a peach (16)Withdraw to get the second best,6.3.2 general principle for makin concessions,13,(1)Keeping up until last concession【0-0-0-60】 (2)Concessions by equal margin【15-15-15-15】 (3)Progressive increase in concessions【5-10-15-30】 (4)Progressive decrease
12、 of concessions with a minor range【20-16-14-10】,6.3.3 Eight patterns of making a concession in a negotiation,14,(5)Progressive decrease with a middle range【30-18-10-2】 (6)Progressive decrease with a large range【40-10-7-3】 (7)Decreasing progressively and increasing at the end【13-8-17-22】 (8) Showing
13、ones hand at the beginning【60-0-0-0】,6.3.3 Eight patterns of making a concession in a negotiation,15,(1)Excessively demanding (2)Emotional outburst (3)Tag-team tactic (4)Divide and conquer (5)Involving competition,6.3.4 Typical hardball tactics used to force the other party to make,16,(6)Red face an
14、d white face routine(Good guy and bad guy routine) (7)Reaching for a yard after getting an inch (8)Feint to the east and attack in the west (9)Taking advantage of anothers faults (10)The ultimatum,6.3.4 Typical hardball tactics used to force the other party to make,17,6.3.5 Strategies used to preven
15、t the counterparts attack,(1)Limited authority (2)No precedents (3)Fatiguing tactics (4)Adjournment (5)Seeking commiseration (6)Showing ones hand,18,6.4 dealing with negotiation deadlock,(1) Change the setting (2) Change the negotiator(s) (3) Change levels in the organization (4) Provide additional information (5) Go “off the record” (6) Say “Lets shift into the both win mode” (7)Take a break,19,Thanks!,
