Negotiation Preparation Checklist: Crucial Questions to Answer
Before entering negotiations, a negotiator should always prepare his very own negotiation preparation checklist. It is a necessary tool that will help the negotiator in preparing for any upcoming negotiation.
For this article, we are going to reveal to you one of our Procurement Tactics secrets for negotiation preparation. It’s a full-blown checklist of everything that you need to ask yourself first before diving into any kind of negotiation.
After reading this article, you’ll be achieving better results in your negotiations, thanks to your negotiation preparation checklist.
Why Preparea Negotiation Checklist?
Being prepared means everything for a negotiator. From start to finish, one must always be one step ahead during negotiations.
You’ll often hear people say that experienced negotiators are so used to the whole process that they often require little to no preparation for upcoming negotiations. As someone who trained with professional negotiators in the Negotiation Course For Procurement Professionals, this is an absolute lie. Seasoned negotiators often rely on these preparation checklists so that they can stay on top of their game and be prepared for any questions, offers, and/or counter-offers during the duration of the negotiation.
The mark of a seasoned negotiator, however, can be seen in the questions he/she often asks before starting any negotiations. These questions will be key to developing your offer, recognizing your BATNA, and planning any concessions or walk-away points when needed.
PT’s Special NegotiationPreparation Checklist
We at Procurement Tactics created several special negotiation preparation checklists for every situation.
That’s because negotiations don’t just happen during procurement. Negotiations will always happen in every part of your professional career.
That’s because as a negotiator, you will always be faced with different scenarios which will require a different set of questions to ask in order to get the information that you need:
Questions to ask regarding contract issues
- Who is responsible for the insurance?
- What is the cover level? And for what?
- Under which law is the contract made (in case the contract is made overseas or in a different country)
- Has the method of transportation been agreed upon unanimously?
- Are custom requirements stated clearly?
- Has the offer been accepted by the supplier and does it have a valid contract?
- Are the contract terms clearly delineate responsibilities for elements of purchase cost?
- Are your administrative requirements stated clearly and is understood?
Questions to ask on general issues
- What are our negotiation party’s strengths and weaknesses?
- What are the strengths and weaknesses of the other party?
- Do you have any available published data?
- Do you know the duration of the agreement being negotiated?
- What is the current contractual position?
- Do you know what dates the agreement is reached?
- Any other major issues that you should know about?
- Any key assumptions that have been made already?
- What information do you need in verifying the assumptions made?
Questions to ask on personnel issues
- With whom are you going to negotiate?
- Do you know anyone from the other team?
- If you’re dealing with a team, who will be the members?
- Do any of the people in the opposing team have the final say when it comes to agreements?
- Which of the members in the opposing party is responsible for enforcing any agreed conditions?
- Which people at the supplier’s factory should be your key contacts?
- Who are the members of your team?
- Who will be the leader of your team?
Once the questions above are asked and you’ve obtained the information you need, it’s time for the following next steps:
- Set objectives for the upcoming negotiations.
- Develop tactics and strategies in order to get your objectives.
- Prepare any related data.
- Develop a method of teamwork that is understood and agreed upon by all when working together with a team.
- Make sure all arrangements needed are fulfilled for the meeting phase.
When everything is set and done and you are ready for the negotiations, it’s time to start preparing for the main event. For different types of negotiations, here are different questions that you’ll need to ask to get the information you need:
Questions on Current Agreements:
- How long will the current agreement last?
- What is the financial history with regards to part transactions?
- Are there any available data costs?
- What does the supplier’s delivery performance record look like?
- Were there any disputes over the contract period? Are they important, as far as the coming negotiations are concerned?
- What date should the agreement be reached?
- Who are you going to negotiate with?
Questions on specification issues:
- Has the supplier been given the chance to improve the specification?
- What aspects of the specification are critical?
- Which specification can be modified to achieve the same function?
- How is conformity for each specification measured?
- Who will work on the measurement and where?
- If it’s a special item, is it possible to use a standard as a replacement?
Questions on Delivery Issues
- How often do you wish the supplier to deliver?
- How many do you want to be delivered?
- How will the components/materials be delivered?
- Who is responsible for the packaging/containers?
- What is the delivery address?
- Will there be any restrictions? (size of boat or plane, delivery timing, etc)
- How will the goods be placed inside a container/rail truck?
Questions on Financial Issues
- In what currency will the transaction be made?
- What is the rate of exchange agreed on when dealing with a foreign currency?
- What dates are important for these financial issues?
- Do credit terms apply?
- What are the agreed terms of payment?
- Does the supplier need to stage payments?
- If the supplier does need stage payments, are the terms negotiable?
- Is there a discount for early payments?
- How can this process be improved on?
+ What is a negotiation preparation checklist?
It is a series of questions asked by the negotiator before jumping in into the negotiations.
+ Is it important to have a negotiation preparation checklist?
It is. Having a negotiation preparation checklist will give the negotiator an edge against the other party.
+ How often should a negotiation preparation checklist be used?
The negotiation preparation checklist should be used at all times, before the start of negotiations.
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