Business Negotiation Styles
Introduction
Business negotiation conducted during the purchasing of a business is the process that begins from the first communication between purchasing buyer and the business seller to the ultimate sealing of the agreement. According to Murray (2013), in the process business negotiation, it is important for the buyer to involve in the purchasing professional so as to attain the appropriate price based on the current performance of the business. In order for effective purchasing of the business to be achieved, purchasing partners need to participate in the negotiation with well defined objectives of the business. Therefore, some of the key plans of the business to be bought need be put in place and be used in the negotiation process (Murray, 2013). This will help the business buyer to consider the price proposed by the vender and the current performance of the organization with the proposed objective of business by the purchasing organization to reach on the best price of the business.
Negotiation Style
Although there are various styles in business negotiation process, the most appropriate negotiation style in buying a business is the integrative or interest-based negotiation style. It is the negotiation process where both parties in the negotiation process collaborate in order to reach on a win-win deal (Michael et al, 2013). Therefore, the process focuses on the developing of beneficial contract based the desire and need of all the parties involved.
Importance of Integrative/Interest-Based Negotiation
There exists various importance of integrative negotiation when purchasing a business. For instance, one of the merits of this form of negotiation is that it produces satisfactory results to both parties as compared to positional bargaining that is based on fixed purchasing amount. According to Michael et al (2013), another advantage of choosing integrative bargaining styles during business buying is that the process increases profitability of triumphant negotiation because it dejects groupthink and allows parties to approach the negotiation process through a multiple perspective. This would help both parties in the negotiation to consider all the proposals of the parties so as to come up with a common purchasing price, which is supported by both parties. Moreover, through the use of integrative negotiation process in buying a business, the process involve at considering various consequences of the agreement by both parties, which are then considered in coming with the final price of the business (Michael et al, 2013). This is in the contrary to distributive negotiation style that does not undertake such provision. Therefore, integrative method of business negotiation is considered as the best approach in buying a business.
Factors to consider in facilitating a Collaborative Style
During business buying negotiation, there are different factors that need to be considered by parties involve in the negotiation to ensure effective negotiation process. For instance, both parties must come up with clear define objectives of ether buying and selling the business (Murray, 2013). This will allow both parties to conduct a proper negotiation as they will have easy time in determining their proposed prices. For the buying company, it is important for the organization to have a thorough scrutiny on the current operation of the business to be bought to known its production rate. This will also play an important role in the negotiation. Moreover, the purchasing company need to consider the machinery of the business and some of the required improvement that need to be done on the business as they will be catered in the negotiation as explained by Michael et al (2013). Therefore, for better solution to be reached during purchasing of a business, buyers need to go for integrative negotiation style so as to come up with better solutions to the negotiation process.
References:
Murray, M. (2013). Negotiation In The Purchasing Process. Retrieved from: http://logistics.about.com/od/tacticalsupplychain/a/Negotiations.htm
Michael, G.J., Jeanne, B., Brian, G.C., Lynn, I., Tsai-Jung, H & Bi-Fen, H. (2013). “Toward a culture-by-context perspective on negotiation: Negotiating teams in the United States and Taiwan” Journal of Applied Psychology, 98(3):504-513. Doi: 10.1037/a0031908.
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