There’s No Glamor In An Information-Based Negotiations Approach

There’s No Glamor In An Information-Based Negotiations Approach

The information-based approach requires immense research about the industry, the supplier’s financial condition, and competitive forces. Some suppliers may be very reluctant to provide financial information and their margins. The supply chain professional must work to overcome this reluctance and build trust with the supplier. Understanding their culture and their organization is critical. You are, in essence, trying your best to put yourself in their shoes and mimic, as well as possible, their anxieties and fears about the whole process. The infor­mation-based approach is not for the fainthearted or for those who do not want to persevere. It should only be exercised for critical materials or services. These are those that have a major impact on your bottom line or can give you a critical competi­tive advantage. One key guide would be if your customers value the aspect that the supplier brings to the table. Since it requires ongoing market research, and it works better when executives are exchanged (stay in person at the site and become part of the team) however, the resources necessary to pull off such an information-based approach should not be underestimated. 


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