“WATCH THE WATCHES”

NEGOTIATION PLAN

TEAM COAD – 028

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STRATEGIC STRONG POINTS

BAY WATCHSTRAPS MFG. CO. LTD. (“BAY”)

D.D.P(Delivered Duty Paid). Under Inco-Terms: Bay was under no obligations to purchase
the insurance as DDP under Incoterms does not include insurance to be covered by seller.

Successful shipment of goods: Bay successfully shipped the second batch of goods even
though they were not covered and were already in losses on the given date.

PARR CELLTECH CO. LTD. (“PARR”)

Quality Of Goods: Bay is in breach of contract with PARR as the quality of goods provided
by them was not of the quality as agreed upon

Obligation of BAY under DPP: The obligation to get the goods insured is on BAY as under
DPP agreement the seller assumes all responsibility, risk & cost.

STRATEGIC WEAK POINTS

BAY WATCHSTRAPS MFG. CO. LTD. (“BAY”)

Subpar Quality: The quality of goods that were shipped in the replacement agreement were
not at par with the given quality.

Reputation: As BAY was highly reputed all over the world, a deal as big as this falling apart
would cause reputation damage and financial losses to them.

PARR CELLTECH CO. LTD. (“PARR”)

Time is the essence: PARR needs those straps as soon as possible as they list loosing the
contract with Kiwi Watches as they want to be the first seller of those watches.

PARR forgo the first cause of action: PARR by accepting the replacement agreement for the
lost goods forgo the first cause of action and accepted that the mistake was made by them.

Limitation: PARR took too much time to convey that the shipment was of inferior quality,
nearly one month, which could be used against them in court.

NEEDS AND INTEREST

BAY WATCHSTRAPS MFG. CO. LTD. (“BAY”)

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Acceptance of goods: BAY wants to ensure that PARR readily accepts the goods so that there
no loss of reputation.

Payment of lost goods: BAY wants to ensure that they are compensated for the losses
sustained by them as agreed upon in the replacement deal.

PARR CELLTECH CO. LTD. (“PARR”)

Better Straps or Refund: PARR currently needs either better straps as soon as possible or a
refund of the money invested so that they can employee better manufacturer.

BEST ALTERNATIVE TO NEGOTIATED AGREEMENT (BATNA)

BAY WATCHSTRAPS MFG. CO. LTD. (“BAY”)

Should the negotiations fail, the best alternative for BAY would be to initiate arbitration
proceedings against PARR.

PARR CELLTECH CO. LTD. (“PARR”)

Should the negotiation fail, the best alternative for PARR would be to accept the inferior
straps from BAY to use for their KIWI watches.

WORST ALTERNATIVE TO NEGOTIATED AGREEMENT (WATNA)

BAY WATCHSTRAPS MFG. CO. LTD. (“BAY”)

Should the negotiations fail, the worst alternative for BAY would be reputational damage and
financial losses sustained.

PARR CELLTECH CO. LTD. (“PARR”)

Should the negotiation fail, the worst alternative would to pay the damages to BAY and either
find another contractor or loose the opportunity to release the KIWI watches.

OBJECTIVE & GOALS

BAY WATCHSTRAPS MFG. CO. LTD. (“BAY”)

To ensure payment of the goods or that PARR accepts the shipment.

PARR CELLTECH CO. LTD. (“PARR”)

To get the refund of the money which PARR gave for the first shipment.

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END OF DOCUMENT