Negotiations between Excalibur Engine components firm and Knight Engines Inc.

over Excalibur
Engine pistons.

An effective negotiating plan involves convincing the opposing party to accept the product of one's firm
(Fells & Sheer, 2019). While persuading Knight Engines to purchase Excalibur pistons, the current
negotiation strategy offers the position of Excalibur's Sales Vice President.

Selling price for one piston

Accordingly, the initial price will be $900, with the optimum price being $600. This is regarded a
reasonable position in comparison to other manufacturers, given our rivals' products are inferior. In light
of the fact that Knight will be producing 10,000 units within two weeks as part of their order, there is a 5
percent rush charge. Setting a high value as a starting point will ensure a favorable price.

Constraints in negotiating

Excalibur-Knight talks are impacted by cost and conditions in light of a 2-week deadline for 8,000
pistons.

Concession plan Agreement

Our Pistons will be promoted and advertised for free on the buyer's engines if Excalibur is able to waive
up to a 10 percent quality charge on our pistons. If the firm agrees to market Excalibur and purchases
10,000 copies, the customer will also be exempt from paying the rush charge (5%) for the order. Knight
will be able to maintain their reputation with their government if they purchase pistons from us, since
our goods are authentic, unlike those from our rivals.

The BATNA

Suppose Knight contemplates purchasing from our low-cost rivals ($400 for a single item). Is this an
important factor for Knight to take into account? In just 14 days, will the other company be able to
produce and manufacture the required number of pistons?

Knight's point of resistance

There is a resistance plan of $580 per piston from the other side. For each piston, Knights targets $525 in
consideration of the opposite party's importance, BATNA and point of resistance.

The Final Say

Overall, our final pricing will be $560, regardless of whether our main competitors offer theirs at $400
per piston.
The Buyer Negotiating with the Seller; Knights negotiating with Excalibur

Our negotiation Strategy

Piston prices are the most important thing to negotiate, as we have no prior expertise in this area and
must ensure that we fulfill the bid criteria. It is also necessary for pistons to be of high quality as they
will be utilized in military applications. In addition, the amount of the product and the delivery dates
must be considered, as well as how to further prepare the material to meet the specified need.

Selling price per piston and the concerns that need to be addressed

Because the pistons will be utilized in the military, they must be defect-free, and a backup must be
created in case any defects are detected. In order to obtain the pistons at our desired price, it is
necessary to discuss the costs because it directly influences our offer price. Deliveries of the pistons,
which are used as inputs in the engines, must take place in a timely manner.

The primary underlying interests

First and foremost, there is a concern about the pistons' quality and cost. The pistons would cost more
than $600. As a result, it is of the highest significance to supply superior performance to the military
forces.

A new sort of piston from a firm that Knight has no prior experience with poses no technical issues, but
our folks in production are apprehensive about utilizing a new type of piston from an unknown
company. "Class C" pistons bought in the past (from other suppliers) were found to have structural
faults that rendered them useless on average, according to the company. Nothing suggests that the
"Class A" pistons will perform any better. This means that Excalibur must provide Knight with a warranty
to protect us from paying for faulty pistons.

My limits and walkaway points and BATNAs

When it comes to piston quality, the military forces rely on them for their security. If we were to make a
mistake in that area, it would cost us and the government dearly.

However, because we have no prior expertise in this field, we need to ensure that the price does not
exceed $600, as this is out of our reach for now. Aside from that, the price we pay for this piston directly
impacts the price we charge for the engines as a result of its availability.

Engines must be supplied in 2 months and pistons must be provided in 2 weeks in order to meet delivery
schedules in a timely manner.

Quality validation-As we have to the supply the engines to the military forces no defects has to be found
in the pistons. So, a definite assurance has to be provided by them so in as to provide a backup in case of
any discrepancies.

My objective points and requests for openings

Opening requests would be for 450$ and would not exceed $600 As it would be first time to enter in
such contract a definite assurance has to be provided to Excalibur as a backup. They are charging us for
the rush orders, but it can be waived as they are using our name on the chassis. A consensus can be
made by wavering 5% additional charges.

The important constituencies to whom I am accountable

We are accountable to the Government employees to whom we are going to sell the engines. I am
accountable to my colleagues who are working with me and are involved in decision making

What I know about the other negotiator’s interests, negotiating style and personal reputation

Other party’s Interest will be to do a publicity of their pistons as their pistons are going to be used in the
engines that is being made for the government and this will give their company a great opportunity to
attain a good market position. They would like to sign a long-term contract as they will be benefitted by
working for our company and getting publicity for their pistons. They must have developed a negotiating
style from past as they had been in this industry for a long time and had experience in selling class A
pistons.

The overall strategy I want to pursue

I will like to adopt win-win strategy as I do not want to lose them because these are the only company
that is ready to deliver piston at very short notice. Whenever there is a walkaway point, I would
encourage them to sign a contract by ensuring them that this will be beneficial for their company as
they will be dealing with the government employees. My main concern will be to make them
understand that time and quality is the most important thing to be concerned about in this deal.

In what ways will I convey my arguments or counter the opposing negotiator's arguments in the
negotiation process?

Before the negotiation starts it is very important to have full knowledge about Class A pistons as we had
not used class ‘A’ pistons in our engine before and we must study the price and qualities of these kind of
pistons.

We should also have knowledge about the quality of pistons produced by Excalibur and experiences of
their customers with their pistons.

We will do research on their websites to know about the quality of their pistons and feedbacks that
were given by their customers and we will also read the charts to know more about the price of A class
pistons on their websites.
References

Fells, R., & Sheer, N. (2019). Effective negotiation: From research to results. Cambridge University Press.