Negotiation Game

Sydney Shirts vs. Retailer # 4

 Negotiation Game

Sydney Shirts vs. Retailer # 4

Prepared for

Mr. Shahed Rahman

Lecturer, School of Business

North South University

Prepared by

Syed Faisal Ahsan

Student ID # 071 917 030

MKT 450, Section 1

Date of Submission

December 8, 2011
 Letter of Transmittal
December 8, 2011

Mr. Shahed Rahman

Lecture, School of Business

North South University

Dhaka.

Dear Sir,

Here is the report on the decisions taken from the “Negotiation Game” participated by me on 30th
November, 2001.

As you have instructed, I have negotiated as a negotiator and general merchandising manager of
“Retailer # 4”, with Nafis Imtiaz, negotiated as a negotiator for “Sydney Shirts”. I have prepared
this report for the management of the retailer, on behalf of whom I have negotiated. I have
followed the guidelines that you have given for this assignment. I have given an executive
summery for the management, properly written the issues, given proper justification after each
issue, and avoid unnecessary things. At last I have given a conclusion in which I have give the
summery of the decisions taken in the negotiation.

At last I appreciate having this assignment of “Negotiation Game”. It has really given me the
experience of how negotiations are held in real business world. I have learnt a lot from it and
thanking you for giving me this assignment.

Sincerely yours,

Syed Faisal Ahsan

Student ID# 071917030
 Table of contents

 Executive Summery

 Main Report
 Factor #1 with justifications
 Factor #2 with justifications
 Factor #3 with justifications
 Factor #4 with justifications
 Factor #5 with justifications

 Conclusion

 Appendix (Negotiation sheet & decision sheet)

 Executive Summery

I have negotiated with the negotiator of “Sydney Shirts” on 30th November. I have achieved all
the targets I had been given by the management. Though I had to agree on their some conditions
may seem loss for our company in shot term, but in long run we will be gainer. Moreover there
was no agreement of the time validity of these agreements. If the management wants to terminate
those agreements, they can easily terminate those risky agreements.

Syed Faisal Ahsan

General merchandising manager,
Negotiator for “Retailer # 4”
Factor # 1

Issue: I had to convince the manufacturer’s negotiator to add a special line of fashion knit shirts
with a joint label of their and our company.

Decision: They have agreed to add a special line of fashion knit shirts with a joint label. In
exchange I had to come to an agreement of giving them 10% of our shelf space.

Justification: I have achieved the given target in this factor. The special line of fashion knit
shirts with joint label will increase our sales, because it is estimated that 25% to 40% of their
customers will not purchase other brands. As we are the second position of retailing Sydney Shirt
products, the joint label will make us number one, and attract more customers. This will result in
an increase in our profit.

Factor# 2

Issue: I had to convince the manufacturer’s negotiator to fill order in 7 days instead of the usual
10 days.

Decision: They have agreed to fill order in 9 days instead of the usual 10 days. In exchange I had
to come to an agreement to share 60% cost of the online store proposed by them. I have agreed
by the option of delivery of the shirts will by the people of us within the cost.

Justification: I have achieved the given target in this factor. Though they wanted 80% sharing
cost of online store for this, but later convinced with 60%. Though the agreement looks like a
loss, but the hidden thinking of mine was the promotion of our company by delivering the
shirts by us ordered at online. We will be benefitted by the online store agreement.

Factor#3

Issue: I had to convince the manufacturer’s negotiator to increase the three yearly special price
promotions to four.

Decision: They have agreed to increase the three yearly special price promotions to four. In
exchange I had to come to an agreement to take 600 shirts per order instead of 500.

Justification: I have achieved the given target in this factor. As they have popular brand and their
products are well received by the customers, it is possible that we can sell the extra ordered
items, and as a result our revenues will be increased.
Factor#4

Issue: I had to convince the manufacturer’s negotiator to increase the cash discount period to 15
days instead of the current 10-day cash discount period.

Decision: They have agreed to increase the cash discount period to 12 days instead of the current
10-day cash discount period. In exchange I had to come to an agreement that we will share 60%
of the two time advertisement cost in our store.

Justification: I have achieved the given target in this factor because the advertisement will attract
their customer, we will also be benefitted, because we are the second highest retailer of their
shirts. So, though the increased cost, our revenues will be also increased by extra promotion and
increased sales.

Factor#5

Issue: I had to convince the manufacturer’s negotiator to provide specially designed packaging
for 10% of our current volume ordered for three months at no extra cost to us for our 25th
anniversary celebration.

Decision: They have agreed to provide specially designed packaging for 10% of our current
volume ordered for three months at no extra cost to us for our 25th anniversary celebration. In
exchange I had to come to an agreement that we will decrease our profit margin by 2%.

Justification: I have achieved the given target in this factor. I agreed their proposal because in my
thinking, we can cover the loss and gain extra revenue by selling the 10% volume packed by
them for three months. Since here, we will have no packaging cost.

There was no agreement of time till that these agreements could be valid. So this is again our
wining factor that we can terminate these agreements whenever we want to.
Conclusion

Though I had to agree with some of their proposals, which may seem to be loss for short term.
But since we had no time restrictions regarding these agreements, those particular agreements
can be terminated. The other agreements were good enough, and in my view it was a win-win
negotiation for both of them and us.