Negotiating with the Sole Supplier
HOW TO NEGOTIATE WITH THE SOLE SUPPLIER
Think before you Offer
Managers often come across situations where the raw materials, intermediate goods or services they need to manufacture products or do business are provided by a sole supplier. You should think carefully if you should be aggressive in such situations as the supplier has much more negotiating power than you. Aggressive negotiation strategies might easily backfire if the supplier is also aggressive. In worst case scenarios, this could become a “take it or leave it” situation, which you cannot afford. Collaborative approach is a safer bet. Keep in mind that even though your company needs the supplier you should be careful of over-paying as that might lead you to other problems.