Preparing for a supplier negotiation
Targets, walk-away points, BATNA and the variables beyond price that create value for both sides.
Most negotiations are won or lost before the meeting. Preparation gives you clarity, confidence and options.
Know your numbers
- Target: the outcome you realistically aim for, based on market data or a should-cost estimate.
- Walk-away point: the least favourable deal you will accept.
- BATNA: your best alternative if there is no agreement — another supplier, a different specification, or delaying the purchase. A stronger BATNA means more negotiating power.
Understand the supplier
What drives their costs? What do they value — volume, cash flow, a reference customer, predictable orders? The more you know, the more you can trade.
Look beyond price
Payment terms, lead time, warranty, packaging, consignment stock and contract length all have value. Trade what is cheap for you but valuable to them. The payment-term comparison tool shows what a change in credit days is worth.
Plan the conversation
Prepare your opening position and the reasons behind it, the questions you will ask, and the concessions you can offer — in order, and in exchange for something.
Close clearly
Summarise what was agreed, confirm it in writing and make sure the PO or contract reflects it exactly.