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Negotiation Skills Exercise
Buyer Information
· >You must buy a Sony audio system today for your apartment.
· >Your friend, who just returned from overseas, offered to sell you his 1-year old Sony audio system, along with all his music CD’s, for 20,000.
· >You just checked the Sony website and found that you can order a new system of the same model for 18,000 (delivered). Or, you can buy a used system for 14,000. The extra value of the music CD’s is between 5,000 and 7,000.
· >You have only 19,000 to spend.
Seller Information
· >You want to sell your used (1 year old) Sony audio system along with your music CD’s that you bought over the years.
· >You offered to sell the system to your friend today. You already told your friend you would like to sell it for 20,000.
· >You paid 14,000 for the system and took good care of it since then.
· >Last month, Sony’s web site showed the value of a used Sony audio system of the same model to be 13,000. You believe the extra value of the music CD’s is between 5,000 and 7,000.
· >You have 2,000 in your wallet, but you must have 18,000 by the end of the negotiation to pay back a different friend.
My Negotiation Process (Seller)
Planning Tool:
Write down the negotiation style you plan to use: win-win
Write down the price you want to sell for: 21,000 (Target)
Write down the lowest price you will sell for: 16,000 (Limit)
Evaluation Tool:
Write down the final price you sell for: 16,000+3,000 (Final Agreement)
Write down the negotiation style you believe the Buyer used: Win
Additional Agreement: only sell 1/2 CDs
Analysis
My Goal:
Get 16,000 to pay back my friend.
Buyer’s Goal
Get a Sony audio system to listen CDs.
Relationship
Friends, so win-win strategy is the best choice.
Choices
1. 1. Borrow 16,000 from the buyer and lend him the audio system until I pay back the money.
2. 2. Sell the system with CDs to the friend for 16,000-21,000.
Win-Win Plan
Buyer Choices:
1. 1. Only purchase the audio system without CDs. (13,000-14,000)
2. 2. Buy a new one from the website. (18,000)
3. 3. Buy a second-hand one from the website. (13,000-14,000)
4. 4. Pay an unacceptable low price to buy my audio system with CDs. (<16,000)
5. Pay an acceptable price for the whole system and CDs. (16,000-21,000)
6. Other plans
Seller Persuation
1. 1. The main point to buy an audio system is to enjoying the music, and it is no use for a audio system without CDs.
2. 2. If purchase the audio system and CDs separately, it will cost more money and will spend much more time.
3. 3. If the buyer want to purchase a new one, I would say that the new system cost really a lot, and my used system is taken good care and much cheaper.
4. 4. If the buyer want to buy a second-hand system from the website, I would say what if the system do not work after one week using, and you know how well the situation of my system.
5. 5. The buyer would say that the CD styles are not his favorite. So he does not want to pay for the CDs.
6. 6. My CD collection has verity kinds of styles, it is impossible that he can not find the style that he loved.
Final Plan
I will sell the whole system and half of my CDs to the buyer. The buyer pay me 16,000. I provide a CD change service in the next half year. During the time the buyer can change the CDs 3 times. After half a year, I will sell the rest of my CDs to my friends or others for about 2,500-3,000. So the total money I can get is between 18,500 and 19,000.
Summary
The core point of win-win strategy is to make a plan for both sides. We should know the needs of both sides and find a way to enjoy everybody. One of the key items we hold is the relationship. In this case, the buyer and seller are friends, and obviously the buyer has more choices. How to sell the audio system in proper price and keep the relationship? Make a reasonable plan.
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