Negotiation Duel

How to play Negotiation Duel

You need 1,000 units and the supplier quotes $100 each. In every round you can make a price offer, offer something other than price, or accept the supplier's current ask. After five rounds the supplier names a final price and you take it or walk away.

The supplier has a floor price that changes from game to game. Offers well below it damage the relationship, and a supplier who runs out of patience leaves the table. If there is no deal you buy on the spot market at $105 a unit. Your score is the saving against the list price.

What the game teaches about supplier negotiation

• Anchors move outcomes, within limits. A low first offer pulls the supplier's counter down. An offer below their cost tells them you are not serious and they concede less.
• Price is one of several variables. A longer commitment or faster payment costs you little and can be worth a lot to the other side. In the game these moves lower the supplier's floor, which is how real concessions get traded.
• Know your alternative. The spot price of $105 is your fallback. Any deal below it is better than no deal, and the supplier knows roughly what your options are.
• Leave some goodwill. You will buy from this supplier again. Squeezing the last dollar and souring the relationship is rarely the cheapest result over two years.

Before a real negotiation

Work out the total cost of ownership and not only the unit price, check at least one competing quote, and decide your walk-away number in advance. The procurement guides cover sourcing and supplier management in detail, and the free procurement tools include a vendor comparison and a total cost calculator.