ZOPA Breakpoints and Negotiation Strategies

The assignment content discusses various aspects of negotiation and sales techniques. It highlights the importance of anchoring, BATNA (Best Alternative to a Negotiated Agreement), and understanding customer objections. The content also emphasizes the need for good records and documentation in negotiation agreements. Furthermore, it provides specific examples from Electron Air-conditioner Company's schedule, plan, set of questions during selling, and debrief sheet.

Running Head: ISMM Model assignment U405 Sales negotiations March 13, 2018
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Name of the course: U405
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“ISMM MODEL ASSIGNMENT-SALES
NEGOTIATIONS”
(Part-1)
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Running Head: ISMM Model assignment U405 Sales negotiations March 13, 2018
TABLE OF CONTENTS
Task 1-Win-win Matrix.....................................................................................................................3
Task 2: The bargaining arena.............................................................................................................3
Task 3: Variables...............................................................................................................................4
Task 4 – Power...................................................................................................................................5
Task 5 – Planning...............................................................................................................................5
Task 6 – Buyer positioning................................................................................................................6
Task 7 – The paperwork.....................................................................................................................7
Works Cited.......................................................................................................................................9
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Running Head: ISMM Model assignment U405 Sales negotiations March 13, 2018
TASK 1-WIN-WIN MATRIX
WIN LOSE
WIN
Both the Sellers A and B get a
great market segment where
they work to support
themselves so that the value of
the company increases and
more and more customers get
attracted towards the products.
Seller A loses as there may be
issues arisen for the coverage
as well as support. They may
not be structured appropriately
for which customer losses get
complaints on the basis of
availability as well as
responsiveness.
LOSE
Seller B cannot work as the
way of consultative sale
professionals. Customer losses
can have the complaint for
hard sales as well as being
sold-to.
The skills of seller are needed
to be updated. It is found to be
weak in the area of solution
selling or in case of value
position as well as negotiation.
There are other who has skills
and capabilities.
(Perla, 2009) (ISMM, 2016)
TASK 2: THE BARGAINING ARENA
Situation 1:
An individual, named Mustafa, is an owner of a house and wants to sell at a price of $ 50,000.
This price is targeted as minimum price. Also, the valuation of the house is $50,000. On the other
hand, Alex, another individual is willing to pay $60,000 and thus he wants to be the valuation as
$60,000. If this trading occurs and Alex has bought the property from Mustafa through the price
which is lying from $50,000 to $ 60,000, it would be said that both the individuals have the
common interest of trading. It is called the “contracting Zone” in which the parties are agreed with
a common value of trading. This is known as ZOPA or Zone possible agreement (King, 2007).
Situation 2:
Another situation can be arising due to the negotiations under BATNA or “Best Alternative to a
Negotiated Agreement”. This situation can be arising when the buyer wants to buy a car for $6000
from the dealer who deals with other potential purchasers at the same time. When the deal will get
the best price for the car, the agreement will made and thus it is valued. In this case, the consumer
gets influenced by the company’s selling product, here model and quality of the car. This
agreement may go parallel when there is another deal can be happened with the same customer for
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B
A

Running Head: ISMM Model assignment U405 Sales negotiations March 13, 2018
different product. So sometime, it may not be the exact mid position of the selling or it may occur
at the end of the financial year.
Situation 3:
In any political measures, the bargaining situation may arise when there are more than one
political parties create the government of the nation. It is generally called “hung Parliament”. The
party thus formed through the most valuable votes would found itself under typical bargaining
situation. As this case there is prime minister Selection has occurred in the countries like Austria,
Turkey, Germany or India.
TASK 3: VARIABLES
a) Variable that is used for deal making:
Under the situation of the car dealing scenario as stated in the assignment, the most deal
making situation may be used by providing some concession over the new car which the
byer wants to purchase by exchanging the old car.
b) Variable as per the customer offer:
As the customer or the party has a good reputation in the industry, he would offer for the
high quality or high priced product, here, car. Also about the security as well as the
insurance term can be checked from the customer end.
c) Variables those are mostly important for organization as well as the buyer:
As per the best dealing price under the negotiation, it can be the opportunity cost for the
car for which the dealing is going on. In this scenario BATNA is right things to do about
the agreement with the organization. BATNA is found as the most valuable important
source for negotiation power. When the potential results of the present negotiation offer
the value which is less than the BATNA, the negotiation situation would have no proof and
thus the best use of the availability option is that before any deals the BATNA value is
needed to be set. Through the use of BATNA, the most important thing is that it analyses
the intelligence of the competitor as they are available within the organization. After this, it
can be easily set down the breakpoints as well as the BATNA agreement would be
successful (Scott, 1987).
d) Variable cost to buy:
The variable’s cost or the car cost can be decided under the situation of the win-win
agreement when both the parties finally go for the trading of the car.
To overcome the situation, it is very important to keep one under composed and not to be
over react with the seller. This tactics become powerful under the scenario when the
weakness is being known by the other parties. The offer value should be extreme but under
the realistic situation. In the similar situation, when the customer act under professional
manner it would be the win-win situation for both the parties under trading (ISMM, 2016).
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Running Head: ISMM Model assignment U405 Sales negotiations March 13, 2018
TASK 4 – POWER
Negotiating power is basically depends on the organisation’s weakness as well as he strength of
the organisations. For any successful negotiation there are number of factors are considered which
is discussed as follows:
1. Preparation and the position: the negotiators are thus found to be sufficiently experienced
as well as trained when they are empowered. Within the organization, there are some
measures which are conferred depending on the formal position. Like as per the marketing
manager in the organisation one should influence the decisions which will affect the
marketing department.
2. Character: The person in individual who are seemed to be trustworthy has the great deal
for power within negotiations. It has been thus perceived as the trustworthiness that there
should be some reputation which will be keener to those who will serve.
3. Knowledge of expertise: It is the strength for any organization and that would have the
application of the knowledge for confers the power. It is very significant enough for taking
the time prior to the negotiation for doing research in the facts as well as the statistics.
4. Behaviour style: In most of the individual one or the combination of following behaviours
styles are found:
Analytical: it is basically process oriented as well as methodical.
Driven: It is task oriented as well as the goal directed.
Supportive: It is relationship oriented as well as focussed on the feelings.
It is also noticed that there are one of the hardest situation when, there is the strong
relationship between two organisations as the starting of both of them. But in future the
relation has changed with time. Thus in a relationship, there is at least a commitment
which generally holds the most positive power (ISMM, 2016).
TASK 5 – PLANNING
a)
While doing the planning for negotiation, it has to be kept in mind both the quantitative as well as
the qualitative research data. The quantitative data is mainly related to business and thus called
hard data whereas; the qualitative data areas attitudinal data and also called soft data. The research
is thus completed and balanced view through these data only.
Therefore, the planning is important at any stage of the negotiation. In some cases it has been
designed as the distractions as well as the “red herrings” when the other occasions of the
objectives would have the misunderstanding for the lack of decision-making power.
For the purpose to reduce the potential there is a serious objection among each group for ensuring
all kind of individuals to focus on the negotiation and thus by agreeing the processing as well as
by providing the relevant information they will build up certain amount for building up the trust
with customer (Fowler, 1996).
Thus, the planning of the sales negotiation is much important for understanding the aim of the
customer and also their negotiating limits. In addition with this, they would think about the fact
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Running Head: ISMM Model assignment U405 Sales negotiations March 13, 2018
and as well as possible arguments when they are supporting with the case as well as it can be
consider with the unstated issues.
The process is thus utilized for identifying the customer for gathering knowledge about the interest
of the customer and their valuable concern.
b) Process follows in handling the negotiation from when there are two people available for
the conversation:
1. Within Two people the negotiation can easily be handle by considering the agreement call
ZOPA or the Zone of possible agreement. In this case only the attributes which affect the
breakpoints of ZOPA is considered. Those points include the price, specifications of the
products or the delivery of the product as well as the relationships of the sales person with
the organization.
2. Another negotiating agreement between two people can be named as Anchoring and thus
attempt for establishing the reference point which is around the negotiation and thus the
negotiation is resolved. In this case the party use to have the reference points for making
the negotiation adjustments. In case of anchoring, the negotiation can be fruitful in short
period or as in long period like 12 months of period as per the adjustments made (Winkler,
1981).
When there are four people under negotiation process:
1. It can be more efficient for having a fruitful negotiation, it is the agreement called BATNA
or the Best Alternative to a Negotiated Agreement and it is the combination of the
breakpoints constructed with the alternative deal. In due course, the party has the current
negotiations that fail or have the agreement which may not be reached.
In case of BATNA, there is the negotiation field that has the single most important source
for negotiation power as they will merely see as the safety side.
2. Thus, by establishing the break-even points, the predetermined limit can be achieved for
which the negotiation is prepared or planned. For any commission level, there is needed to
consider both the lowest as well as the highest point which is represented as the best
possible deal that can be expected for (Fells, 2009).
TASK 6 – BUYER POSITIONING
List for customer positioning tricks:
There may be certain objections that come from the end of customers. Like:
1. Real objections: it is basically depending on the customer need. The type of object that
come from the customer ends is the mistake done by the sale person himself and only way
out from this objection is through direct question to the customer.
2. Imagined objections: It is presumed that there may be an issue and thus customer is started
dealing with considering that. For come out of such wrong situation the sale parson is
needed to use their probing question for uncovering any kind of hidden issues. It is very
important for interpreting the body language for exposing the person’s true feelings.
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Running Head: ISMM Model assignment U405 Sales negotiations March 13, 2018
3. Hidden objections: There are many hidden objection which has the power to shroud the
other real objection. It is also most common type of objection is given in which case the
customer is seemed to be embarrassed for admitting the real reason for which they have no
interest for dealing with the sales person.
4. Therefore, for any successful negotiation it is very important to know about the customer’s
mind setting for the purpose of controlling the flow for the negotiation matter. It is thus can
be managed by introducing the questions, concessions as well as the reciprocal trading.
5. It is also important to notify the body language of the buyers for controlling the situation.
It is also limit for take the chance of the acceptance of the negotiation proposal as the result
of the feeling as pressurized as well as uncomfortable situation (Dawson, 2000).
TASK 7 – THE PAPERWORK
1. Importance of good records:
a) The records are kept the performance improving.
b) The CRM or the integrated Customer Relationship Management system will link with
the principle departments and thus it has been checked through the records the
performance of each departments.
c) From the record it can be easily track the contract which are getting success and which
are further needed to be re-contract or renegotiate.
d) The records keep the valuable information as well. That will be very useful to deal for
the same product with different customers.
2. Importance of the agreement between the parties at the end of the negotiation:
a) It is very important to recheck or reframe as negotiation is done under the contractual
paper and thus documentation is very much important part of the agreement.
b) Those records provide appropriate data for further planning to the internal
stakeholders.
c) Those records provide the parties opportunity cost for clarifying the misunderstanding
or the ambiguity within a managed fashion.
d) The record also identifies the possible weakness as well as the strength for both the
parties as per the future planning (Hanes, 2011).
3. Debrief Sheet:
Electron Air-conditioner Company:
Bahrain
Schedule:
The sales of 10 new air coolers and 20 air conditioners machine within the time limit of
20th March, 2018.
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Running Head: ISMM Model assignment U405 Sales negotiations March 13, 2018
Plan:
The customer’s house is visited within the time 8:30 to 10.00 am everyday as per the circle
divided between the sales people. The target is to reach 20 -30 customers each day. The
sale target should be at least one machine per day. When there is more than three machines
are sold, incentive is provided.
Set of questions during the selling of air coolers and conditioners:
1) Which is the amount is supposed to be given for the product?
2) How much electric consumption can you bear per month?
3) How often you are there within the room?
4) What is the natural average temperature in summer day inside the room?
5) For five star rated machine, company provides the 10 year guarantee on the air
compressor, are you interest to check the offer, Mam/Sir?
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Running Head: ISMM Model assignment U405 Sales negotiations March 13, 2018
WORKS CITED
Dawson, R. (2000). Dawson, R. Secrets of Power Negotiating for sales people: Inside Secrets
from a master negotiator. New York: Career Press.
Fells, R. (2009). Effective Negotiation: From Research to Results. London: Cambridge University
Press .
Fowler, A. (1996). Negotiating Skills & Strategies. Institute of Personnel and Development.
Hanes, D. (2011). Negotiation: Closing Deals, Settling Disputes & Making Team Decisions. New
York: Sage .
ISMM. (2016). ISMM Model Assignment. ISMM, Level 4.
King, G. (2007). The Secrets of Selling: How To Win In Any Sales Situation. FT/Prentice Hall.
Perla, M. (2009). Win/Loss Analysis . Retrieved from https://salesmanagement.org/:
https://salesmanagement.org/web/uploads/pdf/9c864791ac31c9c6f5c34c8fb2f79eac.pdf
Scott, B. (1987). The Skills of Negotiating. Aldershot: Gower.
Winkler, J. (1981). Bargaining for Results. London: Heinemann.
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