Purchasing.com recently ran their fifth installment in their strategic sourcing series – How to Negotiate with Suppliers – which presented a number of tips for successful supplier negotiations. According to the article the following five points are key:

• Know the Market
  The right data allows a sourcing manager to develop a strategy that has a high probability of reducing cost and minimizing risk.
• Be Collaborative
  Remember that the ultimate goal of any negotiation is to get the supplier’s representative to go back and sell the deal. Consider a neutral location.
• Go for a win/win
  Negotiations are most likely to succeed if everyone feels they are getting a good deal.
• Keep things fair
  Don’t try to strong-arm or intimidate suppliers at the negotiation table. They’ll just get defensive, and we already know a collaborative spirit is important.
• Aggregate spend
  Knowing your complete spend up front will give you some leverage in negotiations.

and the following tips should also be kept in mind:

• Aim for long term relationships
• Be ethical and honest
• Be patient; Talk Less, Listen More; Ask Questions
• Set a Deadline
• Don’t be Afraid to Say No

This is good advice … and we’ve found that our customers who employ these tactics are generally quite successful.