Unit 3 Negotiation Tactics

А number of specific tactics are used in international negotiating. The

following examines some of the most common.

Location Where should negotiations take place? If the matter is very important, most businesses will choose а neutral site. For example, U.S. firms negotiating with companies from the Far East will meet in Hawaii. South American companies negotiating with European firms will meet half way, say in New York City. А number of benefits derive from using а neutral site. One is that each party has limited access to its home office for receiving а great deal of negotiating information and advice and thus gaining an advantage on the other. A second is that the cost of staying at the site is often quite high, so both sides have an incentive to conclude their negotiations as quickly as possible. (Of course, if one side enjoys the facilities and,

would like to stay as long as possible, the negotiations could drag on.) А third is that most negotiators do not like to return home with nothing to show for their efforts, so they are motivated to reach some type of agreement.

Time Limits Time limits are an important negotiation tactic when one of the parties is under а time constraint. This is particularly true when this, party has agreed to meet at the home site of the other party. For example, U.S. negotiators who go to London to discuss а joint venture with а British firm will often have а scheduled returned flight. Once their hosts find out how long these individuals intend to stay, the British can plan their strategy accordingly. The "real" negotiations are unlikely to begin until dose to the time that the Americans must leave. The British know that their guests will bе anxious to strike some type of deal before returning home, so the Americans are at а disadvantage. Time limits can be used tactically even if the negotiators meet on at a аneutral site. For example, most Americans like to be home with their family for Thanksgiving, Christmas, and the New Year holiday. Negotiations held right before these dates put the Americans at а disadvantage because the other party knows when the Americans would like to leave.

Buyer-Seller Relations How should buyers and sellers act? As pointed out, Americans believe in being objective and trading favors. When the negotiations are over, Americans walk away with what they have received from the other party, and they expect the other party to do the same. However, this is not the way negotiators in many other countries think. The Japanese, for example, believe that the buyers should get most of what they want. On the other hand, they also believe that the seller should be taken care of through reciprocal favors. The buyer has to ensure that the seller has not been "picked clean." For example, when many Japanese firms first started doing business with large U.S. firms, they were unaware of U.S. negotiating tactics. As а result, the Japanese thought the Americans were taking advantage of them, and the Americans believed they were driving а good, hard bargain.

The Brazilians are quite different from both the Americans and the Japanese. Researchers have found that Brazilians do better when they are more deceptive and self-interested and their opponents are more open and honest than they, Brazilians also tend to make fewer promises and commitments than their opponents, and they are much more prone to saying no. However, Brazilians are more likely to make initial concessions. Overall, the Brazilians are more like the Americans than the Japanese in that they try to maximize their advantage, but they are unlike the Americans in that they do not feel obligated to be open and forthright in their approach. Whether they are the buyer or the seller, they want to come out on top.