Unit 2 Negotiation Skills
Case-study
A certain Shanghai Export Company offered to sell certain commodities to an American company on August 1, prescribing that the duration showed lasted till August 10. The buyer replied on August 6 that he had accepted the offer, but asked the Shanghai Company to take 2% off each of the prices of the offer. On August 8, the American company sent back a cable indicating the rising on the international market, the Shanghai Company did not cable any reply.
Discussion
Was there any contract made between the sellers and buyers? Why?
Negotiation Skills
Business negotiation in international trade is the process in which the seller and the buyer negotiate about the trade terms in order to reach an agreement about the sales of goods.
Negotiation usually involves the discussion and settlement of the following five items:
(1) the subject matter of the contract (the name, quality, quantity, and packing of the goods);
(2) the price of the goods;
(3) the liabilities of the seller (including the time, place, and method of the delivery of the goods, the varieties and number of copies of the required documents, etc.);
(4) the liabilities of the buyer (including the time, place, method and the currency for payment of the goods, the date by which his assigned carrier should have reached the port of shipment in case the deal is done under FOB, etc.);
(5) the methods to prevent the occurrence of disputes and methods to settle disputes in case there is any (including commodity inspection, claims, arbitration, etc.).
Of them all, price is always the most sensitive and controversial issue in the whole negotiation process, so this subject is usually postponed until the other non-price aspects of the transaction have been discussed and agreed upon. Nevertheless, while centering around pricing questions, negotiation comes to the vital phase, in which both importers and exporters are hoping to obtain maximum concessions on the other side. They are bound to take every possible measure to get the upper hand. The main effective strategies to get a favorable price are as follows.
For importers, they can:
(1) obtain the information about the price of the same product whose rand is unknown in the market;
(2) show a lack of interest in the product and then the transaction as well;
(3) object to the initial offer to test its seriousness and to get the possibly lowest prices;
(4) increase the profitability by demanding further concession on quantity discounts, discounts for repeated orders, improved packaging and labeling (for the same price), an earlier delivery, free sales promotion in the language of importers, free after-sales servicing, supply of free parts damaged from normal wear and tear, free training of staff in the maintenance and use of the product, market exclusivity, a long term agency agreement, higher commission rates, better credit and payment terms.
For exporters, they can:
(1) determine the importer’s real interest in the product from the beginning;
(2) prepare for the possibilities in negotiation by drawing up a plan of action beforehand, getting as much relevant information as possible, predicting and evaluating the competition of any suppliers, confirming the local promotional tool of importers, and listing the potential price objections;
(3) carry out a realistic assessment of quantities and schedule of the supplies, avoid any disagreement about price by concentrating the discussion on other non-price issues;
(4) equalize the negotiation by constructively working out the real reasons for the objection to their offer;
(5) in case of price objection, inflate the initial offer artificially, and then make a reasonable counter-offer.
With the negotiation skills mentioned above, both importers and exporters are bound to succeed in smoothing a business negotiation. However, some cultural differences among negotiators are evident. Some negotiators are decision makers; some are not. Some take a pragmatic view; others take a holistic view. Some use gifts and flattery. Many of the problems stem from cultural differences that lead to misunderstanding and mistrust across the conference table. The following cultural factors see the contrast of US negotiators with others:
Individual US negotiators are more likely to have the power to make decisions than their counterparts from some other countries. US negotiators may lose confidence when those counterparts must reach a group decision or keep checking with their head office.
US negotiators want to get to the heart of the matter quickly. Negotiators from some other cultures want to spend time developing relationship and trust before addressing business details.
US negotiators attempt to separate the issues into pragmatic categories, whereas some negotiators with other cultural backgrounds view negotiations more holistically.
US negotiators typically expect a broader range bargaining on issues such as price than do many of their foreign counterparts. For example, US negotiators often see Asians as stubborn and are seen by them as inconsistent.
US negotiations are more prone to set deadlines and then make concessions at the last minute to meet the schedule.
US negotiators often find it very difficult to establish relationship with foreign negotiators, for example, through culturally and legally acceptable gifts, through asking their advices and opinions or through purposely losing at golf.
It may be difficult for negotiators to find words to express their exact meanings in another language. Therefore, a good mastery of your counterpart’s language is very important in a successful negotiation. Since English is so widely understood in the world, people with a different native language may understand quite well most of what is said in English, giving them the opportunity to eavesdrop on confidential comments and to reflect on possible response while remarks are being translated into their language. The degree of precision in language desired by either side may be complicated by cultural factors.
New words and useful expressions
liability 责任, 义务，债务
dispute 争端，争论
arbitration 仲裁
controversial 有争议的, 引起争议的
concession 妥协, 让步
rand 边缘
exclusivity 独家经销权
predict 预测; 预示
equalize 均衡，使相等
inflate 通货膨胀，物价上涨
artificially 虚假地，人为地
be bound to do 必定，一定能
pragmatic 务实的; 实事求是的
holistic 整体的，全面的
flattery 奉承，恭维
inconsistent 易变的, 反复无常的，不一致的
stem 起源于
be prone to 有……的倾向，易于
eavesdrop 偷听，窃听
precision 精确度, 准确(性)
I. Discuss the following questions according to the text.
1. What is International Business Negotiation?
2. What is the most critical issue in the whole negotiation process?
3. What is the difference between US negotiators and the others?
4. Is it important to master your counterpart’s language in a successful negotiation? Why?
II. Multiple choices: choose the right meaning of the underlined part according to the context.
1. Of them all, price is always the most sensitive and controversial issue in the whole negotiation process, so this subject is usually postponed until the other non-price aspects of the transaction have been discussed and agreed upon.
A. suspend
B. planned
C. delayed
D. answered
2. Nevertheless, while centering around pricing questions, negotiation comes to the vital phase, in which both importers and exporters are hoping to obtain maximum concessions on the other side.
A. Although
B. However
C. Maybe
D. Therefore
3. They are bound to take every possible measure toget the upper hand.
A. occupy a dominant position
B. research for the benefit
C. help
D. win
4.Obtain the information about the price of the same product whose rand is unknown in the market.
A. Get
B. Disclosure
C. Declare
D. Announce
5. Object to the initial offer to test its seriousness and to get the possibly lowest prices.
A. Suggest
B. Accept
C. Negotiate
D. Disagree on
6. Prepare for the possibilities in negotiation by drawing up a plan of actionbefore hand.
A. at last
B. immediately
C. rightnow
D. in advance
7. Carry out a realistic assessment of quantities and schedule of the supplies; avoid any disagreement about price by concentrating the discussion on other non-price issues.
A. consideration
B. judgement
C. document
D. requirement
8. However, some cultural differences among negotiators areevident.
A. accidental
B. confused
C. reasonable
D. obvious
9. Many of the problems stem from cultural differences that lead to misunderstand-ding and mistrustacross the conference table.
A. disbelief
B. mistake
C. ignorance
D. careless
10. Negotiators from some other cultures want to spend time developing relationship and trust beforeaddressing business details.
A. placing
B. planning
C. advising
D. talking about
III. Translate the following sentences from Chinese into English.
1. 谈判双方在语言理解上分歧会严重影响(raise some peril)每一笔国际贸易的成交。
2. 在商业谈判中，对对方的底价、时间限制、最基本的权利和交易条件，都是保密的。谁掌握了这些，谁就能够取得主动，赢得谈判。
3. 在国际贸易谈判的成功需要很好地了解外国文化。
4. 要在国际贸易谈判中得到尊重，人们必须首先尊重他（她）的对手。
5. 良好的准备是任何谈判成功的关键。
IV. Grammar task of the present continuous tense and the past continuous tense.
1. — “ What_______ for?”
— “I can’t remember where I _______ my folder.”
A. are you looking / left
B. are you looking / had left
C. do you look / left
D. did you look / left
2. “Has your son worked hard this year?” “Oh, yes. He _______ his best now.”
A. has tried
B. is trying
C. tries
D. keeps trying
3. Nobody likes to work with him because he _______ about this or that.
A. always complains
B. is always complaining
C. has always complained
D. always complained
4. George _______the four o’clock by train this afternoon.
A. arrived at
B. isarrivedon
C. arrivesat
D. is arriving on
5. Look, here _______ the CEO of Haier Group.
A. is coming
B. has come
C. comes
D. came
6. I don’t feel well. I _______home from work tomorrow.
A. stay
B. stayed
C. am staying
D. will have stayed
7. My computer _______ just when I need it most.
A. always breaks
B. always broke
C. has always broken
D. is always breaking
8. The company _______ very well at that time when Mr. Li became the manager.
A. didn’t do
B. hasn’tdone
C. hadn’tdone
D. wasn’t doing
9. — “What’s the matter, Alice? You look worried.”
— “Oh, nothing much. As a matter of fact, I _______ of my son at home.”
A. am just thinking
B. was just thinking
C. just thought
D. have just thought
10. The delegation has already arrived, but I didn’t know it _______ until this morning.
A. will come
B. had been coming
C. was coming
D. comes
11. He _______ asleep while the director _______ at the meeting.
A. fell/ was speaking
B. was falling / was speaking
C. fell / spoke
D. was falling / spoke
12.When I arrived at his office, he _______ on the phone.
A. was speaking
B. spoke
C. had been speaking
D. had spoken
13. — “What _______ you _______ at 8 last night?”
— “I _______ at the office then.”
A. did, do / worked
B. were, doing / were working
C. were, doing / was working
D. were, doing / worked
14. I _______ my breakfast when the morning post came.
A. had
B. had been having
C. have been having
D. was having
15. He _______ about his salary when he worked for us.
A. always was complaining
B. was always complaining
C. always complained
D. has always complained
V. Speaking practice
Checking in at the Hotel
A: Here we are at the China—ASEAN International Hotel, Mr. Wilson.
B: So quick. It’s only 30 minutes from the airport. Oh, it’s a five-star hotel, isn’t it?
A: Yes, it is.
(At the reception desk)
R: Good afternoon, sir. Is there anything I can do for you?
B: Yes, my name is Birmingham Wilson. I’m from Singapore. The day before yesterday, my Chinese representative in Nanning booked a single room for me in this hotel.
R: Just a moment, please. I’ll check up.
(Checking the reservation list)
Yes, there it is. Birmingham Wilson from Singapore light industrial company. A single room for five days, right?
B: Right. What’s the room number?
R: Room 4803. Could you fill in this form, please? I’ll also need your passport.
B: Here you are.
R: Could you sign your name here please?
B: All right.
R: Thank you. Here is your key card. You can find all the information about this hotel from the information card in your room. The bellboy will take you to your room.
B: Thank you. By the way, where can I change money?
R: At the change counter on the right hand of this lobby.
B: Thank you very much for your help.
R: You are welcome.
VI. Supplementary reading.
Cultural Difference
People’s sense of “personal space” - - the distance that separates them from another person - - also varies between people of different nationalities. What feels right for one nationality may feel uncomfortable for another. British zoologist, Desmond Morris, has identified three “personal space” zones in Europe. In countries such as Spain, France and Italy, people stand close enough to touch each other easily. Morris calls this the “elbow zone”. In East European countries such as Poland, and Hungary, people stand a little more distant. Morris calls this the “wrist zone” when they are close enough to touch wrists. In Britain, Holland, and Germany, people prefer to stand further away from each other, and they do not generally touch. This he calls the “fingertips zone”.
Another cultural difference between nationalities is the amount of eye-contact between people. In countries where people stand close to each other, eye-contact is more frequent and lasts longer. Mediterranean countries are “high-look” cultures whereas north European countries are “low-look” cultures. Children who grow up in a low-look culture learn that it is rude to look too long at another person. In a high-look culture, eye-contact, like physical contact and gestures, is a natural way of expressing your feelings and relating to other people. This explains why, for example, north Europeans visiting south European countries may feel uncomfortable at the way people look at them.
Reading comprehension:
1. Who has identified three “personal space” zones in Europe?
A. a British scientist
B. Desmond Morris
C. Albert Morris
D. Isaac Morris
2. People stand a little more distant, which is called the “_____”.
A. personal space
B. elbow zone
C. fingertips zone
D. wrist zone
3. Where do people prefer to stand further away from each other?
A. In Poland
B. In Spain
C. In Italy
D. In Germany
4. Which country is “low look” culture?
A. Norway
B. Italy
C. Spain
D. France
5. According to the passage, which of the following is true?
A. People in Holland stand close enough to touch each other easily.
B. North Europeans visiting south European countries may feel comfortable at the way people look at them.
C. In countries where people stand far from each other, eye-contact is less frequent.
D. In a low-look culture, eye-contact lasts longer.