Negotiation

Negotiation vocabulary

Match the expressions in the bow to their definitions:

COMPROMISE / GIVE AND TAKE / PERSUADE / TRADE-OFF /

ZERO-SUM GAME / WIN-WIN / PARTIES / DEAL

1. When both sides/parties benefit in a deal/agreement, is a………………

2. Another word for an agreement is………………

3. When two companies reach an agreement by making concessions, they make a ………………

4. When you get less of one thing in order to get more of another, it is called a ………………

5. The name of a negotiation strategy where both sides make compromises/concessions is

………………

6. A very formal word to call the 'groups' and 'sides' in a negotiation is ………………

7. Another way to say 'convince', is ………………

8. When one side benefits a lot more than the other in a deal, is a negotiation strategy called
………………

“Distributive” or “integrative”?

Which of these negotiations are probably “distributive” or “integrative”?

a) The rental price of an apartment.

b) Your boss gives a raise but in doing so the working hours per week go up.

c) Your flights been cancelled but the airline gives you 3000 fly miles for the
inconvenience

d) Buying a car.

e) Arranging a meal for your hiking club (40 people).

Negotiation stages

Read the four extracts from the later stages of a negotiation between a franchisor (a chain of
small grocery shops) and a potential franchisee and answer the questions below.
(A = franchisee; B = franchisor)

Extract 1
A: OK, so you said you could be flexible on the initial setting-up fee in exchange for slightly
higher monthly fees. I think we could accept that. I’d say we could
accept a 1% increase in the monthly fees for the first two years in exchange for a 5% cut in the
set-up fee. How does that sound?
B: Er … I think that’s fair enough.
A: So that’s agreed? A 1% increase in monthly fees for two years, a 5% cut in the set-up fees?
B: Yes, that’s fine. And then we can review the situation after those two years.
A: OK, great.
Extract 2
B: What about the non-compete clause? You said you were worried about committing yourself to
five years.
A: Well, yes, I mean obviously I want to make this franchise work, but if it doesn’t, for whatever
reason, I need to be able to make a living. And the non-compete clause says I can’t open another
shop for five years.
B: Well, it says no other shop in the same market, so grocery stores, within a 20km radius of this
shop. We have to include such a clause, you know, so we don’t give you all our secrets and then
watch you set up in competition with us over the road.
A: OK, fair enough, but there’s a big difference between over the road and 20km.
This is a big city, and there’s no way a little shop 5km away, or even 1km away, is in direct
competition.
B: So what are you proposing?
A: Well, as I say, I think the exclusion zone could be cut to 1km, possibly slightly more. Or we
could reduce the term of the non-compete clause, to, say, 2 years.
B: Well, I’m afraid 1km is totally out of the question, as is a 2-year term. We might
be able to show some flexibility in both of these, but I was thinking more in terms of 15 km for a
period of, say, four years. But that would depend on what you could offer us in return. Perhaps
we could revisit the notice period.
A: Er, well, I thought we’d agreed on that. You said you’d accept a three month
notice period.
B: Yes, that’s right. But we’d need something in return for flexibility on the non-compete clause.
Do you have a better suggestion?
A: Not really. As I said earlier, the three-month notice period is as long as I’m prepared to
accept, and I also can’t accept the non-compete clause as it stands.
B: OK, so … are you saying you’re not prepared to accept our offer? If that’s the case, it would
be a shame, but it’s up to you.
A: I don’t know. Could we take a time out? I need to think about this before I make a decision. I
also want to make this work, and it would be a shame to walk away after we’ve come so close to
an agreement.
B: I agree. Shall we meet back here in half an hour?
Extract 3
A: OK, so I’ve given it some thought. I was wondering whether we could do something like this
with the non-compete clause: a large exclusion zone, say your 15km, for the first year, and then a
smaller zone after that, say 2km for the next three years.
B: Hmmm … that’s interesting. We might be able to work out something like that, in exchange
for a longer notice period … How about this? 15km for the first two years, and 5km for the next
two years. In exchange for a notice period of five months.
A: Er … let me think about this … Tell you what. Let’s make the notice period four months, and
you’ve got yourself a deal.
B: Sounds good. Let me just confirm what we’ve agreed, then …
Extract 4
A: Yes, that all sounds fine.
B: Excellent. Well, it’s been a pleasure doing business with you. You drive a hard bargain, but I
think this will be a good deal for both of us. Here’s to a successful long-term relationship!
Questions:
Extract 1
1. At the beginning, the franchisee says ‘I think we could accept that’. What exactly is she
accepting?
2. Why does the franchisee repeat the figures?
Extract 2
3. What do the two parties reveal about their positions with regard to the non-compete clause?
4. How do the two parties show that their proposals are flexible?
5. How does the franchisor show that the franchisee’s suggestion is unacceptable?
6. Why is the franchisee surprised that the franchisor mentioned the notice period?
7. Which party comes closest to brinkmanship here?
8. How do they avoid ending the negotiation?
Extract 3
9. How does the franchisee introduce her creative solution?
10. How does the franchisor express that there is a deal to be clinched without actually accepting
the offer??
11. Why doesn’t the franchisor agree straight away?
Extract 4
12. Why do you think the franchisor pointed out that the franchisee drives a hard bargain?
Match the phrases from the extracts to their appropriate function:

1. How does this sound? …… a. Asking/Making

suggestions

2. So that’s agreed? …… b. Return to the

negotiation table

3. So what are you proposing? …… c. Working out the

Do you have a better suggestion? details

4. Are you saying you’re not …… d. Reaching a

prepared to accept our offer? If compromise
that’s the case, it would be a
shame, but it’s up to you.

5. OK, so I’ve given it some …… e. Reaching a stalemate

thought. It was wondering
whether we could do something
like this.
How about this?
Tell you what. Let’s…

6. …and you’ve got yourself a …… f. Making concessions

deal.
Well, it’s been a pleasure doing
business with you. You drive a
hard bargain, but I think this will
be a good deal for both of us.
Here’s to a successful long-term
relationship!

If-sentences

Consider the following extracts from negotiation scenarios.

Put the verbs between parentheses into the right form.

1. Unless you accept the price, we ………………. (Sign/not) the contract.

2. I ………………. (Consider) giving you a discount if you paid in advance.
3. If you provided us with some leverage, we ………………. (Reconsider) the deal.
4. If you………………. (Suggest) an alternative I would be pleased to consider it.
5. Provided you increase your order by 10%, we ………………. (Give) you a discount.