price negotiation

Price negotiation is the process of agreeing on one or more objects of exchange between at least two parties.

Particularly in the industrial goods sector, price negotiations are often a fixed upstream component of the conclusion of a contract. In principle, price negotiations can relate to all elements of a transaction, such as payment terms, delivery conditions or financing. The most important element of a price negotiation is the preparation of the negotiation, according to the motto ” good preparation is half the battle”. Of central importance here is the so-called BATNA (Best Alternative to a Negotiated Agreement), i.e. the best available alternative of all parties.

Within price negotiations, win-win situations, also known as integrative potential, must be identified. The negotiating power of the individual parties plays a central role in the outcome of the price negotiations. Bargaining power is determined by factors such as size, creditworthiness, reputation, market power or purchase volume.