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.