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Chapter I: Introduction

This project work is titled Negotiation skills as tool for enhancing timely delivery of material. It is inevitable for every organization whether big or small, private or public to procure materials for production or for consumption. Such material can be raw material, finished goods or equipment which may cost an organisation a huge amount of money. In order to achieve the right materials at the right time of delivery and for the right place, negotiation should take place.

In these research work, emphasis will be laid on stressing out the various negotiation techniques available in the field of purchasing and supply. The techniques will tremendously enhance the procurement of material at a very economic cost and shortest possible time of receiving the order of materials. Negotiation is very important in the course of buying materials or services because of enhancing timely delivery of materials.

1.1     Background of the Study

Negotiation is one of the important as well as the most interesting and challenging as part of supply management. In industry and at most level of government, the term “Negotiation” frequently, causes misunderstandings confused with “Haggling” and price chiseling”. In government negotiation is frequently per solved to be a nefarious means of avoiding competitive bidding and of awarding large contracts surreptatiously to forward suppliers.

Webster’s dictionary define negotiation broadly as “Conferring, discussing or bargaining to reach agreement in business transaction” Herb Cohen describes negotiation as a persuasive process in which people ultimately attempt to reach a joint decision on matters of common concern in situation in which there is initial disagreement. Thus a negotiation always requires both shared interest and issues of conflict. Obviously without commonality, there is no reason to achieve resolutions. To be fully effective in purchasing, negotiation must be utilized in its broadest context as a part of a decision making process. In this context, negotiation is a process of planning, reviewing and analyzing used by a buyer and a seller to reach acceptable agreement or compromises include all aspect of the business agreement not just price.

Negotiation differs from a ball game or a war. In these activities only one side can win, the other side must lose. In most successful business negotiation both sides win something popular usage calls this approach “win-win negotiation” the “winnings” however are seldom equally divided invariably, one side wins more than the other. This is as it should be in business. Superior business skills merit superior rewards.

Increasingly, negotiations are conducted by cross. Functional teams, these teams must be well coordinated in order to function as an integrated entity.

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