Your checklist for successful negotiations with suppliers in the SME sector. If you want to stand up to well-trained sales professionals, you have to lure them out of their shell: Stay confident with all the figures, data & facts about the business relationship and fend off flimsy arguments with detailed knowledge about the supplier. With Tacto's checklist, you have a solid foundation for your next negotiation.

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#1 A solid data basis creates negotiating security

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How much do I buy from a supplier? How have prices developed since the last conversation and how many complaints have there been in the meantime? 

These are all questions that you can clarify before the supplier meeting and are essential for targeted negotiations. In addition to the development of the purchase price, the security of supply from the supplier and the quality of the delivered product should be the main focus here. 

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In many cases, a good data basis provides the basic framework for retaining the upper hand in later price poker. For SMEs in particular, Excel is the tool of choice for the analytical preparation of delivery dates and the preparation of historical delivery data. It should be noted that manual evaluations carried out by the user can lead to an incomplete or even incorrect data basis. It is not uncommon for errors to creep in when entering formulas or for the exported data to be incomplete. Both lead to the subsequent evaluation being distorted and incorrect conclusions being drawn.

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In addition to Excel, there are now other e-procurement solutions that contribute to a much more precise data evaluation. Some software solutions are easy to use and perform the analyses automatically in order to visualize and display them in the purchasing cockpit.

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Analytics with Tacto 

Tacto's software solution enables the purchasing departments of medium-sized companies to prepare for supplier meetings quickly and cost-effectively. At the touch of a button, the buyer can access all relevant data in the purchasing cockpit, track price developments and delivery flows, all without the need for major IT resources. 

Learn more about Tacto

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#2 Understanding the supplier's position

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Only if you know your supplier, their market share, upstream suppliers and costs, as well as their current financial situation, will you understand the initial situation with which your negotiating partner is entering into negotiations. This forms the basis for preparing your arguments in a targeted manner.

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Particularly in a tight market situation, with rising prices and the threat of supply bottlenecks, a discussion of the supplier's position can save a lot of money: Not all price increases at any level are justified - many sellers use tight market situations to increase profits. 

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With simple business calculation methods, such as a price structure analysis, the supplier's prices can be at least partially broken down and broken down into the cost structure. Especially if the supplier is located close to the raw material, the current market prices are easier to understand and the calculation becomes more accurate. 

It pays to take careful notes!

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Supplier relationships are usually designed to last for years or even decades. Over the years, there are usually several direct and indirect points of contact with a supplier. A lot can be found out about a supplier through trade fairs, competitors or industry contacts. Who makes the decisions in the company? How much negotiating power does the responsible salesperson bring to the supplier meeting and so on...? 

It is worth keeping a detailed record of the information you have gathered over the years and taking a look at the documents before the interview: Perhaps your counterpart doesn't have as much decision-making power in the company as they claim?

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#3 Preparation of the negotiation framework

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Goals can only be achieved if they are defined in advance. It takes years of experience and a sure instinct to define the right goals for the respective negotiating position. You can formulate ambitious personal goals for a supplier meeting. However, you should keep the achievability in mind: The maxim for setting goals is: "high, but realistically justifiable".

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Basically, the aim is to formulate valid and easily measurable objectives that can be introduced into the discussion on the basis of their research and analysis.

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Possible goals could be, for example 

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• Upper limit for price increases per unit not exceeding 12 euros
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• Raise cash discount rate from 2 % to 3 %
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• Increase payment term from 14 days to 30 days
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• Reduce delivery times from 35 to 20 days

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Especially if you are expecting a tough negotiation, it makes sense to set higher and measurable goals than you can achieve before the meeting.

The reason is simple and rooted in human psychology: if the person you are talking to repeatedly rejects your wishes, they will most likely feel obliged to say "yes" at some point. You can always assume that the person you are talking to is just as interested in a joint solution as you are. Ultimately, such discussions should lead to a win-win situation. The ultimate goal for all your negotiations should always be long-term partnerships with suppliers.

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Everything you need to know in the comprehensive Tacto checklist!

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We have compiled a comprehensive checklist for you with further questions and general assistance in preparing for your next supplier meeting.

Your checklist for successful negotiations with suppliers in the SME sector. If you want to stand up to well-trained sales professionals, you have to lure them out of their shell: Stay confident with all the figures, data & facts about the business relationship and fend off flimsy arguments with detailed knowledge about the supplier. With Tacto's checklist, you have a solid foundation for your next negotiation.