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  • Hi, I'm Gina.

  • Welcome to Oxford Online English!

  • In this lesson, you can learn useful language for business negotiations.

  • You'll learn how to make your position clear, how to accept or reject the other side's

  • proposals, and how to express yourself in clear, professional-sounding English.

  • If you haven't already seen them, I suggest you watch our videos on chairing and attending

  • meetings.

  • Negotiations are also a kind of business meeting, and the language from those videos will also

  • help you in these situations.

  • Don't forget that you should also visit our website: Oxford Online English dot com.

  • You can find many free English lessons, and also book lessons with one of our professional

  • teachers if you need more help.

  • In this lesson, you'll see a scenario where I'll role-play a purchaser for a clothing

  • wholesaler.

  • Daniel will role-play the manufacturer's representative, and we'll be negotiating

  • a deal.

  • Let's look at the first part.

  • So, let's get started.

  • I've read your proposals, and I understand you're looking for unbranded clothing in

  • a variety of styles.

  • That's right.

  • Meaning: t-shirts, tank tops, hoodies, zip-up tops, and long-sleeved tees, right?

  • Correct.

  • Alright.

  • So, my first question is: what kind of volumes are we looking at?

  • Well, we're a reseller, so we rebrand the clothing and sell it on to retailers.

  • We can potentially move quite a lot of product, but I suggest starting small and scaling up

  • later.

  • We're thinking of starting with around 500 to 1500 units per SKU, with more in popular

  • sizes and colours.

  • And that would be per-month, or…?

  • We'd prefer to keep things flexible to begin with.

  • What do you have in mind exactly?

  • I'm not against flexibility, but logistics require a certain amount of forward planning.

  • Of course!

  • Let me ask you something: what's the situation regarding production and delivery?

  • How long does it take you to process orders?

  • It's not completely fixed, but around two weeks.

  • Larger orders can take more time.

  • That's fine, so here's our situation: we don't have a lot of warehousing space.

  • That means we can't commit to a fixed schedule for deliveries.

  • Instead, we'll have to make orders once our stock level is low enough and we have

  • the space.

  • Hmm

  • That's possible.

  • One thing you should know: we won't be able to offer the lowest prices if we can't be

  • sure of your delivery schedule in advance.

  • I understand.

  • And for one product category, for example short-sleeved t-shirts, how many variations

  • of size and colour do you need?

  • We need all the common sizes, from XS to XXL, each in 16 colours.

  • At the beginning of a negotiation, both sides need to make their position clear.

  • In the dialogue, you saw several ways to do this.

  • Can you remember any?

  • First, you can state what you want directly, like this: 'I suggest starting small and

  • scaling up later.'

  • 'We're thinking of starting with around 500 units per SKU.'

  • 'We'd prefer to keep things flexible to begin with.'

  • You can use this language in other ways.

  • For example: 'I suggest a six-month contract to begin with.'

  • 'We're thinking of opening new branches in 15 cities.'

  • 'We'd prefer to do the marketing work ourselves.'

  • You can also ask the other side specific questions to find out what they need.

  • In the dialogue, you heard: 'What kind of volumes are we looking at?'

  • 'What's the situation regarding production and delivery?'

  • Again, you could use these in different situations.

  • For example: 'What kind of schedule are we looking at?'

  • 'What's the situation regarding minimum order volume?'

  • Finally, you can also use open-ended questions to check information, or to get more information

  • from the other side, like this: 'What do you have in mind exactly?'

  • 'And that would be per-month, or…?'

  • Making a question by leaving a sentence unfinished, with the word 'or' at the end, is conversational.

  • You wouldn't use it in writing.

  • However, in spoken English, it's an effective way of showing that you need more information,

  • and that you want the other person to finish the idea.

  • Very often, negotiations depend on setting conditions.

  • What *you* can offer depends on what the other side can do.

  • Let's see how you can talk about this.

  • OK, so if we're ordering around 100,000 units at one time, what kind of per-unit pricing

  • can you offer?

  • That depends if you can commit to a regular delivery schedule or not.

  • Assuming that you need a flexible schedule, we could offer six dollars per unit for tees

  • and tank tops, and fifteen for hoodies and zip-ups.

  • If we need higher volumes, would you be able to go lower?

  • Possibly, but the schedule is more important to us.

  • Supposing you could commit to a minimum monthly volume, we could go down to five-fifty and

  • fourteen.

  • If we commit to a minimum volume over a six-month period, but with a flexible delivery schedule,

  • could you offer us the same price?

  • As long as there were some limitations on the delivery timing, I think that would be

  • acceptable.

  • The easiest way to express conditions is with if-sentences.

  • For example: 'If we're ordering around 100,000 units at one time, what kind of per-unit

  • pricing can you offer?'

  • If we need higher volumes, would you be able to go lower?'

  • If we commit to a minimum volume over a six-month period, but with a flexible delivery schedule,

  • could you offer us the same price?'

  • If-sentences can be used in many ways; it's common to use the modal verbs 'will' 'can'

  • 'could' or 'would' on the other side of the sentence.

  • Let's make some more examples: 'If we commit to a longer contract, can

  • you offer us a better price?'

  • 'If we agreed to pay the licensing costs, would that make the deal work for you?'

  • However, there are other ways to talk about conditions.

  • Can you remember any from the dialogue?

  • You heard: 'Assuming that you need a flexible schedule, we could offer six dollars per unit

  • for tees and tank tops…'

  • 'Supposing you could commit to a minimum monthly volume, we could go down to five-fifty…'

  • 'As long as there were some limitations on the delivery timing, I think that would

  • be acceptable.'

  • All of these have the same basic meaning, which is like an if-sentence, although 'assuming…'

  • and 'supposing…' are used when you want to suggest something which is more speculative.

  • Using these shows that you're talking about possibilities, rather than very firm suggestions

  • which need to be accepted or rejected immediately.

  • 'As long as…' has the opposite meaning; it sets a very firm condition.

  • If you say, 'As long as there were some limitations on the delivery timing, I think

  • that would be acceptable', you mean that these limitations are necessary.

  • If you can reach an agreement, then that's great!

  • But, what if there's a sticking point?

  • Let's work out the details about delivery and scheduling.

  • For us to make this work at the lower price, we'd need to have monthly deliveries, but

  • we could let you adjust the size of the order to some extent, so that you can manage your

  • warehousing space.

  • I'll come right out and say that's not going to work for us.

  • Flexibility is essential for us; our whole model is based on just-in-time logistics,

  • so there's no way around this.

  • Well, in that case, we won't be able to offer you the lower price.

  • I have no problem with flexible deliveries as such, but we can't offer our best prices

  • without a regular commitment on your part.

  • I'm sorry to be blunt, but this seems a little short-sighted on your part.

  • We're potentially looking to order millions of units each year.

  • Flexible delivery doesn't mean that we won't make orders regularly, it just means that

  • we need to control the timing and quantities.

  • I understand completely, but you need to realise that we have our own logistics issues to deal

  • with.

  • If we don't know exactly when and how big an order will be, that creates costs for us.

  • We're not willing to absorb those costs; I feel that if you need this flexibility,

  • then you should be willing to pay for it.

  • I'm sorry but I have to draw a line here.

  • It's simply too risky for us to give you what you're asking.

  • It seems like we've reached a bit of an impasse.

  • Shall we take a five-minute break?

  • Good idea.

  • If the other side makes a proposal which you can't accept, you can tell them directly,

  • like this: 'We won't be able to offer you the lower price.'

  • 'We can't offer our best prices without a regular commitment on your part.'

  • 'We're not willing to absorb those costs.'

  • This language is direct, but it's often better to be direct if something is important.

  • You can use this language in other ways.

  • For example: 'We won't be able to finish the work in such a short space of time.'

  • 'We can't sign a contract if you can't guarantee a delivery date.'

  • 'We're not willing to share this technology for free.'

  • You can also show that you disagree by using phrases like: 'I'll come right out and

  • say that's not going to work for us.'

  • 'There's no way around this.'

  • 'I'm sorry but I have to draw a line here.'

  • These are general, so you can use them to react to any suggestion which you strongly

  • disagree with.

  • It's a good idea when negotiating to keep things calm and avoid direct criticisms.

  • If things get confrontational, you could give everyone space to cool off by saying: 'Shall

  • we take a five-minute break?'

  • Next, let's see how you can resolve disagreements in a productive way.

  • Right, I've spoken to a few people and I have a proposal which I hope can make this

  • work for everyone.

  • Sounds good!

  • What's your idea?

  • The problem for us is that if you don't maintain a certain monthly volume, we might

  • lose money at the lower prices, which obviously we can't do.

  • Sure.

  • So, here's my solution: we have an annual contract with a flexible delivery schedule,

  • but with a minimum volume per-quarter.

  • At the end of the quarter, if you haven't met the volume requirements, you're liable

  • for the difference in price between your orders and the minimum.

  • I like the basic idea, but earlier I suggested a six-month contract, and this sounds like

  • a much worse deal for us.

  • Well, I want to make this work, but the lower prices only work if we can guarantee orders

  • over a full year.

  • I'll make another offer: you pay five seventy-five for tees and tank tops and fourteen-fifty

  • for hoodies and zip-up tops.

  • Then, you can have a six-month contract, with minimum volume per-quarter.

  • That's a good offer, but can we have the minimum over the whole period, just to have

  • more flexibility?

  • I can't make more concessions that I already have, I'm afraid.

  • I think this is a good compromise which allows us to move forwards.

  • I'll need to call my team to confirm, but I think this should be feasible.

  • Great!

  • When you've reached an impasse, you need to make suggestions so that you can move forward.

  • To introduce a new idea, you heard this language from the dialogue: 'I have a proposal which

  • I hope can make this work for everyone.'

  • 'Here's my solution: …'

  • 'I'll make another offer...'

  • You can also ask the other side to suggest

  • their ideas, like this: 'What's your idea?'

  • 'What would you suggest?'

  • Then, you need to react to the other side's ideas.

  • If you agree, you could say something like, 'That's a good offer.'

  • 'I think this should be feasible.'

  • 'Feasible' has a similar meaning to 'possible' or 'practical'.

  • If something is 'feasible', it means that you can do it, and it won't be difficult

  • or problematic.

  • Hopefully, at this point you've managed to reach an agreement!

  • If so, what else do you need to do?

  • Let's go through the main points: you'll order a minimum of 500,000 units in a six-month

  • period, at a price of five seventy-five for short-sleeved t-shirts, long-sleeved t-shirts

  • and tank tops, and fourteen-fifty for hoodies and zip-up tops.

  • That's right.

  • Regarding delivery, orders are flexible, but you commit to giving us three weeks' notice

  • for each order.

  • Yes.

  • We still need to settle the exact details of sizes, colours, and so on.

  • Of course, but from our point of view, that isn't an issue.

  • Production costs are almost identical.

  • OK, so we can work that out later.

  • There's also the matter of penalties in case you don't meet your minimum volume

  • over the course of the contract

  • I thought we agreed that we would simply pay the unit cost for the shortfall?

  • Yes, but which unit cost?

  • We need to agree separate minimums for the t-shirts and tank tops, and for the heavier

  • items.

  • True, but I don't see that being a problem.

  • No, me neither.

  • So, we'll put this in writing and send you a provisional agreement within the next few

  • days.

  • If everything looks OK, we can work on getting a contract drawn up.

  • Perfect!

  • Once you've reached an agreement, you should summarise what you've agreed, and then outline

  • the next steps which you both need to take.

  • You might also mention points which need to be discussed later.

  • To summarise what you've agreed, you could say, 'Let's go through the main points:

  • …' 'Regarding delivery, …'

  • You can use 'regarding' to introduce a new idea.

  • So, you could say, 'Regarding the pricing…'

  • 'Regarding the timetable …' …and so on.

  • If there's something you need to talk about later, you could say, 'We still need to

  • settle the exact details of…'

  • 'There's also the matter of…'