This PPT slide, part of the 84-slide Working Capital Management Strategy PowerPoint presentation, outlines a structured approach to effective supplier negotiations, emphasizing the importance of securing favorable payment terms and long-term agreements that support just-in-time inventory management. It is divided into six key phases, each building on the previous one to create a comprehensive negotiation strategy.
The first phase, "Conduct Preparation and Research," stresses the need for thorough supplier analysis. Understanding suppliers’ market positions, pricing structures, and reliability is crucial. This groundwork sets the stage for clear negotiation objectives aligned with the organization’s needs.
Next, "Build Strong Relationships" focuses on establishing trust and open communication with suppliers. This phase highlights the significance of fostering partnerships that benefit both parties, which can lead to more favorable negotiation outcomes.
The third phase, "Identify Key Terms," involves determining critical negotiation elements such as pricing, payment terms, and lead times. Prioritizing these terms based on their operational impact is essential for effective negotiations.
"Leverage Volume and Commitment" is the fourth phase. Here, organizations are encouraged to use their purchasing power and long-term commitments as leverage. This can enhance negotiation outcomes by highlighting the potential for increased business and ongoing partnerships.
The fifth phase, "Explore Win-Win Solutions," advocates for a collaborative mindset during negotiations. It suggests being open to creative arrangements that can provide mutual benefits, such as vendor-managed inventory.
Finally, "Document and Monitor Agreements" emphasizes the importance of formalizing agreed-upon terms in a contract. Regular monitoring of supplier performance against these terms ensures that any issues are addressed promptly, maintaining the integrity of the partnership.
This slide is part of the Working Capital Management Strategy PowerPoint presentation.
This framework is created by former McKinsey, BCG, Deloitte, EY, and Capgemini consultants and details a robust approach to WCM Strategy used by consultants with their clients.
EXPLORE MORE SLIDES FROM THIS PRESENTATION
EXPLORE MORE PRESENTATIONS ON
Flevy is the world's largest knowledge base of best practices.
Leverage the Experience of Experts.
Find documents of the same caliber as those used by top-tier consulting firms, like McKinsey, BCG, Bain, Deloitte, Accenture.
Download Immediately and Use.
Our PowerPoint presentations, Excel workbooks, and Word documents are completely customizable, including rebrandable.
Save Time, Effort, and Money.
Save yourself and your employees countless hours. Use that time to work on more value-added and fulfilling activities.
