Knight Engines
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- Category: Other
- Date Submitted: 01/26/2016 08:10 PM
- Pages: 3
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Kinght-Excalibur Case
EXCALIBUR ENGINE PARTS – NEGOTIATION PLAN
1. What is your BATNA (Best Alternative to a Negotiated Agreement)?
Sell the pistons to Hanks Super Monster Tractor for $300 / piston
2. Why it is the “best” alternative?
* No other viable alternative available if we decided to go without major losses.
* Better than not selling at all considering the poor demand for specialized pistons in the market
3. How acceptable your BATNA is to you?
This is a very poor BATNA to sell the pistons at a significant loss
4. What are the implications of this acceptability for the way you approach this negotiation?
* I’ll try to cut the deal with Knight Engines even if requires to offer some concessions.
* If there are no profits for this quarter then the trust of the shareholders will be at stake.
5. Does it seem (initially) that one party is more dependent on getting a deal than the other party is? If so, what are the implications of this potential imbalance?
Initially, it does look like we are more dependent on getting a deal with Knight Engines as our BATNA is very poor and we need a good outcome to avoid losses this quarter. But having said that it looks like the other party is also dependent on us because they need to fulfill an order with the government. Also, purchasing 8000 good quality pistons 2 weeks would be a difficult task for them.
6. Decide what the relevant issues are that you want to negotiate.
Issues:
a. Sales price
b. Number of pistons
c. Advertising Excalibur on the Knight Engine chassis
d. Quality control insurance fee for individual testing
e. Rush fee
Priorities:
Very important: a. Sales price, b. number of pistons
Important: c. advertising Excalibur on the Knight Engine chassis, d. Quality control insurance fee for individual testing
Not so important (if they agree upon advertising Excalibur on Knight Engines): e. Rush fee
7. Resistance point(s) : Price less than $300/piston
8. Target Points:
1. $ 560/piston + 10%...
EXCALIBUR ENGINE PARTS – NEGOTIATION PLAN
1. What is your BATNA (Best Alternative to a Negotiated Agreement)?
Sell the pistons to Hanks Super Monster Tractor for $300 / piston
2. Why it is the “best” alternative?
* No other viable alternative available if we decided to go without major losses.
* Better than not selling at all considering the poor demand for specialized pistons in the market
3. How acceptable your BATNA is to you?
This is a very poor BATNA to sell the pistons at a significant loss
4. What are the implications of this acceptability for the way you approach this negotiation?
* I’ll try to cut the deal with Knight Engines even if requires to offer some concessions.
* If there are no profits for this quarter then the trust of the shareholders will be at stake.
5. Does it seem (initially) that one party is more dependent on getting a deal than the other party is? If so, what are the implications of this potential imbalance?
Initially, it does look like we are more dependent on getting a deal with Knight Engines as our BATNA is very poor and we need a good outcome to avoid losses this quarter. But having said that it looks like the other party is also dependent on us because they need to fulfill an order with the government. Also, purchasing 8000 good quality pistons 2 weeks would be a difficult task for them.
6. Decide what the relevant issues are that you want to negotiate.
Issues:
a. Sales price
b. Number of pistons
c. Advertising Excalibur on the Knight Engine chassis
d. Quality control insurance fee for individual testing
e. Rush fee
Priorities:
Very important: a. Sales price, b. number of pistons
Important: c. advertising Excalibur on the Knight Engine chassis, d. Quality control insurance fee for individual testing
Not so important (if they agree upon advertising Excalibur on Knight Engines): e. Rush fee
7. Resistance point(s) : Price less than $300/piston
8. Target Points:
1. $ 560/piston + 10%...