Knight Engines

Assignment: Knight Engines
1. What goal did you set to be achieved in this negotiation? Your opening bid? Your bottom line?
We were representing Excalibur Engine Parts. Our aim was to sell as many Type A pistons as we could at the maximum price possible. We also wanted to make sure that Knight Engines carried our logo on their engines to indicate that their engines were fitted with quality Excalibur parts. This advertising would help us attract more customers in the long run. We also wanted to try to get Knight Engines to buy our insurance of 10% over the price for the pistons which would ensure defect-free pistons. These were our tangible goals. We were careful to maintain a cordial relationship with the opponents since we wanted to make sure that they used Excalibur pistons for all their future contracts. This was our intangible goal. We wanted to minimize the loss caused due to the Swiss deal and increase the company’s revenue and retain the shareholders.
Our opening bid was $600 each with a 5% rush fee which was a total of $630. We also gave the opponents an option to buy the insurance which was another 10%. The total came up to $690. This was our target point. We were aiming to sell 8000 or more pistons.
We had 10,000 pistons which would otherwise have to be sold at $100 each. Therefore, our resistance point or bottom line was $100.

2. Did you have a “Best Alternative” or “Option” if a deal was not struck? How good was this option? How did it affect your negotiations?
Our BATNA was $100 per piston that was being offered by Hank’s Super Monster Tractors Inc.
Usually the availability of a BATNA offers a negotiator significant power (Essentials 4th Edition, Page 162). This option was not at all attractive to us. This option meant that we would have to sell the pistons at a loss. But it was better than having inventory that was not being sold at all.
We were very confident about this negotiation even before it began. The large difference between our...