Thursday, February 23, 2012

Sushant Contract Training Series: Contract Negotiation

What is Contract Negotiation :A contract negotiation is any discussion, either in person or through electronic means, that has as its primary goal to come to a written agreement concerning a business matter. Such a contract can be for nearly anything, Often, the contract negotiation handles issues such as cost, time frame, and whether there are any special considerations to take into account.




Negotiation Impact on Deals

DEAL YA NO-DEAL
  1. Failure to resolve issues
  2. Negotiated terms render deal as no good
  3. Varying negotiating powers of the parties.
  4. Other offers

WIN-WIN SITUATIONS
  1. Resolving open issues
  2. Open discussions
  3. Arriving at consensus
  4. Long term benefits from the contract

Effective Negotiation

Do’s

  1. Direct communication
  2. Professional and assertive approach
  3. Identify key issues to be discussed and sort them first
  4. Controlled discussions
  5. Strategize broad outline of negotiations
  6. Conclude issues before moving on thus minimizing open issues
  7. Structured approach towards negotiations

Avoid

  1. Aggressive approach, being pushy
  2. Ad hoc discussions
  3. Exposing key decision making party at early stage of negotiations
  4. Dodging issues, deadlock
  5. Making offers without consulting decision makers
  6. Leaving too many issues open for drafting

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Lawyer by profession Legal Crusader by choice.