Common Misconceptions About Negotiations

Negotiation is one of the most critical skills in procurement and supply chain, yet it’s also one of the most misunderstood.

Over the years, I’ve seen professionals, both buyers and suppliers fall into common traps that cost them money, relationships and long-term value.

In this newsletter, we'll clear up some of these misconceptions with real-world scenarios and actionable takeaways.

Hello and welcome back to another edition of our newsletter;

Let's get right in;

Misconception #1: "The Best Negotiator Always Wins"

Scenario: A procurement manager, David, aggressively pushes for a rock-bottom price from a supplier. He wins the deal but later realizes the supplier is cutting corners to compensate for the lower margin- leading to quality issues and missed deadlines.

Reality: A negotiation where one party "wins" at the expense of the other often leads to poor outcomes. True negotiation is about finding mutual value.

Actionable Tip: Aim for a win-win outcome- negotiate beyond price by considering service levels, reliability, and long-term collaboration.

Misconception #2: "Silence Means You're Losing the Negotiation"

Scenario: Sarah, a procurement officer, presents an offer. The supplier stays quiet for a long 10 seconds. Feeling uncomfortable, she rushes to revise her terms, offering a discount before the supplier even responds.

Reality: Silence is a negotiation tool. The other party might just be thinking or testing your confidence.

Actionable Tip: Get comfortable with silence. Make your offer and wait. If the other party is quiet, don’t rush to fill the gap.

Misconception #3: "You Should Never Show Emotion in a Negotiation"

Scenario: Michael, a supplier, is negotiating with a buyer who keeps rejecting his proposals. He remains overly formal and detached, missing an opportunity to connect and understand the buyer’s deeper concerns.

Reality: While emotional outbursts are unprofessional, emotional intelligence is key to understanding what the other party values.

Actionable Tip: Use strategic empathy, acknowledge the other person’s concerns and show that you’re invested in a solution that works for both sides.

Misconception #4: "Negotiation Ends Once the Contract is Signed"

Scenario: A procurement team successfully negotiates a great contract but fails to follow up. Months later, they realize the supplier isn’t meeting key expectations, but because they didn’t build a relationship, fixing the issue is difficult.

Reality: Negotiation is ongoing. Contract management is just as important as the initial agreement.

Actionable Tip: Maintain post-negotiation communication, regular check-ins with suppliers ensure commitments are met and adjustments can be made if needed.

Misconception #5: "You Must Always Stick to Your Initial Position"

Scenario: Lisa, a procurement lead, insists on a 10% price reduction. The supplier refuses. Instead of exploring alternatives, she walks away, losing access to a supplier with a strong track record.

Reality: Flexibility is key. A rigid stance can lead to missed opportunities.

Actionable Tip: Be willing to adjust your approach, if price reductions aren’t possible, negotiate for better payment terms, added services or faster delivery instead.

Summarily, negotiation isn’t about winning at all costs, it’s about creating value, building trust, and securing long-term success. By avoiding these common misconceptions, you’ll not only negotiate better deals but also build stronger, more strategic supplier relationships.

Which of these misconceptions have you encountered? Feel free to leave a comment.

PS: If there are any particular negotiation techniques you'd like me to cover in subsequent editions, do let me know at [email protected]