Distributive negotiation of Sarah Talley and Wal-Mart Essay

Distributive negotiation of Sarah Talley and Wal-Mart, 500 words essay example

Essay Topic: negotiation

1. Was this a Distributive or Integrative negotiation?-was it the optimum approach and why or why not.
Sarah Talley and Wal-Mart are in a distributive negotiation as they only haggle about the price for 4th of July Watermelons. Rather than giving a good reason as to why, Wal-Mart persists with the position that the price is too expensive. Wal-Mart is in the obvious position of strength (POS) when it comes to price negotiations. In the end these negotiations ended with Wal-Mart having to pay higher prices and with Frey Farm selling less volume at lower profits and them becoming essentially a third party seller.
2. Other than not doing the deal, list the BATNA's Sarah had for this deal.
Sarah's BATNAs include searching for other possible buyers and establishing the lowest acceptable price to avoid the worst possible outcome. These are the only things that Sarah has going for her in this negotiation.
3) Discuss any BATNA's she didn't pursue that you would have to strengthen your position.
If I was Sarah, I would not have just let Wal Mart walk away because they have the reputation and brand name awareness. She should focus on a BATNA like talking to other Wal-Mart executives and offering them a creative solution like accepting the price in exchange becoming a co-managed supplier.
4. Do you believe Sarah did enough preparation and research for the negotiation?-Is there any additional preparation she could have done that would have substantially improved her outcome? If so, what?
This is a yes and no question. Sarah researched Wal-Marts "Every day low price" doctrine (ELDP), but at the same time she didn't know what the criteria for becoming a co-managed supplier was. Also, she had no idea how Wal-Mart negotiates, she should have developed clear BATNA's to increase Frey Farm's POS. She also should have known how to become and what is involved in being a co-managed supplier prior to entering negotiations.
5. How would you have done this negotiation differently? Please cite Negotiations best practices that you would have utilized.
The best way to negotiate is to do your homework and prepare extensively for it. Integrative negotiation is the only way to create a win-win situation for both parties and, if done correctly, will lead to a proper outcome. But, in all actuality, I would have accepted Wal-Mart's price in exchange for becoming a co-managed supplier. Wal-Mart is a giant, so why not piggy back off of them. Sacrificing short term goals for long term is important.
6. Given the outcome at the end of the case, is there anything Sarah can do to salvage the relationship and/or possibly get back in the running for co-management?
I honestly don't think so. I think she has ruined the chances of Frey Farm to become a co-managed supplier. The high prices of Sarah's farm goes against Wal-Mart's EDLP doctrine, so I don't think they would want to do business with her unless she drastically reduces prices, which I don't think she will do.

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