Q & A Table of Contents
Negotiating With Various Vendors At The Same Time
From: Tina, Sao Paolo, Brazil
Question: From a Purchasing Dept point of view, is it dangerous (or non ethical) to gather some invited vendors, explain to them all together the basis of a quote so that they can prepare their offer and send to a company instead of calling each one of them separately and to explain one by one?
Response: The process you propose sounds much fairer and more ethical than separate conversations with vendors one at a time. If you gather all the qualified vendors at once, they all get the same information simultaneously; they get to hear the questions raised by their competitors and your responses to those questions. In one-on-one conversations, you may forget to say something to one vendor or give information to a vendor that other vendors might not have heard.
If you do have a vendors meeting, it would be wise to have a prepared agenda as well as good knowledge of the specifications your company is looking for, delivery issues, an understanding of what factors may add value to a bid, as well as a comprehension of pricing and value factors. You also need to have an understanding of relationship matters; will your company pay a different price to different vendors because of longstanding relationships or particularly good service?
You can use a prepared agenda and checklist in one-on-one meetings as well. The critical thing is to make certain you don't fail to give uniform information in each conference.
One other thing to think about is whether you might, by mistake, fail to invite a potential vendor to a group meeting -- or one of a series of individual meetings. This is always a risk, since you may fail to negotiate with a vendor who offers more benefits or value than others with whom you are accustomed to doing business.
The ethics are clear: make sure that all potential vendors are working with the same information, that you do nothing that could create the problem of appearing to give anyone an unfair advantage.
Good luck,
Steve
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