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| Section | Objectives |
|---|---|
| Topic 1: Negotiation strategies and tactics | - Approaches to negotiation
|
| Topic 2: Negotiation planning and preparation | - Preparation techniques
|
| Topic 3: Negotiation fundamentals | - Principles of commercial negotiation
|
| Topic 4: Power, ethics and communication in negotiation | - Influencing factors
|
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NEW QUESTION # 343
Listening is a key activity in negotiation. Which of the following are characteristics of effective listeners?
* Showing empathy
* Persuading
* Paraphrasing
* Offering immediate solutions
Answer: A
Explanation:
Effective listeners demonstrate empathy and use paraphrasing to confirm understanding. These skills help build rapport, validate the speaker, and ensure accurate interpretation. Persuading and immediate solutions are active interventions, not listening behaviours. CIPS emphasises active listening as central to persuasion and relationship building in negotiation, enabling buyers to uncover underlying interests and respond appropriately.
Reference: CIPS L4M5 (2nd ed.), LO 3.2 - Listening and questioning as persuasive communication tools.
NEW QUESTION # 344
In a commercial negotiation,a procurement professional believe that the larger the order quantity from buyer, the lower the supplier's average costs. Is this assumption true?
Answer: C
Explanation:
In some markets, suppliers experience peaks and troughs in demand and so buyers can increase their leverage through developing an understanding of how busy their vendor are at particular time during the year or business cycle and targetting atquieter period. Similarly, if a buyer can develop an understanding of supplier capacity and to what extent have they covered their fixed cost, they may be able to target suppliers when their average costs are likely to be lowest. Vendor's average costs will be higher at low and high capacity utilisation.
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NEW QUESTION # 345
XYZ Ltd needs to purchase a bundle of IT products from suppliers. The procurement manager requests details of costs regarding designing and managing those products. After receiving reports from suppliers, she realises that they have charged up to a 1,095% mark-up on IT products. In order to ensure value for money, which of the following should be a priority pricing arrangement of the procurement manager in the negotiation with these IT suppliers?
Answer: B
Explanation:
:
In the scenario, the main cost driver is suppliers' mark-up. The priority should be limit the margin to be added.
XYZ Ltd can agree "cost plus" contracts with their suppliers to ensure no IT product purchased exceeds an agreed maximum margin level. Procurement teams can use their benchmarking tools to police these contracts.
Cost plus contracts are agreements where the contractor's pricing is based on itemising allowable costs and then adding an agreed margin.
Market penetration pricing - pricing low to win a large share of the market Market skimming - pricing a new product high in order to make a large profit from the purchases by initial customers. This is an effective strategy only in the absence of competition.When competition appears, market skimmers usually drop their prices Premium pricing - usually pricing high because the market is prepared to pay extra for the kudos associated with the product, thanks to, say, a reputation for quality, or a highly fashionable brand name, and so on
NEW QUESTION # 346
Jasmine and the IHL sales team have a negotiation scheduled with one of AB's lead buyers, Samuel, at AB's premises. This is one of the biggest negotiations that Jasmine has been involved in and is eager not to make any mistakes. Jasmine has heard from a colleague that Samuel tends to adopt an integrative negotiation style.
IHL senior management decides to send a team of three members to the negotiation. Jasmine is among the team and she is assigned to check body language, reactions, feeds insight to her leader and to record important comments and information from the meeting for minutes. Which of the following are roles of Jasmine in the forthcoming negotiation? Select TWO that apply.
Answer: D,E
Explanation:
A negotiating team can be as few as two people, and one person can play one or more of these roles:
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As from the scenario, Jasmine will act as an observer and a scribe (or secretary).
NEW QUESTION # 347
Which of the following are signs indicating that the trust between buyer and supplier has improved? Select TWO that apply.
Answer: A,B
Explanation:
Explanation
Signs of trust in business relationships
* Mutually agreed and managed objectives
* Sharing information
* Managing conflict through joint problem solving
* On time delivery of products and services
* High-performance teams that feel empowered to get the job done
* Supplier welcomes opportunity to innovate
* Both parties share ideas and insight
* Clear criteria for decision making
LO 1, AC 1.4
NEW QUESTION # 348
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