Introduction International Business Negotiations Introduction u Background u

Introduction International Business Negotiations

Introduction u Background u Fair Exchange u Historical Background u International Negotiations – Features – Complexities – Roles – Principles

Background From earliest times, people have met to exchange things and asked: u Will you exchange? u What will you give me for my item? or u What do you want for your item?

What is a fair exchange? u One tiger skin=meat from three deer? u Beads and blankets for land – Early European settlers and American Indians u $1 million for a painting by Picasso

Trade was complicated u Buy in China, sell in England. Pay transport costs, taxes in different currencies: – By – By road over the Silk Road sea to Baghdad road to Damascus sea to Genoa road to Bordeaux sea to London

Best deals u Buyer and seller at each stage of the trade route will each want the best deal possible. u May use persuasion, trickery or other means to win. u The rules help make trade possible, and forms the features of international business negotiations.

Features of International Business Negotiations u Value of the goods to be purchased u Where purchase takes place u Costs of transport and taxes u Which currency to use u Where sale will take place u Price of selling on arrival u Guarantee of performance

International Business Negotiations u Require understanding between two parties of different nationalities and cultures u Set the basis for future business which benefits both sides u Creates trust between the parties

Roles of International Business negotiations u Negotiations have explicit and implicit roles: – Explicit u Substance of the negotiations – Implicit u Develop understandings u Foundation for future cooperation u Reducing misunderstanding and fear

Principles The features and roles of international business negotiations have been observed so as to improve the outcomes. u Negotiations between two parties can end up with: u – Two satisfied parties or – One very satisfied and one not so satisfied party or – Two very dissatisfied parties

This book u Purpose is to introduce the rudiments of negotiations. u The book is there to help improve but can never replace experience.