Pre-Negotiation Planning

Planning is the cornerstone of effective negotiation. As a best business practice, depending on the requirements, it is recommended that the negotiation team engage in pre-negotiation planning to ensure that all relevant issues are adequately defined.

Negotiations

Negotiation is a procedure that includes the receipt of proposals from offerors, permits bargaining, and usually affords offerors an opportunity to revise their offers before award of a contract. Bargaining is done in the sense of discussion, persuasion, alteration of initial assumptions and positions, and give-and-take. Negotiations usually include three stages:

·         Fact-finding,

·         Preliminary negotiations, and

·         Bargaining/negotiation

These stages may include some of the items listed below:

Fact Finding Stage

·         Review and discuss offeror’s proposal and results of analysis from support team.

·         Check inconsistencies between buyer and seller’s cost information.

·         Probe for rationale behind the seller’s basis of estimates for the various elements of the proposal.

·         Obtain clarification from seller concerning questions raised with respect to its proposal.

·         Identify general negotiation objectives.

·         Attempt to determine the range of negotiation position.

Preliminary Negotiation Stage

·         Critique additional data or re-pricing received form the seller.

·         Narrow the range of objectives.

·         Determine if both parties are ready to negotiate.

Bargaining/Negotiation

·          During this stage, negotiators are trying to obtain the most favorable terms.

·         Involves discussion, hard bargaining, compromise and reaching final agreement.

Negotiation Issues

Issues which might be negotiated include, but are not limited to:

·         Contract Type

·         Payment Terms

·         Terms & Conditions

·         Technical Requirements

·         Scope of Effort

·         Delivery & Schedules

·         Contract Price, and

·         Incentives

The Evaluation Team may choose to engage in negotiations with any or all of the offerors who have submitted a proposal. The Evaluation Team may request the assistance of appropriate personnel, including technical line organizations, auditing, price/cost analyst, etc., in preparing for negotiations.