Feasibility of Kraljic’s strategies: Due to the fact that this product is a
leverage product, and because the buyer has more power, we originally
planned to exploit the supplier. At the same time, we used a strategy of
using phony facts to create the illusion that we have already purchased too
many products in order to lower the buyer's price.
Impact of info sharing and trust: The supplier did not share their costs with
us, so we were unable to accurately assess the market price. The supplier
initially provided a quote of 1200 Dollars, but due to the lower power of
the supplier in the leverage product, we continued to negotiate down to 650
Dollars. However, the supplier's fake quoting during the negotiation
process resulted in too significant a reduction in price, which could impact
trust between both parties in the future.
Ability to handle financial scenarios: If the supplier can provide the cost
price, we will use advance payment, paying 80% of the cost upfront, and
the remaining 20% after a correct inspection.
Negotiation strategies: Despite the buyer having greater power, we are still
willing to collaborate with the supplier if they offer a favorable price,
similar to the collaboration between AEM and INTEL.
Time pressure: Due to the influence of time pressure, we did not proceed
with exploiting the supplier as originally planned. Instead, we selected a
milder negotiation approach to quickly conclude the contract and transition
to negotiations for the final product.