The process of negotiating and signing foreign trade contracts
Signing and signing a foreign trade agreement is a process in which parties negotiate common interests and points of disagreement, to reach agreement.
Pictures are illustrative
The negotiation process: 2 steps
Issue issues to exchange
-change to find solution
Principles in negotiation:
Define negotiation and negotiation goals
-Make carefully content
Negotiating, negotiating in the spirit of mutual understanding, mutual benefit
-Give to know and receive in the negotiation process. Define the limit.
-Create and develop business relationships
Negotiating foreign trade contracts includes the following phases:
End Phase - Signing contract
Risks can arise in all stages of the negotiation process
Risks can occur in this process
-Lack of information:
+ The cultural, political - legal environment
- Weak profession: Participants in the negotiation are not equipped with sufficient knowledge of foreign trade
- Weak language: weak foreign language proficiency, depending on the interpreter
- Not fully know about the goods: quality, specifications, packaging, warranty ...
- Negotiation skills, communication skills: too tough or unsteady in the negotiation
Precaution: Care must be taken in all aspects
-Language: It is best if the negotiator should be fluent in the partner's language or use an interpreter
Where to use translators should:
-Presentation of content for the interpreter
-Say and slow
- Do not use local dialect or slang
-Time of 1 to 2 minutes
Allow the translator time to understand the meaning
Try to use single sentences
Add gesture gestures during speech
-When looking straight partner
- Do not negotiate more than 2 hours of piles. If extended, use 2 translators, ...
1. Goods: learn thoroughly about the merchandise, physical and chemical properties of the product, ... as well as the market requirements for that product such as quality, packaging ...
Firmly aware of the production of such products by partners such as seasonal, raw materials, skilled workers
The life cycle (cycle) of the product
Prices of competing companies
Situation of foreign exchange rate
2. Market information
- Brief information on the country, people, political situation, culture of the partner
-Basic economic information
-Foreign trade policy
-Bank, credit system
- Conditions of transport, the situation of freight rates
- Relevant information about your main product in the partner market
3. Learn partners
- Partner strength
- Needs and intentions of partners
Force the partner to attend
In addition, the negotiating officer needs to master
-Information about the company itself
- Competitive information at home and abroad
Predict the trend of price fluctuations
4. Prepare capacity
Prepare competencies for negotiators:
- Knowledge: a good negotiator and a trader, lawyer, diplomat, psychologist, good at language and knowledge of cultural techniques.
- Have good negotiation skills: be able to put yourself in the perspective of others, express the idea of precision, persuasion and sensitivity to feel good.
Good communication skills: listening, asking questions, presentations, mail transactions, and regular trading skills.
Organization of the delegation: the composition of the delegation must meet the experts of all three areas: law, technology and trade. In which the trade is most important, usually the trade expert is the head of the delegation.
-Time and place:
Time depends on mutual agreement
Place must ensure comfortable psychology and appropriate means
Contact stage: create contact air, explore partners, revise plan (if needed)
To do well, we need to do:
-Things are good
- Exploit information to mutual understanding
Enter a good subject: convey the desired information to the partner, create a good contact atmosphere and explore the location of the partner.
Exploit information to get to know each other. Including:
-Check what has been done
- Revise the plan if needed
Stage of negotiation:
-Provide inquiries and listen to partners presenting their requirements
-Receive and make concessions
- Breaking the deadlock: can unilaterally break or borrow the third party
- Turns out the deal: This stage is very delicate so the negotiator needs to be very calm, focused, using the techniques to reach the best possible deal.
Finishing stage - signing contract
- Agreed to agree on all terms before signing the contract
- To discuss legal grounds and related issues, avoid using commercial practices to resolve disputes
- Not illegal
- Clear, accurate language
- Check, thoroughly compare the terms agreed before signing
- The contractor must be a competent person
- The language of the contract must be the language of the parties being fluent
- Be prepared thoroughly all aspects, imaginable problems to think out
-Follow the steps in the negotiation process
+ Drawing experience