United Food CompanyNEGOTIATION DILEMMAUnited Food Company specializes in producing and packaging large range of food products, and
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United Food CompanyNEGOTIATION DILEMMAUnited Food Company specializes in producing and packaging large range of food products, and because of increased demand on the companys products, the company decided to make considerable expansion in production lines.A team of technical people specified the quality specs for required expansion and proposed a few wellknown suppliers to Mr Ahmed the purchasing manager who oversees negotiation with suppliers regarding commercial aspects. As a result of the dramatic increase in prices during the past years, Mrs Malak the finance manager asked Mr Ahmed to employ all ethical and unethical negotiation techniques to accommodate expansions cost with the approved investment budget set two years before.Therefore, Mr Ahmed invited vendors to submit their bids. Unfortunately, the lowest bid exceeded the investment budget by ; in addition, all bidders stipulated an increase in price of after months from striking the contract to cover the remaining period of the contract.On his part, Mr Ahmed opted to negotiate with the lowest all on cost bidder, Mr Latif, the marketing manager of the vendors company to negotiate the deal. Mr latif, who is in contrary to his superb technical expertise, he was commercially modest.After almost an hour of negotiation Mr latif agreed to reduce the total cost of his bid from $ to fixed $ without any changes in specs, or lead time or delivery time, and consequently, a contract was made, and a purchase order was issued, and a check of down payment were handed over to Mr latif.After weeks Mr Maher the production manager of the united food company called Mr Latif to discuss some technical issues, after many calls, Mr latif finally answered saying, the top manager rejected the contract, and he claimed that fixed price is applicable only to deals that do not exceed $ The production manager informed Mr Ahmed of what happened, who in turn called Mr Sayed, Mr Latifs boss who repeated what was said by Mr Latif in addition, he stressed that we would not agree on a losing deal like this.Questions: Who is responsible for the unethical practices? And why? And who behaved in an irresponsible manner? If you were Mr Latif whose deal was rejected by top management what would be your reaction? If you were Mr Ahmed, would you renegotiate with Mr Latif to get a solution to this dilemma? Assume that you have decided to renegotiate with latif and you set your negotiating range between to and an increase in price of after months from striking the contract. What are the various options available to taper off concessions? And what is the best option? How the following negotiation techniques be applied in this case.a The red herring.b Good guys bad guys.c The deliberate mistakes.d Interests outweigh principals or positions.e Tapering off concessions.f Others Mention.
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