Yunjing Trading Company, Mauritius (hereafter referred to as Yunjing Co.) Party B (Seller's Representative): Economic and...

  

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Yunjing Trading Company, Mauritius (hereafter referred to as Yunjing Co.) Party B (Seller's Representative): Economic and Commercial Counselor's Office of the Chinese Embassy in Mauritius (on behalf of the Seller, Shandong Lutai Arts and Crafts Import & Export Co., China.) Background of the Negotiation: In March 2005, Shandong Lutai Arts and Crafts Import & Export Co. (hereafter referred to as Lutai Co.) signed a contract with Mr. Li Yixin, a Chinese Mauritian businessman from Yunjing Trading Company, for 20 containers (20 feet) of porcelain dinner-ware. According to the contract, the CIF price of each container is USDS,500 and the time of delivery is between July and August 2005 with 5% more or less allowance. At the beginning of June, Ms. Wang Xiaoling form the Export Department of Lutai Arts and Crafts Import & Export Co. made delivery of 20 containers of porcelain dinner-ware in accordance with the contract. In early July, this careless lady, Ms. Wang Xiaoling found the contract in her drawer and she totally forgot that she had already delivered the goods one month ago. She could not help rejoicing that she did not delay the shipment. She then immediately informed the manufacturer to prepare the goods according to the requirements stated in the contact. And Ms. Wang immediately arranged shipment. After delivery of the second consignment, Ms Wang informed the Mauritian businessman that the goods had been delivered on time. However, what startled Ms Wang a lot was the reply from Mr. Li confirming that the company had already received the goods from Lutai Co. in July. Ms Wang then checked the documents in her files, finding that she had delivered the goods twice due to her negligence. In order to minimize the loss, she sent a fax to Mr. Li requesting him to buy the second consignment and offering a discount to Yunjing Co in the future. However, Yunjing Co. rejected the offer on the ground that with a population of only more than one million in Mauritius, it would take some time to complete the sales of the porcelain dinner-ware in such a small market. Yunjing Co. has to rent a ware- house to store the unsold goods. Moreover, the payment for the second consignment will reduce its fluid capital. Yunjing Co, indicated that they might consider to buy the second consignment with a 30% discount. Ms. Wang contacted with Economic and Commercial Counselor's Office of the Chinese Embassy in Mauritius, earnestly requesting the staff to intercede with Yunjing Co. on behalf of Lutai Co. As it will suffer a great loss if the second consignment is auctioned in Mauritius or delivered back to China, Lutai Co. is willing to give a discount. Counselor Yu, First Secretary Mr. Mao, Third Secretary Mr. Zhao and attaché Li etc. of Commercial Counselor's Office of the Chinese Embassy in Mauritius all had engaged in international trading business in China. Except attaché Li, they all have rich experiences and professional knowledge of international trade. On behalf of Shandong Lutai Arts and Crafts Import & Export Co. and in order to minimize financial loss, the Economic and Commercial Counselor's Office invited Chinese Mauritian businessman Mr. Li Yixin of Yunjing Co. for lunch and negotiation. The Economic and Commercial Counselor's Office suggested that Yunjing Co. develop the new market in the neighboring countries and offered to help Yunjing Co. to establish new customer channels and expand the market through the Economic and Commercial Counselor's Offices of the Chinese Embassy in Madagascar and other neighboring countries. Hence both sides agreed to negotiate on how to solve the problem of the duplicate delivery of porcelain dinner-ware. Tips for the Two Parties: This is a negotiation beyond the original contract in an export business due to the mistake made by Lutai Co. The negotiation may lead to the modification of the original contract or to form a new agreement. Negotiators involved shall understand the relevant technical terms in foreign trade business and the operation process. Unexpected problems do occur in trading business and to deal with the problems, it is necessary for negotiators to make effective communication and seek mutually acceptable solutions of solving the problems. These are the basic skills a negotiator should master. Time and Place for negotiation: By the end of July 2005; at the Economic and Commercial Counselor's Office of the Chinese Embassy in Mauritius, Belle Rose, Rose Hill IV. Complete the formulation of the negotiation plan as following: Analysis of interests, advantages and disadvantages of both parties Our party's: Opposite party's: Negotiation objectives Highest objectives: Acceptable objectives: Minimal objectives: Yunjing Trading Company, Mauritius (hereafter referred to as Yunjing Co.) Party B (Seller's Representative): Economic and Commercial Counselor's Office of the Chinese Embassy in Mauritius (on behalf of the Seller, Shandong Lutai Arts and Crafts Import & Export Co., China.) Background of the Negotiation: In March 2005, Shandong Lutai Arts and Crafts Import & Export Co. (hereafter referred to as Lutai Co.) signed a contract with Mr. Li Yixin, a Chinese Mauritian businessman from Yunjing Trading Company, for 20 containers (20 feet) of porcelain dinner-ware. According to the contract, the CIF price of each container is USDS,500 and the time of delivery is between July and August 2005 with 5% more or less allowance. At the beginning of June, Ms. Wang Xiaoling form the Export Department of Lutai Arts and Crafts Import & Export Co. made delivery of 20 containers of porcelain dinner-ware in accordance with the contract. In early July, this careless lady, Ms. Wang Xiaoling found the contract in her drawer and she totally forgot that she had already delivered the goods one month ago. She could not help rejoicing that she did not delay the shipment. She then immediately informed the manufacturer to prepare the goods according to the requirements stated in the contact. And Ms. Wang immediately arranged shipment. After delivery of the second consignment, Ms Wang informed the Mauritian businessman that the goods had been delivered on time. However, what startled Ms Wang a lot was the reply from Mr. Li confirming that the company had already received the goods from Lutai Co. in July. Ms Wang then checked the documents in her files, finding that she had delivered the goods twice due to her negligence. In order to minimize the loss, she sent a fax to Mr. Li requesting him to buy the second consignment and offering a discount to Yunjing Co in the future. However, Yunjing Co. rejected the offer on the ground that with a population of only more than one million in Mauritius, it would take some time to complete the sales of the porcelain dinner-ware in such a small market. Yunjing Co. has to rent a ware- house to store the unsold goods. Moreover, the payment for the second consignment will reduce its fluid capital. Yunjing Co, indicated that they might consider to buy the second consignment with a 30% discount. Ms. Wang contacted with Economic and Commercial Counselor's Office of the Chinese Embassy in Mauritius, earnestly requesting the staff to intercede with Yunjing Co. on behalf of Lutai Co. As it will suffer a great loss if the second consignment is auctioned in Mauritius or delivered back to China, Lutai Co. is willing to give a discount. Counselor Yu, First Secretary Mr. Mao, Third Secretary Mr. Zhao and attaché Li etc. of Commercial Counselor's Office of the Chinese Embassy in Mauritius all had engaged in international trading business in China. Except attaché Li, they all have rich experiences and professional knowledge of international trade. On behalf of Shandong Lutai Arts and Crafts Import & Export Co. and in order to minimize financial loss, the Economic and Commercial Counselor's Office invited Chinese Mauritian businessman Mr. Li Yixin of Yunjing Co. for lunch and negotiation. The Economic and Commercial Counselor's Office suggested that Yunjing Co. develop the new market in the neighboring countries and offered to help Yunjing Co. to establish new customer channels and expand the market through the Economic and Commercial Counselor's Offices of the Chinese Embassy in Madagascar and other neighboring countries. Hence both sides agreed to negotiate on how to solve the problem of the duplicate delivery of porcelain dinner-ware. Tips for the Two Parties: This is a negotiation beyond the original contract in an export business due to the mistake made by Lutai Co. The negotiation may lead to the modification of the original contract or to form a new agreement. Negotiators involved shall understand the relevant technical terms in foreign trade business and the operation process. Unexpected problems do occur in trading business and to deal with the problems, it is necessary for negotiators to make effective communication and seek mutually acceptable solutions of solving the problems. These are the basic skills a negotiator should master. Time and Place for negotiation: By the end of July 2005; at the Economic and Commercial Counselor's Office of the Chinese Embassy in Mauritius, Belle Rose, Rose Hill IV. Complete the formulation of the negotiation plan as following: Analysis of interests, advantages and disadvantages of both parties Our party's: Opposite party's: Negotiation objectives Highest objectives: Acceptable objectives: Minimal objectives:

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