Vantage Partners Customer-Supplier Negotiation Study

The Vantage Partners Customer-Supplier Negotiation Study is a global benchmarking study comprising more than 500 survey responses from individuals representing more than 300 companies, plus interviews and case-study analysis. The study explores and analyzes key aspects of customer-supplier negotiation in practice, including:

• Negotiation outcomes
• The negotiation process
• Collaborative versus adversarial approaches to negotiation
• Negotiation best practices
• Buy-side best practices
• Sell-side best practices
• Buy-side and sell-side negotiation priorities
• Role of Procurement

Based on these Study findings, customer-supplier negotiations have formalized and evolved significantly since Vantage’s landmark 2009 Customer-Supplier Negotiation Study. Perceptions of value delivered and received have improved; however, significant value erosion is still reported. 25% (buy-side) and 7% (sell-side) report improvement in potential value realized/delivered since 2009.

A total of 271 buy-side respondents and 259 sell-side respondents participated in the current study—approximately 38% were executives, 38% were managers, and 24% were individual contributors. The study is further informed by interviews with respondents and case studies from Vantage Partners’ work with hundreds of clients over more than 20 years. 

Contrasting perspectives on negotiation

Common characteristics of low performers

• Believe negotiated outcomes as primarily dictated by market forces and leverage
• Assume negotiations as zero-sum and adversarial
• Approach negotiations as events rather than a process
• View negotiation as an individual skill versus organizational competency
• Focus on achieving the most favorable terms on individual deals
• Manage negotiations as tactical activities owned by commercial groups 

Common characteristics of high performers

• Believe negotiated outcomes are largely determined by strategies and tactics
• Assume value can either be created or destroyed in every negotiation
• Manage negotiations as a process, not as events
• View negotiation as an organizational competency, not only an individual skill
• Focus on maximizing deal value over time across their portfolio of negotiations
• Manage negotiations as strategic activities that require cross-functional involvement

The number of negotiations where the buy-side perceives it has more leverage than suppliers has
increased 156% since 2009.

The number of negotiations where the sell-side perceives it has more leverage than customers has
increased 104% since 2009.

For more findings and insights, download the full customer-supplier negotiation study below.