Nego Part II: From Plans to Playbook
- Pauwel Nuytemans
- 4 minuten geleden
- 7 minuten om te lezen
In Part I, we covered the groundwork of negotiation: building a solid internal plan, selling your vision in the business review, and setting the stage for commercial alignment. The better you sell upfront, the easier the negotiation will be later on.
In this second part, we move into the actual preparation of your negotiation meetings. This is where deals are made or lost.
We will walk through:
What you want to change in the current collaboration
The right financial framework to hit your targets
Scenario planning and action design
And one reminder upfront: selling and negotiating are not the same thing. Once you walk into your first negotiation meeting, the selling should already be done. Continuing to sell during negotiation makes you look uncertain. It weakens your position. Sell early. Negotiate with intent.
Learn from past negotiations
Negotiation prep should always start with a look in the rear-view mirror. People are creatures of habit. They often repeat behaviour unless context dramatically changes.
You need proper documentation to do this well. Not vague notes. Real summaries of how negotiations unfolded in the past years. Ideally, you go back three years to spot patterns.
Ask yourself:
How many meetings did it take to close a deal?
When did the breakthrough happen?
What were the key demands?
What threats were made?
What counteroffers came through, and when?
How much did you invest to land the deal?
This retrospective helps you anticipate behaviour and build your offer roadmap accordingly. But be smart: not everything repeats. Your plan may be stronger or weaker. People on the other side may have changed. Competitive dynamics may have shifted. Past patterns should inform you, not dictate you.
Draft & Structure your Negotiation Variables
Negotiations look different by retailer. Steve Gates’ “Negotiation Clockface” (The Negotiation Book, 2015) captures the contrast perfectly (Exhibit 1). On the right side: competitive negotiations, where value is fixed and both parties fight over a split. On the right side, power dominates. Brand strength matters, alternatives matter, the conversation concentrates on price, and trust is low.
Traders and hard discounters often live here. In your business reviews ahead of time, you should have positioned strength clearly to improve your power at the table, then in the negotiation you keep your message tight and you do not drift back into selling.
On the left side you aim to expand the pie. There is more complexity because you bring multiple variables into play, there is also more interdependence, both parties need each other in the long term. Taking advantage of your partner today will cost you tomorrow, mistrust destroys value over time.
Positioning still matters, you want to be chosen as a preferred partner, yet the focus shifts to joint plans, solving the customer’s problems, and designing win-wins. Sometimes you accept an ask that is not perfect for you, provided it stays reasonable and earns you something more valuable in return.
Start with a full review of your current agreements: both formal (contractual) and informal. Break them into three categories:
Commercial: listing fees, folder fees, promotional funding, retail media, bonuses, assortment clauses and all other types of formal or informal commercial agreements
Financial: payment terms, invoice discounts, off-invoice schedules, deductions, etc.
Logistics: service level targets, full truck ordering, returns, etc.
Now ask yourself: what doesn’t work for us anymore? What should change?
From that list, select a handful of items to tackle this year. Highlight one or two critical breakpoints and a few “nice to haves.” For each variable, assess the potential impact for both parties: cost, benefit, perception.
Then shift perspective. What do you expect your customer to ask for? New retail media investments? Bigger promotional budgets? Assortment exclusivities? Map them out.
Think early about potential trades across the two lists. Be flexible. Know which variables are most valuable to you and least costly to them, and vice versa. We call this the perceived value matrix.
Set Your Negotiation Principles
Before entering the room, define your ground rules. These are your negotiation principles: a clear set of do’s and don’ts that will guide every discussion.
Some are non-negotiable:
“We only invest in return for clear counterparts.”
“Price increases take effect as of 1 January.”
“No lump sums on declining businesses.”
“Exclusive promotions must be co-funded.”
Mark which ones are non-negotiable and which ones can be traded for something valuable. Keep the list short, precise, and enforceable. These principles will give you direction and help maintain consistency across sessions.
Build a Flexible Financial Framework
Going in without a financial ambition is reckless, going in with a rigid price only framework is safer yet often suboptimal. The first approach leaves you spending money, you will not know when to stop, the other party will not feel your constraint, and they will keep pushing. A rigid framework beats that, but it can leave money on the table and can prevent smart trades that create volume and profit.
At Falcon, we advocate for flexible but anchored financial planning. You start with a clear USG (Turnover) target and then define your mix of volume (UVG) and pricing (UPG).
Set a negotiated USG target, for example +4% (Exhibit 2)
Split it into a provisional UVG target (example +2%) and a provisional UPG target (+2%).
Add a minimum UPG (ex: +1%) to protect the p&l against cost increases and new investments.
Targets 1 & 3 are leading. The intent is simple. You allow movement between UVG and UPG, so that sales can use counterparts to drive additional profitable volume and still reach the total USG. It’s important to keep mix management in mind.
If you over-invest in a category that contributes overfaire share to your margin, you might lose UPG, but you’ll drive additional profit through volume for the total company. You’ll be maximizing volume growth without necessarily sacrificing profit. That’s why it’s so important to understand both topline and bottom-line return of each item in your business plan.
There is also a reverse message that helps you avoid unnecessary spending. In a rigid system, someone with a UPG target of +2%, will often invest until that breakpoint, even when the plan is weak. If you get a thin plan, push for more UPG to compensate, otherwise you start the year behind and spend the rest of the year trying to close the gap.
This approach isn’t without any risk and can be hard to execute. Important watchouts:
Internally, minimum UPG can become a lazy fallback. Guard against that.
External commitments beyond your mandate can become irreversible.
Third, we all tend to overestimate counterpart value. Business cases are optimistic by nature, actual deliveries are usually lower
Use these plays only where there is enough trust and later in the process when additional counterparts are partially on the table. For right side negotiations, stick to the strict framework.
When you are assessing your UPG, don’t be rigid either. UPG is more than just your list price change. If your pricing target is +2 percent, you could get there with a straight price hike. Or you could keep prices flat, but remove a costly contract element, delivering the same P&L uplift. Alternatively, you could go higher on price but offset it with better payment terms or incremental bonuses. It’s not about one number. It’s about total deal value.
Map Your Action Plan
With your financial and variable plans in place, start working on your negotiation scenarios. Build:
One base case: the most likely outcome
One stretch scenario: where you exceed targets through strong business alignment
One worst case: where talks escalate or stall, and you need to weigh retaliation. Decide where you are willing to go, and where you will walk away.
For each scenario, map out:
The expected number of meetings will determine your investment rhythm (start big, step down gradually) and give-takes phased across offers. Use the perceived value matrix to phase your concessions. Be smart, delay giving items that they value highly.
How each proposal translates in terms of value for customer (Exhibit 3). You can share this with every offer you make. Do the same exercise for your internal P&L.
Potential cost of retaliation for worst case scenario. Major clashes mainly occur in inflationary periods, where both sides feel constrained and less able to compromise. In normal conditions, retaliation economics are usually disappointing. Check the numbers rather than your pride, many blow ups are ego driven and destroy value that you cannot easily earn back.
Negotiation requires adaptability, finesse, getting inside the head of your counterpart. Sometimes you accelerate followed by standing on the brakes, sometimes you lead, sometimes you respond. In low trust settings, you may need to take initiative to break a stalemate, yet do it with small, deliberate steps that invite a reciprocal move.
Make sure you have an easy but strong tool to quickly document and analyze each offer and counteroffer with a translation into your UVG, UPG, and USG (Exhibit 4). This living file becomes your anchor when pressure rises.
Your First Meeting
When you walk into your first negotiation meeting, you should have a simple deck with:
Opening Offer: Your gross price increase, plus any initial asks (for example, payment terms). Give context. Example: “Assortment support has dropped year over year despite heavy investments. This is why we are adjusting our assortment discount.” Ideally, this should not be a surprise. You should have preconditioned them throughout the year.
Negotiation Principles: State your rules of engagement clearly.
Planning: Meeting cadence, timelines, and structure.
Avoid discussions on material inflation. You are not selling anymore. Shift the conversation to value and structure. Keep repeating yourself. A general statement suffices: “We are both facing structural cost increases, and 2026 will be no exception. A price increase is required. We approach this negotiation in a spirit of collaboration, aiming to focus on joint value creation.”
And one golden rule: do not come in with an investment proposal. Let them make the first move.
By now, you are fully equipped to enter your negotiation with clarity and control. Will things go exactly as planned? Never. But with proper preparation, you will be quicker to adapt, firmer in your position, and sharper in your response.
At Falcon Consulting, we have hands-on experience in both executing and leading negotiations from a commercial and a financial perspective. We use proven negotiation tools to capture every step in the negotiation and how it impacts both your and your customers’ P&L.
We believe that dealmaking goes way beyond tactics at the negotiation table. A successful negotiation is blending several very different skillsets: strong analytical and financial acumen, human psychology and behavior, risk taking, commercial flair and much more.
If you want to strengthen your negotiation preparation or are looking for support throughout the negotiation process, reach out:
