Working in the procurement or buying department of a company will make you come across several instances where you have to negotiate prices with a vendor or supplier. Needless to say, this is not something any of us looks forward to simply because negotiation is not easy! However, one has to do what one has to do, so let’s get into how we can make the task easy.
Negotiating over the telephone or in person can lead to conflict. So it’s best to write a negotiation letter to the person with whom you want to set a rate for something. A letter will leave little room for arguments and conflict and will prove to be an effective way of getting your point across.
Writing a rate negotiation letter is actually quite easy. You are aware of what terms the company wants you to work on so all you have to do is convince the vendor to agree to the terms. Not easy? We thought so. It’s all in how you portray your argument. To see an example, refer to the rate negotiation letter sample below:
Rate Negotiation Letter Sample
Sarah Adams
Procurement Manager
Havana Jeans
18 Thomas Avenue
Johnstown, PA 12937
Tel: (000) 210-4145
Sarah @ email . com
July 27, 2016
Ms. Jessi Faulkner
Supply Manager
The Outfitters
5 Freedom Avenue
Johnstown, PA 12121
Dear Ms. Faulkner:
Thank you for taking out the time and putting in such great effort to develop a quotation that you have sent to me, for 100,000 pieces of denim cloth. I am positive that the quality of these items is as exceptional as all others that you have delivered to us in the past.
I understand that you have invested considerable time in creating this quotation and I am appreciative of your efforts. However, the quote that you have provided is 13% higher than our budget for this particular project. While we can raise our budget by a maximum of 5%, I am afraid that the projected cost will still not be viable for us.
We have had a strong business relationship with you in the past and would like to keep it this way, as your company had never disappointed us in any area, including quality, cost and delivery timeliness. For the time being, I have stopped the procurement office to acquire further quotations as I would like to bring you on board as our supplier this time around too. For that, your quotation needs to be 9% lower than the this one.
I hope that we can come to an agreement on this so that I can place the order immediately. Anticipating a prompt and positive response from your end.
Sincerely,
(Signature)
Sarah Adams
Procurement Manager
Havana Jeans