Retailer Negotiation Prep

Methodology

Step 1: Stakeholder and Power Analysis

Map the negotiation landscape:

Retailer Buyer Profile:

• Decision-making authority level (category manager, DMM, VP)
• Known priorities (margin, traffic, differentiation, private label growth)
• Negotiation style (collaborative vs. positional)
• Performance metrics they are measured on (category $ growth, margin %, inventory turns)

Power Balance Assessment:

Step 2: BATNA Development

Define your walk-away position and alternatives:

Your BATNA:

• What happens if no agreement is reached?
• Alternative retailers/channels available
• Revenue at risk and timeline to replace
• Cost of no-deal (inventory, capacity, brand impact)

Retailer's BATNA (estimated):

• Can they replace your brand? With what?
• Consumer switching behavior if delisted
• Category performance impact without your brand
• Private label readiness in your segment

ZOPA (Zone of Possible Agreement):

• Your reservation point (minimum acceptable outcome)
• Estimated retailer reservation point
• Overlap range = negotiation space

Step 3: Value Creation Framework

Identify tradeable value beyond price/trade spend:

Prioritize levers with favorable trade ratios — low cost to you, high value to retailer.

Step 4: Concession Strategy

Design a planned concession sequence:

Concession Rules:

1. Never concede without getting something in return
2. Make concessions progressively smaller to signal approaching your limit
3. Start with low-cost/high-value items (from Step 3)
4. Reserve high-cost concessions for final rounds only
5. Always have a "pocket" concession ready for closing

Concession Map:

Round 1 (Opening): Offer [Value Lever A] in exchange for [Priority Ask 1]
Round 2 (Middle):  Offer [Value Lever B] in exchange for [Priority Ask 2]
Round 3 (Close):   Offer [Pocket concession] in exchange for [Final terms]

Hard No Items (non-negotiable):
- [Item 1 — reason]
- [Item 2 — reason]

Step 5: Talking Points Construction

Build structured talking points using the SPIN framework:

Situation Questions (establish common ground):

• "Your category grew X% last quarter — we see similar momentum in the channel..."
• "We understand inventory turns are a priority for the department..."

Problem Questions (surface retailer pain points):

• "We've noticed the premium segment is under-spaced relative to its growth rate..."
• "Promotional ROI in the category has been declining — we've seen similar trends..."

Implication Questions (amplify urgency):

• "If the premium segment continues under-indexed, the category risks losing shoppers to [competitor retailer]..."
• "Without corrective action, we estimate $Xm in category value is at risk over the next 12 months..."

Need-Payoff Questions (position your solution):

• "If we could demonstrate a planogram reset delivers +X% category growth, would that support a shelf expansion discussion?"
• "Our shopper data shows a loyalty program collaboration could increase basket size by $X..."

Step 6: Scenario Rehearsal

Prepare for three negotiation scenarios:

Output Specification

# Negotiation Prep — [Retailer] [Meeting Type]
**Date**: [Meeting date]
**Objective**: [Primary negotiation objective]

## Power Analysis Summary
[Net power assessment with key leverage points]

## BATNA Analysis
| | Your BATNA | Retailer's BATNA |
|---|-----------|-----------------|
| Best alternative | ... | ... |
| Cost of no-deal | $X | $Y |
| ZOPA range | [Your floor] to [Retailer floor estimate] |

## Value Creation Menu
[Prioritized list of tradeable value items with trade ratios]

## Talking Points
### Opening (Situation/Problem)
1. [Point with supporting data]
2. [Point with supporting data]

### Building Urgency (Implication)
1. [Point with quantified risk/opportunity]

### Proposing Solutions (Need-Payoff)
1. [Proposal with expected retailer benefit]

## Concession Strategy
[Sequenced concession map with hard-no items]

## Scenario Responses
[Best/Base/Worst case playbook]

## Pre-Meeting Checklist
- [ ] Materials printed/loaded
- [ ] Data verified and sourced
- [ ] Internal alignment confirmed (Sales, Finance, Marketing)
- [ ] Backup proposals prepared

Analysis Framework

Trade Spend ROI for Each Proposed Term:

Incremental Revenue from Term = Estimated Lift × Duration × ASP
Cost of Term = Direct Cost + Opportunity Cost
ROI = (Incremental Revenue − Cost) / Cost
Threshold: ROI > 2.0x for standard terms; > 3.0x for new/unproven terms

Example

Input: "Preparing for Kroger JBP. Goal: expand shelf space from 3 to 5 facings. Our brand is #2 in category with 18% share. Category grew 6% but our brand grew 12%."

Key talking point generated:

"Your snacking category delivered 6% growth in the Kroger banner this year, and our brand outpaced the category at 12%, contributing disproportionate growth per linear foot. With 18% value share on 3 facings (5% of section), our brand is significantly under-spaced relative to contribution. Our analysis shows that expanding to 5 facings would generate an estimated $X incremental weekly revenue per store based on velocity uplift seen in comparable resets at [peer retailer]. We're prepared to support the transition with a [merchandising commitment] and [exclusive Kroger SKU] to drive incremental basket trips."

Guidelines

• Ground every talking point in data — assertions without data erode credibility
• Never disparage competitors by name — focus on category opportunity
• Quantify every proposal's benefit to the retailer, not just to your brand
• Prepare for objections before they're raised — every talking point needs an "if they push back" counter
• Maintain a collaborative tone — JBP is joint value creation, not zero-sum
• Always have a "next step" proposal ready regardless of outcome

Validation Checklist

• Power analysis completed with at least 5 factors assessed
• BATNA defined for both sides with quantified cost of no-deal
• ZOPA range identified
• At least 5 value creation levers identified with trade ratios
• Concession strategy sequenced with hard-no items listed
• Talking points use SPIN framework structure
• All data points sourced and verified
• Three scenarios (best/base/worst) prepared with response strategies
• Internal alignment confirmed across Sales, Finance, Marketing