Features and general aspects of the Negotiation
Issues Get the contract Set the price per unit for the headlamps
Parties 1. Mapletech (primary) 2. Yazawa (primary)
Nature of relationships: One time relationship between Mapletech and Wasuzu One time deal between Mapletech and Yazawa
All the relationships are in the same level of hierarchy given that they are all (or will be) business partners.
BATNA’s, Reservation Values and Aspiration Values
MapleTech BATNA: Waste the extra capacity and continue to earn CAN$4.8 million. This BATNA also excludes the extra spending to modify the production line. Reservation Value: $10 per unit Aspiration Value: $30 per unit
Yazawa BATNA: Get agreement with Japanese rival company. Reservation Value: unknown (price per unit that rival company is offering) Aspiration Value: unknown (price per unit of rival - $1)
Other features of the negotiation
Are contracts binding? Yes, Yazawa has a contract with Wazusu that has to fulfill. And Mapletech will sign one with Yazawa if the deal is reach where will be specified that Mapletech can only provide 60,000 units.
Is there a linkage? The negotiation will have an effect on the relationship between Yazawa and Wazusu. It will also affect the business relation between Yazawa and the Japanese company that was or will provide the headlamps.
Costs and benefits to delay There isn’t a possibility of delaying the negotiation, therefore, the cost of delaying would be to lose the deal.
Uncertainty The price that is given to Yazawa from the Japanese firm is unknown. That derives in an also unknown reservation and aspiration price, hence a undefined
