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Shalini, a recent MBA graduate, works for a company which represents clients who are interested in either buying or selling businesses. As a “business broker,” her job is to arrange such sales.
Abhishek Singh, a retired college professor, contacts Shalini’s company to arrange for the purchase of a large retail outlet. He has recently formed a nonprofit corporation to aid troubled youths and wants to convert the building into a recreation and rehabilitation center.
Shalini’s supervisor, Akram, has assigned her the task of negotiating a deal for Abhishek’s organization. Some of the hardware at the outlet are in poor condition and would require INR 20 Lacs to repair. Abhishek intends to remove them in any event. The seller is asking for a INR 80 Lac down payment on a INR 3 Crore sale. Abhishek’s organization can only raise INR 60 Lacs.
After studying the situation, Akram is convinced that if the seller can be led to believe that repairing the hardware is important to Abhishek, the down payment request would be reduced to INR 60 Lacs and the asking price to INR 2.8 Crores. Akram therefore instructs Shalini to mislead the seller.
Discuss Shalini’s future course of action.
Hello everyone!
Analysing the case shows us that Shalini, the MBA graduate has got two options/alternatives ahead of her. Either she can give in to her supervisor Akram’s wish and mislead the seller by making him believe the necessity to repair the hardware and possibly resulting in Abhishek getting a better deal(no confirmation of getting a better one).The other path she can choose is to combine her MBA education and negotiating skills as a business broker to convince both Akram (for choosing the ethical way around and not misleading the seller) and the seller in terms of bargaining with him and trying to convince him for a better deal.
So lets discuss/analyze on these fronts and reach a consensus.
After points-
For making the seller agree to a better deal she can bring into play many negotiating tactics like- Compromising around shared interests (Maybe decreasing the downpayment amount), Bringing good-cause factor (the outlet would be transformed as a rehabilitation centre), Telling the seller about the getting a better deal in same amount somewhere else, etc.
As Shalini is a recent MBA graduate,she must follow business ethics and not opt for the alternative of misleading the seller.Since Abhishek intends to remove the hardware,misleading the seller to invest money in repairing the hardware and thus decreasing the downpayment and asking price would not be ethically correct.It shows that the brokers just want to close the deal and get the job done.A business broker understands the sales negotiation process, as well as tactics for marketing the business.Shalini surely has better ways to close the deal.During the early stages, when the seller is still considering making an offer she can negotiate with him for the downpayment and asking price.Since Abhishek has contacted Shalini’s company to arrange for the purchase of an outlet,they owe loyalty towards Abhishek in getting the best deal for him in an affordable price of around 60 lacs.As Prabhat mentioned,the seller can be convinced by incorporating the good-cause factor and even then if the seller does not agree with decreasing the downpayment, then the best negotiating weapon is to have options available.
Hello friends. The situation in front of shalini is tricky but it is not that it cannot be solved. She cannot resort to solution given by akram basically for 2 reasons. First, it is unethical, and second, she is a business broker whose job is to negotiate. She should talk to akram and explain him confidently that she can get the price reduced, but misleading is not going to be a part of it because the cause it itself too pure. She can talk to the client and explain the good cause for which it will be utilized and how many people will get help because of that. Since a professor is doing it, who has vast knowledge,so it can be said that it has been well researched. She should ask the clients to be a part of this philanthropic act and help not only Abhishek but also the troubled youth.
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