In the Restaurant

Carl RITCHIE: I was surprised that day to see you accept my price offer so quickly. I certainly found you to be more combative from then on.

Margaret PEAKE: Perhaps that was no coincidence.

Carl RITCHIE (suddenly worried): What do you mean?

Margaret PEAKE: Can I be frank with you? Despite those negotiations apparently concluding satisfactorily, that day you made three mistakes that proved very costly in the long term.

Carl RITCHIE: What were they?

Margaret PEAKE: First, and most immediately, you started by giving ground slowly, from 4% to 5%, but then you leapt very quickly from 5% to 7.5%.

Carl RITCHIE: You got the impression that you could obtain other benefits?

Margaret PEAKE: Yes, you would have done better to go from 4% to 7% and then from 7% to 7.5%, which would have given me the impression that I was putting just the right amount of pressure on you.

Carl RITCHIE: And my second mistake?

Margaret PEAKE: “Splitting the difference.” That mistake had more serious consequences, as I realized that your 7.5% discount was quite arbitrary and that, with you, the more I demanded, the more I would get.

Carl RITCHIE (a little hurt): And my third mistake?

Margaret PEAKE (uncomfortable): I’m not sure that I should discuss that.

Carl RITCHIE: Please, no need to spare my feelings.

Margaret PEAKE: Well, that was the most worrying thing for your company. Under pressure, you agreed to reduce the price of your new product and got caught in a trap that condemned you to put a long-term strain on the profitability of the business you did with us.

Carl RITCHIE: What should I have done?

Margaret PEAKE: Give as little ground as possible, as slowly as possible, but above all give ground where it causes you the least possible long-term danger: for example, an extra discount on the BB52, which was due to be withdrawn from the market a few months later.

Carl RITCHIE: Or maybe concessions that would have been less costly than discounts.

Margaret PEAKE: Indeed, such as extra services.

Carl RITCHIE: Or a quicker turnaround on deliveries.

Margaret PEAKE: In short, you should have given ground gradually.