How you can negotiate with supplier about the less price if he has best quality in town?

The first question you got to ask yourself is: Do you really need this kind of quality?

Is this quality "covered" by your company's profile and the markup you have? 

If no, then suggest your target price and negotiate with no stress.

If yes, then negotiate in accordance to your annual required quantity and analyse supplier's turnover to do so.

If your required quantity ain't enough to negotiate efficiently, then unfortunately you have to play with your supplier's rules and to work instantly and in tense within the next year, to create competition, providing specifications to other suppliers.

Simple!

PS: You can always source outside of the town or country.

This is very nice question indeed.

If the supplier has already quoted the rate in his offer, further negotiation to reduce the price is possible only when the purchaser has been authorized by the Management or Procurement committee to negotiate the prices.

 

Negotiation process:

The Purchaser shall talk to the supplier over phone and emphasize on the following:

1.  You are representing such and such Company which is well known and has a good reputation in the market as a purchaser.

2.  Emphasize transparency, integrity and fairness in the procurement process. (no underhand dealing)

3.  Emphasize that no one from your company will harass the supplier unnecessarily.

4.  Emphasize that you treat the supplier as business partner this would be a good opportunity to work together. 

5.  Emphasize that the supplier’s bill will be paid quickly as per terms and conditions of bid document

Its not always about the best Quality. If your company can work on an average quality and will maximize savings then procure average quality. If you are looking for the best quality, it is better to order directly from the manufacturer. They can give you the best possible price as they dont need to put a big mark up on their price

Well this sounds to be monopolistic situation where the quality offered by a supplier is unmatchable. So in this case i will suggesst to negotiate for annual bulk quantity ordering.In this way you will be able to negotiate for a better price and will cover yourself for out of stock situation.On the other hand , always search for the alternatives as any new vendor will likely to give competition to the existing one.

First show to the seller that you are the right person to negotiate and can assure to award the order Try to negotiate with him by telling him that average quality is approved but you want to help each other by supporting each other not losing the order Asking for project discount of 5% is not very hard to get. Usually i'm experiencing the same scenario from Companies in Europe and America which are quoting final price Unlike in GCC always playing the price with each other

it is depinding on what the quality we need and the budget we have ... strong negotiation and he should know he is not the only one in world

You order large quantity and reduce the credit period for payment.

If you can use average quality of material for your product then why we negotiate with supplier which have best quality,

improved quality will increase product cost if you are not quality concious. find other suppliers in town to fulfill your requirement.

 If He is the only single source then negotiations can be.

1. buy in bulk to avial discounts.

2. build business relations

3. offer payment terms which he like.

4. by realizing him you are the best customer for him

5. if he is manufacturer then we will ask for the price of stockist.

6. we can done agreements for future projects

First of all you have to decide that, you really need this kind of quality because improved quality will increase your product cost. If yes, then you have to assure supplier that you are the right person to finalize this deal. To get maximum discount you should represent your company reputation /project quantity / transparency, integrity and fairness in the procurement process /advantage of opportunity / supply source etc. 

we have to give him confidence of long business association and in the best interest of business , definitely supplier will give best price. 

Depends on many things, mainly on what business a vendor can expect from you in the future. However if your volumes are small, vendor still has to get out of the deal. I have experienced a vendor giving me extra just because I asked nicely. Payout to vendor being he wanted to do it just because he liked the way he was asked / treated. Treat people nicely and with respect and you will get more than you would treating them opposite.