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for successful supplier negotiations fact-based discussions go a long way toward removing emotion from the negotiation process to set up a successful supplier negotiation you need three things one fact-based should costs based on your Unique Designs and Manufacturing processes two accurate materials costs and labor rates around the world and three digital models of your supplier's capabilities use the following tips and strategies to strengthen your supplier relationships and work together to reduce costs stress the importance of transparency for Mutual success sharing business information including margins and cycle times can help you and suppliers generate ideas to optimize the manufacturing process and reduce cost recognize valued suppliers partners that feel appreciated are more willing to negotiate than a vendor concerned with losing an account you can also understand your suppliers goals and identify commonalities for example each company may want to expand its presence in sustainable Manufacturing lastly make it clear you want to help your supplier succeed use your digital insights into materials and machine trade-offs to help you both cut costs and hit your profitability targets don't say you're charging us too much or your material rates are too high Instead try saying let's look at this part I want to understand the processes that build up to the final cost or I show X as the average price per pound for the stock size does this align with what you're paying the goal of the should cost negotiations is not just to reduce component cost directly but to also remove adversarial negotiations in favor of a cost reduction collaboration with suppliers learn how opera can help you optimize supplier negotiations go to operiori.com should cost analysis to get your guide to should cost analysis and negotiation