How to adapt to globalization, is becoming more of a necessity, business customers are putting pressure on suppliers to adopt a global contract prices (GPC). However, before signing the contract, the suppliers have to do due diligence. Buyers can promise provider access to international markets, guaranteed production volumes and improved economies of scale and scope - but too often they fail to deliver. According to the authors, vendors must fully understand the client's global strategy and business conditions in their respective markets. They also need a solid understanding of their own strategies and local practice. What GPC will be suitable and which would be detrimental? Using data collected from interviews with global managers in various industries across four continents, the authors help suppliers navigate the terrain. Exploring why customers want to GPC, under any circumstances, contracts are likely to profit providers, and how to implement successful contracts, the authors identify training as the key to success. The more information you can gather suppliers (for example, the deviations in their own prices in different markets, the cost of customer service, exchange rates, and local regulations), the better their negotiating position. "Hide
Narayandas by Das, John A. Quelch, Gordon Schwartz Source: MIT Sloan Management Review 12 pages. Publication Date: 01 Oct 2000. Prod. #: SMR056-PDF-ENG
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