We use cookies to give you the best experience possible. By continuing we’ll assume you’re on board with our cookie policy

Positive and Negative Bargaining Zone

essay
The whole doc is available only for registered users
  • Pages: 2
  • Word count: 466
  • Category: Contract

A limited time offer! Get a custom sample essay written according to your requirements urgent 3h delivery guaranteed

Order Now

Describe and define the “positive bargaining zone” and the “negative bargaining zone.” “Negotiation is not a policy. It’s a technique. It’s something you use when it’s to your advantage, and something that you don’t use when it’s not to your advantage.” (Bolton) Although they do not always have a common ground, the structure of the bargaining process usually refers to having either an integrative or distributive task. This is how and why there are positive and negative bargaining zones and how they will influence or break a negotiation process.

The positive bargaining zone is the range that exists when the parties in a negotiation have reservation prices that permit an agreement to be achieved. This is a result of having overlapping stances on prices or other issues at hand. As an example of this, a seller posted an ad to sell a 2006 Ford Fusion. The listing price was for 5800, but there was no way the seller was willing to take less than $4550. A buyer approaches the seller and proceeds to negotiate. He is not willing to spend more than $6000 but wants to get it as minimal as possible, so he offers $5200. This was a positive bargaining zone because it was within the range that was acceptable as the seller. It was also in the range of payout by the buyer. With every positive, there is also a negative.

In negotiation, a negative bargaining zone exists when there is no overlapping range of prices or issues at stake, and this prohibits the negotiator from reaching satisfactory distributive outcomes. If we take the same car scenario as previously stated, but changed the man’s offer to $4400 firm, then we are in a negative bargaining zone. He’s not willing to go into the sellers range and the seller isn’t willing to budge on their price. In a forced situation, such as a bankruptcy, it’s also possible to have a resolution in the negative zone.

In a negotiation situation it is pretty clear that reaching a mutually beneficial agreement is however much easier when it comes to being in the positive bargaining zone range. Define the “bargaining surplus” and the “negotiator’s surplus. Bargaining surplus is the overlap between what the negotiation parties’ desires. This is how the positive and negative bargaining zones are identified and measured.

The zone overlap for the car sales is between $4500 and $6000. The negotiator’s surplus is what the other party missed out on. In our rolling example of the car sales, for the buyer, he has no surplus because the offer was accepted at their lowest amount willing to pay. For the seller, the surplus is $600 because the seller did not attempt to negotiate up on the buyers offer, they just settled.

Related Topics

We can write a custom essay

According to Your Specific Requirements

Order an essay
icon
300+
Materials Daily
icon
100,000+ Subjects
2000+ Topics
icon
Free Plagiarism
Checker
icon
All Materials
are Cataloged Well

Sorry, but copying text is forbidden on this website. If you need this or any other sample, we can send it to you via email.

By clicking "SEND", you agree to our terms of service and privacy policy. We'll occasionally send you account related and promo emails.
Sorry, but only registered users have full access

How about getting this access
immediately?

Your Answer Is Very Helpful For Us
Thank You A Lot!

logo

Emma Taylor

online

Hi there!
Would you like to get such a paper?
How about getting a customized one?

Can't find What you were Looking for?

Get access to our huge, continuously updated knowledge base

The next update will be in:
14 : 59 : 59