Pacific Oil Case Study

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Reliant had a downturn in sales of its PVC products in the European market. They thought they could ride this out they were concerned about future obligations under the contract they had with Pacific since they had already agreed on minimum requirements. Reliant wanted contractual right to resell the product if it could not use it. Pacific main requirement was to maintain a minimum amount of sale to Reliant. Pacific wanted a long term contract for more than three years each time they went out and wanted to talk terms with Reliant. Pacific did not have a point at which they would walk away from the negations they came to agreement and conceded each time to the agreement to keep Reliant as their customer.

In the text it refers to decision making bias Pacific was worried about keeping their customer when the supply went from being tight and a surplus was on the horizon and they gave up many concessions to keep the customers they had and did what they had to not to lose customers to the competitors that would be opening in the near future. Pacific also had some overconfidence that would be able to easily sign Reliant due to the relationship that they had with the customer. Fontaine let emotions affect his negotiations throughout the process, he was worried about his job and took it as a failure if he did not succeed in keeping Reliant as a customer.

References

Lewicki, R. J., Saunders, J. W., & Barry, B. (2014). Negotiation: Readings, exercises, and cases (7th ed.). Boston: McGraw Hill Irwin.

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