International

BUSINESS NEGOTIATION
Vinamilk x NZMP

Group 4 Ph.D Nguyen Thi Thuy Giang

 OVERVIEW | VINAMILK
Vinamilk stands for Vietnam Dairy Products Joint Stock Company
NORTHERN
It is the largest dairy producer in Vietnam with:
HA NOI 2 Factories

40%
2 Farms
of the milk and dairy products market share in Vietnam
CENTRAL REGION

6th in the Top 10 most valuable dairy brands globally

LAOS
1 Farms
4 Factories
8 Farms

2nd among the strongest global dairy brands

UNITED STATES
SOUTHERN

250 15
1 Factory
8 Factories
4 Farms

Items in product 1 Laos CAMBODIA

dairy farms
catalog

16
1 Factory

60
Headquarters
1 AngkorMilk - Cambodia HO CHI MINH CITY

Exporting countries dairy factories 1 DriftWood - USA

 OVERVIEW | VINAMILK
MAIN STRATEGY SLOGAN
Sustainable development
focus on a harmonious connection between business
EST 1976
targets and social responsibilities
ment Marks the timeline of the appearance
mit
m of this famous dairy brand in Vietnam
co
and is a decision that needs to
le
ab

globalize the brand if it wants to

ain

expand the market internationally

in sust

5points
GOAL
Maintaining the No.1 position in
Vietnam market and aiming to reach
the Top 30 of World’s Largest Dairy
Companies in terms of revenue
 OVERVIEW | NZMP
ONE OF THE WORLD'S LEADING DAIRY EXPORTERS
NZMP stands for New Zealand Milk Products, is the ingredient brand of Fonterra based in New Zealand

Fonterra is a global dairy nutrition company owned by 9,000 farmers and their families
Fonterra exports dairy products to over 140 countries
NZMP supplies ~30% of the world's dairy ingredient trade to be the world’s largest dairy exporter
NZMP specializes in B2B dairy ingredients like milk powders, proteins, and fats, catering to manufacturers
rather than end consumers

GOAL MAIN STRATEGY

Position NZMP as a global The Fonterra Climate Commitments: NET ZERO by 2050
leader in sustainable dairy Grass-fed pasture-based systems can support a more sustainable
nutrition way of dairying
Focus on Asian markets Regenerative Agriculture - focus on improving the health and
wellbeing of our animals, waterways and soil
 OVERVIEW | REASON TO PROCURE
Milk Powder Market Major player
Market Size

2024 2029

Base year for estimation 2023

CAGR 3.86%

Fastest growing market Asia Pacific

Market Concentration Low

 OVERVIEW | PRODUCT
DESCRIPTION
H OLE M ILK OVER THE PAST MONTHS, THERE HAS
Regular Wholemilk Powder is a
W D
BEEN A CONSISTENT UPWARD TREND
soluble powder made by spray
O W ER
drying fresh pasteurised wholemilk. P
HS CODE: 04021041

PACKAGING
Multi-wall bag with a paper outer
and an inner plastic liner. No
staples or metal fasteners are used.
Net Weight: 25 kg
Gross Weight: 25.35 kg Mid of August 2024: $3,150 - $3,325/MTS
Typical Packaging Dimension: 27 September 2024: $3,375 - $3,650/MTS
90 x 53 x 14 cm
 OVERVIEW | PRODUCT
CERTIFICATES THAT NZMP OFFERS FOR WHOLE MILK POWDER

Hazard Analysis and Critical ISO 9001 ISO 14001

Control Points

Food Safety System Certification Non-GMO Certification Grass-Fed Certification

 OBJECTIVES | OVERALL

Establish a long-term, mutually Expand NZMP's market presence in

beneficial partnership with NZMP to Vietnam by securing a significant
secure a reliable and high-quality contract with VINAMILK, a leading
supply of whole milk powder. dairy company.

Strengthen VINAMILK's brand image Establish a stable and profitable

and reputation as a producer of high- long-term relationship with
quality dairy products. VINAMILK.

Enhance VINAMILK's product portfolio Leverage VINAMILK's extensive

and market competitiveness through distribution network to increase sales
the incorporation of premium NZMP of NZMP's whole milk powder in the
ingredients. Vietnamese market.
 OBJECTIVES | DETAIL

Offer competitive pricing to establish a

SHORT Purchase an initial quantity of 100
partnership with VINAMILK.
MTS of WMP to meet immediate
TERM production needs in Q4/2024
Provide the first shipment of 100 MTS of
WMP.

Be a comprehensively strategic Become the main supplier of WMP and

partnership with NZMP. other dairy ingredients for VINAMILK.
Increase annual purchase volume by Establish a dedicated sales and support
LONG 10% to meet growing market team for the Vietnamese market.
TERM demand. Explore opportunities to expand the range
Enhance product quality and of products offered to VINAMILK, such as
VINAMILK's brand reputation by using other dairy ingredients or specialty
premium ingredients from NZMP. products.
Collaborate with NZMP on shared Strengthen NZMP's brand recognition and
strategic sustainability goals to reputation in Vietnam.
promote environmentally friendly Align with VINAMILK on sustainable
practices in sourcing and production. practices to support a greener supply chain.
 KEY INTERESTS

Sell large quantities at a high price,

Have competitive pricing with a
no discounts for small orders.
PRICE discount for bulk orders.
3,550 USD/MTS CIF
3,300 USD/MTS CIF

30% T/T in advance 50% T/T in advance

PAYMENT 70% T/T after delivery 50% T/T after delivery

TIME OF 30 days after the signing of the 60 days after the signing of the
contract contract
SHIPMENT Delivery on time

OTHERS Increase product productivity

Find a stable supply source
Enhance brand presence
Expand market presence in Vietnam
 POWER BALANCE

T & LEGITIM
ER A
P T Expertise in dairy
Has expert EX
OWER E
ingredient
knowledge about P production and
dairy production
global supply chain
and the specific
management,
needs of the
offering advanced
Vietnamese
technological
market
solutions

Both companies command legitimate power through their senior executives who bring
credible and authoritative presence to negotiations, backed by strong academic and
professional backgrounds.
 POWER BALANCE

O N IN STRUC
TI T
As the leading A U As a significant
dairy company in OC
PE R SO N A RE portion of the
L L
Vietnam, it holds a & OWER world's dairy
pivotal position in P exports, NZMP has
the country's dairy a critical position in
supply chain the global dairy
market structure

Ms. Sakura
Mr. Mai Pham has
Kinomoto has the
the negotiation
negotiation
success rate: 98%
success rate: 95%
 POWER BALANCE
Largest dairy World’s largest dairy
producer in Vietnam
O RMA TION exporter
F
IN Supplies ~30% of the
40% market share in
POW ER global dairy
Vietnam
ingredient trade

6th globally among

the most valuable Focuses on B2B dairy
dairy brands ingredients

Strong in New Zealand - best

sustainability and dairy production
social responsibilities country

Both companies have strong brands and reputations, emphasizing quality and reliability,
which balances power as both aim to uphold their market images. However, if NZMP can
collaborate with Vinamilk, they can affect regional market share in Southeast Asia
 POWER BALANCE
Diverse product
Global export network
portfolio
ESOUR CE
Extensive
R OWER Diverse dairy
distribution network P ingredients

Advanced technology Community of farmers

and manufacturers

Skilled workforce
Sales Offices over the
world
Dairy farms and
factories
Skilled expertise
Export capabilities
 POWER BALANCE

Strong financial
NANC IA
results I
F OWER L International
investors
P
Projected 2024 Strong profit (2024
revenue: $2.5 billion estimate: USD 700
million)

Top purchased dairy Financial backing by

brand in Vietnam Fonterra

Leading FMCG
Access to large
brand in rural and
capital pools
urban areas
 ZOPA | DEFINITION

A ZONE OF POSSIBLE AGREEMENT

is a bargaining range in an area where two or
more negotiating parties may find common ground

CONDITION 1 CONDITION 2
A ZOPA can only exist when If negotiating parties cannot
there is some overlap between reach a ZOPA, they are in a
each party's expectations negative bargaining zone
regarding an agreement
 ZOPA | PRICE
3.200 USD/MTS CIF 3.780 USD/MTS CIF

ZOPA

3.000 USD/MTS CIF 3.620 USD/MTS CIF

 ZOPA | PAYMENT
40% TT advance 60% TT advance
60% T/T after delivery 40% T/T after delivery

ZOPA

30% TT advance 50% TT advance

70% T/T after delivery 50% T/T after delivery
 ZOPA | TIME OF SHIPMENT

45 days after the 75 days after the

signing of the contract signing of the contract

ZOPA

30 days after the 60 days after the

signing of the contract signing of the contract
 BATNA | DEFINITION

BEST ALTERNATIVE TO A NEGOTIATED AGREEMENT

represents the most attractive option available if
negotiations are not agreeable to the parties involved

IDENTIFY YOUR BATNA

1. List all alternatives if your current negotiation ends in an
impasse
based on the value of pursuing an
2. Evaluate your alternatives
alternative
that would have the highest expected
3. Select the alternative action(s)
value for you
 BATNA | PRICE

Price per unit: 3,350 USD/MTS CIF for a larger volume commitment of
2000 MTS

Price per unit: 3,000 USD/MTS with FOB, Incoterms 2020

Price per unit: 3,350 USD/MTS CIF with a Framework Contract with a
two-year contract guaranteeing price stability despite market
fluctuations

Explore partnerships with other suppliers offering competitive pricing

closer to 3,000 USD/MTS CIF in the U.S. or other markets with
comparable quality and logistical terms
 BATNA | PAYMENT

30% T/T in advance, 70% T/T against documents

30% T/T at 60 days, 60% T/T after partial delivery, 10% T/T after final
delivery

40% T/T at 15 days after Contract signing date, 40% T/T after delivery,
20% when Buyer receives Complete shipping documents and confirms
arrival of Goods at Destination Port

50% T/T advance, 50% T/T after delivery

 BATNA | TIME OF SHIPMENT

30 days after Contract signing date with price per unit 4,200 USD/ MTS

Shipment in batches: the first batch in 30 days and the balance in 60

days

30% within 30 days, 40% within 45 days, 30% within 60 days

Partial shipment with 50% per each within 45 days

 DO

GIVING AND RECEIVING

BUSINESS CARDS CORRECTLY
1 Need to pay attention to using both hands

Place them carefully in a business card

2
holder or neatly on the meeting table
 DO

BOW WHEN GREETING

 AND DON’T

GIVING AND RECEIVING

BUSINESS CARDS INCORRECTLY

Let the business card directly into your pocket

 AND DON’T

GIFTS ARE GIVEN IN QUANTITIES

OF 4 OR 9

1
2

3 4
 AND DON’T

WHEN TALKING
Cross your arms or put your hands in your pockets
 PRE-NEGOTIATION
STEP 1: PREPARATION SET OBJECTIVES

TOP OBJECTIVE TARGET OBJECTIVE BOTTOM OBJECTIVE

3,320 USD/MTS CIF 3,350 USD/MTS CIF 3,365 USD/MTS CIF
for a larger volume for a larger volume for a larger volume
commitment of 2000 MTS commitment of 2000 MTS commitment of 2000 MTS
(at Buyer’s opinion) (at Buyer’s opinion) (at Buyer’s opinion)

SET LIMITS
HIGHEST POINT LOWEST POINT
3,360 USD/MTS CIF 3,330 USD/MTS CIF
for a larger volume for a larger volume
commitment of 2000 MTS commitment of 2000 MTS
(at Buyer’s opinion) (at Buyer’s opinion)
 PRE-NEGOTIATION

OUR TIMELINE
 PRE-NEGOTIATION
STEP 2: BUILDING THE RELATIONSHIP

The process of creating trust and

understanding between partners through social
and interpersonal interactions.

Its duration and importance vary across

cultures, with some valuing long-term
connections and others focusing on efficiency.
 PRE-NEGOTIATION
STEP 2: BUILDING THE RELATIONSHIP
Before meeting
Learn about Japanese business manners
Don’t rush to make a deal Buiding trust
Prepare your business card
Instead, you talk about how your company wants a
Bring a small gift to show respect
long-term partnership.
Being on time is very important to Japanese,
You know that Japanese companies like to make
you should arrive 10 minutes early
decisions as a team, so you don’t push for a quick
answer. You should show patience and respect for
After work
their process.
After a few meetings, you should invite them to
After dinner
dinner. At dinner, you talk about personal
Send a thank-you email for the dinner and saying
things like hobbies and family.
again that you are excited to work together.
Keep in touch with regular emails to show your
commitment.
 PRE-NEGOTIATION
STEP 3: EXCHANGE INFORMATION
TASK RELATED - INFORMATION

Before negotiating, Vinamilk's director and

secretary had a meeting so that NZMP had the
opportunity to visit and exchange information
about products, prices, and international
certificates which ensure Vinamilk's reputation
in the Vietnamese market.
 PRE-NEGOTIATION
STEP 3: EXCHANGE INFORMATION 1ST OFFER
The act of making the initial proposal to the other party,
establishing a starting point for the negotiation process.

The purpose of this initial offer is to set an anchor point,

from which both parties will adjust their demands and
concessions to reach a mutual agreement.

The first offer can significantly impact the final outcome as

it sets the reference frame for subsequent discussions.
 PRE-NEGOTIATION
STEP 3: EXCHANGE INFORMATION 1ST OFFER

Have competitive pricing with a discount for bulk orders.

PRICE 3,300 USD/MTS CIF

PAYMENT 30% T/T in advance

70% T/T after delivery

TIME OF 30 days after the signing of the contract

Delivery on time
SHIPMENT
 FACE TO FACE
STEP 4: PERSUASION
It is the ability to present a unified solution in a conflicting situation, minimizing
conflicts of interest between parties to achieve the best outcome and maintain
cooperative relationships

1 HEART OF THE NEGOTIATION PROCESS

GETTING OTHERS TO SEE THINGS

2 FROM OUR PERSPECTIVE

3 NUMEROUS TACTICS USED

 FACE TO FACE
STEP 5: CONCESSIONS

An act where one party involved is willing to give up part of their initial
demands or benefits to reach an agreement with the other party.

1 AN OPENED MIND Be willing to listen, consider different views, and adjust

2 SHARED INTERESTS Focus on both conflicts and common ground

3 POSITIVE START Begin with points of agreement to set a constructive tone

No one-size-fits-all approach; adapt based on

4 FLEXIBLE STRATEGY
power, relationship, and context
 POST-NEGOTIATION
STEP 6: AGREEMENT

Final agreement

The contract is signed with the agreement of both parties

Commitment to performance

Both parties have committed to fulfilling their obligations and responsibilities

under the contract, with a formal written agreement
 POST-NEGOTIATION

OUR CONTRACT
 POST-NEGOTIATION

OUR CONTRACT
 NEGOTIATION STYLES | DEFINITION

This strategy involves yielding to the Accommodating

other party's needs and desires to (The goal is to yield)

maintain a positive relationship.

Com
It is often used when preserving the (The g
midd
relationship is more important than
the immediate outcome. Avoiding
(The goal is to delay)
 NEGOTIATION STYLES | DEFINITION

Also known as “lose-win”. Accommodating

(The goal is to yield)
This approach involves delaying or
avoiding the negotiation altogether, Comp
typically when the issue is minor, or (The go
middl
when confrontation is not desired.
Avoiding
It's useful when the costs of engaging (The goal is to delay)

outweigh the benefits.

 NEGOTIATION STYLES | DEFINITION

Collaborating Also known as a "win-win" strategy.

(The goal is find a
win-win solution)
It focuses on working together to find a
ising mutually beneficial solution that
find a
und)
satisfies both parties’ interests.

Competing It's ideal when both the relationship

(The goal is to win)
and the outcome are important.
 NEGOTIATION STYLES | DEFINITION

Collaborating This is a "win-lose" approach, where

(The goal is find a the negotiator aims to maximize their
win-win solution)
own gain, often at the expense of the
ising other party.
find a
und)
It is suitable when the outcome is
Competing critical, and the relationship is
(The goal is to win) secondary.
 NEGOTIATION STYLES | DEFINITION

Collaborating In this strategy, both parties give

(The goal is find a
win-win solution) up something to reach a middle
Compromising
ground.
(The goal is find a
middle ground) It’s used when time is limited, or
when both parties’ goals are
Competing
equally important but conflicting.
(The goal is to win)
 HOFSTEDE’S CULTURE DIMENSIONS
How much people accept unequal power
distribution.
How freely people can satisfy their
personal desires.

Whether a society values individual

achievements or group cohesion.

Whether a culture focuses on MOTIVATION

tradition or adapting for the future. TOWARDS
ACHIEVEMENT
AND SUCCESS Whether success and competition
are valued more, or care and
cooperation.

How comfortable people are with

uncertainty and change.
 VIETNAM AND JAPAN DIFFERENCES

Japan (100): Japan scores the highest, emphasizing long-term planning, perseverance, and a pragmatic approach to
future goals
Vietnam (47): Vietnam has a moderate score, indicating a balance between long-term planning and respect for
traditions
 NEGOTIATION STYLES
HIGH

IMPORTANCE OF RELATIONSHIP Accommodating Collaborating

(The goal is to yield) (The goal is find a
win-win solution)

Compromising
(The goal is find a
middle ground)

Avoiding Competing
(The goal is to delay) (The goal is to win)

LOW IMPORTANCE OF OUTCOME HIGH

 VIETNAM AND JAPAN DIFFERENCES

Japan (95): Japan has a very high Masculinity score, indicating a highly competitive society that values achievement,
success, and ambition
Vietnam (40): Vietnam scores much lower, reflecting a more balanced approach, with a greater focus on quality of life
and cooperation than on competition
 NEGOTIATION STYLES
HIGH

IMPORTANCE OF RELATIONSHIP Accommodating Collaborating

(The goal is to yield) (The goal is find a
win-win solution)

Compromising
(The goal is find a
middle ground)

Avoiding Competing
(The goal is to delay) (The goal is to win)

LOW IMPORTANCE OF OUTCOME HIGH

 VIETNAM AND JAPAN DIFFERENCES

Japan (46): Japan leans towards collectivism, meaning individuals value group harmony and prioritize the group over
personal goals
Vietnam (20): Vietnam is even more collectivistic, with a strong focus on family, community, and social connections over
individualism
 NEGOTIATION STYLES
HIGH

IMPORTANCE OF RELATIONSHIP Accommodating Collaborating

(The goal is to yield) (The goal is find a
win-win solution)

Compromising
(The goal is find a
middle ground)

Avoiding Competing
(The goal is to delay) (The goal is to win)

LOW IMPORTANCE OF OUTCOME HIGH

 TACTICS

BUILD TRUST AND RELATIONSHIP FIRST

BE PATIENT AND EXPECT LONGER
NEGOTIATION TIMEFRAMES
USE INDIRECT COMMUNICATION
RESPECT GROUP HARMONY AND
AVOID CAUSING “LOSS OF FACE”
 TACTICS

BUILD TRUST AND RELATIONSHIP FIRST

BE PATIENT AND EXPECT LONGER
NEGOTIATION TIMEFRAMES
USE INDIRECT COMMUNICATION
RESPECT GROUP HARMONY AND
AVOID CAUSING “LOSS OF FACE”
 TACTICS

BUILD TRUST AND RELATIONSHIP FIRST

BE PATIENT AND EXPECT LONGER
NEGOTIATION TIMEFRAMES
USE INDIRECT COMMUNICATION
RESPECT GROUP HARMONY AND
AVOID CAUSING “LOSS OF FACE”
 TACTICS

BUILD TRUST AND RELATIONSHIP FIRST

BE PATIENT AND EXPECT LONGER
NEGOTIATION TIMEFRAMES
USE INDIRECT COMMUNICATION
RESPECT GROUP HARMONY AND
AVOID CAUSING “LOSS OF FACE”
 TACTICS

PROVIDE DETAILED DOCUMENTS

SEEK WIN-WIN SOLUTIONS AND

LONG-TERM PARTNERSHIP

BE PREPARED FOR SILENCE AND

NON-VERBAL REACTIONS
 TACTICS

PROVIDE DETAILED DOCUMENTS

SEEK WIN-WIN SOLUTIONS AND

LONG-TERM PARTNERSHIP

BE PREPARED FOR SILENCE AND

NON-VERBAL REACTIONS
 TACTICS

PROVIDE DETAILED DOCUMENTS

SEEK WIN-WIN SOLUTIONS AND

LONG-TERM PARTNERSHIP

BE PREPARED FOR SILENCE AND

NON-VERBAL REACTIONS
 KEY SKILLS

SHOULD DO SHOULDN’T DO
Be polite and respectful Don’t rush decisions

Communicate clearly and indirectly Don’t be aggressive or confrontational

Prepare detailed proposals Don’t show impatience

Allow for silence Don’t cause “loss of face”

Focus on long-term relationships Don’t ignore hierarchy

Observe non-verbal cues Don’t assume silence means agreement

THANK
you.
Phan Nguyen Xuan Quynh
Nguyen Ngo Thanh Thao
Nguyen Thi My Le
Le Ho Truc Mai
Pham Ngoc Mai