What do you do when vendors keep raising prices? It’s easy to feel outmaneuvered—but that’s exactly when you need to reframe the negotiation.
When “Take It or Leave It” Isn’t an Option
If you’ve been in business long enough, you know the sinking feeling that comes with yet another price hike from a key vendor. I’ve sat across the table from suppliers more times than I can count, listening as they explained why costs are increasing—again. Leaders often feel out of control and trapped in these moments: either accept the higher cost, scramble to find alternatives, or risk disruption by saying no outright. Over my 30+ years negotiating deals as a business leader and coach, I’ve learned that real negotiation begins when you reset the conversation, not just react to the pressure. In this piece, I’ll share how I approach these situations, drawing on the principles that form the backbone of the OmniLevel Executive Negotiator Framework.
Moving Beyond Binary Choices: How I Start the Conversation
Early in my career, I would see price increases as a take-it-or-leave-it proposition. The anxiety was real: absorbing the higher cost and watching margins erode or pushing back and risking jeopardizing the supply chain. But I realized that negotiation isn’t about binary choices, it’s about designing options that work for both sides.
Whenever a vendor presents a price change, I start with respect for the relationship: “I value the work we do together, but these new costs make it hard for me to purchase the volume on the schedule you expect. How can we adjust so that both our goals are met?” This approach shifts the conversation away from a standoff and toward mutual problem-solving. It’s a mindset that says, “I’m here to give you what you want, but only if my conditions are respected too.”
When I frame it this way, I’ve found vendors are more willing to collaborate. Sometimes, we find alternatives—adjusting volumes, agreeing to phased pricing, or working on joint efficiency projects. The best negotiations I’ve led have always emerged from these honest, value-driven conversations.
Developing Options: A Real World Client Breakthrough
I’ll never forget working with a mid-sized manufacturing client who faced three vendor price increases in two years. The procurement manager—frustrated but savvy—came to me for guidance. She didn’t want to accept the change, nor did she want to risk delays by replacing the supplier. We worked together to reset the conversation.
She approached the supplier with transparency: “Our business depends on cost and supply predictability. If prices keep rising, we’ll have to decrease orders or seek alternatives, which isn’t good for either of us. Could we explore ways to give you some of the additional margin you are seeking while protecting our margins at the same time?”
Together, they generated options: a longer-term contract with predictable pricing, a joint logistics review to cut costs, and shared planning to help both sides forecast more accurately. The result? An agreement that kept their business running, improved their partnership, and avoided the pain of disruption.
This is the power of developing options—something I discuss further in “Understanding the Art of Compromise”. When you focus on what both sides truly need, you often find solutions that aren’t obvious at the outset.
From Hardline Mistakes to Collaborative Wins: My Personal Negotiation Lessons
I’ve made my share of negotiation mistakes. Early on, my instinct was to issue ultimatums when faced with a price hike: “If you can’t hold your price, we’re out.” In one memorable case, my hardline stance backfired: the vendor stopped responding, and suddenly, my team scrambled for alternatives, causing costly project delays.
That experience taught me a lesson I never forgot: negotiation is rarely about winning or losing, it’s about constructing a deal that works in practice. Now, whenever I face a price increase, I clarify our shared interests and explore options before making a final call. In one successful negotiation, I was upfront about our constraints, and together with the vendor, we found ways to bundle services and adjust delivery schedules for more stable rates. The deal got done, our operations continued uninterrupted, and trust was actually strengthened.
Five Steps for Regaining Control When Vendors Raise Prices
From decades of high-stakes negotiations, I recommend these steps when facing vendor price increases:
- Assess the Real Choices: You could accept the new terms to keep supplies moving, but that may hurt profitability. Refusing could disrupt operations. The best path is often to develop options that protect your business and offer value to your vendor.
- Highlight Value on Both Sides: Remind your vendor why your partnership matters and what you need in return. I often say, “Let’s find a way that delivers for both of us.”
- Collaborate on Solutions: Invite your vendor to the table: “What options might help us both achieve our goals?” This can lead to creative agreements—longer contracts, bundled services, or operational efficiencies.
- Be Honest About Constraints: Vendors need to know if further increases will force you to scale back or look elsewhere. It’s not a threat—it’s a reality of business.
- Formalize Agreements: Once you land on a new deal, get it in writing. This prevents confusion and sets clear expectations for the future.
Build Better Outcome – Reset the Conversation for Lasting Partnerships
Repeated vendor price increases put you at a crossroads. Accept the terms and squeeze your margins, walk away and risk disruption, or—my preferred approach—reset the conversation and build options that serve both sides. Over my career, I’ve found that the most sustainable deals are built on mutual respect, clear communication, and a willingness to develop creative solutions together.
Suppose you’re ready to strengthen your negotiation skills or want hands-on support navigating vendor relationships. In that case, I invite you to explore the Executive Negotiator Framework. Let’s master these critical conversations—together.
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