After the budgeting period ends, companies \u2013 both small and large \u2013 move from the planning phase to the execution of purchases and investments. January marks the most active period for procurement departments and for professionals responsible for cost optimization and generating savings for their organizations.<\/p>\n
Labor, material, and service costs are increasing \u2013 as they do every year.
\nWhen planning their 2026 budgets, companies had to account for cost increases of at least approximately 4%, in line with inflation from the previous year. However, not all of these costs can be passed on to product or service prices, which makes contract negotiations and renegotiations a necessity.<\/p>\n
Effective negotiations are a process that includes:<\/strong> 2. Understanding the other party<\/strong> \u2013 empathy enables solutions that are beneficial for both sides.<\/p>\n 3. Seeking a partnership-based approach<\/strong> \u2013 negotiations should not be a field of conflict, but a way to build long-term business relationships.<\/p>\n The effectiveness of negotiations is not limited to price alone. Cheaper does not always mean better \u2013 commercial terms, contract flexibility, and long-term business impact are equally important.<\/p>\n In the tendering and bidding process, most companies place price as the top criterion, assigning it the highest weight. However, it is worth remembering that price should not be the sole factor when selecting a supplier, especially when the cooperation is expected to last for a year or even several years.<\/p>\n As Warren Buffett famously stated: \u201cPrice is what you pay. Value is what you get.\u201d<\/strong><\/em><\/p>\n Negotiations and well-considered purchasing decisions should always aim to maximize value, not merely minimize costs. A professional approach in this area enables companies to effectively implement their savings and investment strategies while ensuring stable growth and long-term relationships with business partners.<\/p>\n","protected":false},"excerpt":{"rendered":" After the budgeting period ends, companies \u2013 both small and large \u2013 move from the planning phase to the execution of purchases and investments. January marks the most active period for procurement departments and for professionals responsible for cost optimization and generating savings for their organizations. Labor, material, and service costs are increasing \u2013 as […]<\/p>\n","protected":false},"author":2,"featured_media":1891,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[12,3],"tags":[],"class_list":["post-1896","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog","category-uncategorized"],"acf":[],"yoast_head":"\n
\n1. Thorough preparation<\/strong> \u2013 analyzing needs, market conditions, and available options.<\/p>\n