Lloyd E. G. Barrett, Co-Founder of Uncapt, emphasises the pivotal role of negotiation in business and untapped potential of Advanced Artificial Negotiation Intelligence.
Soaring energy costs and rapid inflation in the price of goods and services have left many businesses struggling to stay afloat. With unpredictable consumer demands, the retail sector, now more than ever, needs a rethink.
The retail industry must find new ways to adapt. Advanced Artificial Negotiation Intelligence (AANI) offers a lifeline for retailers by revolutionising how they conduct business. Leveraging Artificial Intelligence-driven negotiation tools can streamline processes, optimise pricing strategies and increase business revenue.
Many companies still rely on Excel spreadsheets and their wits to negotiate with manufacturers and suppliers. However, AANI is about to overturn those long-held traditions; it is the future of bargaining.
Unlocking the real value of your business
Many business leaders are aware of the untapped value within their companies. They know they may be sitting on a gold mine regarding value but don’t have the money to hire the right people to extract it.
Imagine if you could map the decision-making of your best people and combine that with the reasoning of world-class negotiators. Now, imagine they can work 24/7, 365 days a year, across all your suppliers simultaneously. How much value do you think you could unlock?
What if you could use AANI, a technology that’s cognitively on par with people and, in some cases, better, to conduct negotiations on your behalf? What if you used it to analyse vast amounts of data, predict outcomes and make strategic decisions instantly?
You suddenly have technology that unlocks your company’s actual value. You’re fully equipped to extract that value to generate more business, revenue and profits.
Preventing inefficient tail spend
One of the industry’s biggest challenges is finding the time and resources to negotiate effectively with all their manufacturers and suppliers. Some buyers manage hundreds of suppliers within short time frames. A reasonable question to ask is, how do they manage?
There is no way you can effectively manage hundreds of suppliers at a time and maintain long-term relationships with all of them. With the best will in the world, you’re limited to skimming through some of your deals, which inevitably will leave value on the table.
We tend to prioritise larger businesses that spend the most money. It’s easy to fall into the habit of neglecting smaller suppliers who’ve been with you the longest. Over time, you end up with tail spend.
People drop off your radar, they may become disgruntled, which isn’t great for business. AANI allows you to resolve your tail spend issues instantly by automating processes, allowing buyers to improve overall supplier management practices.
Negotiating win-win agreements
AANI utilises Pareto optimisation to mathematically unlock the best outcomes for all parties involved in a negotiation. Most deals in the retail industry are done by haggling over a small number of variables, mainly price.
The concept behind Pareto optimisation is that if all parties to a negotiation are willing to reveal their wants, desires and concerns, there’s more scope to reach an agreement.
Instead of treating the negotiation process like a game of chess where winning is the ultimate goal, AANI algorithms ensure there’s enough of the pie for everyone. Both buyers and sellers get the best deals possible.
Data gathering and mitigating key person risk
Essential data and knowledge accumulated during negotiations are primarily stored in people’s heads, so you have key person risk. When key employees move roles or, worse, leave your company, they walk away with a wealth of knowledge about how your business operates, someone will have to relearn all the hard-earned lessons at your expense.
An AI-driven negotiation system that standardised processes enables you to capture and track essential information. You’re reducing the impact of key person risk. Moreover, you can generate crucial insights from the data you’ve captured during negotiations, which you’re not currently doing.
Tailoring AANI to your business needs
Choosing AANI doesn’t mean letting go of the reins. Companies may choose to rely on autonomous negotiation software once they’re confident that the technology is performing on par with humans. You can run AANI parallel to day-to-day business negotiations and test it regularly to ensure it is robust.
Until you fully commit to using AANI, you can have a person at the other end of the auto-negotiating process checking what’s going on. You decide what you’re comfortable with whilst using various auto-negotiating tools.
AANI levels range from co-pilot to fully auto-pilot, with multiple safeguards in place. So, a human can interject at any point during the negotiation. It allows you to manage the negotiation and feel more secure.
Freeing up your most valuable resource: Time
Time is the most valuable commodity in retail. Once spent, you can never get it back. Every aspect of retail demands robust time management, from handling inventory to analysing data, from organising marketing campaigns to maximising point-of-sale transactions.
For many retailers, the race against time is like fighting a losing battle. AANI is a game-changer in this regard. Here’s where it adds value: it removes the burden of ‘time-consuming’ mundane tasks. It allows you to direct your efforts to higher-value activities that yield better results and bring more money to your business.
The future of retail negotiations
Economic uncertainty, changing consumer behaviour and high inflation are expected to continue disrupting the industry in the foreseeable future. Navigating uncertainty means weighing up the variables and making quick adjustments. AANI does precisely that and more. It is the future.
Companies that have begun using AANI are impressed by its bargaining power. They’re equally impressed that they have a direct hand in training the technology because it learns from them and uses the information to supercharge their negotiations.