I will talk about the first negotiation between Chipotle and McDonald. Why it is McDonald not other companies sitting in the other side of the table? How did Steve persuasive the fast food Giant to invest his company? According to the record, it’s the first time McDonald made its investment in other company’s restaurant brand.
I get the perspectives from the article we have learned in this semester about 3D Negotiation.
From my point of view, the dimensions can be ‘categorized by What? Who? How?
What’s the goal that the company wants to pursue in the negotiation?
What’s the BATNA? best alternative to negotiated agreement.
To Steve, the BATNA is quite clear.
The goal is to achieve funding to accelerate the growth rate. With the money, the company can open more units, introduce better distribution system, increase management efficiency and so on.
The line is that Chipotle has to be run independently, headed by Steve as CEO, and neither its management structure nor its menu will change.
Who should sit in the other side of the table?
Who should be brought into the negotiation.
At first, the Chipotle didn’t think about bringing McD to the table. They want Venture Capital firms because they just want the money.
However in the year of 1997, the beginning of Dot-com Bubble, venture capital firms were more interested in the high-flying tech world, so they refused to infuse Chipotle.
After being rejected by the VCs, they found out that McD might be a much better candidate for the negotiation.
Why? Because McDonald not only has the money they want, but also has rich fast food industry experience, great industry clout which can help the Chipotle grow.
After Chipotle sent the business proposal to McD, they got a positive reply that McD also has interests in the popular Mexican grill restaurant.
How to make a satisfactory proposal work for both sides?
How to step over or get rid of the barriers and reach an