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Financing negotiation









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发表于 2018-9-25 17:18:52 | 显示全部楼层 |阅读模式
Financing negotiations refer to negotiations between the two parties on how to provide import and export credit, organize international syndicated financing, issue bonds, stocks, and provide financial guarantees in the other country. Such negotiations often involve the conditions of financing, the cost of financing, the method of payment, the scope of guarantees, and foreign exchange management issues in developing countries.

1 Basic conditions for financing negotiations

There are many conditions involved in financing negotiations, but the most basic conditions are:
1. The relationship of financing negotiations. That is, the parties involved in the negotiations are generally the two parties, but sometimes they may not only be the two sides. In the World Bank loan, the negotiating parties are the delegation of our country and the World Bank, but in the joint venture negotiations, if the joint venture is a tripartite, then the relationship between the joint venture negotiations is the tripartite representative.
2. Certain economic benefits. That is to say, the purpose of the parties participating in the negotiations is to strive for their respective economic interests. In government loans, the purpose of the borrowing country is to introduce funds to develop the domestic economy; and the purpose of lending countries is not to seek high profits like ordinary commercial loans, but with some additional conditions, or political purposes, or On the other hand, discounts, etc.
3. The parties must negotiate. In other words, the parties must conduct consultations in order to seek conditions that they can all agree to accept.
The above three basic conditions are indispensable conditions in financing negotiations. Without any one, financing negotiations cannot be carried out.

2 Characteristics of financing negotiations

In addition to the commonality of general business negotiations, international financing negotiations have their own unique features.
1. Financing negotiations are based on certain economic interests.
In international commercial bank loans, the purpose of the lender is to lend a predetermined amount of funds with a small financing cost, and the purpose of the lender is to obtain as much loan income as possible while taking into account security. . In leasing financing, the purpose of the lessee is to allow the lessor to provide or advance the purchase of the necessary machinery and equipment, to solve the problem of insufficient funds, to start production as soon as possible, to obtain economic benefits at an early date, and the purpose of the lessor is to increase the rent as much as possible. Make existing rentals more economical. The core issue at this time is the rent.
2. Financing negotiation is a process in which a party gradually adjusts its needs and interests and gradually agrees.
Negotiation English is Negotiation, Bargaining, which has the meaning of bargaining. If you want to make financing negotiations successful, you must constantly adjust the interests, seek common interests, and communicate on the common goals of both parties. In the negotiation of compensation trade financing, the lenders providing machinery and equipment, and the lenders who repay the loans with designated products are subject to specific conditions, such as what kind of equipment or technology is used as a loan, what kind of products and how many To repay the loan, the two sides must have a coordination process.
3. Financing negotiation is the unity of opposites between "cooperation" and "conflict"
The so-called cooperation means reaching an agreement that is beneficial to both parties. The so-called conflict means that both parties hope to obtain as much as possible. This is the duality of financing negotiations. Negotiations are in constant conflict, the two sides gradually buffer, and finally reach a consensus, thus a process of unity of opposites. If both sides can grasp and not escalate the conflict, and gradually dilute the conflict in adjusting needs and interests, it is possible to reach a consensus and form a consensus.
4. Financing negotiations have certain boundaries
Some people compare the negotiation to wine, and may end up killing the last small cup; some people compare the negotiation to the atomic furnace reaction, and they lose control beyond the critical point. These metaphors are very appropriate. If in the financing negotiation, one party ignores the other party's minimum interests and minimum needs, then the negotiations will fail.
5. The benefits of the parties in the financing negotiations depend on the strength of the parties to the negotiations, the objective situation and the use of negotiation strategies and techniques.
The strength of the negotiating party includes the quality, ability, experience, psychological state, feelings and composition of the negotiators; the objective situation includes the environment of the negotiating place, the market situation of the financial market, and the relationship between the countries where the parties are negotiating.

3 Principles of financing negotiations

1. Principle of good faith
Honesty and credit are the first principles of all economic work, and financing is no exception. In order to make the financing negotiation successful, any party involved in the negotiations must first have the sincerity of cooperation and sincerely touch each other and gain the trust of the other party. In the negotiation process, whether both sides are creditworthy, whether they are honest and reliable, this is the basis for the success of the negotiations.
Adhering to the principle of honesty and credit, the parties must: 1 Keep their promises and abide by their promises. This is the core of trust. 2 Trust each other, this is the basis of negotiation, and the way to win the trust of others, only trust the other party, in order to get the trust of the other party. 3 Never neglect, do not consider maturity can not express, this is an important guarantee of trustworthiness. 4 Sincerely treat others.
2. Principle of equality and mutual benefit
Equality and mutual benefit are the foundation of international political exchanges and the basis of international economic exchanges. In the international financing negotiations, the principle of mutual realization of their respective economic interests on the basis of equality should also be followed. This is not only the premise of the success of financing negotiations, but also the law of market economy.
In the financing negotiations, no matter how the national strength of the two sides, and no matter how strong or weak the financial strength of the two sides is, the outcome of the negotiations should be in the interests of both parties. Nilenberg said that "successful negotiations are everyone wins." That is to say, when formulating financing negotiation goals, plans and strategies, we should consider the needs of both parties and base the hopes of successful negotiations on the needs of both parties. Satisfied. Of course, mutual benefit is not that the benefits of the two sides are absolutely equal. It can only be achieved on the basis of equality and through arduous negotiations. Under the prevailing conditions of the two sides, it is a relatively mutually beneficial one that can be accepted by both sides.
3. Compatibility principle
The so-called compatibility means that both sides must have strong patience in the negotiation, and they should be broad-minded and open-minded. If they can advance, they will retreat. When encountering a problem, you can take the initiative to retreat to retreat; and when the situation is good for you, you can seize the opportunity, take the initiative to attack, express your intentions in a way that is easy for the other party to accept, and let the other party accept. That is to say, in financing negotiations, it is necessary to be highly integrated with principle and flexibility so that it is possible to achieve the intended financing objectives.
4. Law-abiding principle
Any economic work must be bound by laws and regulations, especially in financing negotiations. It is not only subject to the financial regulations and economic policies of the country, but also subject to the financial regulations of the country and the international conventions or international practices. Therefore, before the negotiations, you should be familiar with and understand the relevant legal provisions, and be prepared for the work; in the negotiations, it is necessary to pay attention to comply with the relevant laws and regulations, which is not only related to the success of financing negotiations, but also related to the country's reputation.

4 Strategies for financing negotiations

Strategy 1: Prepare "negotiating language"
Background of financing communication
As a financing company, in the communication and negotiation with the fund side, there are often two types of situations: First, the enterprise team does not know enough about the financing-related expertise, the financial side's operational processes and financial regulations, and even often has significant Misunderstandings have made it difficult for the two sides to reach an agreement, even unhappy. Second, some companies do not pay attention to the writing of financing plans and project plans, and do not pay attention to preparing written materials related to financing, making it difficult to have large financing cooperation. progress. The reasons for the differences between the general financier and the funder are as follows:
1. The focus of the financing party and the funder is different. The financiers are concerned with financing quotas, financing costs, financing deadlines, etc. Most of them hope to integrate large sums of money at a minimum cost (low cost), the easiest procedure, and in a short period of time, and take up this for a long time. The funds are concerned with the project's feasibility, return on investment, investment return period, investment risk control, how to successfully exit, etc. It is hoped that the project company has a very good team, and the operating projects are not reproducible and have With high technology content, good marketing channels and high market share, as long as a certain amount of funds is invested, the company's projects can be made into industry leaders, investment risks are small, high returns, and safe exit.
2. The language expression level of the financing party is extremely limited. Due to the lack of professional knowledge, communication skills, negotiation strategies, etc., the level of expression of the project is extremely limited. The feasibility of the project cannot be fully explained in the description of the project, and the first time it is in contact with the funder is not “eyeball”. "Attraction, the result is clearly a good project but missed a lot of financing opportunities.
3. The financing party's materials are insufficiently prepared. In the investment decision-making, the funder needs to rely on a complete and standardized material, and needs to transfer information between different decision-making levels. The financing project information provided by the financing party is often scattered, unsystematic and non-standard, even to the enterprise. The future development strategy, marketing, capital operation, cost control, etc. have not been detailed, resulting in the lack of sufficient written materials to understand the company's projects, and therefore unable to judge and make decisions and give up investment opportunities.
It can be seen that there is often a “language barrier” between the financier and the funder. The language of communication with the funder is broad, including both financial expertise and documentary information that will help the funder understand the company and its financing projects, as well as information and confidence in building confidence.
Negotiations require a special language
The fund supply and demand teams are completely different "two types of people."
In practice, we found that the team of SMEs and the team of the funders (enterprises and banks, enterprises and venture capitalists, enterprises and short-term borrowers, and corporate funds) are completely different types of people. It is precisely because of the differences in the system, background, age, education, professionalism, growth experience, way of thinking and behavior of these people that they often have misunderstandings and disharmony in the financing process, so that the financing process Progress is slow, and even the past is abandoned. The above differences have caused many obstacles in communication. Some business operators need to form a financing team and leverage the power of financing services.
Capital supply and demand sides "information asymmetry"
Information asymmetry is caused by language barriers, communication methods, communication environment and other reasons, resulting in information loss, information leakage and information misunderstanding, and affects the decision-making of both parties.
The reasons for information asymmetry are as follows:
1. The fund supply and demand teams are “two types of people”, and they have great differences in their way of thinking and behavior. In the process of information communication, different languages, speeds of speech, expressions, emotions, and messages are different.
2. Due to the spatial distance and identity restrictions of the two parties, there are few opportunities for the corporate team and the funder to face-to-face communication, and the communication efficiency is low. It is difficult to express the concerns of both parties in a short period of time.
3. Different levels of personnel on the project side have different understandings and expressions of the project at different times, sometimes even contradictory, and it is difficult to give a convincing, complete and scientific impression in communication and description.
4. The Project Feasibility Study Report can only be used as an indispensable procedural document when the project is established. The risk, market and financial considerations are difficult to satisfy the fund in terms of breadth, depth and credibility.
This asymmetry of information greatly increases the cost of communication and affects the efficiency of financing work.
Different aspects of project and funding concerns
The issues of concern for both the supply and demand sides of the funds are different, and both sides strongly express what they want to express. For example, if a company says that there is a patent, the funder wants to see if the patent certificate exists and how much the value of the patent exists. The company says that the market situation is very good, but the funder wants to see the order or sales letter of intent and sees the market. Survey reports, data analysis and competitors. Just as two people debate and the views of the two sides are different, it is difficult to reach an agreement.
For the above reasons, a "language" or a tool is needed to solve the difference between the supply and demand sides of funds and solve the problem of information asymmetry.
Type of "negotiating language"
The “negotiating language” is divided into the following: First, the basic knowledge category: Since the capital supply and demand sides are almost completely different types of people, in order to improve the efficiency of communication, enterprises must learn the “negotiating language” to communicate with the fund side, from the knowledge level. At least the following aspects must be mastered: First, professional knowledge, including finance, finance, and business management;
The second is the laws and regulations, mainly including various policies and regulations related to financing; the third is the work practice category, which mainly includes the types of financing tools, the working practices and work processes of the funders and financing service agencies. Second, in the data list category, many funders have their own required information list to facilitate the standardization of work processes and improve work efficiency. All types of financing tools of various banks, various investment companies and other funders have their own lists of information. Therefore, before preparing financing materials, companies should get these lists of materials in various ways and prepare them carefully. For example: business license after annual review, business registration information, company charter, tax registration certificate, organization code certificate, legal representative certificate, legal representative ID card, financial statement, tax return and tax certificate, bank account Statements, related commodity transactions, labor contracts or agreements, basic settlement account opening cards, corporate qualification certificates (construction, real estate companies) and other information. Third, the application form, the application generally has a fixed format, some have a fixed format form, and some only have a clear content framework.
Strategy 2: Defining the content of the negotiations
The important role of financing communication and negotiation
The role of financing communication and negotiation to the financing party is mainly reflected in the following points: First, to understand the basic situation, background, strength and capital direction of the fund side, in order to judge the authenticity of the fund side and the possibility of successful financing, for further Cooperation lays the foundation. The second is to find the focus of the funder and determine the possibility of successful financing. The third is to find the imperfections of financing projects and materials, and lay the foundation for further improving financing information. The fourth is to establish mutual trust with the funders and lay the foundation for possible close cooperation. The fifth is to establish communication channels and communication mechanisms. The sixth is to accumulate experience and lessons in presentations, communication, and lay the foundation for the next cooperation.
The role of communication and negotiation on the fund side is mainly reflected in the following points: First, understand the basic situation, background and strength of the financing party and financing projects, and lay the foundation for further cooperation. The second is to find the imperfections of the information provided by enterprises, and require enterprises to further improve the information. The third is to find the key points and problems in the process of corporate financing, and to inquire about the enterprise. The fourth is to establish communication channels and communication mechanisms. The fifth is to establish a project database and accumulate experience for other project negotiations.


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