CAT #2 Question 7

[sophia.lin12345]

Email 1:

Email from account manager to customer

February 17, 9:33 a.m.

I received your order for 50 plastic syringes and 550 single-use needles (one per injection). Also, the portable infusion pumps are on back-order. I can get you 300 now but the other 900 won’t be available until March. In response to your question, the plastic syringes typically last for 30 to 40 injections; they are guaranteed to last for a minimum of 20 injections.

Finally, current prices are $20 per box of 50 syringes, $25 per box of 50 needles, and $175 per box of 10 infusion pump kits.

Email 2:

Email from customer to account manager

February 17, 10:42 a.m.

I noticed that the price of the pumps is set to increase by 15% next month. Will we still receive this month’s price on the entire order, including the ones we receive next month? My boss is already upset about some of the price increases earlier this month. Do you offer any large-volume discounts? We’re ordering more than 1,000 pumps.

Hold off on the syringe order; my boss has found syringes that are guaranteed for at least 30 injections. They’re more expensive ($30 for a box of 50), but he likes the 30-injection guarantee. If we were able to get a volume discount, though, he might still be willing to give you the order.

Email 3:

Email from account manager to customer

February 17, 1:28 p.m.

Pricing is guaranteed at the time of your order, even if the price increases before you receive the shipment. My supervisor agreed to a 5% discount for any orders of more than 1,000 units of a single product or a 10% discount on the whole order if you order a total of 2,000 units for all products combined. I can’t give you a discount on just the 50 syringes, but you already qualify for the 5% discount on the pumps.

In the exchanges provided, the customer uses all of the following negotiating tactics EXCEPT

A. demonstrating the value of the existing relationship asking for a specific consideration
B. asking for a specific consideration
C. offering a concession that goes beyond what was demanded by the other party
D. signifying a readiness to walk away from the deal
E. indicating displeasure with some aspect of the existing relationship

[sophia.lin12345]

Solution:

In this "Except" question, we will need to find the "odd one out" answer. Four of the answer choices describe negotiating tactics used by the customer. The fifth one (the correct answer) does not.

(A) Incorrect. The customer attempts to indicate the value of her business by pointing out to the supplier that her company is "ordering more than 1,000 pumps."

(B) Incorrect. The customer specifically asks for a large-volume discount.

(C) Correct. The supplier offers a concession, but the question asks us to find negotiating tactics used by the customer, not the supplier. The customer asks for a volume discount on the pumps; the supplier offers a volume discount on the entire order (if the customer orders more).

(D) Incorrect. The customer both tells the supplier to "hold off on the syringe order" and mentions that a volume discount might make her boss "willing to give you the order." This implies that she is willing to consider walking away from the deal if needed.

(E) Incorrect. The customer states that her boss is "upset" about previous price increases.

The correct answer is C.

[sophia.lin12345]

What does the question mean by "value of existing relationship?" I'm interpreting that to mean that both the supplier and the buyer had a pre-existing relationship prior to the email correspondence. I'm not sure how the specific quote, "we're ordering more than 1,000 pumps" represents an existing relationship.

[tim]

Your interpretation of an existing relationship appears correct. Unfortunately I'm unable to comment on what appears to be a question about answer choice A, because it is not clear from your transcription of the problem which answer choice is A or even if A has been transcribed at all. Notice that you only giave us four answer choices. Can you clarify what all five answer choices were so we can help you further?

[sophia.lin12345]

Hello again,

I picked answer choice A as the answer. Solution states that this is wrong because the "customer attempts to indicate the value of her business by pointing out to the supplier that her company is 'ordering more than 1,000 pumps.'"

Just wanted to know how the act of ordering 1,000 pumps relates to the value of an existing relationship? All we know from the passage is that she would like to order that amount, but we don't know that the relationship existed prior to this email exchange.

[RonPurewal]

Hello again,

I picked answer choice A as the answer. Solution states that this is wrong because the "customer attempts to indicate the value of her business by pointing out to the supplier that her company is 'ordering more than 1,000 pumps.'"

Just wanted to know how the act of ordering 1,000 pumps relates to the value of an existing relationship? All we know from the passage is that she would like to order that amount, but we don't know that the relationship existed prior to this email exchange.

That's the existing relationship: the customer has placed a large order. From email #1, we know that the order already exists -- i.e., it's not just a hypothetical order that the customer is thinking about placing.
It's like paying for a large party at a restaurant and then saying, Could you please give my wife one dessert for free? After all, I'm paying almost a thousand bucks here.

Also -- what about the correct answer?
Not only is (C) definitely false -- the customer doesn't offer any concessions, regardless of whether they "go beyond xxxxx" -- but, in fact, exactly the opposite is true: The customer asks for a volume discount, which would be a concession from the manager!

[AbhishekD643]

Quick question here:
Who is the customer?
According to the passage, customer is the Buyer. Account manager is the Seller.
So the question is asking for the tactics employed by the buyer.
But answer options seem to be based on the seller(account manager).
Is the question incorrect or am I missing something here?

[tim]

Many of the answer choices could be applied to either party. Your job is to make sure you are applying them correctly, exactly as the problem requires. Don't change the problem into something it isn't and then claim there is something wrong. That is is a perfect example of what is known as a straw man argument (look it up). This is a very common problem on sentence correction as well, so make sure you are careful not to use this kind of logical fallacy on those questions either.

[AbhishekD643]

Don't change the problem into something it isn't and then claim there is something wrong

Thanks. I do that often!

[RonPurewal]

Don't change the problem into something it isn't and then claim there is something wrong

Thanks. I do that often!

This is especially important because you're taking a standardized test.

In creating items for standardized tests——more than for any other testing instrument——the problem writers must be extremely rigorous about creating well-justified answers that use information that's actually there.

If you "transform" the test questions in any way——excepting only those transformations that are 100% everyday common sense (e.g., "affordable for more people" can be changed to "less expensive")——then, more likely than not, you're now considering a question that isn't actually on the test.