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SITXMGT002 Negotiate Business Contract To Foster Sustainable Business Relationship Assessment Answer




Develop and negotiate business contract to foster sustainable business relationship


Students may form ‘project team’ of up to three (3) persons for this assessment. Each ‘project team’ is required to choose an organisation and conduct research to determine two (2) potential business partners to support sustainability of the business. 

For the two potential business partners, project team is to draft a proposed contractual agreement with each to establish and maintain business relationship. 

Students will prepare and conduct negotiation meetings using one of the proposed contractual agreements with the goal of signing the contract with the selected business partner in a Role play environment.



As a ‘project team’, select an organisation that you are familiar with to brainstorm what business partners the organisation need to establish and conduct relationships with to sustain business.

Select two (2) business partners from the list below to draft contract proposal (one for each) for a product/service that is required for your organisational operation. 

Business partners may include the following:

  1. cooperative partner with organisation
  2. contractor
  3. customers
  4. networks
  5. supplier

Write a two (2) page reflection report to discuss how you would go about conducting and maintaining business relationships with them. 

Your reflection report should include the following:

  1. Reason your team select these two (2)  business partners
  2. List any organisational protocols or requirements for establishing relationships
  3. Effective communications skills and techniques required to build and nurture these relationships
  4. How you could proactively take up opportunities to maintain contact, review and provide feedback with these business partners.
  5. Take ownership to honour the agreement and comply with agreed KPIs
  6. Consult and make changes to agreement and update stakeholders on changes.
  7. Your contract proposal for each business partner should include the following contractual contents:
  8. Name of the Parties  (Business name/Company name/ABN number/Address for both the parties)
  9. Contact Person and Details – for both the parties
  10. Contract Start and End Date – mutually agreed by both the parties 
  11. What the contract is about (Goods or Services) – outlines the goods or services that are offered by each respective party to the other.
  12. Payment Terms – mutually agreed by both parties (may include deposit, pre-payment, instalment, part payments)
  13. Obligations (of both the parties) – role, responsibility, accountability, expectations, specifications
  14. Other clauses - each party to specify if any (resources – example equipment, facilities)
  15. Special Conditions - each party to specify if any (example – Licence, permits)
  16. Insurances – (example public liability, workers compensations)
  17. Confidentiality – respecting each parties service level
  18. Warranties - each party to specify if any
  19. Exclusion clause - each party to specify if any
  20. Arbitration/Dispute Resolution – mutually agreed by both the parties
  21. Cancellation/Termination (due to a breach of contract) - mutually agreed by both the parties, in case the parties are not able to meet their obligations as outlined in the contract or agreement
  22. Dated and Signatures of Authorised personnel – the date of signing the contract or agreement as this is the officially and legally binding date for both the parties
  23. You will be advised to email one of your contracts to a project Team agreed by your Trainer whom you will be meeting to negotiate the contract at an agreed date and time in a role play environment.
  24. Prepare and conduct your negotiation using the five (5) step negotiation process (See Appendix 1):
  25. Preparation - Prepare effectively 
  26. Clarification - Understand the needs & interests of all parties involved
  27. Exchange of opinions and persuasion - Conclude better agreements through creativity
  28. Encourage movement - Identify potential barriers or hindrances to the engagement
  29. Completing the deal - Adopt a collaborative approach to ensuring trust, rapport and long term gains


  • Two (2) completed contract proposals
  • Two (2) page Team reflection report on negotiation meeting and maintaining business relationship for the organization
  • Completed Negotiation 5-Steps check list (Appendix 1) with meeting notes taken and updated on checklist.
  • Final amended contract after negotiation meeting if applicable.


1. Organization and business partners

In order to generate the business contract proposal, Woolworths has been selected. The organization needs to conduct business relationships with several partners in order to sustain their business in the Australian retail market. That is why suppliers and networks have been chosen as the business partner of Woolworths with whom the business contract proposal will be established.

2. Reflection report

A. Reasons for choosing the business partners

The project team has selected two business partners, they are networks and suppliers to sustain the business Woolworths in the Australian retail market. Woolworth is one of the leading supermarket chains in the Australian retail industry (Woolworths, 2020). The organization is majorly famous for supplying its high-quality grocery products to the customers. Therefore, by increasing the suppliers of the organization, it will be possible to provide fruit products to the customers. Along with that, network improvement will enable Woolworths to reach more customers in the market. These business partners will help the organization in the selected business operations; therefore, it is necessary to develop relationships with them.

B. organizational protocols for establishing relationships 

There are few organizational protocols which need to be maintained by Woolworths to establish their business relationship with the partners. In the below, I have discussed some of them in details:

  • We feel that Woolworths need to share their organizational goals and values with their partners as in this way the business standard of the organization will be maintained. 
  • Woolworths needs to provide benefits to their suppliers and networks such as delivery partners, third parties and others to establish and maintain good business relationships.
  •  We think Woolworths need to generate contracts with their business partners to get long term profit from them and it will establish business relationships too.

C. Required communications skills and techniques to nurture these relationships

Effective communication skills and techniques are highly needed to maintain a business relationship with partners (Hänninen & Karjaluoto, 2017). Therefore, Woolworth is required to maintain communication regularly with their partners. For this purpose, the organization can arrange weekly meetings with the networks and suppliers. Through this meeting by directly communicating with their partner, Woolworth can be aware of their partners about their requirements to reach into the organizational goals. On the other side, the business partnership will be established equally.

D. Opportunities to maintain contact, review and provide feedback with these business partners

In the weekly meetings, the performance of the business partners of Woolworths will be reviewed. We think with this procedure, it will be possible to improve the networks of Woolworths as the organization will know in which area the network needs to be improved for establishing the business more precisely. Apart from this, by assessing the supplier's performance, Woolworths can review the demand for their products. Along with that, by providing them with feedback, the organization can sustain good business relationships with the partners.

E. Ownership to honour the agreement and comply with agreed KPIs

A key performance indicator is helpful to measure the performance of the employees and to evaluate the success of the organization (Jiang & Yin, 2018). we will generate contracts with the business partners to establish the business relationship. In the contract, key performance indicators will be included to assess the performance of the business partners. The performance of the partners will be considered on the basis of the organizational goals and values.

F. Consultation with the stakeholders

As in a business, there are many stakeholders, therefore, it is necessary to aware the other stakeholders about the contract with new business partners. That is why we will ask the other stakeholder of Woolworths if they need any change in the contract of the business partner or not. This process is necessary as in business the interest of the stakeholder is one of the important things. However, if any change is added in the contract, then, it will be updated to the new business partners of Woolworths as well.

3. Business contract proposal

Business contract proposal 1: Networks

A. Party name:

The online channel, delivery partner 'Drive Yello' 

Woolworths supermarket

B. Contact person and details:

Level 1 Spaces, 111 Flinders St, Surry Hills NSW 2010, Australia

C. Contract starting date: 01/07/2020

Contract ending date: 05/07/2025

D. The contract is about:

The contract is about the development of the network of fruit products of Woolworths. The networks such as delivery partner 'Drive Yello' will work as a delivery medium through this contract with Woolworths.

E. Payment terms:

Payment will be generated by instalment mode. Woolworths will pay to their networks by instalment thrice in a year.

F. Obligations

The responsibility of the networks will be to deliver the fruit products of Woolworths to their customers which will be ordered through the digital medium. It is expected that customers will get their product in the given time through the online network.

G. Other clauses

The online delivery network will need equipment like bikes for the delivery of persons to deliver the fruit products to the customers of Woolworths. Facilities will be provided to the delivery persons as they can earn commission through each delivery.

H. Special Conditions

For the delivery persons, there will be a few special conditions. For example, delivery persons need to have a driving license as motorcycles will be used to deliver goods to the customers. Along with that, they need to be physically and mentally fit.

I. Insurances

Woolworths will provide compensation to the workers of their delivery networks in case of an accident. Along with that, public liability insurance will be provided if any delivery person is injured. Compensation will be provided to Drive Yello if their business faces any issues due to Woolworths.

J. Confidentiality 

The partnership will be based on the trust and loyalty of both business partners, Woolworths and Drive Yello. Both parties will respect each other and will maintain confidentiality in business partnerships.

K. Warranties

Both the party will try to provide their utmost service to each other as in this way both Woolworths and Drive Yello will be benefited in terms of business. The Drive Yello will deliver the goods to the customers in the given time and Woolworths will pay to their online network in the specific time as well.

L. Exclusion clause

Drive Yello will deliver only the fruit product of Woolworths to their online customers. Apart from this, there is no other exclusion clause of Drive Yello.

M. Dispute Resolution

In future, if there is any issue arise, both the parties Woolworths and Drive Yello will resolve equally by negotiation in order to sustain their business relationship.

N. Termination

If any of the parties cannot fulfil the business values, then, other parties can break the contracts if needed.

O. Dated and Signatures of Authorised personnel


Business contract proposal 2: Suppliers 

A. Party name:

Woolworths supermarket


B. Contact person and details:

1/678 Victoria St, Richmond VIC 3121, Australia (SPC, 2020)

C. Contract starting date:01/07/2020

Contract ending date: 05/07/2025

D. The contract is about:

This business contract is about establishing a business relationship between Woolworths and SPC through which SPC will supply organic fruits to Woolworths. This contract will enable Woolworths to improve the supply of the fruit items in their store.

E. Payment terms:

Prepayment will be followed in the business partnership between Woolworths and SPC. Therefore, after getting payment from Woolworths, SPC will supply the fruit products to the physical stores of Woolworths.

F. Obligations

SPC will act as a supplier in this business contract and will deliver their organic grocery products to Woolworths. Specifically, SPC will supply their organic fruits.  

G. Other clauses

SPC will be required for trucks to carry the fruits from their warehouse to the stores of Woolworths. Therefore, the trucks will be needed which will be provided by Woolworths to SPC. Truck drivers will get facilities from both Woolworths and SPC.

H. Special Conditions

Both the parties will need to have a license and permits to do business in Australia. Along with that, truck drivers need to have a driving license.

I. Insurances

There will be insurance of the trucks and drivers as well. In case of any damage, Woolworths will need to pay compensation to the SPC.

J. Confidentiality 

Confidentiality will be maintained by both Woolworths and SPC in this business partnership. SPC will provide high-quality fruit products to the Woolworths as per the standard of the company. Along with that, Woolworths will generate prepayment to SPC for supplying fruit products.

K. Warranties

SPC will provide warranty in the quality of their fruits, therefore the standard of the company will be maintained.

L. Exclusion clause

As SPC is a fruit supplier company, therefore only fruits will be supplied by their company to Woolworths through this business partnership.

M. Dispute Resolution

Dispute resolution defines the process that a company follows to resolve business disputes between two organizations (Meirowitz et al., 2019). Therefore, both Woolworths and SPC will take initiative if in future the organizations face any disputes in the business partnership.

N. Termination

In this contract, both the companies mutually agreed that they will provide their utmost service to each other.  Therefore, if SPC will not be able to supply the products as per the standard, then Woolworths can break this contract.

O. Dated and Signatures of Authorised personnel


4. Email

Dear project team, 

                  The contract has been made and now it is required to fix a date and time to negotiate about the contract. It has been decided for Woolworth to sell food products by selecting the two partners in order to sustain the business. For this purpose, the chosen contract is "SPC who will be the suppliers of fruits as the business partner of Woolworths”.Therefore, it is requested that you provide your opinion about the contract and make the deal final with the help of significant discussion on it. Thus, it is being requested you to please arrange a meeting in which we need to discuss this business contract. Along with that, it is required to for a date and time in which there can be discussion and negotiation about the business contract. I await your immediate response.  

Yours faithfully,



5. Negotiation process

Negotiation method can be considered as a process through which two or people or organizations settle their differences (Brett & Thompson, 2016). There are majorly five stages in the negotiation process. Below the negotiation process between the project teams regarding the business contract with suppliers is discussed in detail:  

5 Steps of the negotiation process
Pre-meeting strategies
Meeting notes
Post-meeting follow-up
Preparation - 

In the negotiation process with the project team, few strategies have been adopted. Before the meeting, which points need to be discussed is identified and documents will be prepared. As in this way, the negotiation process is completed in an organized way.
During the meeting session, the benefits of generating business partnership with SPC are assessed and negotiation is done on providing exact payment for every supply.
After the meeting, all the project members were agreed with the benefits of the business partnership of Woolworths with SPC.
Clarification - 

As through this business partnership both Woolworths and SPC will be benefitted, therefore, it will be used as a strategy in the negotiation process.
In the meeting, the benefits of Woolworths and SPC were discussed and Woolworth will be able to increase the supply of food products.
After the meeting, team members agreed with the benefits of Woolworths and SPC.
Exchange of opinions and persuasion-
In the pre-meeting, it is discussed that the opinion of other project members is necessary and proper consideration will be given for that. 
One of the project members depicted that the certificate of the quality fruit of SPC needs to be involved in the contract.
After the meeting as per the project members, the certificate of the assurance of high-quality fruit of SPC is added in the contract.
Encourage movement - 

The barriers will be discussed equally in the negotiation process.
The recent issues regarding SPC are discussed in the meeting. The bitter taste of the fruits of SPC during the time of Globalization is a threat (The guardian, 2020).
After meeting it has been discussed as the quality assurance certificate is added in the contract, therefore, it can be avoided.
Completing the deal 
The deal will be completed by the collaborative approach and before meeting all the price related planning will be done.
In the meeting, the business contract is signed by gathering permission from all the team members. 
The business contract is signed by the collaborative approach in order to achieve long term benefit from the partnership

Table 1: Five Stages of the Negotiation process

(Source: created by author)

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