Janeen Mena, a senior sales rep for Micronix-Digital -a large semiconductor manufacturer - is negotiating with the chief buyer for China Changhong Computers (CCC). The lawyer, Lawrence McCann, a long-time employee of CCC now nearing retirement, is such an aggressive, greedy bargainer that most salespeople hate to negotiate with him. He views each sales negotiation as a contest to be won, so he won't agree to sign a contract unless he feels that he's gotten the best of the supplier. Salespeople who degree to the usual "seller lose-buyer win" agreement with Mr McCann usually try to salvage a little profit on the contract by cutting some corners, usually on product quality or service. But this strategy often leads to dissatisfaction by CCC, so Mr. McCann usually moves on to another supplier for the next contract. The CCC account could be very valuable since its annual purchases of semiconductors exceed $6 million and are steadily increasing by about 5% a year. Mr. McCann, however, makes sales to CCC very dicey by insisting on squeezing out most of the profit margin and then switching suppliers if performance is less than fully satisfactory. Mr. McCann's assistant, Lester Bates, seems to be much more reasonable, but he doesn't say much in negotiations since McCann always dominates. Most of the sales reps who call on CCC seem to be looking forward to the day when Mr. McCann retires because they often supply ask receptionists about his retirement plans. Mr. McCann has just demanded that Janeen give him a whopping 20% discount on all CCC purchases - or, as he bluntly states, "I won't be buying anything from Micronix- Digital." If the 20% discount is provided, Mr. McCann promises to give Micronix-Digital all of CCC's semiconductor business this year. Janeen knows her company can't make any profit if she agrees to a 20% discount, and she's quite sure no other semiconductor supplier will offer such a large discount. While Mr. McCann continues talking, Janeen wonders how to respond to his demand.

Questions 1. Is it worthwhile for Janeen to negotiate with Mr. McCann when his demands are so unreasonable - and unprofitable if she agrees to the 20% discount? Explain. 2. Should Janeen do like most salespeople who "win" orders from Mr. McCann - simply cut back on product quality and/or service and be relatively unresponsive to complaints, so that her company can make a little profit? If she follows this strategy, Janeen realizes that she probably won't get any orders from Mr. McCann next year, and it may hurt her company's reputation - not only with CCC but with other companies through negative word of mouth. 3. Janeen wants to keep CCC as a customer because it could become a valued account when Mr. McCann retires. So she's thinking about calling her sales manager to ask if she can offer the 20% discount and accept a loss on the contract in order to keep the customer relationship going with CCC. As her sales manager, what advice would you give Janeen? 4. What role, if any, does customer relationship management play when dealing with difficult buyers like Mr. McCann?