Negotiating a Deal in Korea: Reflections of a Battle-Scarred Veteran

In 1996, for an international widget company focused on selling to the Japanese tourist and looking to expand its business, Korea was the Promised Land. Korea had a widget business well in excess of (U.S.) $500 million, and was the second most popular Japanese tourist destination. No foreign companies were in the market, and my client BWC (a world-renowned widget company), sought to change that. They did, for a while. This paper analyzes select aspects of the twelve months of Round One negotiations that led to the triumphant signing of a Joint Venture Agreement with SY, a leading Korean widget retailer. Space constraints permit only the briefest recap of Round Two of the negotiations, which was the not-so-triumphant dissolving of that joint venture ( JV ) eighteen months later-a victim of the intervening Asian financial crisis. We found that in this Promised Land the milk was not so fresh and the honey not so sweet. We also found that a carefully crafted agreement that plans for the worst-case scenario is essential to surviving the expected and unexpected risks of doing business in the often-volatile international business arena