Circumstances that may favor the use of integrative negotiation approach in purchasing contracts.

1. Long-term relationships: If the parties involved in the purchasing contract are looking to establish a long-term relationship, an integrative negotiation approach may be more beneficial. This approach focuses on creating value for both parties and finding mutually beneficial solutions, which can help build trust and strengthen the relationship over time.

2. Complex or unique purchases: Integrative negotiation is often more effective when dealing with complex or unique purchases where there are multiple variables to consider. By working together to understand each other's needs and interests, the parties can find creative solutions that meet everyone's objectives.

3. Shared goals: If both parties have shared goals or interests in the purchasing contract, an integrative negotiation approach can help align these goals and work towards a common objective. This can lead to a more collaborative and cooperative negotiation process.

4. Win-win outcomes: Integrative negotiation is focused on creating win-win outcomes for both parties involved. If the parties are looking to maximize value and create positive outcomes for everyone, this approach can be more effective than a competitive or distributive negotiation approach.

5. Open communication and transparency: Integrative negotiation relies on open communication and transparency between the parties. If both parties are willing to share information, listen to each other's perspectives, and work together to find solutions, an integrative negotiation approach can be successful in purchasing contracts.

Circumstances Favoring Integrative Negotiation in Purchasing Contracts:

1. Complex and Long-Term Relationships:
- When suppliers and buyers have ongoing and interdependent relationships, integrative negotiation fosters trust and collaboration.

2. Interdependence of Interests:
- Integrative negotiation is ideal when both parties have overlapping or shared interests, allowing for the creation of joint solutions.

3. High Stakes and Significant Investment:
- In high-value contracts, integrative negotiation helps address complex issues and ensure a mutually beneficial outcome.

4. Need for Innovation and Flexibility:
- When the contract involves innovative products or services, integrative negotiation allows for creativity and adaptability.

5. Limited Time Constraints:
- Integrative negotiation can be more time-consuming than other approaches, but it can be effective when time constraints are not critical.

6. High Level of Uncertainty or Risk:
- In uncertain or risky situations, integrative negotiation helps parties develop solutions that mitigate potential threats and maximize opportunities.

7. Need for Joint Problem-Solving:
- When the contract involves complex issues that require input from both parties, integrative negotiation enables collaborative problem-solving.

8. Multiple Stakeholders with Diverse Interests:
- In contracts involving multiple stakeholders with varying objectives, integrative negotiation helps reconcile different viewpoints.

9. Desire for a Win-Win Outcome:
- Both suppliers and buyers can benefit from an integrative negotiation approach that prioritizes long-term value and mutual satisfaction.

10. Cultural Fit or Similarity:
- When parties share similar cultural values or negotiation styles, integrative negotiation can be a natural fit.