THE ROLE OF VENDOR NEGOTIATION IN REDUCING CONSTRUCTION PROJECT COSTS

Vendor negotiation can influence construction expenditure through prices, payment arrangements, delivery commitments, scope clarification and the allocation of commercial risk. Nevertheless, a reduction in the purchase order value does not necessarily produce an equivalent reduction in the completed project cost. This focused narrative review examines how negotiation can contribute to cost control while protecting quality and delivery requirements. Selected research on construction procurement, supply chain modelling, supplier evaluation and value management is combined with professional procurement guidance. The analysis distinguishes competitive bargaining from joint problem solving and separates predicted savings from savings demonstrated at financial closeout. A proposed framework connects technical preparation, comparable quotations, negotiation planning, contractual documentation and post-award verification. An illustrative procurement calculation shows how a supplier with the larger price discount can generate the higher risk-adjusted package cost. The review argues that negotiation effectiveness depends on the quality of the baseline, credible alternatives, supplier capacity and coordination between procurement and project delivery teams. Its contribution is a practical analytical framework for evaluating commercial concessions against their effects on total package expenditure. The framework is suitable for further testing in construction portfolios, including Saudi projects, but is not presented as an empirically validated savings model.