Everyday Negotiation: Principles and Techniques
By Steve Gillman
In our culture the average consumer often limits the use of
negotiation to real estate transactions and a few other areas,
while paying whatever the stated price is for most things purchased.
This is a costly habit, and is based on the faulty idea that
most things are not negotiable. But in fact, in a 2007 survey
done by the Consumer Reports National Research Center it was
found that of those consumers who negotiated, 90% had received
discounts during the survey period, on everything from televisions
to medical bills and furniture.
This isn't a small matter. Most saved $50 or more each time
they were successful in getting a discount. Along with the results
they published online Consumer Reports also related a few true
stories, like that of the couple who, after getting several quotes
of around $25,000 for siding, negotiated one contractor's price
down to $17,000. For $8,000 it might be worth doing a little
Fair and Profitable Negotiation
Beyond outright hypnotizing of the salesman, which few of
us could do in any case, almost any technique you use to negotiate
a better price is most likely ethical. A smile has been proven
to be an effective subliminal negotiating tactic, and we are
probably all willing to do that. In any case, whatever we try,
the salesman or owner of the business should know how low he
or she can go while still making a profit, so we can hardly "take
advantage" of him.
There are exceptions, of course, and you can use your own
judgment as to how far to go. I once offered a desperate book
store owner half price for a children's book in Spanish, and
she said yes, followed by going out of business two months later.
Now some might think I took advantage of her, but the truth was
that I really only wanted the book at that price, and although
she made no profit (book seller typically pay 50% for their books),
she was failing regardless, and got more than the 20% she probably
got closing out the rest of her stock. In other words, I was
honest and she had the right to say yes or no according to what
she needed (which was cash flow at that moment).
There are dozens of techniques that professional negotiators
use. For our purposes - getting consumer items at a discount
- we'll look at just a few.
The most basic way to pay less is to ask. You can start with
"Can you do any better on the price of this?" You might
also let the salesman know an item is too much and ask if there
is a sale coming up anytime soon, which may prompt him to offer
To make this work better, though, it helps to first establish
some rapport. If you can find something you have in common with
the sales person (you both fish, read a certain author, live
in the same town), you're more likely to get a discount. So spend
some time talking a bit before asking for price reduction. If
the owner or sales person likes you it is much more difficult
to say no to your request.
Use what knowledge you have. If the item is priced lower at
another store, ask if they can match or beat that. If it is a
model that will soon be replaced and the store has a large inventory
to get rid of, let them know that you know this - but in a nice
way. If it is towards the end of the month and you lean that
the sales people are paid on commission with monthly bonuses
for volume, you know you can push a bit harder.
Be ready to walk away. Unless you absolutely need the item
that day, be ready to politely walk away from the deal if you
can't get the discount you want. You can always return the next
day and pay full retail if necessary, but walking away will often
b the trigger that finally gets the price lowered. Business owners
and sales people know that once a customers leave they almost
never return to buy the item, so they often will offer whatever
discount they can at this point.This most basic of negotiation
techniques has always been one of the most powerful.
Money Can't Buy
Happiness? - Or can it?
Got No Money? - Or just a lot
Ask and Ye Shall Receive
- An example.
Should You Do What You Love?
- Or do what makes money?
Increase Profits - Ten
tips for businesses.