The typical American consumer has been reluctant to challenge
that retail icon, the list price. When I urge participants
in my Negotiation Boot Camp® seminars to bargain for goods
and services, you'd think I was asking them to commit a felony.
"You can't negotiate set prices." "People will think I'm cheap."
"That's not ethical." While it is acceptable to haggle with
car dealers, the prevailing wisdom is that the same approach
will not work in a department store or with your accountant.
In fact, a certain car manufacturer has advertised that they
have only one price so you won't have to be bothered with
the unpleasant task of negotiating. Isn't that thoughtful
Well, guess what, now that the economy has gone south on us,
these rigid attitudes about wheeling and dealing are loosening
up. The notion that you can stretch your paycheck by negotiating
better purchases is enjoying wider acceptance. My suggestions
for making deals were featured recently in Smart Money
magazine, and Fox News followed me around with hidden cameras
for an entire day as I bargained for consumer products, furniture,
hotel rooms, and clothing.
The following tips sum up my approach to getting the best
deal for your money:
1. Before you negotiate, do your homework. Read up
on the dealer's cost for the car you want to buy. Comparison
shop to see what different stores are asking for the same
piece of furniture or for similar items. Ask your friends
what their dentist charges for a porcelain crown. Do research
to determine which products are hot and which are not; the
best deals can be made on those that are less in demand.
2. Lower the seller's expectations by asking for concessions.
The only way to get a better deal is to ask for one.
Challenge everything they say. The more assertive you are
in pursuing a better deal, the more they will be inclined
to cave in and offer concessions. Remember that the seller
is under pressure to make the sale. Especially in a down economy,
sellers are desperate to find new business. In many stores,
the salespeople are actually instructed to give a discount
if the customer merely asks for one.
3. Try the Flinch. "What! You want how much for that
refrigerator? Are you crazy?" Flinching is a good way to find
out if the seller's expectations are low. It may turn out
that the salesperson shares your view that the price is excessive.
When you flinch, he may respond with a discount.
4. Tell a Sob Story. "I like your sofa, but I don't
have enough money in my budget. I didn't plan to spend so
much." This is not a lie. You have a right to set your own
budget. It is the seller's choice either to meet that budget
or to test your resolve by holding firm on price. The Sob
Story is your way of testing how much they want to make a
5. Execute the Squeeze. "I like your hotel, but I
can get a better room rate elsewhere." This is also called
the power of competition. Many sellers will do somersaults
in order to match or beat competitive offers. Simply mentioning
the competition will often lower the seller's expectations.
6. Nibble a little. "If I buy this dress, will you
throw in a pair of shoes?" The seller may not be able to discount
the dress, but they can sweeten the deal by throwing in other
items for free or at a reduced cost.
7. Buy in quantity. "What discount will you give me
if I buy three suits instead of just one?" Most sellers are
accustomed to giving quantity discounts. If you can, get your
friend to buy a couple of suits at the same time.
8. Don't limit your bargaining to price. Deals can
also be made for non-price items such as better terms (a discount
for paying cash; postponed billing), waiving the delivery
charge, and warranty (including the extended warranty in the
9. Be patient and persistent. If they say no, don't
give up. Sometimes the best deal will come only after you
have devoted some time to the quest, which convinces the buyer
that you are serious. A friend of mine spends four hours or
more when he buys a new car. He wears them down.
10. Be prepared to walk away. I call this Brodow's
Law: Your willingness to walk out and either buy somewhere
else or buy an alternative product is your greatest asset
in any bargaining situation. You must behave as though you
don't need to buy it. Many great deals occur when you return
the second or third time.
11. Wait for the seller's big sale or slow season. Many
clothing, appliance, and furniture stores substantially slash
prices at least once a year, usually after January 1. When
buying a car, consider visiting the dealer on a rainy day
at the end of the month. Or buy at the end of the model year,
after next year's models have been introduced.
12. Ask for their advice. If you politely ask the salesperson
for suggestions on how you can do better, she may surprise
you with ideas you never thought of, such as how the store
has given concessions in the past, or the dates of an upcoming
sale. Even if she doesn't have the authority to deal, her
ideas can help you to bargain with the manager.
13. Go to a higher level. If the salesperson can't
or won't give you the deal you want, ask to see the manager
or owner. Higher ups are more likely to bargain because they
have more authority, they don't have time to haggle, and they
are more inclined to look at big picture issues such as customer
good will and, "How many of these items do we need to move?"
Also, the amount of your requested discount may seem less
significant to a manager, who is looking at overall sales
figures, than to the salesperson, who is focused on her commission.
14. Find a way for the seller to save face. They may
be reluctant to give you a discount because then they can't
refuse to do the same for the next customer. They need to
maintain the integrity of their pricing structure. You can
give them a way out by accepting a product with a defect,
or by choosing the floor model, last year's model, or a repossession.
Any good reason you can suggest, such as a Sob Story or the
Squeeze, can help them to justify making an exception.
15. Be funny. The use of humor can lighten up the
atmosphere, weaken the seller's defenses, and make it easier
for you to assume a tough bargaining position without alienating
the salesperson. One of my favorite gambits is to ask, "Do
you give veteran's discounts?" It usually gets a laugh or
a chuckle, often followed by a discount.
Remember: None of these techniques will work unless
you convince yourself that it is okay to negotiate. When you
bargain for goods and services, you are participating in one
of the oldest human activities. The people who founded this
country were traders who wheeled and dealed all the time,
and in most other parts of the world, bargaining is a respected
art form that is enjoyed by both buyer and seller.
Although it won't work every time, bargaining is usually successful
often enough to make it worthwhile and a whole lot of fun.
The bottom line is that if you don't negotiate, you are unnecessarily
leaving much of your hard-earned money on the table. If you
don't ask, you don't get. Good luck!