When preparing for negotiations, ALWAYS develop your opening offer before developing your least acceptable agreement or walk-away position.
Hagglers in Paradise
By Marianne Eby
There are many places in the world where consumers haggle and would never pay asking price – like the souks of Marrakech and the Beijing Silk Street Market. But nowadays even the US retail stores are fertile haggling territory. Know how to extend your holiday haggling into the January 2014 retail sales bonanza.
Haggling is a cousin to serious negotiations. Haggling is the back and forth that is used to get a quick deal from someone you aren't likely to deal with again, like in the souks and flea markets. A 2009 Consumer Reports survey found that only 28% of Americans say they haggle often. But by 2011, talk of negotiating price tags at retail stores became a common sport of savvy consumers who read Kiplinger advice columns. And now it’s so common that one click on wikihow teaches us how to do it.
As reported in the New York Times, what’s more interesting in this last holiday season is that retailers are both training their floor sales managers to haggle, and inviting the public to do so. This may be an attempt to turn the tide from consumers who use brick and mortar stores for looking, only to return home and search the Web for the best price on the same item. The retail stores are fighting back. One has trained its managers not only to meet competitors’ prices, but given them authority to beat them. And they’re not just focused on price, but are creative in offering you add ons (that may or may not meet your needs).
As consumers, our job is to answer this call to action. You don’t need to be someone who negotiates deals at your day job; you just need to follow a few simple guidelines -- the fundamentals all master negotiators hone:
- Prepare: get information so that you know why they should lower their price for you or what else they can offer you (or you them). It’s never been easier to do research on the price and quality of what you want before entering a store, or just use your smart device while browsing.
- Plan your positions: Determine your opening request (what would be the most awesome deal, but one that you can defend), and know at what point you will walk away. Write those two positions down to prevent yourself from asking for less, or settling for less.
- Have a planB, whether it’s foregoing the purchase, waiting for a big sales day, or going elsewhere. Having a back-up plan (referred to by business negotiators as a Best Alternative to a Negotiated Agreement, or BATNA) will give you the confidence to ask for what you want, and to engage in a conversation about the possibilities.
- Do engage! Friendliness wins every time, not arrogance. Every master negotiator knows that people give the best deals to people they like. But don’t waste the retail staff’s time on lots of small talk about the weather and yourself; use sincere curiosity to ask themquestions about the company, the job, their long day, the product or service, the other customers, the market this year. Show an interest in them and they will show an interest in you.
- Don’t make assumptions that prices and terms are set in stone. At a clearance sale at a high-end retailer the other day, I asked for help with the down coats (facing our first cold winter in years). I fretted over the high price which showed a markdown of only 20%. I then asked the sales person if she could try the coat on so I could see how it looked on someone else. I added in some flattery when I saw the coat on her, and only then asked if a further reduction was coming. She whispered that that there will be a pre-sale in 3 days with another 40% off, where shoppers can purchase then and pick the item up a few days later once the actual sale begins. Knowing I would risk losing the perfect down coat, I asked if I could do a pre-pre-sale – getting the extra 40% off now, but willing to wait to pick up the coat with all the other shoppers in a week. I’ve been nice and warm ever since!
- Be creative: offer them something (like cash, buying in bulk, taking the odd size off their hands, a comliment to their manager). This is where your creativity can pay off, as you give something of value that costs you little or nothing but that they value, in exchange for something you want. What value can you find, beyond the price and the profit margin, to bring into the negotiation? Would using cash save them money? Will it go on sale soon anyway? Do they work on commission and would rather you buy from the now than from their colleague on another day? Would a referral, or a positive “Yelp” review be valuable PR?
- Above all, respect your counterpart as a person making a living. Haggling over a retail price, if you engage in it, is a game which involves a short-term relationship. Insulting your counterpart or being a jerk will ruin the game and most likely, your chances of a good deal.
Want more advice? Here's 10 Tricks for Haggling Over Price at Any Store.
One more reason to haggle in this January's retail sales?
Negotiation takes practice. The more you practice, the better you become at building rapport, asking for what you want, seeing possibilities, asking questions, and leveraging your willingness to walk away. The more you do it, the better negotiator you will become.
Have fun haggling in and out of your vacation paradise!