When you hear the word “negotiation,” you might imagine labor disputes, greedy businessmen, or, maybe, a Hollywood hostage situation. But negotiation is simply the art and practice of getting the best and the most for your money. Usually, all you have to do is ask. If you could put hundreds of dollars in your pocket just by asking a simple question, would you do it?
I have successfully negotiated for, among other things:
- 12% off an LCD TV (and got them to throw in a $30 HDMI cable)
- 30% off a washer/dryer set
- 40% off a used car (also 30% and 25%, on other used cars)
- 10% off a vacuum cleaner
- Free software upgrades on a new laptop computer
- 23% off the price of our home
Don’t assume that a store’s sales price is non-negotiable; oftentimes, it’s not. And there’s nothing unethical about asking for a better deal.
Here are 11 Tips to help you get the best possible deal by using the art of negotiation:
1. Prepare, Prepare, Prepare
This is the most effective element of negotiation. Do your research, check other stores, find alternatives and gather as much information as you possibly can about the product and the seller. Look online to see lower sales prices that retailers may have offered in the past. That’s also a good time to look for upcoming sales events.
2. Get Psyched Up
Preparing for a negotiation can cause anxiety if you haven’t mentally prepared and gotten motivated. Remember: This is a business transaction; it’s not personal. As much as you can, leave your emotions at the door.
3. Dress For The Role
If you’re negotiating for a sofa at a high-end retailer, dress in business appropriate clothing. If you look like you’re serious, salesmen will take you seriously regardless of where you’re shopping.
4. Always Be Polite and Respectful
A smile, charm and respect go a long way. Be someone the salesperson wants to work with, not someone they want to get rid of. Having a positive interaction with a salesperson will give you a better shot at a discount.
5. Consider Your Own Value As A Customer
A hotel may be willing to offer a lower rate or free room upgrade if they aren’t at capacity. A restaurant may offer discounts or throw in some extras for a larger than average bill – say, a birthday party or reserving a room for a private event. In exchange for a discount, offer your gratitude, loyalty, the promise of repeat business, and mention you’ll give the store a shout-out to your 6,500 Twitter followers.
6. Be Willing to Walk Away
If you aren’t willing to walk away, then you have no negotiating power. If the salesperson won’t give you a deal you feel good about, politely tell them their offer isn’t quite good enough, leave them your contact information and tell them to call if they change their mind. Try other stores or sellers and find one that will give you a favorable deal. I have walked off car lots and out of stores, only to be called back by a seller and offered the deal I asked for.
7. He Who Pauses Longest, Usually Wins
When you ask the question or propose the deal, zip your lips. Let the awkward silence force the salesperson to begin speaking. If they propose a counteroffer you’re displeased with, sit silently and count to 10. This will throw them on their heels and they may backtrack and offer a better compromise.
8. “I’d Like To Speak To The Manager”
In a retail store, the floor associate likely doesn’t have the authority to negotiate, so ask for the store’s Manager. If the Manager isn’t willing to budge, politely ask to speak to their manager. Even the hint that you’re willing to escalate the conversation may cause them to back down and cut you a deal. Persistence pays off. So does being a (polite) pain in the butt.
9. May I Speak to The Retention Department, Please?
If you’d like a better price on your current cable, wireless or Internet service, call and ask to speak to your provider’s retention department. Let them know you’re considering switching providers unless they can offer you a better deal. Research the “introductory rate” their competition offers and ask why you shouldn’t switch.
10. Keep the Lines of Communication Open
If the salesperson or manager won’t give you the initial discount you ask for, ask them, “What can you do to sweeten the deal?” Give them the chance to make a counteroffer. If you’re satisfied, you can accept. Otherwise, it’s your turn to make another counteroffer or walk away.
11. Man Does Not Live By Price Alone
In some cases, the manager truly can’t budge on price. In that case, ask what extras they could throw in to “sweeten the pot.” If the store can’t discount your new TV, maybe they can offer some free accessories.
The art of negotiation is all about coming to a mutually beneficial purchase agreement. For most people, this can be uncomfortable at first. Get out there and try it. You’ll get better with time. In the end, you’ll be the smart, savvy shopper that can brag about the hundreds you’ve saved by simply asking for a better deal. Now get to it and save some money!
Do you typically try to negotiate for a better deal before making a purchase? Do these tactics work for you? What are some others you’ve tried? Join the discussion in our comments section below.
Clint and Katy Davis are PerkStreet Customer Columnists and founders of Davis Coaching. As financial coaches, their passion is helping people become and stay debt free! Their personalized coaching is designed to help you get your financial life where you want it to be. Like personal trainers for your finances, they can help you develop a specific plan to achieve your goals, and provide the expertise and accountability to get you there. If you’re ready to take control of your financial life, visit Davis Coaching online, check out the Davis Coaching blog, and connect with Clint and Katy on Twitter and Facebook.