I like money. A lot. I want to keep as much of it as possible. At the same time, I want to spend as much of it as possible. It’s a conundrum for the ages…
Hi Everyone! Kevin is back with his Handyman Wednesday’s today. However, this post doesn’t involve tools, just your mind and a little niceness. After I found our new rugs at West Elm and Jess posted them, people asked how I got a good deal and how (and when) to negotiate with the salespeople. Here’s my little step by step process.
I’m in no way an expert, but I work in Marketing, I’m getting my MBA, and I quite often save myself a lot of money by following a few easy steps anyone can do. Read below for my handy little guide.
When to Bargain
This one isn’t so easy. There are a few times when negotiating will get you nowhere. Namely, big stores. There is no point trying to bargain at Wal-Mart, Target, or Restaurants. If you have a competitors coupon, bring it, ’cause that’s all you’re gonna get. Also, it’s pointless to try to negotiate for small purchases. If something costs $50 or less, the salesperson isn’t going to be extremely helpful.
Now on to the fun part: times it’s ok to bargain.
1. Where salespeople are paid on commission. Places like Best Buy, West Elm, Sears, and even Home Depot have salespeople willing to lower the companies margins in order to increase their personal rate of return through commission.
2. Any large purchase (and do your homework!). If you want to buy a Washing Machine from Best Buy, look it up on Amazon first and bring the printout with you. Purchases over $200 typically have some wiggle room.
3. Clearance Areas: This is huge. The reason there is a clearance area is to decrease margins and hopefully break even on the product. The business isn’t looking to get rich here, they need the space! I did a study in my MBA on a Christmas store in January. With the cost of storage and changes in fashion, along with high markups (100% markup), it was even money to offer an 80% off sale instead of storing all the goods for the next Christmas. Again, clearance areas are just that, they NEED the stuff gone.
4. When you’re READY to buy. Don’t go into stores bargaining just to see what price you can get. This is unfair to the store and salesperson. However, when you are negotiating, maintain your exiting power. If they don’t get to the price you want, leave. Go somewhere else. They may stop you before you reach then front door.
Ok, so you’re probably tired reading about when to bargain and want me to move on, so here’s how I go about negotiating.
How to Bargain
Always remember this quote:
“Here’s the rule for bargains: Do other men, for they would do you. That’s the true business precept.” – Charles Dickens
And don’t be this person:
“There are very honest people who do not think that they have had a bargain unless they have cheated a merchant.” – Anatole France
I’m a huge proponent of being nice. The person across the table isn’t your enemy, they’re trying to put food on their table just like you do. Treat them like a person and don’t get angry with them. The nicer you are, the more likely they will want to help you. Ask them bonding questions (family, if they have one of these widgets at home, etc.) and they’ll actually WANT to help you.
1. ASK! This is the #1 A+++++ thing to do. Ask anything you’d like. My favorite’s are: “Do you have any coupons out there right now?”, “Is this the best price you can do?”, and “Look, I love this but can’t quite afford it right now, do you think we can work something out or is the price firm?”
2. PRACTICE! Practice makes perfect and you’ll never get better if you don’t try. I know it’s tough to approach someone and ask for a lower price, but think about it, you’re actually HELPING them out too. They aren’t going to sell you something at a loss, and you shouldn’t want them too. You’re still helping them out by asking for a better price because they still earn money. This is something I had trouble wrapping my head around until I gave it a little thought.
3. Flinch. This is the oldest trick in the book. When a salesperson tell you the price, give a little flinch (like you can’t believe it’s that much). They’ll instantly start to think about lowering the price.
4. Be ready to name your price! Often, when you ask for a lower price, the salesperson will ask you what it would take for you to buy it, right then and there. Have a target ready. Depending on the item, I usually suggest a 10-30% drop in price.
5. Ask for a manager. Typically, the salesperson has little power to approve price reductions. If you work with the manager directly, you can get to your price point much more quickly.
6. It’s not all about price. Sometimes, people just can’t lower the price. In these case’s, ask if they’ll throw in a warranty, or connection kit, or accessories.
7. Learn where to shop. I LOVE LOVE LOVE LOVE LOVE www.searsoutlet.com. It’s not the most user-friendly site, but it will search all you local sears clearance departments and show you a better price than what you can see in the store. I buy all my tools from there, along with a washer and dryer, air compressor, and garage door opener. The prices drop every week if they don’t sell, so check back often.
7. ASK! I know, it’s #1, but I didn’t want you to forget it. Be nice, make a conversation, and ask. You’ll never know if you don’t try.
What other tactics do you use to negotiate? Any good deals you’ve gotten recently? Any plans to negotiate in the near future? Any suggestions for next week’s Handyman installment?