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How “Not To Be A Jerk” Haggling Guide

Posted By Jim On 04/23/2012 @ 7:13 am In Personal Finance | 13 Comments

As a kid, I would visit Taiwan every few years. My parents emigrated to the United States a few years before I was born and every few years we’d have the chance to go back to visit family. One of the lessons I quickly learned was that haggling was a way of life almost everywhere else outside of the United States. Whenever we went to street markets, everything was negotiated. If you wanted to buy a product, the listed price was the starting point.

I loved haggling because it was like a game. I rarely got money from my parents so it was a precious commodity. As a kid, without a healthy dose of social morays, I haggled like a champ. I’d ask for ridiculous things because I didn’t know any better! As I grew up, I realized some of the tactics I used made me a jerk (had I been older) and so I adjusted.

These are some strategies I use today, whenever we’re traveling, and not meant to be an exhaustive guide on how to haggling. It’s just how I do it, based on my own ideas of what makes you a jerk, and what is effective.

General Idea

Remember that in negotiating almost any sale, the buyer has all of the power. The only way the buyer loses power is if they give it up willingly because the buyer can always walk away. If you need to buy a car, there are a dozen dealerships within twenty or thirty miles of where you are right now. There are going to be multiple Toyota, Ford, or GM dealerships so if you don’t like the salesperson you’re talking to, go somewhere else. Buyers have the power because they can always leave. No vendor will every physically stop you if you want to leave, that would be against the law. So, knowing that the seller needs to make the sale more than you need to buy puts you in control.

Next, don’t feel bad negotiating. If the vendor isn’t going to make money, they won’t sell it to you. You aren’t taking advantage of them, you’re simply decreasing how much they’re taking advantage of you!

Remember, the goal of negotiation is to arrive at the “real” price of the item. The list price is just the start.

Observe

As you’re shopping, watch the vendor to try to assess how open he or she is to negotiations. It only takes two seconds to realize that walking into a Gap and negotiating won’t work. The same applies on a person by person basis, some people just won’t negotiate regardless of the situation. Don’t waste your time haggling with them because it won’t work and it’ll just frustrate you.

Be Nice

This is rule number one – be nice, cordial, make some jokes, and be an all around nice person. You’re about to go into some hand to hand haggling combat but people are generally more willing to give you a deal if you seem like a nice person. Think about when you play any intramural or adult league sports. You certainly want to win but you really want to crush those teams that take kickball or softball way too seriously. When you lose to a more cordial, friendly, “out to have fun” type of team it doesn’t bother you as much – same logic here. Plus, it’s just good to be nice!

Learn to Pause and Consider

My favorite tactic is to simply sit/stand there and be quiet. Ponder it. Do the math, take your time. It’s not like a conversation where an awkward pause can actually be awkward. When you do this with a street vendor who has invested five minutes trying to sell you something, they get anxious. They want to make this sale so they might offer concessions without you having to do anything. If you aren’t comfortable standing there, or pausing simply isn’t working, just ask if they can do better than their last offer. Say things like “that’s just too much, is that the best offer?” and you might find out quickly whether or not they’re willing to let you walk away.

Look Disinterested & Be Willing to Walk

The seller wants to make a deal so if you act like you’re disinterested and they’re about to lose you, they might come with a better offer to keep you in the conversation. Also, being willing to walk away (and actually walking away) is crucial because acting disinterested only works if the next step is walking away. If you aren’t willing to walk, an experienced seller (and they are experienced if they’re in a street market) can tell this and adjust accordingly.

Bulk Purchases

If you plan on buying several items or a few in your group want to buy the same thing – negotiate a bulk deal. Step one is to negotiate the one item down to a place where you’d be happy to do the deal. Then, keep the negotiation going by adding in the fact that you want two items and see where that gets you. If something costs $15 by itself, see if you can buy two for $20 (or $10 a piece). Maybe you don’t get two for $20 but you get 2 for $24, which is an extra $3 savings per item. Don’t do this unless you’re willing to get two (that would make you a jerk).

Story About Tactics

This is a story I once told in an old your take about haggling [3] in Bermuda. It showcases a few of the tactics above. We were in Bermuda with friends, near an open air market, when I saw a kid was selling conchs. The list price was $10 each and I knew the cost of them couldn’t be more than a dollar or two, so the kid was looking at huge profits on each sale. Tourists were walking up, paying the $10, and walking away happy. I walked up and asked him how much they were, he responded $10. I said it was too much and stepped aside [acting disinterested]. I waited until there was a lull in his sales volume (my friends were shopping in the market, I was just drinking my adult beverage) and then offered him $6. He said no, to which I responded $7… then he pondered, then I quickly said “we’ll buy two for $10.” [bulk purchases] He agreed.

What tactics did I not include? Anything that requires deceit, such as agreeing to a price and then saying “oops, I only have [something less]” or negotiating on behalf of someone else (who isn’t there) to try to find the lowest price they’d go to, makes you a jerk in my eyes.

I know it’s all fair in haggling and I wouldn’t begrudge you for doing it, but I would think you were being unfair.

Do you have any favorite haggling tactics? Ones that you know make you a jerk but that you do anyway? Or any that you’ve always wanted to try but haven’t had the chance?

(Photo: kayone73 [4])


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[3] your take about haggling: http://www.bargaineering.com/articles/bw-article-retail-negotiation.html

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