How to Negotiate a Cheaper Price on Anything

I’m not saying that you should create a discount by buying less of a car. I am saying that all things being equal, if you broaden your scope, you will have many more vehicles to choose from and a better chance of getting a substantial discount on a car with the features that matter to you most.

Isn’t haggling rude?

In this country, many of us have an aversion to haggling. Some people even think it’s rude, while others consider themselves too shy or inexperienced. The truth about haggling is that it is not rude, nor is it difficult.

Successful price negotiation depends less on style than on understanding a few simple principles:

1. All prices are negotiable.

This doesn’t mean that you’ll always get the price you asked for. It does mean you are in control of any buying situation.

“Not true,” I often hear. “The big company sets the price and I can’t do anything about it.”

“Not true,” I say. “It may appear that the retailer has the product you want. In fact, you have the product he wants more: the money, the cash, your moolah.” You always get the final vote on whether the transaction takes place.

Keeping this in mind helped me to save five grand on my midlife trinket. When the car dealer told me he’d given me his best price, I said it wasn’t low enough and left. Once home, I went online and found two other dealers within a 100-mile radius with the identical vehicle. I called the nearest, told him what the first dealer had offered and asked if he could do better. I promised to be a quick sale with no trade-in and let him know I’d pay in cash. (While auto dealers do like to write their own financing, cash is still king.)  The second sales manager quoted a price $2,000 lower than the first one.

The following day, I rang up the third dealer, gave him the name of the sales manager at dealer two, the price she had offered, and asked if he could do any better. Again, I promised a quick-and-easy sale. He replied that if I could make it in by that afternoon that he’d take another $1,500 off the deal, making my price just $36,500. 

The next morning, armed with two names and two lower prices, I called the first dealer again. I told him that I’d be willing to buy the car from him for $34,500—$2,000 below the best deal I’d been offered so far. He said, “No way.” I thanked him for his time, and hung up the phone. My next pot of coffee hadn’t quite finished its drip cycle when he called back with a counter offer a $1,000 higher than what I’d asked for. It was still more than $5,000 off the sticker price, so I took the deal.

At no time in the negotiation did I have to strong-arm, plead, or threaten. I simply created a bidding war for the product I was selling: my money. Each dealer wanted my money more than I appeared to want their cars.

Was it worth my time? In three days I saved $4,500.

2. You don’t need to buy anything today.

In a recent seminar, one attendee declared that my negotiating “secret” wasn’t a secret at all, that I was just “shopping around.” Not quite. Think about those car dealers. If I’d just called and asked for their sticker prices, I would not have received much of a discount, because they were all within a few hundred dollars of each other. Instead, I ignored the asking prices, kept control of the negotiation, and nudged them to bid for my business.

The “secret” was that I took my time. As long as those car dealers believed that I was willing to walk away, I had the power. When you walk away, you release the time and geographic pressure. And if you don’t need or want an item at a specific time from a particular store, you can shop around and get a great deal.

Next: If your money stays in your wallet, you're in control. >>