EXAMPLE OF A NEGOTIATION; NEGOTIATING, BARGAINING AND HAGGLING
How to Haggle, Bargain and Negotiate
Step by step explanation of the bargaining and negotiating process.
Save $1000s when buying a car or a house and $100s on other merchandise. How to get the best deal. What you can bargain for. When you should negotiate. Haggling tricks and tips.
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5.0 EXAMPLE OF A NEGOTIATION; NEGOTIATING, BARGAINING AND HAGGLING
How do you apply the techniques to buying a house to a small item? The principles are the same. Here is an example:
Let's say you find a two year old VCR in very good condition with a ton of bells and whistles at a yard sale. The scribbled price tag says $125.
know that you can buy a brand new bare-bones VCR for $100 and that VCRs need repair after
a few years.
You explain to the seller that you have seen new VCRs selling for less and you have seen used VCRs selling for as low as $40. Notice you didn't say you are offering $40, it's just what you have seen. You are also letting the seller know that you are somewhat knowledgeable.
The seller says that it has been cleaned and checked recently and that he only used it on Sundays to watch a rental video. However, he will let you have it for $100 if you are really interested.
You ask if you can turn it on and put in a video. You push a few knobs and fiddle with the remote. You put your finger on a scratch in the finish. After a while the seller says, "Well, I guess I could sell it for $90."
then make your first offer. He has come down $35 so you come up $10. "I'll give you $50
for it because it seems to be in good condition." You have now justified why you are
willing to pay more than the $40 you originally mentioned.
The seller looks stunned. He was quite sure that he could get $90-$100 for it if he asked $125, but he is looking at a serious buyer who will take it off his hands. "$75 is the absolute lowest I will go," says the seller.
You take some more time. Try out all the various features. Ask to see the instruction manual. The seller shifts from one foot to the other. "Well, it does have a lot of features. I will give you $60," you say.
Now the seller has a choice. The bid and asking price are so close, the two can probably split the difference, or he can wait for another person to buy it, which might never happen. Also, the seller has now invested some time in this sale and wants it to succeed.
You say,"Look our prices are so close why not split the difference. $67.50?" The seller does not look happy. "Make it $70 and you've got a deal," he finally says. "Okay," you say.
How did the buyer get such a good deal? He knew and could justify the going price for used VCRs so he started low to begin with. He gave a rational reason for every rise in his offer. He let the seller drop his price twice as much as he raised his price. He agreed to the sellers price at the very end, letting him save face.