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Personal Finance
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Talk your way to a lower price
Sticker price is only a suggestion. Learn how to score discounts on everything you buy.
June 13, 2002: 2:40 PM EDT
By Annelena Lobb, CNN/Money Staff Writer

NEW YORK (CNN/Money) - You consider yourself a decent shopper: You clip coupons, buy in bulk when you can, and hit the after-Christmas sales at your favorite stores.

But there are those among us whose consumer savvy goes above and beyond raiding the bargain bin. Come on, you know who they are: Perhaps your sister can talk a sales manager into a whopping clearance price, and get a free gift or three thrown in to boot. Or you have a friend who sweet-talks his way to free drinks and dessert at most restaurants he visits -- even if he isn't a regular.

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What do they have that you don't?

Finely honed negotiation skills that help them land a better deal -- "better" meaning advantageous to both buyer and seller.

And you may be surprised to learn that few prices in the U.S. consumer marketplace are fixed. Successful negotiation can knock down the price of department store clothes, electronic equipment, child care or even doctors' bills.

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"People can negotiate for anything from the price of medical care to taxicab rides," said G. Richard Shell, author of "Bargaining for Advantage: Negotiation Strategies for Reasonable People" and a professor at the Wharton School of Business. "My MBA students learn to negotiate everywhere from Nordstrom's to the supermarket."

If you're ready to learn the negotiation dance, keep reading.

The rules of the game

1. Do your homework. The precursor to good consumer bargaining is being an intelligent shopper, said Steven P. Cohen, president of the Negotiation Skills Co. You need to know where you can find the best deals and services.

"A man visiting the Canary Islands, where lace is a big seller, ran across a woman selling lace tablecloths," said Cohen. "They bargained like the dickens and he bought the tablecloth for $6. The next day, he saw the same tablecloth on sale in a store for $6. The sheer fact that you're bargaining doesn't ensure you get the best deal -- you have to do your research first."


Take the Money Quiz: Are you a good negotiator?


Always go in armed. You can haggle on firm ground over the price of a stereo, for example, if you know competitors sell it for less. The authors of "Negotiating for Dummies," Michael and Mimi Donaldson, urge you to check Consumer Reports and conduct online searches before you make any major purchases.

The more information you have before you bargain, the greater your chances of scoring a deal. Ask shoppers who frequent your favorite stores why it typically offers discounts -- some use price breaks as an incentive for buying multiple items or opening a charge account, said Shell. Use those rules in your favor.

2. Pick the right partner. You won't do yourself any favors if you're trying to get a trainee at a call center to waive shipping fees on the DVDs you ordered. It never hurts to ask, of course, but your best bet is to target a decision-maker, said Shell.

That's usually a senior employee or a manager, but different places have different rules.

"I found out that at Bloomingdale's the whole floor staff has 10-percent-discount authority, if they thought, in their discretion, that giving it was the right thing to do," Shell said. "At some stores that you don't think of as places to negotiate, you may find [that the] staff have privileges to help you."

If you're unsure whom to talk to, find a more senior employee, who's likely to have the authority to grant you a discount -- and who's interested in having you (and your business) back.

3. Ask plenty of questions. Now it's time to put that research you did to good use -- open the door to a better deal by asking the seller how you can swing a discount.

"This rule trumps all the others," Shell said. "Ninety percent of people don't get discounts simply because they don't ask."

But you have to ask politely, and in your own style. Remember, your best chances come when you make a deal advantageous to the store or service provider, too.

Could you get a break by paying with cash instead of credit? If they're trying to move a floor sample, is it possible to get a discount? If you can bring them new business, could they give you a price cut? What if you purchase a warranty?

4. Remember the soft sell. Questions are great, but avoid the rapid-fire Q&A: it's not a press conference. The key here is to remember to take it easy and empathize with the other person as much as you can.

The Donaldsons claim empathy is the bedrock of all successful negotiation, whether it's in the boardroom or over the price of a sweater. And Shell said a light touch and a personal, attentive approach go a long way.

"Treat the person with respect, and be upfront and honest if you need their advice on a product," Cohen said, who added that someone who feels treated like a valuable resource will be more likely to cut you a deal. "Ask for their expertise. If the person is honest and honorable, they'll probably volunteer more help than you ask for."

5. Don't play power games. A word to the wise: Keep your ego to yourself. One of the biggest myths out there is that a smooth talker who swaggers in and impresses the salesperson always gets the better deal.

Nothing could be farther from the truth.

"When people use bargaining as a one-sided game to 'get' the salesperson with whom they're bargaining, they're likely to leave a bad taste in the mouth of the dealer," Cohen said.  Top of page






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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.