Mark Lockley is a seasoned negotiator
There's no better time to indulge in a spot of old fashioned bargaining - and you don't need to be a smooth talker.
Marc Lockley, founder of Lockley Associates and author of How To Pay Less For More, shares his tips on how to get a good bargain through skilled negotiation rather than blatant haggling (there's a fine line) with Working Lunch.
WL: What is the difference between haggling and negotiating?
ML: Haggling is flying by the seat of your pants, being cheeky, asking for a discount without any justification for why you should have one. Negotiating is going in prepared with research as to why you should get that discount. It's looking at competitors and knowing the market.
What's the secret of success?
The skill with negotiating is knowing the motivation of the sales people - understanding both sides. Why you want and deserve the discount, and why they should give it to you.
Beware of giving off bad 'buying signals'. If you walk into a store and, for example, start telling the sales person how your fridge/freezer has just packed up, they'll see pound signs. They know your ready meal is defrosting as you speak... and so they know you will buy.
It's amazing how many people show their desperation! The trick is to remain keen but not over-enthusiastic.
Make your money go further by beating down the price
Do sales people on the shop floor have the authority to give you a discount?
Some do, some don't. You need to speak to a 'decision maker' so that's a manager or an assistant manager. Sometimes it's easier in an independent store because the owner is standing behind the counter.
Try it in larger stores when you are buying electronic goods - the sales staff have their own pre-agreed commission on sales so you can haggle and the salesperson can decide (and often does) to use part of his or her commission to cut the price rather than see a sale walk out of the door for the sake of a few pounds. To make the sale they'll ease the price on the principle that 10% or 5% even 2% commission is better than no commission at all.
What is the best saving you have made?
I got my car from the stickered price of £18,000 to £14,000 with some extras thrown in. This year I also got my fridge/freezer for £250 from £350 so saved £100.
You should complain if things aren't right and ask for a discount. I got £60-70 off my phone bills this year because I complained abut poor customer service. I got £8 off my internet package.
You can easily save between £1000 - £2000 if you negotiate well.
What preparation should you do?
You should go in with three prices in mind - your ideal price, your 'good' price and your 'walk away' price. If you can't negotiate on the price then maybe try for added value.
Make sure you know what their competitors are offering. Go in with a print-out of other stores' prices if you can. Know how the industry is doing as well.
A pleasant host may be more helpful...
Where should you be wary?
Don't push it too far in restaurants because you don't know what they will serve you! Also, it's pointless trying to push too far on independent hotels as you may get a discount but an unpleasant host. A pleasant host would probably be more help in knowing good value local services and discounts - so it pays to have them on side.
Is there a difference between negotiating goods and services?
With goods you usually won't get it below cost price. Whereas with services there is a lot more room for bargaining. Services are based on the current market; supply and demand - if their industry isn't doing well then they will accept a lower price than if it was booming. Its only worth what people are prepared to pay.
Is it really worth it?
If you do an hour and a half research preparation and make a £100 saving that's worth doing!
How do you get into the negotiating mindset?
Always ask yourself "Do I have to pay this?" Be able to justify why you want the discount.
When you first start you are bound to be reticent but when you get into it you will be walking out of shops and punching the air - it's a great feeling.
Is it unethical to try and squeeze small businesses out of their profits, especially in the current climate when they are trying to make ends meet?
No - they can say no. its about you and the shopkeeper agreeing on a price that suits you both. Negotiating actually encourages trade. In an independent shop you have the decision maker behind the counter so it's better for negotiating, which then brings business back to smaller independent stores rather than high street giants.
From their point of view you will be great for word of mouth if they are nice to you. It actually encourages people to trade and gets people to spend if they weren't able to afford the full price.