The Times is reporting that recession-fearing chain stores like Best Buy, Home Depot, and Circuit City are increasingly more desperate to clinch sales by negotiating prices. Hit the jump to see how ordinary shoppers are wielding research and charisma to knock added savings out of retailers.
Michael Roskell, 33, a technology project manager from Jersey City, N.J., said he and a friend from high school periodically visit electronics stores. While Mr. Roskell expresses interest in buying an item, his friend acts as though he is dissatisfied with the price and threatens to leave.
“We play good cop, bad cop,” Mr. Roskell said.
In February, he said, the friends got $20 off a pair of $250 speakers at 6th Avenue Electronics in the New York area. Earlier, he and the same friend negotiated to buy two 46-inch high-definition Sony televisions at P. C. Richard & Son, a New York-area electronics chain.
List price: $4,300. Price after negotiation: $3,305.50.
“My parents never did this,” Mr. Roskell said. “But once you get it, you realize there’s a whole economy built on this.”
The strategy can even work when buying pants. At least it did for David Achee of Maplewood, N.J., who said he went to a Polo Ralph Lauren store in the SoHo neighborhood of Manhattan last month and became interested in a pair of pants on the clearance rack for $75. He told the salesperson that he had seen a similar pair on the Internet for $65, adding that he thought the pair on the rack looked worn (even though he did not really think so). He got the pants for around $50, he said.
Among his other tactics, he said, he sometimes threatens to walk out of a store and go to a competitor, as he did recently to get a price break on a drum set at a music store. But, mainly, he relies on researching prices and coming armed with information — prices he finds on the Internet and in ads from competitors.
“You can negotiate, but you have to do your research,” said Mr. Achee, who works for the Port Authority of New York and New Jersey. “When I’m bargaining, I’m bargaining with information.”
Research isn’t your only ammo. Buying high-margin accessories (that you can return later) can help coax salespeople into lowering prices. One former Best Buy salesman also suggests, “If you get denied once, go looking for someone else who looks nice.”
Of course none is this groundbreaking or new; it’s just becoming more accepted and widespread. What are your best haggling tactics? Share in the comments.
At Megastores, Hagglers Find No Price Set in Stone [NYT]
PREVIOUSLY: The Rebirth Of Haggling?
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I’ve done my share of haggling with the major stores, or at least attempted to haggle with them. Being a big fan of J&R and B&H I always check their prices before going shopping. Since they’re not nearly as close as the other chain stores I will generally print out the items and bring them with me. Without fail the sales associates just stare back at me vacantly and say that the price matching policy only goes for major chain stores, not local ones. Most of the time I’ll argue with them for a while, then ask them questions about the products that they should but invariably don’t know the answers to and leave unsatisfied only to go to B&H and have them be more than happy to haggle on the price (assuming that there are even any prices lower than theirs).
@nardo218: This reminds me of the “sale” that CompUSAs just went out with. The liquidator apparently went through and put prices up to or past full MSRP and then started with 5% or 10% off. Even the demo units and the broken stuff. It was such a joke, I visited several times just to see how ridiculous they could be. But miraculously the cashiers were working and stuff was disappearing off the floors even though their non-returnable stuff kept selling at a 30-60% premium over NewEgg, Amazon, Buy.com and other places.
I guess I just don’t get the American mindset – so brainwashed that if they see a price written on a sign then that is the price they pay without argument – believing they are getting a deal even when they are really selling out their return rights for little to no discount over an open store down the street. People were actually looking at AND PURCHASING older model out-of-box “demo” laptops that had been marked up to MSRP or above and then “discounted” by 5%. I found a couple things that were of mild interest if prices met some level of reality, but the written price was “non-negotiable” so I just laughed and moved on.
Competing with the stupidity of buying at full retail with no guarantee was no match for my senses – in several trips I finally found ONE thing that was a mild deal and bought it just for fun. But the visits there did give me much deeper insight into how gullible the Americans are about what authority tells them is “real.” Baaaaaaaa baaaaaaaa.
When I worked at Circuit City, I’d estimate that more big screen televisions left with a markdown than without. I actually got kudos for seldom asking for markdowns from the manager.
High-end televisions 32″ and larger, and all televisions 42″ and larger (save loss leader or ADV items) tend to have high margins. High-end audio tends to have high margins. These items can be marked down. Managers seldom think twice about making a largish purchase zero-interest – never pay interest on a big box store card, especially when it’s one of the easiest things to get.
Cables and warranties don’t get markdowns. It simply isn’t done. There are tight quotas on these items, and if they marked them down, it’d look like cheating.
Computer equipment has little margin, so you shouldn’t expect much of a markdown.
Decide what you’re buying before you ask for special consideration on the price. Managers often look at the margin on a whole deal to pick a markdown amount, and you want them to see cables and warranties when asking for an adjustment on your main purchase.
One category where I’ve successfully haggled, or at least asked for a lower price, for decades is that of very slightly soiled (a dirt stain on one sleeve, for example) or damaged (a missing button) apparel.
You have to get the manager or department manager to do this, but it can be worth it. The store doesn’t have to waste time declaring the garment a loss, and you can get some bucks knocked off the price and then go home and sew on a button or whatever. I learned this from my mom back in the “Leave it to Beaver” era. She was a tough shopper!
@dweebster: Every time you haggle, God kills a kitten?
So I used to work retail and never felt this pressure. My question is purely conjecture.
Will wages, or the pressure to hold a job, ever require (or “economically suggest”) that a retail agent should comp you the difference for a price that is negotiated?
Will that put the sales person on the hook, if for example, you don’t pay, but they paid out of pocket on the expectation on a commission that they don’t collect?
Now surely if the agent is greedy no pity is needed, but what if they’re just trying to make ends meet, or make them meet a little better. Offered you a short-term discount in order to secure their long term gain?
Is that a real concern for anyone? Or just an imaginary one?
@spanky: “How are those quantified, and how are they applied? Should pretty girls get better discounts than ugly ones? Should women get better discounts than men? What about discounts based on class distinctions? Age? Race? Religion? Thing is, without a uniform pricing structure, people do get discounts based on those criteria and others.”
But people already get discounts on those criteria, even with the allegedly uniform pricing structure. I once got a half-price oil change because the counter clerk wanted to get in my pants and gave me the, and I quote, “pretty girl discount.” And added, “I can’t believe they forgot to put that on there in the first place!” (Insert your own Jiffy Lube jokes here. And then insert your own “insert” jokes here.)
I’m not an economics person, but if prices were set based on actual business needs and actual market conditions, rather than “inflate for highest profit,” wouldn’t there actually be LESS room to make deals based on the “pretty girl discount”? Most of the places where I haggle I get discounts because I’m a good customer who refers other customers — that’s a business decision, not a discount because the way I look (that was the only pretty-girl discount I ever got) or my sparkling personality. When I give discounts to clients, it’s not because of what they look like, it’s because in my estimation, in this particular case cutting my rates will be better for my business in the long run and/or it’s the right thing to do.
The key is to be armed with legitimate information. If I walk into a store and the salespeople know they are dealing with a dude who knows what he is talking about, they are willing to talk. So long as apples are being compared to apples, the store will give.
If you happen to know the actual cost to the retailer, like if you get a Consumer reports printout on a new car, the only argument is whether to give the dealer more, or less, than a 3% mark-up. If y’all are willing to take a car off the dealer’s lot, you have the additional leverage of saving them a ton of interest cost. Ask how long it has been sitting there. If it’s been more than a month, the dealer will almost surely sell it to you for his cost – anything to stop paying interest on that car sitting there.
Well, coming from a starving college student that worked RadioShack’s base pay of minimum wage, my commission was something I was not about to just give away to anybody. But as it was, I very rarely ever had anyone try haggle a price, and 90% of those were on the floor models. And the funny thing is, the ones that wanted to haggle were the ones that asked me questions about their home theatre set-up for 45 minutes, while my co-worker has made 10 sales in the same amount of time. So, no, consider paying the full price compensation for my knowledge (oh, and being a loyal customer is cool too).
Another thing about my experience with hagglers, they were already sold! I literally only had 2 or 3 customers walk out when I wouldn’t budge on a price. They would ask if I could lower a price and I would reply politely but sternly (that was key, especially me being 18, I couldn’t let people doubt that I didn’t know what I was doing) that regrettably I could not. “Oh shucks,” and we were on our way to the register. Even with floor models, I would explain that I all could give them was the extended “open-box” warranty and most people were satisfied.
Granted, 60% of our customers were over the age of 50 due to our location, so all I had to do was prove that a “young buck” like myself could provide some courteous, knowledgeable customer service with a big ol’ smile and they were sold. (And no, I did not con elderly people into buying 90$ monster hdmi cables, I felt bad enough selling them the 40$ shack brand)
Several of the morning trash news shows have jumped on this and claim you can try this practically everywhere (yeah right). I can just envision people coming back to post that either security at the big box store booted their asses out on to the street or they found their utility(s) cut off (when they insist they deserve a better price).
I know the article isn’t about cars but when I bought my truck in 2003 I got the dealer to go from $13485 down to $8950 with a brand new set of tires. It was used but had been on their lot for about 3 months. I didn’t act like a jerk, I just basically kept my mouth shut while the sales manager kept coming down in price. It didn’t hurt that I was preapproved from my bank for $43k. I could have bought anything new or used pretty much on their lot. Sometimes haggling can be just keeping your mouth shut and letting the sales guy guess as to what you are thinking.
@Eyebrows McGee: As I said, I know that people get discounts based on those things. I’ve gotten the ‘pretty girl’ discount, the regular customer discount, and things like that myself; and I’ve seen lots of people get race based discounts and/or service upgrades, too. I don’t mind regular customer discounts, combo or volume discounts, or things like that, but I don’t like race, sex, or appearance discounts. Apart from being sort of creepy, they’re just not fair. But there’s no good way to prohibit the kind I don’t like while still allowing what I consider legitimate uses, so I wouldn’t advocate a big official crackdown. I just don’t go back to places that regularly engage in practices I consider hinky, regardless of which side of the hinkiness I’m on.
That’s why I say there’s a fine line. I think it’s a good thing to empower employees to make decisions. In a coffee shop or something, giving employees the power to toss someone a free coffee every now and again can be great for morale and for business without feeling that they have to explain their reasoning, and the inevitable inequities are a fairly small issue. And you offering your services at a discount for deserving clients is perfectly understandable, acceptable, and even inevitable. Hell, I charge annoying clients more, and I give fun projects and pleasant clients discounts on my services, too.
What worries me is when a store is routinely charging different customers different prices, especially for big ticket items. Whether it’s conscious or not, those uneven pricing structures will always skew for race, sex, appearance, etc., and when it’s happening regularly, it can add up to serious inequity.
Know when and where to haggle.
Haggling at an auto dealership or an appliance showroom? Sure.
Haggling with a minimum-wage clerk at the video store? No.
One time I needed to buy two pipes for smoking ganja, and each one was selling for $35. I threatened to go to another smoke shop – a competitor – and the sales person sold me both pipes for $40.
It’s good to haggle.
Americans (and i consider my self definitely american even though I was not born in the country) really don’t know the first thing about haggling. Unless you’ve lived in asia or europe, you really haven’t had to do real hardcore back and forth haggling for your goods. I’ve seen shops cut prices 75% or more based on the skill of the person. The fact that the price are so inflated in the first place means that there are definitely suckers who pay it.
The best way to keep the haggle going for me is to be really interested in the product. No one wants to waste time on window shoppers, so if you can let them know that a) You want to buy and b) you won’t take any BS then it gives the seller more incentive as they know at the end of it they’ll have a definite sale. With cars, that means cash (or loan) in hand, edmunds/bluebook prices at the ready, and bottled water and snacks for the long haul that is the auto buying process. I’ve seen people walk into a dealership totally unprepared and while I didn’t stick around to watch the aftermath, it looked like they were gonna get completely taken simply because they don’t know where they stand in the whole process.
Finally, In order to haggle well you really have to enjoy the process, and play it like any game. You’ll lose more often then you’ll win, but hey, a loss just means you walk out and you didn’t pay anything.
I had a friend who owned an elctronics store which was a Panasonic dealership. Since my brother and I gave him a lot of business and to keep in Panasonic’s good graces to order and move as much as possible he would custom order anything I wanted (so long as it was Panasonic) for whatever it was selling for the cheapest (and he was making a profit of course)
I feel bad he retired. I much prefer doing business like that with a local guy you know over the chain store. I refuse to haggle with a salesman or be an ass about it.
Of course, if it’s a car, well you’re expected to haggle.
I work at Radio Shack and frankly haggling is just annoying. I can’t give anyone a discount on the set price of any of our items. I don’t know how it works at Best Buy or Circuit City, but the only person who can adjust the price of an item we sell is the manager of the store. The rest of us could be fired for giving out special discounts.
But, if you get a helpful employee at a Radio Shack the best thing to do is ask what they think is the best deal. They usually know the product and if they’re honest they’ll usually tell you whether or not you should waste your money on a certain product or whether it’s a good deal or not.
For instance, yesterday a gentleman came in to buy a $99 GPS we advertised but we were out. I told him there was a store a few blocks away that had plenty in stock. Then I told him that we had an unadvertised deal on a Sony GPS with similar specs for only $79 (original retail $249.99). He asked me which was the better deal and I told him that I’d save the $20 and take the Sony, which has good reviews and is only discounted because it’s sales are poor compared to Garmina and TomTom.
I own a small shoe store, I price our stock less than the “mall/big box” stores by a few bucks. HOWEVER, I pay more for my products because I can’t buy in the same quantities.
Contrary to what these articles say, go try and buy a pair of Reef flip flops @ Macys and demand a 25% discount. See what happens. I tried it yesterday (w/o the “demand part”) just to make sure. Sorry, but no, was the answer. But yet people think the small guy HAS TO! Macy’s won’t special order for you (yes, that costs extra for me too) nor do they have signs saying Military discount. IMHO, iIf you have to bargain for a $40 sandal, please reconsider whether you can really afford it instead. Payless is out there as is Walmart both are s a viable option. I cannot tell you the number of people who park their Land Rovers, Hummers or Expeditions in front & come in crying poor & want us to help pay for their gas. I have sales on some styles up to 40% off, yet this is still not enough. I’m not making more than $6 on these, not counting shipping I paid to get them there!
So, in closing, sure haggling @ car lots, hotels, etc. makes perfect sense. But by doing it continually to small businesses you will only end up w/us closing. Will you be happy with only Payless or Walmart or Macy’s, etc? I hope so because the small boutique that carries those cute shoes, dresses or stylish shirts & shorts that you prefer won’t last. And once the economy is back up and running strong, you’ll end up buying those things @ Nordstrom for more than ever because haggling put their competitors out of business.