"When You're Negotiating, Money Isn't As Important As You Think" by Roger Dawson

prev 1 2 3 4 5 6 7 8 next
download printable version

Offer something in return to see if it will cause them to lower the price. "Would you take less if I let you borrow it once in a while?"
Have other people make super-low offers to lower the expectation of the seller. This is unethical of course, but I'll tell you about it so that you will recognize it when it's used against you. If the seller has high hopes of getting $15,000 for his truck, your offer of $10,000 may sound like an insult. However if he's had only two offers so far, one for $7,000 and the other for $8,000, when you come along and offer him $10,000, he may jump at it.
Make a low offer subject to the approval of a higher authority. "My buddy and I are going in on this so I'll have to run this by him, but would you take $10,000?"

Now let's look at some techniques that a seller could use to find out how much a buyer is willing to pay. Let's say that you sell switches to computer manufacturers.

Here are some techniques you could use:

Raise their top offer by hypothesizing what your higher authority might be willing to do. Perhaps they buy similar switches now for $1.50 and you're asking $2.00. You might say, "We both agree we have a better quality product. If I could get my boss down to $1.75, would that work for you?" Protected by Higher Authority, it doesn't mean that you have to sell them to him for $1.75. However, if he acknowledges that $1.75 might be workable, you have raised his negotiating range to $1.75 so that you're only 25¢ apart instead of 50¢.
Determine their quality standards by offering a stripped down version. "We may be able to get down below $1.50 if you don't care about copper contacts. Would that work for you?" In this way you probably get them to acknowledge that price isn't their only concern. They do care about quality.
Establish the most they can afford by offering a higher quality version. "We can add an exciting new feature to the switch, but it would put the cost in the $2.50 range." If the buyer shows some interest in the feature, you know that they could pay more. If he or she says, "I don't care if it's diamond plated. We can't go over $1.75," you know that fitting the product to a price bracket is a critical issue.

prev 1 2 3 4 5 6 7 8 next
Back to Index

November 2004