How to negotiate: The ultimate guide

“No’ is a reaction, not a position. The people who react negatively to your proposal simply need time to evaluate it and adjust their thinking. With the passage of sufficient time and repeated efforts on your part, almost every ‘You Can Negotiate Anything no’ can be transformed into a ‘maybe’ and eventually a ‘yes’.”
– Herb Cohen, author of the best selling book, You Can Negotiate Anything

Fully embracing a frugal lifestyle means being able to negotiate effectively. In order to save money, you either need to make more money or reduce your costs, both of which involve negotiation to some extent.

Have you ever traveled abroad and noticed that haggling or bargaining is the norm – fully accepted by both parties as a way of doing business? Sellers and buyers expect some sort of negotiation as part of the process of making a final sale.

For most Canadians, on the other hand, haggling is not as common. This leaves you with less money in your pocket. It doesn’t have to be this way.

Here are tips for fearless, friendly negotiations.

Everything is negotiable (well, almost everything).

If you want to get the best deal, you need to negotiate – and you can negotiate just about anything.

Household bills, salaries, gym membership, bank fees, credit card rates, car insurance, dental visits, furniture, appliances, clothing, and more.

Don’t be embarrassed, too proud or worried about looking cheap.

So many people are concerned with how they will be perceived by asking for a better deal.

Who cares what other people may think! Do you think that “rich” people got rich by paying full price for everything?

Do your research in advance.

Know what the bottom line is that you are willing to settle on and know what else is available out there.

Arming yourself with information will help you better your chances of getting the deal done. As we know, retail stores price match, but even those that don’t advertise such policies will price match (or do better) just to get your business.

Have an end in mind.

Be prepared to walk away if what you want doesn’t happen.

Know the price that you are willing to pay and your bottom line terms, and keep them in mind while negotiating.

Don’t be apologetic.

You’re entitled to negotiate a more favorable deal. Don’t use any kind of language that implies you are apologetic (women may be more prone to this during negotiating than men).

Studies have shown that women apologize more than men, and you certainly don’t want to say “I’m sorry to ask this but…”. If you do, then from the start, you are implying that you are doing something wrong by asking.

Maintain positive body language.

For face to face negotiations, your non-verbal behavior sets the tone and plays a huge role in how things will turn out. Before you get a chance to speak, you need to exude confidence and positivity.

Did you know?: Renowned Canadian author Eliot Hoppe focuses on teaching sales professionals how to close deals by using non-verbal influence.

Even when on the other side as a buyer, the same techniques apply.

Deal with the decision-maker.

When you know you want to negotiate, you need to get to a person who has the authority to make it happen.

This is often the manager, so ask for them right away.

Look for words that scream “It’s Negotiable”.

Whether you’re at a garage sale or a retail store, look and listen for language like “the suggested price is”, “the usual price is”, “we are asking this price”, “this usually sells for” etc.

This type of language is telling you that they expect to negotiate and that you can most certainly get a better deal.

Build rapport.

Once you meet the person that you will negotiate with, take note of their name, remember it, and use it throughout your conversation.

Don’t just jump into asking what you are looking for. Start off by complimenting or making small talk about something positive.

Attitude is everything.

Be approachable. From the first contact, you want to come across as friendly, co-operative, and respectful – not demanding, arrogant, and hostile.

You are not likely to go far if you start out by making demands or threats. Chances are you’ll go a lot farther by being collaborative and taking the “work together” approach.

Use your words carefully.

Phrase your questions carefully. The simplest and most important way to ask questions is to go back to the basic open-ended questions we learned in grade school – who, what, when, where, why, and how.

As a rule of thumb, you never want to get a simple yes or no response.

For example,
“Who do I speak to about getting a discount?” vs. “Is there anyone that I can speak to about getting a discount?”

“What is the special rate if I buy 3 or more?” vs. “Do you offer a special rate if I buy 3 or more?”

Here are some good negotiation questions to ask.

Be willing to compromise.

You asked for what you want and you’ve been told that it is not going to happen. What next?

Be flexible and willing to consider other options. You need to ask about other discounts, deals, terms or rates that may be available.

It is not a good idea to demand one option only or make threats or ultimatums. When there’s no movement on price, focus on other aspects such as delivery, service fees, warranty, or accessories. Look for other opportunities to benefit.

Propose that you pay in cash or in full (or both).

For many items, offering to pay in cash is reason enough for a merchant to offer a price break. Credit cards have processing fees and may not be immediately released so the merchant may be more likely to pass the savings on to the buyers.

For bigger ticket items, if you can pay in full this will make the deal more enticing for the seller and they will be more likely to agree to a deal.

Learning how to negotiate is one of the best ways you can save money on almost all of your purchases.

Though it might be difficult at first (I always thought it was rude and felt awkward when I first started negotiating), it does get much easier.

Do you negotiate? What is one of your best deals?