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The Golden Rules Of Haggling

December 15, 2010 By Aloysa 32 Comments

Some cultures strive on haggling. You go to a store, a yard sale (how to yard sale), or a local flea market and you are supposed to bargain because if you don’t, you will end up overpaying. You might even offend a seller depending where in the world you are.

I grew up in the country where every Sunday, instead of church, we would go to a local bazaar to buy anything from food, fresh produce to clothes, even books and jewelry. The bargaining would start right from the entrance of the market. I perfected my haggling skills over the years. In fact, I enjoyed it.

Haggling can be fun, if it is done correctly. The meaning of “correct” in every country is different. A different set of rules applies to haggling in Istanbul than to haggling with a cable company in the United States.

Our social life is all based on bargaining. We bargain about our allowances, negotiate salaries, bills, discounts, prices. When I moved to the United States, I’d been told that people don’t bargain here. It is acceptable to pay whatever price is named. I took it as a rule, and boy was I wrong. You can still haggle and, in fact, you should. You just have to know where, how and why. In other words, you have to know the “correct” way of haggling.

The Golden Rules Of Haggling (according to Aloysa):

1. Never be aggressive (remember, you are not in Marrakesh souk where the atmosphere itself requires you to be aggressive… in a nice way). Don’t claim a discount because you deserve it.

2. Ask if a company has any special offers or promotions. I noticed quite a few times that unless asked, no one will tell you about the special offers. The retailer might be ready to give a discount to a customer who asks about it.

The same rule applies to a hotel reservation. I always try to call directly and ask about any current promotions. Sometimes you think that websites like hotels.com or expedia.com give you the best pricing. Not necessarily.

3. Threaten to take your business somewhere else. I know, it somewhat contradicts my rule #1. You can threaten politely but firmly. Just make sure you have all the required information before hand (do your homework): competition pricing, conditions and requirements. Sometimes a simple phrase like “I am going to shop around,” might seal the deal.

4. Ask about older (last year’s, for example) models. I think July, August and January are the best months to shop for furniture, cars, appliances, even clothes. Retailers need to make room for a new merchandise when the season is ending. Therefore they can more easily discount older models.

5. If you are paying with cash, always ask for a cash discount. It might work even at a doctor’s office. Just make sure you know the going rates for common procedures and exams. Cash works wonders at car dealerships (other car buying tips). In fact, I think cash can work wonders anywhere. Even when buying a flat screen TV at a store and offering to pay with cash might get you a discount, because a retailer doesn’t have to pay merchant fees on a credit card transaction.

6. Practice, practice, practice. To perfect your haggling technique go to a car dealership. It is a very intimidating place even for experienced hagglers like me. If a dealership is too intimidating, you can start with your neighborhood garage sale.

7. Never make haggling a contest of wills. I never break this rule. The final offer should be beneficial to both parties: the seller should be able to make a profit, and the buyer should get a desired price.

8. Remember, no matter what are you bargaining for, have fun! Haggling is not all about the art of getting a desired object for a low price. It is also about the experience. At least, I think so.

Filed Under: Financial Miscellaneous, ShareMe

About Aloysa

Comments

  1. LifeAndMyFinances says

    December 15, 2010 at 8:11 am

    I think you are spot on with the rules of haggling. I love to get a good deal, and haggling is one of my favorite ways to get it!

    Threatening to walk out is often the toughest one, especially if you really want the item. But, most of the time, that item can easily be purchased somewhere else and until you let them know that, you will be overpaying for that product.

  2. Melissa says

    December 15, 2010 at 10:52 am

    Great tips! I found the hotel tip to be especially true. I was travelling recently, and the clerk quoted me $95 for the room. When I pressed for discounts, she listed several I did not qualify for. When I asked her if there was anything else she could do, she decided to give me a manager’s special for $79. I still don’t know if it was a real discount or she made it up, but I was happy to have knocked $16 off the price.

  3. Khaleef @ KNS Financial says

    December 15, 2010 at 10:59 am

    Aloysa, these are great tips! I especially love the one about avoiding a contest of wills. I think that gets a lot of us into trouble!

    I don’t like haggling that much, but I’ve been doing it more. This will definitely help me!

  4. Budgeting in the Fun Stuff says

    December 15, 2010 at 11:21 am

    Great post! I use Rules 1, 3, and 5 with the best results. 🙂 I’ve also found that haggling in Mexico is way easier than haggling in the states, lol.

  5. aloysa says

    December 15, 2010 at 12:06 pm

    Life and My Finances – Never show that you are REALLY interested in something. Sometimes it is difficult, I know. But in the end it pays off.

  6. aloysa says

    December 15, 2010 at 12:08 pm

    Melissa – A manager’s special? I will remember that one! I don’t think front desk clerks can make up a discount. I am sure they are allowed to go down to a certain price, though.

  7. aloysa says

    December 15, 2010 at 12:10 pm

    Khaleef – Yes, people do tend to get caught up in a contest of wills. I believe it is not necessary. It takes away from the experience and hurts the end result.

  8. aloysa says

    December 15, 2010 at 12:11 pm

    BFS – I love haggling in different countries. So far the toughest was China. Retailers there just exhaust you. You will get what you want and for a good price, but they will make sure you work for it. Hard. 🙂

  9. retirebyforty says

    December 15, 2010 at 12:35 pm

    I am terrible at haggling. When I travel I don’t haggle too much, I just try to do my best researching before I go and usually don’t buy too much stuffs.
    The hotel discounts sounds like something I can do though.

  10. Suba @ Wealth Informatics says

    December 15, 2010 at 1:01 pm

    I always struggle with haggling. Esp. growing up in India, we are not supposed to buy anything without haggling. But I never became a very good haggler (compared to Indian standards I mean). After coming here, with haggling done mostly online or on phone, I do a LOT better 🙂 I just don’t work well in person. Great tips!

  11. aloysa says

    December 15, 2010 at 2:02 pm

    Retireby40- You are like Beaker, my husband. He doesn’t haggle. He usually leaves it up to me. I enjoy it. 🙂

  12. aloysa says

    December 15, 2010 at 2:05 pm

    Suba- Haggling in person is harder because you can see other person’s reaction. Some experienced hagglers use their facial expressions as a part of a haggling process. On the phone it is so much easier, right? 🙂

  13. Sandy @ yesiamcheap says

    December 15, 2010 at 2:56 pm

    I love the idea of haggling in America. It requires subtly and diplomacy. My BF is American and was HORRIFIED that I would try to haggle with the salesman at PC Richards (an electronics chain in the North East). He was shocked when the price of the new washer and dryer we were looking at magically fell. Also, I’ve haggled at Sears when it’s close to the end of the month and the sale people want to meet quotas. I’ve worked out 0% financing or dollars off the top or gift cards to come back and shop. Every little bit adds up and sometimes sale people are empowered enough to be able to make these decisions. I find haggling always works best when you say you are paying cash. That’s an immediate 2%-3% addition to the seller’s bottom line since they are not paying that money in credit card fees.

  14. Buck says

    December 15, 2010 at 5:16 pm

    Awesome post. It’s so true the art of haggling differs from culture to culture. You have so great rules. Will try and use some myself. Cool way to look at it as a whole experience! 🙂

  15. Everyday Tips says

    December 15, 2010 at 9:07 pm

    I negotiate much better than my husband, and I embrace it. Even small things. Like if I go to Kohl’s and I don’t have a coupon, I tell the person at the register that I forgot my coupon (which is true) and ask if I can still have the 15 percent discount. It works every time. It never hurts to ask. (I guess that isn’t negotiating, but it is getting a better deal.)

    You should write a haggling ebook!

  16. Money for Regular People says

    December 15, 2010 at 9:48 pm

    Thank you for a well written article. The points are in line with an international business seminar I attended that had a session on bargaining in the international marketplace. It was fascinating to learn that the worst country in the world in terms of bargaining was the United States (with Germany a close second). The best was Japan.

    What separated the worst from the best? Much of it came down to culture. Americans like to get things done, and that drive can lend itself to impatience in negotiations. That’s a major disadvantage. Americans are also embarrassed to haggle – it makes them uncomfortable. It’s like asking for a handout. That very much goes against the grain of can-do American culture.

    Japan excels because they are paragons of patience and simply cannot be rushed. This alone makes them formidable hagglers. But what set them apart was their mastery of the process with a particular emphasis on the, “Yes…but” strategy. In other words, they will almost never say “No” outright. For example, if you say, “Can I have that car for $10,000” then they will say, “Yes, but not THIS car…BUT you can have THAT car for $10,000.” As a result of constantly saying yes they ultimately give up extremely little ground in the face of an inexperienced or undetermined negotiator.

  17. Amanda L Grossman says

    December 16, 2010 at 8:43 am

    Great post Aloysa!

    I have haggled many a great situation. For example, in Bed Bath and Beyond, we were able to get a 20% discount on the floor model side table because of a small scratch.

    Some sales people are very surprised when you ask to get a discount…but it works about 70% of the time (in my experience).

  18. Forest says

    December 16, 2010 at 8:19 am

    Nice post, I am learning about haggling here in Cairo. The skills won’t exactly translate to UK or USA but will certainly help when I go back!

  19. aloysa says

    December 16, 2010 at 10:26 am

    @Sandy – looks like you know haggling pretty well! Your boyfriend should be proud of you! LOL

    @Buck – Haggling is an experience. Not everyone likes it but pretty much everyone needs it… or uses it. 🙂

    @Everyday Tips – not to be somewhat gender discriminating but I think that in general women embrace and exercise the art of haggling much better than men.

    @Money For Regular People – I thought that Japan was right along with the US and Germany. Interesting that Japan is the best country for haggling. Now that I know their haggling methods, I want to practice. 🙂

    @Forest – no, this article will do no good for you in Egypt. Haggling in the Middle East requires a very different set of skills. That would be a completely different post. LOL But if you master the art of haggling in Egypt, you will be prepared really well for the US. 🙂

    @Amanda – I totally agree. I got some good deals on furniture with slight scratches and clothes with a missing button. 🙂

  20. JohnG Home Loans says

    December 16, 2010 at 5:38 pm

    I love this article. I recently moved to a new city on my own (age 23), and I’m learning how to get on by myself. I’ve found that haggling is awesome and it really does work. Cheers! And thanks for the tips.

  21. 101 Centavos says

    December 16, 2010 at 11:20 pm

    You don’t get if you don’t ask! I like #3, and it doesn’t have to be a threat, merely a matter-of-fact statement. I personally like yard sales as a way to keep haggling skills sharp.

  22. Squirrelers says

    December 17, 2010 at 12:25 pm

    Good stuff, Aloysa.

    I can attest to your comment above about haggling in China. Actually for me it was Hong Kong, though it’s now under Chinese domain. Anyway, years ago I tried to buy 7 t-shirts from a street vendor, normally being sold at $3. I offered $6 for all 7, less than $1 each. The guy yelled back that he wasn’t starving, and waved me off. He wouldn’t even listen to a counter offer:)

    I’m not a natural haggler (wife is), but when it’s expected or acceptable, it’s good to be willing and able to try.

  23. aloysa says

    December 17, 2010 at 2:32 pm

    I was yelled at in China too. I offered $5 dollars for something (I don’t even remember what it was) and got yelled that I am insane. I walked off. They yelled back that we still can talk. 🙂

  24. Kay Lynn @ Bucksome Boomer says

    December 17, 2010 at 8:35 pm

    I’m very experienced in haggling in Mexico since we live so close to that border. But it’s not something I do enough of here in the states.

    I did do pretty good haggling when I bought my car though; I’m better than my husband at it.

  25. aloysa says

    December 17, 2010 at 9:09 pm

    @JohnG – I am glad you can use a few things from my article. 🙂

    @100 Centavos – yard and garage sales are the best place to practice. Threatening to walk away might not work there though.

    @Kay Lynn – I always had a good experience haggling in Mexico. But there was a situation once where I could not get a price I wanted. Oh well… sometimes you just have to walk away. 🙂

  26. Jessica07 says

    December 21, 2010 at 11:54 am

    Great post!

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