It's usually easy to spot the sourcing person in an electronics store or the automotive lot. We're the ones not afraid to walk out or raise our voices if a negotiation or deal goes South (especially if someone fails to honor a previously negotiated arrangement when it comes time to consummate a new purchase). For years, our behavior was most certainly an exception to the rule. But a recent Time Magazine article suggests that the fixed-price consumer culture that so many of us take for granted is beginning to change. The article cites research from a consumer-firm that suggests last October, "56% of consumers said they had recently tried to negotiate at retail outlets other than car dealerships" and "50% got deals" based on their haggling efforts. More remarkable are the results from May of this year, in which the numbers climbed to 72% and 80% respectively. Are we becoming a culture of higgle haggle?
Time provides a number of examples of successful negotiations in everything from retirement homes to Lowes, but more important, it gives some tips for success, many of which would not be out of place in a procurement organization. One of the first tips is to "butter up" suppliers. In other words, treat them nice. Another is to ask for discounts based on packaging or other issues (a favorite of my wife's in fact). In other words, if a box is damaged or missing, ask for some percentage discount. Haggling over expired goods -- or merchandise at or near expiration -- is also a useful tip.
But the best tip of all comes at the end of the article -- price benchmarking. Using the same technique we all use in our day jobs working with and managing suppliers, an expert interviewed in the article prints out a web-price for an item and marches it into Best Buy. After some back and forth with a manager, she gets an even greater deal than she bargained for. I recently used the same technique to shave off nearly $8,000 from a Toyota Avalon sticker for my Father-in-Law. All this approach takes is the same tenacity and willingness to do up-front homework on the supply market before beginning a negotiation. Then, all that's left is to point to the data. And if a vendor bites, then you know you've gotten not only a good deal, but a deal at the true market clearing price.
And by-the-way -- if you're car shopping and want to do your part to increase the Federal deficit, don't forget to trade in that old garaged clunker you've been planning to restore for years.