The #1 way to haggle (honed in Morocco and India)
I was not raised in a haggling culture. But you know who was? My best friend, who originally grew up in India.
I never really was exposed to hardcore haggling until we both were on a trip in Morocco. That’s where I learned from the master how it’s done.
Here’s an example for something like a t-shirt, perhaps an heirloom souvenir that’s being sold in a tourist area (substantially higher prices).
Typical course of business: they go high, you go low. 20 minutes later after an exhausting back and forth, you meet somewhere in the middle. If you’re a good negotiator, you might end up at 1/3 of the original price. If you’re a bad negotiator, you will overpay. Some people might try and point out something they might not like about the item in hopes of getting a lower price.
Example of me, first time, without instruction in the Medina of Fez, Morocco.
Vendor: “this shirt will be $40.”
Me, without prior instruction and practice: “ok, here’s $40” (naive American). Or maybe, “would you take $35?” (all the while thinking about how I could help that person financially, who am I to negotiate, what a beautiful place this is, etc. etc., not keeping my eyes on the prize)
Example of my friend, seasoned negotiator.
My friend: “No. $10”. (he knows the original price is bull honkey)
Vendor: “This is a great shirt! $40! OK, $35”
My friend: “No.” [keeps walking] (Thinking, “If I don’t get a deal, I don’t buy it.”)
I’ll save you the play by play. Continues, my friend walks away, not rudely, just he’s ready to move on, knowing he is going to get a deal. Vendor comes running back. My friend buys the shirt for $15, maybe $20 tops, down from $40.
The ultimate tactic? Be willing to walk away.
What’s the most tactful way to walk away? “I need more time to think about it,” then exit. It sounds simple but is extremely underutilized.
Later in Marrakesh, vendors were trying to sell us dinner and I was honestly full from earlier. But funny enough, us continuing to walk received offers for a practically free, loaded dinner! At that point, not even trying to negotiate and not that hungry, the deal was so good we honestly couldn’t resist.
Now let’s up the stakes… Car buying.
You are in the market for a new or used car. You, for whatever reason, cast yourself into the unforgiving net of a car dealership. Time to go big on haggling!
You find a car you like, price seems “ok" but you know there is a dealer markup. You don’t want to manufacture a lie.
If the car is not exactly what you were hoping for, now is the time to point it out. For example, I was recently searching for a used Toyota Prius V, which is the wagon version of the Prius and one of the best family car options — insane MPG, crazy reliable, safe, and roomy — this thing is a unicorn.
However, doing my research on the IIHS website, it surfaced that there was a massive improvement in safety ratings with the redesigned models starting in 2014. I really only wanted 2014 and newer. (Check out my earlier post on why the year of a car model can make or ‘brake’ your life.) The car I tested at the dealer was a 2013. I loved how it drove but wanted the safer model. That being said, the Prius, regardless of the year or model, is consistently one of the cars with the least amount of accidents, owing to responsible driver behavior. So I responded, “I need some time to think about it.”
The salesman, who was very courteous, went inside and brought back the store manager. The manager asked, “is there anything we can do for you?” (wink wink nudge nudge ‘tell me your price’ is what he was getting at). I explained that I needed more time to think about it. Truth be told, I did a gut check and realized I honestly wanted the 2014 for the more safety, since my kids would be regular passengers. So I did email and let the dealership know.
But fast forward… I got a call the following week from the manager, and the week after, with the price lowered each time! Time works to your advantage.
Now, let’s make the scenario better for haggling. Let’s say it were a more minor difference such as the exterior color or not having a certain feature on a stereo. I’d explain that, then mention I need more time to think about it, leave my number, and walk away. Even better, wait a day or two. Instant leverage! You would easily save a thousand dollars or more from this.
Conclusion
Operating on a system of fixed prices is undoubtedly faster. For someone without effective negotiation, fixed prices are for sure better for them. In this case, buyers are likely overpaying, be it a t-shirt or a car.
But the best price is for buyers that can negotiate. Just take the time to think about it.