The art of negotiating – a crucial skill for a frugal lifestyle

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About Maya

Maya is the founder of Memetales - a mobile reader and publishing platform for children's stories. Get your child reading by downloading the FREE iphone/ipod touch app with 20 Free books included!

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Photo by Jojakeman

The thing I love most about the frugal approach to life is that it forces me to get creative. The more I challenge myself, the more fun it gets. Small efforts and small returns add to big changes in life and big savings overall. More than anything, it makes me feel better for trying, all the time, to get the most of life.

When I was a little child (in India), I’d watch my mom buy vegetables from a street vendor almost every single day. Watching the two of them engage in a fun haggling process was the high point of my day. They pushed each other back and forth to finally settle on a price that worked for both of them.  And in the end, I’d always see a deal, a sale, and two happy people waving goodbye.

Only now do I realize that as I watched this process, I was learning a very essential skill needed for a frugal lifestyle – the skillful art of negotiation.

Since then, I have grown up, been to various countries, had numerous jobs, consulted on business, married, had kids, and even studied negotiations in business school. And over all these years, I have learned that no matter where I am or what I am doing, some basic truths about negotiating exist – be it negotiations with business partners, clients, friends, spouses, or even my own kids.

Rule 1.  EVERYTHING is negotiable.

When you REALLY need something and believe that there is NO WAY you are going to have it, tell yourself that EVERYTHING in life is negotiable. Have you noticed how your three-year-old will do his very best to get what he wants? No matter where you are, what you are doing, and what you are buying, ASK for a better deal. Never EVER assume a price on anything is set. And if you have a legitimate NEED, be sure to communicate it to the other person.

  • Where this works: Picked up a product that is less than perfect at a store? Ask for a discount.  At a hotel, and you need a better table or room? Ask for it. It costs them nothing to make a change for you. Ask for a price-match, even if the store does not advertise it. If something sounds expensive, just ask about what kinds of discounts or coupons they might have.  Are you a blogger?  Did you know that a number of hotels offer a blogger rate these days? Ask. Ask. Ask.
  • Why this works: When you have a genuine reason for something, people WILL listen.  Even completely computerized stores have a way to put in discounts and such.  When people learn about your situation (like that my child hates closed spaces and will scream in a corner), they might be more likely to help you (by giving you a better table, room, or airline seat).

zero percent off sign
Photo by Christina Kennedy

Rule 2.  There is almost ALWAYS a WIN-WIN for both parties.

Negotiating a deal does not always mean one person wins and the other loses.  As much as you might think of negotiating as something a shady car salesman would do, most successful negotiations in life are the ones are where both parties reach a mutually agreeable decision.

  • Where this works: This approach works at stores ALL the time, because stores exist to make sales. When you don’t get the exact product you are looking for, be sure to ask if the store can give you the similar-but-more-expensive product at a lesser price. If there is a product that you’re thinking of buying and the store wants to get rid of it, find out what their best offer is. Do you want to attend an event but can’t afford it? Can you volunteer at the event and get a free pass instead?
  • Why this works: No matter what people say, every person WANTS to make a sale.  It’s as simple as that. And as long as the sale does not create a loss, they will consider it.

Rule 3.  There are ALWAYS at least TWO perspectives.

There are two perspectives to every negotiation. Whenever you want something, and truly believe that you deserve a better deal, take a minute to think about the situation from the other person’s perspective.  Think about what’s valuable to them, and see how you can offer that. Once you see the other side of the story, you might be able to see what YOU can offer to help the other person.

  • Where this works: Can someone do a little design work for your website if you pay back with babysitting?  Can you drop a special word to their boss for someone whose been helpful at a store or hotel?  Hopefully you’ll enjoy the rest of your experience, and perhaps a few add-ons and discounts as well.
  • Why this works: People are busy with their own struggles.  There aren’t too many customers who’ll willingly see my perspective on things – but if someone did offer to make my life a little better, I am certainly more inclined to help them with a discount or a better deal.

Rule 4.  It’s best to keep the EMOTIONS out.

With two people talking about something they really want, it’s a challenge to keep emotions out of a negotiation.  Add kids and loss of sleep to the equation, and it become impossible to shake out those emotions – even when we want to make a simple request to someone like a flight attendant. But it’s important to remember that keeping emotions out and starting negotiations on a positive note is key to getting what we want. Be it with your child, your client, or your prospective consultant – always start out by creating the right platform for a negotiation. Show respect for the other person, appreciate, and thank the other person.

  • Where this works: This approach works just about everywhere and in every case.  And it’s key for successful cross-cultural negotiations.
  • Why this works: Emotions cloud a person’s thinking. Especially negative ones. Keeping emotions out will make it much easier for you to get what you need – be it at a restaurant or at the airport. When a waiter gets your order wrong, stay calm, and you will get your order fixed. Appreciate the waiter for fixing his mistake, and maybe you’ll get dessert on the house.  (Or you could get all worked up, and get marginal treatment the rest of the evening.)


Photo by Steve Ling

Rule 5. The end GOAL is somewhat fixed, but the process is not.

Negotiate with a goal in mind, but be flexible with how you actually negotiate. Think of negotiating like playing a game. Keep your eye on the goal, but respond appropriately to the other person at every step.  Keep emotions out and add a gaming spirit. Listen and respond to what the other person is saying. Be aware of cultural differences – things work differently in different countries and in cultural groups.

  • Where this works: You want something really badly, and the other person refuses?  Change your game plan.  Does your daughter desperately want something at the store?  Get creative and say something other than no. Tell a story and save that money, perhaps.
  • Why it works: The gaming approach forces you to be more responsive and creative.  And when you negotiate like you’re having fun, people are less likely to take advantage of you – including your own toddler.

A  little story

Two people were arguing over an orange.  The obvious solution was cutting the orange in half and each talking one part. But as they talked, they realized that one of them wanted the orange for juice, and the other wanted the orange to make marmalade.  So they created a different solution – one took the fruit, and the other took the rind. Soon enough, they were both sharing an orange farm – one farm, twice the output.

If someone is unwilling to negotiate, tell them this story.

Have everyday negotiations helped you save some money and take pride in your frugal lifestyle? Share your stories in the comments!

I plan to share my negotiations worksheet for more advanced negotiations in my next column on frugal living.  Let me know if you think that would be useful.

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Comments

  1. I also live overseas and being there has taught be how to bargin. When we returned to the US I found that I continued to bargin there. I always ask sales people if there is a discount available and always as if there is a way I can get something cheaper. You would be surprised how many times it actually works even in the States.
    Where we life the price is often jacked up so that people will bargin. They are quick to tell you that they will negotiate the price. The key is discovering when someone has gone as low as they are willing to go and not offending them by pushing it too far. I do have to remember at times that I don’t need to argue over .10 cents especially when that is someone’s livelihood and I have far more money than they do.
    Thanks for this fun post!

  2. I love the part about keeping emotions out of the equation. this is often easier said than done-especially if I really feel like I NEED the item. I saw this to be true with my time in China-just like you said. It was almost a game to them, it was fun and entertainment. I think that in the US we take bargaining to be an insult–if the product needs negotiating, then something is wrong with the person offering the product. Not true, but we Americans can turn everything to be about US so easily.

    You speaking about 3 year olds negotiating reminded me of a post I did comparing my little girl’s negotiating with my prayers to God. You can read about it here: http://burningbushes.org/?p=103

    Nicole´s last blog post…Celebrate Easter-Mourn

  3. i grew up with a dad who would negotiate for ANYTHING (in a culture where that is not the norm) because he hated to spend any extra money. as a kid and a teenager, i was totally mortified by this! as an adult, i can see a bit more of the value in what he was doing… but i still feel that there are times when negotiating would be rude or inappropriate. that said… i have no problem asking for an upgrade to a king bed in a hotel (hubby and i are both over 6′)!!

    Krista´s last blog post…getting back into the groove

  4. A special rate for bloggers? Now we’re talking!
    Excellent post, Maya, thank you! I do most of my bartering at garage sales and this will help me sharpen my skills for this summer.

    Aimee´s last blog post…Nine Easter Brunch Ideas

  5. Great Advise, most times I don’t even think of it as a possibility! It’s a lost art and we need to pass on to our kids too!

    Dawn – Partybluprints.com´s last blog post…Glazes To Amaze!

  6. I don’t know if this counts, but I definitely used the art of negotiation when we bought our new car and it totally paid off. One of the key parts, which is what you mentioned, was removing the emotion. We walked into the dealership and said that we would pay cash up front if they would give us such and such a price. They wouldn’t do it, so we left. I told my husband that we could find it at another dealership (which turned out to be rather challenging to find the exact make and model). An hour later, the dealership called and gave us another price. It still wasn’t what we wanted so we looked elsewhere. And we found it! We had to drive a little way, but they took the price we offered and we saved a few thousand bucks. It was awesome! But we definitely had to be willing to walk away or it wouldn’t have worked.

    Tabitha (From Single to Married)´s last blog post…Washington DC: Can You Say Cherry Blossoms?

    • Tabitha,

      You did so well!! When we spend big amounts of money (which is really relative), knowing when we will walk away and using that card is important. It is a good way to quickly get to the best deal the other person is prepared to offer and not waste any time trying to get small discounts. Thank you for sharing!

      Maya´s last blog post…Creating powerful micro-experiences

  7. I’m also going to have to check out that blogger rate idea!

    I love haggling over prices when in Africa or India, but have never really gotten into it here in the US – something I’ll have to think about, thanks.

    Jamie

    steadymom.com´s last blog post…not so steady thought for the day

  8. I like all the rules you lay out in your post. I thought it was quite comprehensive.

    I have noticed that there are some people who have no problem with negotiating while others basically refuse to do it. The reasons for refusing to do it vary from timidness, lack of confidence, or feeling it is somehow inappropriate to talk about money. Others just don’t want to take the time.

    With the economy going south this tendency, I have noticed, is starting to fade away for lots of people. I notice more and more people using coupons, asking clerks for price matching, etc. which I think is great.

    For those that are still timid regarding asking for a better deal, I have a suggestions from a person who themselves used to not like to do this. (I am still getting used to it, but get better everyday). Practice. Practice asking for a deal. Start with something small, something inconsequential, and just do it. The more you do it the better you will get at it, and the more natural it will feel. Soon, it won’t be a good deal at all.

    In addition, you will make mistakes when negotiating, because to a certain degree it is an art, not a science. There will also be times when you will get rebuffed. Don’t let these get to you. I know it is easier said than done, but I have found that in the long run I have just learned from these experiences and gotten better at negotiating because of them, as long as I don’t let it take away my confidence.

    Hope these thoughts helped! I really think the suggestions given are spot on, and will really help people!

    Taylor at Household Management 101´s last blog post…Apr 8, Uses For Vinegar – What Vinegar Can And Cannot Do Around Your Home

  9. Loved all the Great Tips! So many apply to more then just buying items but also dealing with people (and children). And, this summer when I head out to the farm stands and yard sales I will try these great tips! Thanks!

    Words to remember “IT NEVER HURTS TO ASK”!

    Bonnie´s last blog post…Easter Decorating

  10. I’m another one who doesn’t think about negotiating; I think it’s because I *do* keep the emotions in the would-be negotiations – I’m afraid they’re going to get angry with me.

    Iva @ Horizontal Yo-Yo´s last blog post…What-in-the-World-is-That-Wednesday

  11. Like others I’ve negotiated when buying things in other countries but never really in the US. I guess I have always thought that it wasn’t acceptable in the US since business is so separated from relationships in the states.
    I always get nervous when negotiating but I think this is because I am afraid the other person will be offended. I am going to apply your tips next time, especially the emotions one, next time and see how it goes.
    Thanks for the advice.

  12. My parents always told me…the squeaky wheel gets the oil! I find this to be true and you put it out there very well. What is the harm in asking for things? What is the worst that can happen? They say no?

    Jen
    http://www.afterthealter.com

    Jen´s last blog post…Wine Club!

  13. Great post, Maya!

    Here in the U.S., I’ve “accidently” found success with negotiating.

    Example 1: The kids and I walked to the local nursery to buy bulbs. I brought a $20 bill–that’s it. When we got to the cash register, my bulbs came to $20. 87. I pleasantly explained to the cashier that I only had the $20 on me, and said we’d have to put a bag of bulbs back. “I’ve got it,” he replied, and went on to give me the Landscaper’s Discount! My new amount came to $18 and change. : )

    Example 2: I had an online subscription to a (nameless)fitness website, where you can print out weekly workouts. It was fabulous, but we no longer had room in the budget for it. I called the customer service to cancel. When I explained to the customer service rep that it was for financial reasons, she proceeded to give me 4 more months for FREE. I didn’t even have to ask.

    Kirwin´s last blog post…What’s your Love Language?

    • Thanks Kirwin. LOVE your examples. It goes to say that as long as we have a real and legitimate reason, we really do not even have to negotiate, right? We just have to let people know what are situation is and very often they will make a better deal :)

      Maya´s last blog post…Creating powerful micro-experiences

  14. I’ve had to master the art of negotiation to get my hubbie and son to agree to all sorts of things. Now I just have to apply those skills to the world “out there.” :-)

    Special hotel rate for bloggers, huh? Hmmmm….

    Lisis | Quest For Balance´s last blog post…Roast Marshmallows, Live Longer

  15. When I have a difficult phone call to make, about a problem with a product, or refund, or have been over charged, or even to offer a constructive complaint–I’ve found it incredibly helpful to playfully ask for “the most patient person in the building,” or “the most understanding soul in the department” or “the kindest supervisor in the company.”
    Perhaps this even sounds sappy but what has happened–every time is that the person on the other end of the phone has said, “Well, ahhh….that would be me.” (So now, what have we done? We’ve gotten them to make a tiny commitment to be patient, kind, etc.)

    Maybe it’s a pleasant break from their day of dealing with often impatient, unkind people–I don’t know. But even the most tired sounding, frustrated person usually perks up a bit when given the chance to be who they believe they are inside–kind, patient–especially if they don’t get many opportunities to talk to gentle, patient people in the first place.

    You can almost hear them heave a sigh into the phone, as if to say, “I’ll be kind and respectful–because you seem to be kind and respectful.” It’s like you’ve given them the chance to take a compliment personally or pass it on to someone else. In my experience, they’ve always taken it–quite happily.

    By-the-way…the first time I used this method was in a very scary phone call to the IRS about some pretty messy back tax details after a divorce. The agent was fabulous and helpful and he even joked with me about the solutions.

    If you have even a bit of playfulness to your personality–I’m telling you–this works.

    Launi´s last blog post…The Chicken or the Egg?

  16. Excellent thoughts! I travel a lot and always ask for upgrades and more often than not, I get them! I’m amazed at what you can get just by asking!

    What’s the worst that could happen? They say no…oh well!

    Grant @ BrokePiggy.com´s last blog post…April CHANGES Update

  17. I have to admit that I AM NOT GOOD AT IT! But I also have to tell that my mother in law is the QUEEN of negotiating EVERYWHERE! and my husband has learned it to extremes!!! lol… when he starts with his negotiating attitude I want to hide! lol I don’t know what’s with it! I just feel shame! lol :S

    lvlc´s last blog post…Going to Grad School while having kids

  18. I do have to pipe in and say though… as a small business owner… everything comes out of my pocket. If I give you a $20 discount on something… that is $20 worth of food not on my kids plates. I am all for bargaining and being frugal. I am a frequent coupon user and shop on sales only. I have not bought an item of clothing that was NOT on clearance in probably 10 years. BUT… there is a time and place for negotiating. If I produce a product for you, on time, its beautiful, complete and you are going to love it. Do NOT say to me… “but you are so expensive.” If you are not willing to pay my prices, then please go somewhere else because I have a limited amount of time to make the funds I need to keep my family going. I am not Wal Mart who is banking in millions in profits each year.

    Also… when negotiating… I find that it is LEAST useful to compare to another competitor. Even in my own business if I have a client who says… “so and so will DO THIS… will you?” Well if so and so is doing it then why are you here with me?

    And that is not to say I am not willing to give discounts. I regularly throw in freebies for first time clients, and extra cute kid, someone having a hard time financially – like an old client that recently lost her job and had a new baby.

    Its not shameful to ask… but do understand that me owning my own business does not mean I can say YES to everything.

    • This is great input Amber. I cannot stress enough about how important it is to be sensitive and understand the other perspective. It does not make sense to just haggle without understanding the market, the quality, the ranges and the prices for similar products. (I was actually wondering why nobody has said what you said until now :))

      It is important for both sides in a negotiation to set up a a walk-away point. A lot of negotiations between two individuals (not an individual and a company rep) are less like negotiations and more like conversations. As much as getting a deal is about asking, the other side of it is also about learning to say NO and saying it patiently and not taking it personally. I am sure if the person really wants to use your services he/she will come back if/when they can afford it.

      If someone asks me to do something for them for free, I will take a moment to explain why/how my product is different or better than something someone else offers – so they know that I price my products based on what I offer and NOT what someone else is quoting.

      It is important to know when to quit, give-in or walk away from a negotiation.

      Thank you for your perspective!

      Maya´s last blog post…Creating powerful micro-experiences

      • I think it is just such a mis-conception that someone asking for a discount is inevitably trying to take advantage. It has given the whole “negotiating” process a bad feel. When I use coupons at Wal mart they act like I am such an inconvenience and taking advantage because I have 5 of the same one… well I bought 5 papers to get those… is THAT a problem?

        I can truly see both side of this as a recently reformed couponer and as a business owner also.

        Thank for the great convo on this!!

  19. I knew that my modeling of this art had paid off when my 11 year old found a game that he had wanted at Walmart. It was the last one, and on his own he said, ” I think I am going to go find the manager, I sould think he would take off something for this damaged package. ”
    Oh yes, did a frugal mom’s heart good. :)

    Jen@Balancing Beauty and Bedlam´s last blog post…Easter traditions that build character – May Day baskets

  20. Great article! I just came home from vacuum shopping and ended up not buying anything because I was so frazzled by the sales guy… so this was super timely!

  21. Great advice! Thanks!

Trackbacks

  1. [...] may allow users to be disastrous pieces of malicious attacks. 9, Steve Jobs If Steve Jobs less The Art of Negotiating – A Crucial Skill For a Frugal Lifestyle – theartofsimple.net 04/08/2009 Photo by Jojakeman Written by green & frugal living columnist [...]

  2. [...] simple mom placed an interesting blog post on The Art of Negotiating – A Crucial Skill For a Frugal LifestyleHere’s a brief overviewPhoto by Jojakeman Written by green & frugal living columnist Maya Bisineer . T he thing I love most about the frugal approach to life is that it forces me to get creative. The more I challenge myself, the more fun it gets. Small efforts and small returns add to big changes in life and big savings overall. More than anything, it makes me feel better for trying, all the time, to get the most of life. When I was a little child (in India), I’d watch my mom buy vegetables from a [...]

  3. [...] simple mom placed an interesting blog post on The Art of Negotiating – A Crucial Skill For a Frugal LifestyleHere’s a brief overviewPhoto by Jojakeman Written by green & frugal living columnist Maya Bisineer . T he thing I love most about the frugal approach to life is that it forces me to get creative. The more I challenge myself, the more fun it gets. Small efforts and small returns add to big changes in life and big savings overall. More than anything, it makes me feel better for trying, all the time, to get the most of life. When I was a little child (in India), I’d watch my mom buy vegetables from a [...]

  4. [...] The Art of Negotiating – A Crucial Skill For a Frugal Lifestyle.  I’ve never been good at haggling, but after reading these five negotiating rules I now have some ammunition for the next time I need to negotiate.  (@Simple Mom) [...]

  5. [...] The Art of Negotiating – A Crucial Skill For a Frugal Lifestyle.  I’ve never been good at haggling, but after reading these five negotiating rules I now have some ammunition for the next time I need to negotiate.  (@Simple Mom) [...]

  6. [...] The Art of Negotiating: A Crucial Skill For A Frugal Lifestyle – Great thoughts from SimpleMom reminding us that everything is negotiable and how to negotiate for what you want.  [...]

  7. [...] Maya placed an observative post today on The Art of Negotiating – A Crucial Skill For a Frugal LifestyleHere’s a quick excerptMaya´s last blog post…Creating powerful micro-experiences. Reply. Lisis | Quest For Balance 04.08.09 at 8:25 am. I’ve had to master the art of negotiation to get my hubbie and son to agree to all sorts of things. … [...]

  8. [...] trying to keep in mind this post I read back in April, on SimpleMom, which I found via Like Merchant Ships. The Art of Negotiating is something I’m not the most [...]

  9. [...] The Art of Negotiating – A Crucial Skill For a Frugal Lifestyle [...]

  10. [...] do check out my latest guest post about Negotiating out at Simplemom if you want to learn about a few universal truths about [...]

  11. [...] Negotiating is not about fleecing another person. You have the right to seek out a good deal. Negotiating is not the same as haggling –- you lose nothing and often save more than a few pennies to put back into your savings account. [...]

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