In college I sat in on a few workshops at the graduate school about negotiation. It was an eye-opening experience to realize that there were tried and true tactics to reaching a fair deal, and I wish that it was taught more widely. We all do so much negotiation regularly.
While I’m no expert, I have built up a set of tools over the years that have served me well in the regular negotiations we all find ourselves navigating. Whether it’s getting the quote for a wedding photographer, a painter, a mover, a mortgage, or any other of life’s major purchases, these are the six steps that have helped me shave hundreds or thousands off my bill.
Note: This article is geared toward services rather than goods, though these steps are still mostly applicable to hard goods.
The single biggest thing you can do to improve your outcome is to ask for multiple quotes. But unlike most people, refrain from doing a giant initial blast of a generic email. You want to use the first few quotes to tailor your message to others and maximize your chances of coming off knowledgeable to get a good deal.
With our mortgage process, I spoke with over half a dozen vendors. I used the first few conversations to educate myself about float-downs, rate lock fees, credits, and all the other terminology. I was able to ask smarter questions about timing and process. In the end, we scored a deal that could be worth an incredible amount of value. Total Savings: $145,000 over the life of a 30-year loan (more on that here).
Ask For Variations
Another way to test the flexibility of the quote without soft pitching a budget figure is to ask for variations. I recently reviewed quotes for movers. I asked them what the rate was for the move, but I also asked if the rate was different for weekdays vs. weekends. I asked if the rate was different if they packed for us vs. if they only picked up the boxes. I even asked what the price difference was for packing using their boxes vs providing the boxes ourselves. I could then take the quote from the most competitive/flexible and pitch it to other firms to see if they could match or beat. I ended up signing with a company with over 200 reviews on Yelp averaging 4.5 stars. Their rate was not only the most competitive, but it was fixed fee and included packing services for an extra $125. All of our stuff is going to be packed by someone else for $125. I am over the moon excited! There is no guarantee that this will end up working out perfectly, but I count it as a win from a negotiation standpoint. Total Savings: $225.
Highlight Extenuating Circumstances
Particularly with small and medium sized businesses, highlighting your extenuating circumstances may bring you and the vendor to a win-win situation. Back to the situation with the movers. In NYC, moving tends to gravitate towards a cycle centered around the first of the month. That’s because in the rental market landlords set the leases to expire at the end of a month.
We wanted to move a week before the end of the month. I highlighted this as a potential extenuating circumstance and asked if they offered discounts for off-peak move times like ours. The guy helping me put me on hold to discuss with the team and came back saying they could give us a discount. Total Savings: $125 (in addition to above).
Freebies and Add-Ons
When it comes to fixed-rate quotes, sometimes the most effective negotiation tactic is to ask for free add-ons. When we were negotiating our contract with our wedding venue, they offered an open bar option and an a la carte option where it the drinks were complimentary to guests but the staff would keep a running tab for us at the end of the day. Half of our attendees didn’t drink or drank very little, so the open bar option seemed subpar. However, there were also price minimums the venue wanted its events to meet. To bridge this gap, I explained the issue and asked if they’d be able to accommodate us by giving us a few add-ons. We got to keep the open bar status but also got a bunch of extra services like a private tram and premium hors d’oeuvres options.
You can remove add-on charges in a similar fashion. Our venue usually charged a ceremony fee of $8 per guest (unreal, I know – I went back to the sales materials and checked). I explained to them that they were our first choice but that there was no room in our budget for an additional ceremony fee. Would they be able to accommodate us? They waived it. Total Savings: $400.
The politest way of asking I’ve found is just to say that there’s no room in your budget for X. If you want a slightly stronger version, you can say several of the vendors you are speaking to don’t charge for X so you don’t have anything budgeted for it. I would tread lightly here though because you don’t want get people’s backs up. The conversation should be collaborative rather than adversarial.
Divulging Competitive Pricing
As you arrive at the end of the negotiation process, you will probably have one or two vendors that are your top picks. At this point it may be effective to share the best price you are getting. In my experience, it is always best to present this politely. “I’ve really enjoyed the discussions with you and you strike me as a very professional and consistent operation. I have another quote at $X but would prefer to work with you if you can match it.” If they say no, you’ve still left the door open for yourself to choose them anyway.
I found the most amazing wedding photographer. I absolutely loved his work. His minimum was typically $3000. With this technique and some creative brainstorming, we were able to get the price to $2,200 for him and a second shooter. Total Savings: $800.
If You Were In My Shoes
If you hit a particularly thorny situation, you can pull out the final technique: leveling. This is where you explain the challenge from your point of view and solicit the listener’s help in solving it. In the case of the wedding venue, I explained to our coordinator that half of the attendees wouldn’t be drinking much because of (reason). I said the challenge I faced was I obviously didn’t want to pay for drinks no one would consumer but I wanted to respect their need to hit a certain minimum, and I’d welcome any suggestions she had to bridge the problem. She became my ally in the problem-solving. When I’m in situations like this, I like to have thought of some suggestion of my own to pitch, but I generally wait to see if the other person has a better idea before I come out and share it. The vendor has much more experience than I do, and they’ve probably dealt with similar challengers before so their ideas may be more creative. Total Savings/Value: $500.
Bonus: The Follow-Up
Leave them a long and detailed review. Or ask them where a comment from a happy customer can do them the most good. It costs you nothing and will leave them with a positive experience from dealing with you. Isn’t that what you want? To know that people who interact with you leave the experience feeling better than when they came in?
I did this for my wedding photographer. Not only did I refer another client to him who also had a positive experience, but I also wrote the most in depth and convincing customer review about the vendor that existed on any of the major wedding review sites. It was so comprehensive and valuable to them that they reached out to me directly to thank me for the review and explained how much it would mean to their business. I felt good. They felt good. Win-win.
Hopefully this six-step process will serve you as well as it has served me. Do you have any other negotiating tactics you’d suggest?
Share your tips and negotiating stories in the comments below!