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Stories about haggling continue to abound with wild claims of amount saved and pervasiveness in America right now. Case in point was this article in the Los Angeles Times by Susan Carpenter, Go Ahead, Haggle. It quoted Pam Goodfellow with BIGresearch, a consumer intelligence firm that “Everybody’s looking for innovative ways to save a few dollars. If that means going to a garage sale and haggling a $10 item down to $5, it’s something people are doing right now.” She said a 2008 survey found that 50% of Americans were haggling for better prices on all kinds of products in light of the economy.
Cheap people have been around forever. You’ve had to deal with them before and so have I. When I used to sell western wear in the 80′s I’d have guys ask me to “throw in the shoe trees and I’ll take ‘em.” No dice. I remember asking one guy, “So how do you buy groceries – say, ‘I’ll take the grapes if you throw in the Windex?’” It usually got a laugh and a sale. Again, if you are a salesperson, you learn to read people and know how to be a chameleon with customers.
How did I develop thick skin to not discount? I saw the slippery slope I would be going down if haggling produced results. The gal or guy gets their way. They tell their friends of the “great deal.” Their friends come looking for that deal. You have to remember what you did to repeat it. Then the original person comes back and wants an even BIGGER deal for all the business they brought you.
The piece that I think so many businesses leave out is training their employees to not do it. I don’t care that Seth Godin has said all employees should be “empowered to discount up to 10% to save a sale.” That’s not good management.
Your employees are hurting themselves and faced with debt. They identify with anyone looking for a deal. They already feel you are making boat loads of money off them. They don’t know how to sell to begin with so if someone will like them for giving them a “deal,” they’ll do it. That can kill profits.
Here’s how to stop the haggling virus:
- Explain how much profit you make to your crew from every dollar showing rent, taxes, insurance, health benefits, advertising, the works; with most businesses it is about 3 – 5 cents out of each dollar paid. Any less money is less to pay them.
- Train employees how to sell (see product at end of this article)
- Institute a “no haggling” policy. Just don’t do it.
- Give scripts for what to say you can do if asked that might include: “No, we don’t have a lower price on this item but you can sign-up on our e-club to get the best prices right here.” “We have a similar item over here.” “You can put it on layaway.”
You must have scripts or well-meaning employees say things like, “I’m sorry I can’t do that,” which implies that someone else can. Or they say, “Only the manager can do that,” which implies the manager can.
As more stories continue to pop up by writers identifying with people looking for discounts you have to arm yourself to stop it, or face becoming one of those haggling helpless retailers grateful for any sale.
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How to grow sales in a down economy? The Retail Doc’s Five Parts to a Successful Sale is Phibbs proven sales techniques on two DVDs with workbook. You’ll actually see Phibbs training a crew with the exact exercises needed to instill a sales process into your store.
The internet has aggravated this condition. Look at pricegrabber, nextag, etc. Then you’ll understand where this shopper is coming from.
I was standing in a store recently, saw a shopper put his phone up to an item barcode, say to his friend, “We can get it for less up the road at…”
I don’t know if an improving economy will outweigh the increasing ease with which consumers have access to price data to shop with.
[...] retailers join in the fray at their own peril. I’ve written extensively about it on my blog and how to train employees to deal with [...]
consumers may actually being getting wiser (still utter idiots who buy certain items at 500% mark up-but improving). the internet has removed the social taboo of seeming cheap with being anon and they are wanting those savings passed into real life/gaining self confidence/ or f ur thoughts stranger there are so many of you anyways if you aren’t family or a sex goal idc. it used to be common place then everything got all corporate with clerks whose only training was this is a 1,5,10,20$ bill and knew/cared nothing (why should they w/o shared profits) about the total cost of product so the mentality became price is price.
businesses who turn down negotiation are turning down business. as to whether the huge loss is as huge as the expense of training their cheap,unmotivated, uncaring labor force to understand the bottom line who knows (not like they couldn’t give the employee a computer with inventory database with make sale above x in a whisper)
I dont feel for retailers. The strongest beast can eat them all and the virtual market place will/is dominating luxury/comfort items. The physical locales are just there so you can touch it, feel it, smell it before you go online and snag it and a fair enough price with the optimum cashback cc,bing, rewards,coupon codes.
Interesting “take” mentality evilmoney. Readers, this is a certain type of consumer – do you want to court them or shun them. The choice is yours.