When You're Negotiating, Money isn't as prominent as You Think

Let me tell you about my pet subject: When you're selling your goods or service, money is way down the list of things that are prominent to the other side.

First, we'll talk about something that you may find hard to believe but it's something of which I've become convinced-that people want to spend more, not less, and that the price concerns salespeople more than the people to whom they sell.

Att Call Conference

Then I'll teach you all the things that are more prominent to people than money.

Finally, I'll teach you some techniques to find out how much they'll pay.

People Want To Pay More, Not Less

After roughly two decades of training salespeople, I have become convinced that price concerns salespeople more than it does the people to whom they sell. I'll go even supplementary than that-I think that customers who may be request you to cut your price are confidentially wishing that they could pay more for your product. Hear me out before you dismiss this as being imbecilic.
I was the merchandise manager at the Montgomery Ward store in Bakersfield, California back in 1971. Although Bakersfield was not a large town, the store ranked 13th in volume in a chain of more than 600 stores. Why did it do so well? In my opinion, it was because head office left us alone and allowed us to sell to the needs of the local population. For example, we did a huge firm in home air conditioners because of the outrageously hot summers. In Bakersfield, it's base for it to be 100 degrees at midnight. In those days an median blue-collar home in that city cost nearby ,000. The air conditioners that we would setup in these homes might cost ,000 to 12,000. It was very hard for me to get new salespeople started selling in that branch because they had a real resistance to selling something that cost more money than they had ever made in a year. They plainly didn't believe that anyone would spend ,000 to put an air conditioner in a ,000 home. The customers were willing to pay it, as was illustrated by our huge sales volume, but the salespeople weren't willing to keep these decisions because they thought it was outrageously expensive.

However, if I could get salespeople started to where they began to make big money and they installed air conditioner son their own homes, suddenly they didn't think it was so outrageous any more, and they would dismiss the price objection as if it didn't exist.

Beginning stockbrokers have the same problem. It's very hard for them to ask a client to spend 0,000 when they don't know where lunch money is arrival from. Once they become affluent, their sales snowball.

So I believe that price concerns salespeople more than it concerns any customer. This is demonstrated by the perceive of one of my clients who is a designer and provider of point-of-purchase sales aids and displays. He tells me that if three products are on a shelf in a store-let's say three toasters-and the features of each are described on the carton, the customers will most oftentimes agree the top price item-unless a salesperson comes along to help them with the selection. When that happens, the salesperson, who is probably working for minimum wage, is unable to by comparison spending money on the best and manages to talk the customer down to the low-end or middle-of-the-line toaster.

The prominent element here is the article on the carton. You must give customers a conjecture for spending more money, but if you can do that, they want to spend more money, not less. I think that spending money is what Americans do best. We love to spend money. We spend six trillion dollars a year in this country, and if we could walk into a store and find a salesclerk who knew anyone about the merchandise, we'd spend seven trillion dollars a year. And that's when we're spending our own hard-earned after-tax dollars. What if you're request someone who works at a corporation to spend the company's money? There's only one thing great than spending your own money, and that's spending someone else's money. If that weren't enough, remember that corporate expenditures are tax deductible, so Uncle Sam is going to pick up 40 percent of the bill.

So, I believe that we've had it all wrong for all these years. When we're trying to sell something to somebody, she doesn't want to spend less money; she wants to spend more. However, you do have to do two things:

1. You must give her a conjecture for spending more.

2. You must convince her that she could not have gotten a great deal than the one you're contribution her.

That second point is where Power Negotiating comes in because all I teach is designed to convince the other people that they won the negotiation and that they couldn't have done better. Let's face it, does what you pay for something unmistakably matter? If you're going to buy a new automobile, does it matter if you spend ,000 or ,000? Not really, because you'll soon forget what you paid for it, and the dinky growth in payments is not going to work on your lifestyle. What unmistakably matters is the feeling that you got the best inherent deal. You don't want to go to work the next morning and have every person crowded nearby to admire your new car when somebody says, "How much did you get it for?"

You say, "I worked out a frightful deal. I got them down to ,000."
"You paid what?" he replies. "My friend bought one of those, and he paid only ,000. You should have gone to Main road Auto Mall." That's what hurts-the feeling that you didn't get the best deal.

The objection that every salesperson hears most is the price objection. "We'd love to do firm with you, but your price is too high." Let me tell you something about that. It has nothing to do with your price. You could cut your prices 20 percent across the board and you'd still hear that objection. I trained the salespeople at the largest lawn mower premise in the world. You probably own one of their products because they design most of the low-end hidden label lawn mowers that discount and chain stores sell. Nobody can undercut their output cost on lawn mowers. They have it down to such a science that if you bought one of their mowers at Home Depot and you tipped the kid who carries it to your car a dollar; the kid made more on the lawn mower than the premise did. That's how slim their profit margins are. However, when I asked them to tell me the estimate one complaint they hear from the buyers at stores, guess what they told me? You got it. "Your prices are too high."

You hear that complaint all the time because the people you're selling to study negotiating skills too. They meet in groups at their conventions and sit nearby in the bars saying things like, "Do you want to have fun with salespeople? Just let them go straight through their entire presentation. Let them take all the time they want. Then when they ultimately tell you how much it costs, lean back in your chair, put your feet up on the desk and say, 'I'd love to do firm with you, but your prices are too high.' Then try not to laugh as they stammer and stutter and don't know what to say next."
Instead of letting this kind of thing work you up into a sweat, adopt the attitude that negotiating is a game. You learn the rules of the game, you practice, practice, practice until you get good at it, and then you go out there and play the game with all the gusto you can muster. Negotiating is a game that is fun to play when you know what you're doing and have the belief to play it with vigor.

The next time you're trying to get somebody to spend money remember that they unmistakably want to spend more money with you, not less. All you have to do is give them a conjecture and convince them that there's no way they could get a great deal.

Things That Are More prominent Than Money

A reporter at a press consulation once asked Astronaut Neil Armstrong to retell his thoughts as Apollo 11 approached the moon. He said, "All I could think of was that I was up there in a spaceship built by the lowest bidder." A cute line, but he was falling prey to a beloved misconception that the government must do firm with anyone who bids the lowest price. Of course, that's not true, but it's splendid how many people believe it. I hear it all the time at my Secrets of Power Negotiating seminars: "What can we do when we have to deal with the government? They have to accept the lowest bid."

I once found myself sitting next to a Pentagon procurement officer on a flight to the East Coast, and I raised this point with him. "All the time I hear that the government has to buy from the lowest bidder. Is that unmistakably true?"

"Heavens no," he told me. "We'd unmistakably be in trouble if that were true. Cost is far from the top of the list of what's prominent to us. We're far more involved with a company's experience, the perceive of the workers and the administration team assigned to the product, and their capability to get the job done on time. The rules say that we should buy from the lowest bidder who we feel is capable of meeting our specifications. If we know that a singular provider is the best one for us, we plainly write the specifications to favor that supplier."

Of course, that is the key to selling to government agencies, either it is the city, county, state, or federal government. If you want to do firm with any level of government, you should become known as the most knowledgeable someone in your industry, so that when the branch starts to get ready bid specifications, they welcome your advice on what they should specify. Fortunately, the trend is away from this type of direct bidding and toward the government branch hiring a hidden sector scheme manager to supervise the work. By inserting this middle person, they avoid the enforcement to let bids and instead let the middle someone negotiate the best deal.

So even with the federal government, price is far from the most prominent thing. When you're dealing with a firm that doesn't have legal requirements to put out a request for bids, it's far from the top of the list. Just for the fun of it, retell the following list of things that are probably more prominent than price to buyers.

I said, "Don't you need to know when and where I bought it? I'm not sure that I can find my receipt."

"I don't need to know any of that," he told me. "I just want to be sure that you're happy with what you bought." When a firm stands behind what they do to that extent, am I unmistakably going to worry about either they have the lowest price or not? Of course not.

The capability of the workers that you will assign to the job.

The level of administration that you will assign to oversee the work.

Finding Out How Much a seeder Will Take

Now let's look at some techniques to find out the seller's lowest price. When you are buying, the negotiating range of the seeder ranges from the wish price (what they're hoping you'll pay) all the way down to the walk-away price (at anyone less that this they will not sell at all). The same is true in reverse with the buyer. How do we find the seller's walk-away price? Let's say that your neighbor is request ,000 for his pick-up truck. Here are some techniques you can use to find his lowest price.

Of course, the way that you ask for his lowest price makes a big difference. Try these approaches:

"I'm unmistakably curious only in a pick up truck for occasional use, not one as fine as yours. I'm finding at one that the owner's request only ,000 for. However, I thought I'd be fair to you and ask you what the least you'd take would be."

Or the Reluctant Buyer advent (see lesson 5): After spending a lot of time finding it over and request questions you say, "I unmistakably appreciate all the time you've taken with me on this, but unfortunately its not what I was finding for. But I wish you the best of luck with it." Then, when you're halfway into your car to leave you say, "Look, I unmistakably want to be fair to you because you spent so much time with me, so just to be fair to you, what is the very lowest price you would let it go for?"

Now let's look at some techniques that a seeder could use to find out how much a buyer is willing to pay. Let's say that you sell switches to computer manufacturers. Here are some techniques you could use:

As you can see from all we've talked about here, there's a lot to be said about the field of price. Power Negotiators know not to exacerbate the price qoute by assuming that price is uppermost in the other person's mind. Also it is ludicrous to say that what you sell is a commodity, and you have to sell for less than your competitor's price for you to get the sale.

When You're Negotiating, Money isn't as prominent as You Think