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How to bargain effectively

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Introduction to Bargaining

One of the oldest and most basic human skills is bargaining, but many western travelers have completely lost the art.

How to Bargain

To bargain successfully the single most important factor is the apparent ability to walk away from the deal. Everyone knows you are relatively rich and can afford an exorbitant price. Therefore you must look convincing when replying to the pick-up truck driver who is asking $10 for a ten-mile ride–when other passengers are paying only a few dollars–“No, that’s too much, I’ll walk.”

Your bargaining power is severely eroded if you look dead-tired, if you have already loaded your pack into the back, or if your Danish companion is pleading with you to accept any price.

There is no need to pay $10 for the ride. The driver won’t leave good money behind. That would be as foolish for him as you paying the first price he asks.

Bargaining Tips

1. Take your time. You don’t have to rush into anything, including the back of a truck, taxi, or airplane. Make inquiries to find the average price. If you can’t spare the time to discover the true value and quality of something, do you really want it?

2. You are bargaining from a position of strength if, and only if: a) You are willing to walk away, or b) You look like you’re willing to walk away.

3. Offering a price half what the seller originally offers and working up from there is not always a good strategy. Some sellers quote at ten times true value. If you bargain to half or three-fourths of that–which many backpackers assume must be a reasonable price–you are still paying an outrageous mark-up. Such prices are often asked by hawkers who approach on the street with beads or jewelry. Aggressive sellers are usually looking for a sucker.

4. Unless you absolutely have to, don’t trade away for unfavorable terms that which you think has more value.

5. Try not to take advantage of the poor Mayan who has been at her stand all day with few or no sales. Without knowing it you can easily drive her price to cost or below–which she sadly agrees to because she needs cash to buy food for her family that evening. Sometimes the best bargain is full-market price.

6. Buy stuff from poor people.

7. Restrain goofy purchases until the end of your trip.

8. Laugh at ridiculous prices and act the person’s friend who is trying to sell you something you want. Play with them, enjoy bargaining. It is an ancient sport. The vendors seem to often times have just as much fun trying to get as much out of you as they can as you do getting something for the cheapest price possible. It is a game of wit and endurance — the person who can outlast the other is the one who wins.

9. Determine who wants it more. If you are buying something from a person who does not seem to interested in selling to you, then using a strong strategy may not work to your advantage: if you try the “walk away” move on a wealthy merchant, you may find yourself empty handed. Instead, pester the person. Continuously reassert the price you are willing to pay. Take out the money and flash it. At the end of this game, slowly shrug and put the money back into your pocket. If your price is within reason, the vendor will often open up his palm

10. Is what you want a one of a kind product or service or are there many people offering the same thing? If there is only one guy in a town giving rides to where you want to go, then you are proabably not going to be able to bargain him down on the price more than if there are dozens of drivers doing the same route.

If what you want is very common — there are lots of people offering it or selling it — then you can use this to your advantage. Have an auction of sorts, play vendors and drivers against each other. Try to form a mob around you of vendors trying to get your business. Offer the price you are willing to pay loudly and stand strong to it. Often, you will be laughed at and all the vendors or drivers will tell you that the price you are offering is not possible. Laugh back at them and reassert your position. Often the vendors will walk away in a group. This is good. You should walk away too and go to a location that is away from the group but still in sight. Continue asking around for what you want.

Eventually, a vendor or driver will break and give you what you want for the price you are willing to pay. You just need to break down the group dynamic. Engage the group and publicly state your offer, stand strong to it, then retreat and pretend to look for services elsewhere.

Remember, the power of money is often stronger than the power of friendships or professional respect. In most instances, a vendor will arise who undercuts his competition.

[Do you have any tips on bargaining? If so, please contribute them to this page.]

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