A Guide to Bargaining

8/11/2019 A Guide to Bargaining

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Zen

and

the art of

buying grey Cell Phones

Apurv Parashar

2000189

Group-4


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he Proble!-"The problem involved here was to get myself a cheap cell phone which

Would cost me less then Rs3000

Would not necessarily be the size and weight of a mortar brick.

Also wanted a !decent" range of features on my gizmo where !decent" for me usually

borders on the e#travagant for others. The only way this seemed possible was for me to

tap the !grey" market which e#ists in $affaar %arket and &aalika 'azaar in (elhi.)owever these markets have a reputation of being twin edged knifes of sorts as too many

stories abound of people having been taken for a ride by smooth talkers and ending up

paying more than the retail price for these gadgets. 'ut confident* by virtue of desire andneed* decided to press on and did e#tensive research of sorts on retail as well as grey

prices and ultimately headed for these markets. Along with e#perienced friends* headed

out and ultimately got what desired after two days of scouting at Rs+,00 about -00

bucks less then retail. The entire process* the negotiations* the threatened walkouts andthe ridiculous stories told on both sides of the counter were tremendously instructive and

here attempt to analyze our transactions as a /uintessential middle class guide for

getting that cell you want for a wee bit less of your pocket.

he #etup-" 'oth of these markets /uoted above operate on a negotiation model where

the term !marked price" goes for a big si#. 'argaining is the mantra of the day andrepresents the pinnacle of materialistic fruitful communication for the buyer. The game

itself starts upon your initial glance towards the seller"s rack The sub1ects in /uestion are

armed with counters resembling better a cigarette2beedi bo# rather then a shop and the

seller towards you$It is here I must emphasize that this entire process is an exercise in

communication between you and the seller. Through your moves, your attitude, yourspeech, you are unconsciously (or consciously) sending signals by which a seasoned

seller makes up his mind to what price he can take you for and hence reacts .t is at thislevel if you are careful you can turn things around your way as intend to show or at least

prevent yourself to be cheated. n effect it generally boils down to a two player

communication problem which e#pands to more if more sellers or buyers are involved.

$enerally similar communication techni/ues will follow for both &aalika and $affaar* but

will differ in some few vital areas due to characteristic differences between both in

location* setting and type of sellers. This becomes increasingly important when choosingbetween markets* if the time you can spend is limited. Also note that this is intended not

to be a general bargaining guide for any product or market but only for this peculiarproblem for markets /uoted above as many methods developed for this situation turn ontheir head in say* a souvenir shop or some place else.


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4ollowing the lead of successful $enerals from history* we begin by analyzing the

opponent by segregating him into two classes

he Paan-%eedi type vendor25.These types dominate in $affaar and have a

reasonable presence in &aalika. They are typically sitting behind a small glasscounter showing their wares on the open street and hence their name. The vendors

themselves range from right to chaps looking like actual beedi types to

!respectable" looking broken 6nglish speaking types. They have about -02- cellphones right there for you to see and have more stashed somewhere and are even

connected well to get you a model if you care to name it for him. They usually

deal in second hand phones but can be the best source for a killer buy on a new

phone provided you can verify their claim. These tend to be more receptive tobargaining strategies then the second type as they have to resort to similar

communication channels for their sales pitch to make up for their lack of shop

structure and hence lack of trust and reliability therein.

he &'espe(table #hop)eeper* vendor25 These are mostly found in &aalika

where they usually host other electronic items but can be wholly 7ell &honeoriented too. They have all the fa8ade of retail and inspired by some original

cardboard bo# packs on their showcase* /uote even higher then retail price. They

usually assume an arrogant attitude so as to 1ustify the higher floor area occupiedby them compared to the path side vendor sitting outside his shop. They rarely

deal in second hand stuff but like to classify all their wares as new* whatever

condition they are in. 9ot invincible to bargaining techni/ues* but they are less

receptive then the first type maybe* as they seem to get a regular share of rich

gullible customers who go home happy in the thought of making a bargain 1ustbecause they bought it from &aalika.

he +yth25Before developing our general tactics* we clear the air first by breaking a

myth about bargaining in general and specifically here. )aving watched too many)ollywood movies in which the buyer and merchant simply name prices until they agree

one that is roughly halfway between the original asking price and offer price* many

people think that this is the way bargaining really works. Well it doesn"t.

f you try to ask for a discount the seller will come up with all kinds of stories as to how

his margin is Rs0 or even lower* or how this phone is worth much more but he"s doingyou a favour because he you are his first sale of the day::f you believe his story* andaccept the figure that he named* you are going to be paying an outrageous price.


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;o you know what he"s up to. 9ow what do you do< f you don"t want to pay an

outrageous price* you have to remember one simple guideline= ell hi! a story$ ,e told

you a story and no. you tell hi! one. Tell him you intend to buy the phone right thereand place the money in front claiming that as all you had minus the auto fare. The >

have this much only? @ story /#work* provided you act it out convincingly and the

money you lay in front is does give the poor chap some margin and at the same timereasonable to you. This works e#tremely well with the first type as they often doubt

sincerity of their prospective !customers" as even many 1aywalkers also ask them out for

fun.

$ood acting skills are important too. &ractice your surprised look in the mirror. When he

names his price* look shocked and start apologizing. >"m really sorry. had no idea it

was so e#pensive. thought it would only be around half that price. like it but don"twant to waste your time. There"s no way could afford it.@ This also sometimes works

but often mistook for sarcasm but when its not* you are most likely to be made another

offer. ;o you have to decide on instinct by your perception of the seller and to what

particular tone and content will he respond to. personally found that a subtle firstreaction is much more useful if you know that the price is grossly inflated and has to

come down like in this case as will be seen 1ust ahead.

We now e#amine general tactics for effective bargaining and will later review my own

e#perience and analyze it in light of aforementioned and communication theory by doinga mini case study.

he General 'outine25

#tri)ing a pose25our attitude is everything when you go in. Almost every seller

seems to welcome a positive* fun* and friendly potential customer and sales

interaction. Abrasive ta)e no prisoners in your fa(e 'a!bo type attitudesusually are not e!bra(ed .ith the sa!e enthusias! although you mayhave to

end up being a little aggressive to stri)e the final deal$At the same time sincerity

must* and can not be compromised for a light disposition when dealing especially

with the first type. This can not be overemphasized as the repeated /uestion fromthem is to whether you reallywant to buy a cell phone and that itself is very

important for the /uoted price to begin its downward spiral.

he routine itself-" )ow to start 4irst of all through e#tensive market research you

should be familiar with prices and models available. ;o you will have idea aplenty

when you actually venture out to buy. 9ow is the time to scan all the counters outthere. ou see a phone you like or were thinking as a possible buy. ou then proceed

to ask its /uoted price. The price /uoted is almost certainly way above your threshold

limit and is almost twice if you are in &aalika. t is then advisable to react with


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subtlety in mind and keep inspecting the phone up and down* in and out. 4inally

when convinced of the set"s value it is advisable to follow a scaled down routine on

some other phones even if in pretence. This should be done in order not to give awayyour liking for that set. Beep asking /uestions though* about model* battery life*

features even if you know more than him.

3eep in !ind this is not a eer(ise in delay but one in .hi(h your sin(erity as

.ell as gullibility 5or the la() of it6 is (o!!uni(ated to the seller. f it"s not

happening* you are missing the point. f you feel it is not happening your way* thenask a different /uestion and keep asking and e#amining until you incite the seller"s

interest and attention. Cnnecessary delay will bear no fruit and you must enter now

the second phase of the great game.

9ow you come back to your best bet phone and ask for a second price which

generally meets with two responses25

A ne. pri(e is 7uoted !arginally less then previous$ he 7uestion &,o. !u(h are you prepared to give*

n case of first response* act with disgust: This is an opportunity for you to be your

e#pressive best: and start narrating stories at the same time pressing home the point

that while u appreciate the set* you will not be taken for a ridees* make this clear inclassic direct style communication and how you can not pay him the higher price and

carry the feeling home of paying more than fair. The keyword here is&ngage*.

6ngage the shopkeeper even if he appears reticent and try to bring him to the second

response orto a price you might be willing to pay.

Things get interesting in the second response and preferably you should not suddenly/uote your price or a price below it* but rather wait and incite the seller to give hisbest price insisting as it is his product he should come out with a fair price himself.

This delay takes a little bit of the shock out of the price you will /uote which is even

lower then the price you think is fair.

Cpon hearing that price now it is the seller"s turn to act in disgust. This cycle can be

ended now by instinct and fle#ibility and your as well as hisneed to make a sale.Dnce you /uote a price and you think it is fair to you and him stick to it and now

you enter the final act* the walkout.

ou must also be a good actor when you do your >walkout@. lmost all successfulbargaining sessions involve threatened or real walkouts. f you are not have any

success in getting to the price that you want to pay* it is time to apologize for wasting

the seller"s time* and pretend to leave. $enerally in $affaar* you will be called backE0F of the time. t usually takes one or two threatened or actual walkouts to get a

good price. The walkout is also useful because if the shop2keeper lets you go* you

know that he is not going to go any lower and you can always come back if you want.Though you shouldn"t if you think your price is fair


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%odyal)-" 6#pressive gestures* facial movements* and or the lack of them* will

emphasize motivation toward a purchase. 7ommunicating what you will pay and

when you believe something is over2priced can be accomplished through bodylanguage. 6ye e#pressions* hand movements* a smile* or dropped 1aw* will all be

understood regardless of any language barriers. our kinesthetic disposition will be

of paramount importance throughout the transaction.

%-" )owever once you do sight things you like and hear stuff you like* stay cool*

calm* and collected. &ut your best poker face on. After going crazy over a phone* by

praising it up one side and down the other* donGt be amazed when the shop owner

wonGt budge from his price. The shop owner then knows how much you want andlove that piece. )eGs got the upper hand now. Dnce you have revealed your true

intentions and desire* to regain any leverage with the shop owner is futile. ;hop

owners* Gm convinced by now* have e#traordinary powers of mental telepathy. hen

you see an ite! you .ant being non(halant about the .hole thing .or)s best. know it may be difficult but remaining neutral works to your advantage. The thrill of

ac/uiring what you want is worth the challenge of staying cool.

a)ing it slo.-"magine thatyouare a seller. A guy walks into your store and shows

some interest in an item. ou give him your best sales pitch* and price negotiations

begin. After a minute or two* if he leaves without buying something* you haven"t lost

anything* but if you spend ten or fifteen minutes* you will be e#tremely reluctant tolet the customer leave the store without making a sale. 6ven if you are only going to

make a very small profit* you will want to make sure that the customer buys

something. This brings us to our second guideline= ;pend a lot of time at the counter.Ask a lot of /uestions. 6#amine the phone in minute detail. &retend that you are

interested in other phones as well. Try things on* and try to look as if you have all the

time in the world. 6#ercising patience may be the difference between getting whatyou want for the price youGd like to pay or not. /on:t be i!pulsive. Beep those

feelings zipped in your back pocket and put some restraint in your wallet. Hearn to

pull back gently on your reins* as you go charging toward your potential purchasing

victory.

,abeus Corpus-" f you can rant along a cell phone of a buddy or take the cell

phone buddy with you it can be very useful indeed. The most important use comesalong in the happy coincidence when you intend to buy the same model and can

dangle the phone in the air* moaning in disgust as to how it really costs a tenth of the

/uoted price. Dr you can resort to comparing the phone on counter with that in yourand as how despite having more features your phone costs less then that on the

counter.


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;llusion of )no.ledge-"ou /


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end second hand model. erred in letting my e#citement show for the other model which

the shopkeeper picked on. ;o this effectively negated our advantage of looking for two

phones and was thoroughly avoidable. %eanwhile continued with my inspection of thephones and kept asking /uestions which he rather intelligently replied.

The dialogue went something like this scaled down in time

%e= s this is the new %itsubishi %ars

A Guide to Bargaining

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