Concede with Reluctancy

With the addition of our fourth child, my wife and I decided to remodel our home. We had the carpets removed and replaced with beautiful hardwood flooring on the entire first floor. I wanted a grandfather clock that matched the color of our new hardwood flooring that also had the “Big Ben” chime. Finding that specific grandfather clock was not going to be an easy task. I went to the largest furniture store in Utah and went to their department that had grandfather clocks. When I walked in, I saw roughly 30 – 40 grandfather clocks. I walked up to the first clock. Wrong color. The second clock had the right color so I hit the chime on the back of the clock and it was the “Big Ben” chime! I could not believe my luck. I was thrilled. I checked the price tag and it was $5,000. I honestly had no idea if that was a good or bad price. So, I decided I would test the water and see if the sales rep would negotiate. I found a sales rep, walked him over to the clock and used a famous J.P. Morgan negotiation line. “I like the clock. But I don’t like the price. I’ll tell you what. I’ll write you a check, right now, for $3,000!” Without hesitation, the sales rep blurted out, “Great! Let’s sign you up!” and began walking to their purchasing department. Wow! A $2,000 discount. Awesome! But as I began following the sales rep to the purchasing department, I began to feel uneasy about the discount. “Maybe I should have started lower?” “Maybe I should have only offered $2,000!” “Maybe that clock is a piece of crap!”
I purchased that grandfather clock almost 15 years ago and it’s still sitting in our living room. Every time I walk by that clock, or hear the chime, I’m reminded of that experience and how I wish the sales rep would have charged me full price. If he had, I would have felt better about the purchase!
The negotiation mistake that sales person made, which is a common mistake, is discounting quickly and willingly instead of slowly and reluctantly. In buyer-seller negotiations, how you concede can be as important as what you concede. When making concessions, don’t make it a trivial or trifling process. “Okie dokie” does not carry the same impact as “Let’s work out some figures on paper and then make a decision.” When sellers make concessions seem inconsequential, they communicate to buyers that the conceded item wasn’t terribly important to begin with.
When sellers make concessions, it should be done reluctantly. Reluctantly doesn’t mean grudgingly or with the attitude of a sore loser. It means conceding with calculation. You might express a little pain as you do it, but make it a cerebral decision. Pull out a calculator and carefully weigh the cost. Show the buyer thoughtful contemplation was given to the decision before agreeing to the concessions.
One way to create the impression that you have done your homework in calculating a discounted price is to avoid using round numbers. Use odd numbers and decimal fractions such as 5.2 percent or 11.9 percent.
Make buyers earn concessions. It helps maintain the value of the product or service, adds value to the actual concession or discount, gives meaning to the compromise, and builds power for future negotiations and business interactions.