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KEY TO SUCCESS

Company: Berkeley Signs

Project: Haggling on price  

Key to success: It’s always important to be educated about the true market value of certain items, either by comparables or a price guide. Never lose sight of what the product or service would cost if the client were to go elsewhere.

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I’ve recently found myself in more sales situations that involve haggling. I’m used to selling sign packages directly on the street, standing toe-to-toe with savvy customers, and I’ve built an extensive repertoire of selling pitches and strategies over the years. Now my skills are being tested anew as tough deal-making has come back into style. There is a type of business person that I square off with time and again that I call “the Old World trader.” Despite common stereotypes, traders are actually a diverse group who come in every age, race, class, creed, ethnicity and gender. They often seem to focus on price, but what they really want is “a deal.” I have an extraordinary desire to please my clients, but there needs to be a balance between clients getting “a deal” and me being compensated fairly for my output.

 

I’ve been around sales all my life, and when forced, I can work up a quick talking contract in a New Jersey minute. I, too, thrive on making deals and need to keep my sales up at all times. In a tight economy, I’m willing to broaden my range of clients if it looks like there is some serious money. Yet over the years, I have been taken on many underbids and they still happen occasionally. Even today, I couldn’t believe that someone roped me into doing a free installation. I was irritated, but it was just another day on the proving ground. Working for tough business people frequently offers me opportunities for rigorous self-examination. I routinely grill myself for solutions so I can understand how to better handle future situations. There have been painful outcomes and a number of Pyrrhic victories that have nearly killed me. I always get paid, but often I’m wisely reluctant to do repeat work for the client, if I feel that we cannot come to a mutual agreement of “fair trade.” 

 

Here are some antidotes and pre-game pep talks for those “magic words” that we have all heard.

 

“Times are tough right now.”

It goes both ways. I try to determine what my bottom line is ahead of time, based on my costs and how reasonable the person is. Chances are they have much more money than I do and they’ve said this line every day of their lives. Now, instead of taking it personally, I respect their business skills. I realize that if someone can knock even $200 off of a price in two minutes, that’s making $6,000 per hour! Summary discounts need to be no more than 10 percent, and can probably be justified if there is legitimate repeat business. Try to leave a little margin for the occasion when you know you’ll be obligated to “be reasonable.”

 

“You said this was included.” 

I was walking away with a deposit check in hand and I did a U-turn when it occurred to me that I might have left a window open to an interpretation such as this. I told the client that that “other sign” that had been conveniently left out of the final discussion was definitely “not included.” He was very surprised to hear this! The key is to speak up and put it in writing because some people will spin wishful thinking in their favor, no matter how absurd it seems at first glance. 

 

“It’s a small thing. It’s nothing for you to throw in.” 

It’s always important to be educated about the true market value of certain items, either by comparables or a price guide. When I speak from authority about the value of “small things,” I either get closer to my price or I know the issue will disappear forever. Never lose sight of what the product or service would cost if the client were to go elsewhere. Don’t be the only person in the world who will provide it for next to nothing.

 

“I am going to give you a lot more work.” 

This is the holy grail of trader lines. Instead of being eternally grateful for the “promise” of more work, turn the tables and consider how fortunate the client is that you will be doing their sign work. If all goes well, their repeat business will be welcome. And frequently, traders do own several properties because of their superior business acumen. Always keep in mind what it would look like to do the current job over and over. And never give future-based volume discounts. Consider giving a discount only if there are two or three jobs linked together in one deal. Generally ignore the “more stores” line. Stay in the present moment.

 

“I really want you to do this job.” 

Beware of the buddy effect. Management consultant Judy Smith stated in one of her seminars that, “Familiar clients and community will get a better price from you every time.” It just stands to reason. Traders are well aware of this reality. The paradox is that I won’t work for people who I don’t get along with. And yet, this often works against me. My best work is based on a sort of client/designer relationship that is inspiring. I’m encouraged that the client is excited about my better work. So then I aspire to do a real knock-out job. Next I find out that I’m giving a ridiculous deal. Three times this year I have done 25 percent more work for the money, $3,000 instead of $3,800 for example. It seemed like a lot of money at first, but later I realized that I had avoided giving a good deal on a Yugo, only to give a great deal for a Lexus. I lose sight of the fact that traders are not just looking for a low price for cheap work. They want to get a good deal for high-quality work.

 

“Please take care of this small issue.” 

I’m often able to sell jobs that are higher than the client’s initial budget. And I need to be absolutely accountable for every stray detail on the project. This is good barometer for finding out where you stand with your “buddy,” the trader. I can knock myself out doing signs that are better than the client could have ever imagined and suddenly I get nailed for a vague or debatable element. It can be excruciating. Sometimes I want to yell, “Please appreciate what a tremendous deal you are getting!” On several occasions, I have in fact, tried to convey what a deal a client is getting. Big mistake, because then the payback kicks in. On the real proving ground, you have to stick to the deal, and there is no whining. 

 

The power struggles that are inherently part of Old World trading can be painful. The balance of providing thoughtful, artistic work within the context of harsh marketplace realities can be daunting, but it beats digging ditches, and I always get paid. I have to accept that it is not the client’s fault when I “give away” a sign, and I can’t hold them accountable for miscommunications or little details that get screwed up. At the end of the day, I have to answer to myself and take responsibility to make sure that I am both giving and getting a “fair deal. I was so fumed at the end of a recent “endless” job when a client wanted me to move a sign over a couple of inches, because it looked “just stuck up there.” I’d been working way overtime and I lost it a bit. Later I stuck out my hand and apologized for losing my cool. He stared at my hand for several seconds, and then said, “You’re not blaming me; it’s not my fault.” I was doubly steamed, but I realized that he was right and we shook. Later I got my check and a compliment on a job well done.