June 19, 2009
The art of haggling
By Amy Winn
When you think of haggling a price on a purchase, you probably don’t think of walking into a national retailer and asking for an extra percentage discount on a TV. Or suggesting a lower price on office supplies, handcrafted accessories or musical instruments at a local shop.
But it’s indisputable the practice of negotiating prices is experiencing a resurgence across the retail spectrum, including in mid-Hudson Valley stores.
As a consumer, the first and most important step in negotiation is being knowledgeable. Not only about the product, but also about the merchant selling it, since not all are open to discussing price.
“Some business owners may be insulted to think that customers are questioning their integrity,” said Paul Solis-Cohen, owner-president at Catskill Art and Office Supply, with stores in Poughkeepsie, Kingston and Woodstock.
“We encourage any kind of communication between our customers and our stores. When a customer approaches us for any consideration we welcome it, as it shows their interest in doing business locally. They want to be recognized, heard and made to feel important – and they are,” Solis-Cohen said.
That said, even in Solis-Cohen’s stores, there are distinctions.
In the art and office supplies businesses, the stores face serious price-based competition from large retailers and the Internet. Solis-Cohen said the 30-year-old company’s long-term relationships with manufacturers and distributors allows the stores to “match any price anywhere on any item we sell,” assuming the situations are comparable.
Relative value poses challenge
“If a competitor has a warehouse operation and they vend over the Internet, with no overhead costs or service – no samples on a sales floor, no staff that can answer questions intelligently, no product they can put into customers’ hands – then it’s hard to have relative value. If it’s a direct comparison, not only do we match the price, but we offer additional savings over any competitor,” he said.
They will also offer bulk discounts for large purchases, and offer a customer loyalty program that provides $10-off coupons for every $100 spent, all at once or over time.
However, he said the company’s other major business areas, custom framing and reprographics, are not price-sensitive, so negotiation is not appropriate for these services.
Margaret Nichols, one of eight partner-owners at Craftsmen by Design in the Poughkeepsie Plaza shopping center, said the store’s policy is not to bargain on its selection of locally produced handcrafted products, jewelry, fine art and photography.
“The artisans set their prices, so [negotiation] is not something we could or would do. Prices vary – it’s a question of the materials and what the craftspeople think their time is worth. Most craftspeople I know work on low profit margins,” Nichols said.
However, if a customer is seriously interested in a piece and wants to make a lower offer, she agreed she might be willing to contact the artist and ask whether he or she is willing to accept another price.
Over at Let’s Jam Music in Poughkeepsie, owner Larry Helweg said refusing to negotiate is bad for business. “I don’t like to [negotiate], but the way the economy is, you have to – you have no other choice. If the customer goes elsewhere, someone is going to. Businesses are hungry right now,” Helweg said.
He said the price on lessons is not negotiable, but on instruments, repairs and rentals, “we’ve definitely gone down from what it was a couple years ago.”
His response, like Solis-Cohen’s, has been to pay more attention to providing the human touches and service Internet vendors cannot.
When it comes to hard dollars, Helweg said he understands the customer’s point of view.
“Because of the Internet, customers definitely are a lot smarter these days; they check out what they are buying, especially kids. They know exactly what things cost. It’s about money right now. Loyalty is gone for small stores. Nobody has money,” he said.
Likewise, a smart negotiator understands the retailer’s point of view before opening a discussion. It’s important to respect the merchant’s business philosophy.
At Elizabeth Boutique in Poughkeepsie, owner Beth Madsen draws a firm line against discounting on request.
“I feel if I were to give a discount to someone once, they will always want a discount, and it will go around to everyone they know. Wouldn’t you go back and ask again next time? It could put a store out of business, especially a smaller store. You can’t do business that way,” Madsen said.
“Usually, I don’t discount something unless it’s on sale, and it’s on sale for a reason. I have had people ask before, but I try to keep reasonable prices in my store,” she said.
A compromise she’s comfortable with is the “EB Client Reward Card” program. This is a way for her to offer an indirect discount to returning customers on popular items, such as denim jeans and accessories, while being fair to all, she said.