Saturday, 21 April 2012

Serial Haggler and Working from home

Confessions of a Serial Haggler

Most people negotiate on super-expensive things like cars and houses. But for many, that's where the haggling stops. It shouldn't. Negotiating for better deals on everything from cable bills to doctor visits isn't just rewarding: it can be fun. Check out this story on how to do it right.

Whether it’s jewelry for Valentine’s Day, a used car, a hotel, your credit card, your doctor or your cable bill: the easiest way to save money is to simply ask for a lower price.

Haggling is a part of the process when you shop for a car, a house or at a yard sale. But there’s no reason you shouldn’t try it more often. I certainly do.

And recessions are prime time when it comes to getting better deals: check out this story I did about buying like it’s 1999.
Here are some recent deals I’ve negotiated just within the last several months:
  • A few weeks ago I went on-camera and asked for a better deal on my cable bill. I saved $15 a month in about 5 minutes. Here’s a look at that story.
  • When I bought the camera used to shoot the story above, I negotiated a free camera bag.
  • When the microphone I was wearing while shooting the story above broke, I wheedled a free repair out of Sony even though it was out of warranty.
  • My credit card bill was received late last December (it was lost in the mail… honest!), but I got the late fee waived and made sure the late payment wouldn’t be reflected on my credit history.
  • I got $20 of the last hotel I stayed in and got upgraded to a better room.
  • I got the sofa I bought last fall delivered free from one store and got 30% knocked off my dining room chairs at another.
  • I got my doctor to reduce my bill for a recent physical by explaining that I had high-deductible health insurance.
  • Last fall when I got new windows put in my house, I negotiated a $2,600 discount.
There you have it: I’m a compulsive bargainer. I’m happy to add, however, that I’m not the only one. There are so many of us, in fact, that Consumer Reports did a survey on people like me. Watch this 90-second news story about asking for better prices, then meet me on the other side for details and more tips.

So let’s recap: according to this survey by Consumer Reports, negotiating a lower price is not only possible, it’s likely. Below is more detail from the survey. These results came from interviewing more than 2,000 men and women who had tried negotiating for at least three years. The numbers below reflect how many achieved a discount at least once during that three year period, along with the greatest discount any of them achieved.
  • Furniture: 94% of those who asked got a better deal at least once.
  • Medical Bills: 93% of people who tried negotiating a lower bill were successful at least once.
  • Home Electronics: 92% were successful at least once.
  • Appliances: 92% were successful at least once.
  • Floor Models/demos: 91% were successful at least once.
  • Credit Card/Bank Fees: 87% were successful at least once.
  • Jewelry: 86% were successful at least once.
  • Cell Phone Plans: 80% were successful at least once.
  • Collectibles: 78% were successful at least once.
Another conclusion reached in this survey is that men and women were about equally successful in negotiating discounts, but women felt less comfortable asking for one. In fact, 46% of women said they felt so uncomfortable asking for a discount, they rarely do it. Only 32% of men felt that way.

If you don’t feel comfortable asking for a discount, it’s probably because you feel that it’s demeaning. Maybe you believe it makes you appear poor, low-rent, desperate, or some combination of these. In short, you’re embarrassed. Believe me, I understand: many of my friends are embarrassed to even stand next to me when I go shopping. And when I’m buying something like a house or a car? Forget about it.

But if you feel stupid asking for better deals, here’s some advice: get over it. And here’s some math that might help. If you can set aside $200 extra dollars a month by negotiating lower prices, earn 10% on those savings, and can keep it going for 20 years, you’ll have saved about $150,000. That’s enough to put a kid through Harvard, or yourself in retirement years earlier. All for doing something that should be easy: asking a stranger to do you a solid. Big upside, no downside.

I’d much rather feel stupid by asking for a better deal than feel even more stupid by letting that kind of money slip away.
If you’d like the know the techniques I use to haggle your way to a bigger savings account, here are some key ones:
  • Be prepared to walk away: I once wanted a used Mercedes that was for sale for $9,000: about what it was worth. I offered $6,000. When the seller insisted the car was worth $9,000, I told him I completely agreed, then added, “But it’s only worth $6,000 to me. I wouldn’t blame you for not selling it at that price, or even getting mad at me for making the offer. But that’s all I’m willing to pay, because I really don’t care if I buy it or not.” That obviously won’t always work. But that time it did.
  • Be nice: When you don’t have any real position of power to negotiate from, use honey, not vinegar. For example, when I’m trying to get a discount or upgrade on something like a hotel room or an airline seat, I’m so nice I’m bordering on flirtatious. If you’re dealing with someone who’s job involves getting verbally abused by ticked-off people all day, you’ll be amazed at how responsive they are to someone who’s genuinely friendly and as they say in Avatar, sees them.
  • Be firm: “I’ve been buying Sony cameras and video equipment for 20 years. If you want more of my money over the next 20 years, don’t refuse to fix a microphone just because the warranty ended two months ago.” If you spend a lot of money with some company and they’d like to see more, they’ll often be cooperative, especially if you can find a decision-maker. Stand up for yourself: then after you get what you want, be nice.
  • Be a comparison shopper: “I looked online and found a credit card with a lower rate than yours. Why shouldn’t I switch?” “I’d much prefer Hilton, but the Sheraton next door is $20 cheaper. Help a brother out.” “I don’t have a problem with my cable service, but Direct TV keeps sending me letters offering me basically the same thing for half the price.” Similar things for less money is an argument that’s hard to counter: just make sure it’s actually true before you try it.
  • Be real: You’d probably think that the people I’m negotiating with universally hate me, but you’d be wrong. Because I’m not a jerk, just a guy who’s tying to get a better deal: that’s not offensive. When I talk to people, I try to use their names a lot because that’s a proven technique to make people like you. And I like people, so looking them in the eye, joking with them, seeing them and working with them so everybody’s happy isn’t hard to do.
Bottom line? Bargaining isn’t sleazy, it’s smart. It’s not embarrassing, it’s fun. And even if it were both sleazy and embarrassing, it’s worth it because having more money is better than having less.

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Working from home may be more common in the future
Those who need flexible working arrangements may be able to work from home or from dedicated Smart Work Centres near their homes in the future.

The Infocomm Development Authority of Singapore (IDA) has launched a Call-for-Collaboration (CFC) to invite companies to collaborate and conduct pilot tests in home-based work and setting up of Smart Work Centres (SWCs). Industry players will develop ICT services to support flexible working arrangements.

Under this scheme, employees can have dedicated workspaces at home to ensure that they are productive or use SWCs near their homes if a dedicated workspace is not available.

According to a media statement released by IDA, working from home or at SWCs may have several benefits.

There will be increased employment opportunities for those who are of working age (25 to 54 years old), but not in the workforce due to family commitments.

Employers can also use flexible working arrangements to attract and retain staff. There will also be improved productivity and a larger manpower pool to recruit workers.

Employees will have better work-life balance and reduce commuting time so that they can focus on work.

Assistant Chief Executive Officer Mr Khoong Hock Yun from IDA's Infrastructure and Services Development Group, IDA, said technological advances such as the next generation broadband will take the concept of working from home one step further by opening up new opportunities in the area of home-based work and Smart Work Centres.

"With the network, similar functions within the office environment can be supported at home. But having a capable infrastructure is not the end-all answer - we still need to have processes in place and a mindset change to encourage the adoption of home-based work and Smart Work Centres.

"This is why we have decided to embark on this CFC so that everyone from the government, unions and industry can come together to explore how we can bring work closer to home and the community a reality," he said.

Those who are interested in the CFC can attend a briefing session on April 10 where they can network with other companies and collaborate to submit proposals for the CFC at this session.
More information on the CFC briefing session is listed at http//www.NextGenNBN.gov.sg. Users can also email services@ida.gov.sg.

The call is made under the Next Generation Services Innovation Programme (NGSIP) and is developed in consultation with Ministry of Community Development, Youth and Sports (MCYS), Ministry of Manpower (MOM), Employer Alliance (EA), National Trades Union Congress - Women's Development Secretariat (NTUC WDS) and Singapore National Employers Federation (SNEF).

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