More of us should haggle in the shops

[Fnaar]

Anyone see Junior Mastermind last night? The winning kid was a lad who apparently wants to be prime minister (and had that ultra confident slightly stuck up sort of accent that makes you think he'll make it, but you'd like to give him a slap first...). Asked by John Humphries what his policies would be, he said he'd put taxes up by 5%, then cut them by 10%, reasoning that he'd only be giving people a 5% cut, but they'd be conned into thinking he'd given them more... Methinks he has a great career ahead of him, somewhere....

I saw that. I concluded that if I was his teacher, and I saw him being bullied*, I would probably join in.

Disclaimer
------------
*joke... I disagree with bullying and think it is horrid. I would never normally encourage it, which is part of the joke.

 

[davidwalton]

This is fine in an economics textbook but in reality it depends on the market. Take Thailand in the mid 80's; you could go there and haggle for most things. By the mid 90's you could still haggle, but because the economy had boomed, most vendors realised there were two markets for the goods. A market for locals, where haggling was still expected and a market for tourists where they didn't expect to haggle either because the tourists weren't used to it or more likely they realised that the next tourist would buy it anyway at the increased non-haggle price. The most often heard retort was 'you keep it, you need it more than I do' which speaks volumes about the changes that had taken place in that economy over a period of ten years.

Coming from a professional background you can ask for a discount but ultimately you're in the business to make a profit. So yes, occasionally inducements may be offered on some instructions but the idea is to make a return in the long term. You don't hold onto a client who doesn't want to pay, they're just not worth the hassle (as Thai street vendors found out). You also get what you pay for, which is why driving instructors at the lower end of the market discount. You won't necessarily get the same quality instructor for a cheaper price which may be why they are discounting. Cheap isn't always good - otherwise we would all be riding Claud Butler's or the equivalent (not that there's anything wrong with them per se, but you know what I mean).

I don't want CHEAP, I want the best value. That isn't always the cheapest.

Many businesses will give discounts based on there being an ongoing relationship. Many others will rethink their pricing based on a number of other factors.

End story is, if you never ask, you will never get.

 

[Smokin Joe]

There is a term that bankers use, "A busy fool". That, for example, would be a driving instructor who charged £15 per hour to attract custom and worked fifty hours a week when the rate the market would bear was £20 and those charging it were working 37.5 hours.

Which way would you go?

 

[llllllll]

End story is, if you never ask, you will never get.

Actually, I got a discount from my LBS without asking .
I'd spent quite a bit of money with them over several visits, though not new bike kind of money. On one visit they totalled up my bill, I think it was around £37, bloke said we'll call it £30. Not really up on economics, but I suspect they've not lost on it in the long term, I've been a customer of their's ever since.

 

[SamNichols]

It's more complex than just supply and demand: all items also have a certain amount of 'branding' with them. Thorstein Veblen and Karl Marx were one of the first people to explore this avenue, although a great deal of work on the symbolic meanings of products were done in the 70s and 80s. Basically, the produced product and the consumed product are essentially different things: this is because of the production of surplus value. So, the product costs x to make, and is sold at y. Y is a flexible amount, but the capitalist system intrinsically relies on y being higher than x.
We as consumers can readily acknowledge that spending the dictated price of y is too high, and can ask for it to be lowered. That is our perogative: typically a retailer is adding on a third to cover their costs and to make profits. In terms of high street retailers, that third isn't necessary, in independent retailers the costs are far higher.
So, what am I saying: the internet and high street retailers can afford to charge lower costs, due to them incurring lower costs in the process of selling. It's harder for smaller retailers to sell at a lower price, although they often will. This is only true for consumer items though: as i've said before, the margins for groceries are lower. We in the UK have a mortal fear of spending too much of our income on food, and the prices of it are lowered accordingly (hence the milk controversy at the moment: we weren't paying enough for it, and unfortunately the price had to be raised).

 

[davidwalton]

as i've said before, the margins for groceries are lower. We in the UK have a mortal fear of spending too much of our income on food, and the prices of it are lowered accordingly (hence the milk controversy at the moment: we weren't paying enough for it, and unfortunately the price had to be raised).

Yes, the likes of Tesco are making such little profit they have to keep buying land and opening new bigger stores. BT make small percentage on calls, but still profit more than a lot of companies.

The price of anything has to be based on what the customer is willing to pay, ie. their perception of value. As a customer, if you don't find you get value for money at the ticket price, either haggle or go somewhere else.

Whether a small business profit margins are smaller has no bearing on the customers perception of value for money. Nothing becomes more valuable just because it is sold by a small business.

 

[SamNichols]

Yes it does, because a product is about more than just a product. A product has symbolic value as much as functional value, that symbol is determined by sources outside of the person. You may just like a shop so much that you buy the product there. Take for example bikes, a great many of us have paid more for a bike because it comes from a smaller supplier, or comes from our LBS. Customer loyalty exists. This isn't to say that we in any way pay over the odds for it, I for one would rather buy a book from a smaller supplier than a bloody borders, even if Borders have it for £3 off. Value for money isn't simply about the product you are buying, as that isn't what consumerism's about: take the iPod. It's not worth anywhere close to £200, but is sold as such due to the connotations of the product rather than the product itself.

I didn't say tescos profits weren't high, I said that grocery margins are smaller, thus meaning that you can't really haggle. As it is, tesco often sell stock under the cost price because they can. They're a massive company and can afford to have a smaller margin: after all, one pound in every 7 is spent in tescos at the moment. The reason why they make profit is because their margins are smaller than smaller suppliers. If you buy direct from a farm shop, you will often pay more than at tescos, even if you are buying the same product that is sold on tesco's shelves.

 

[barq]

It's more complex than just supply and demand: all items also have a certain amount of 'branding' with them. Thorstein Veblen and Karl Marx were one of the first people to explore this avenue, although a great deal of work on the symbolic meanings of products were done in the 70s and 80s.

I was reading the other day the diaries of an American law professor (whose name escapes me...). She explained that until the 1980s if you bought a brand name coat and later discovered the brand label was missing, you wouldn't have a legal case unless the coat was actually defective. Since the 1980s branding has taken on such value that missing brand labelling now constitutes gross breach of contract.

It is a really concrete example of the value of branding.

 

[SamNichols]

I used the inverted commas, because I was talking about more than branding (which is of course that hateful industry and is the bastard brother of advertising), but products have social and cultural connotations too. There's brand cache, but there's also accidental branding caused by matters no controlled by that industry (such as Skoda=rubbish cars).

 

[davidwalton]

Yes it does, because a product is about more than just a product. A product has symbolic value as much as functional value, that symbol is determined by sources outside of the person. You may just like a shop so much that you buy the product there. Take for example bikes, a great many of us have paid more for a bike because it comes from a smaller supplier, or comes from our LBS. Customer loyalty exists. This isn't to say that we in any way pay over the odds for it, I for one would rather buy a book from a smaller supplier than a bloody borders, even if Borders have it for £3 off. Value for money isn't simply about the product you are buying, as that isn't what consumerism's about: take the iPod. It's not worth anywhere close to £200, but is sold as such due to the connotations of the product rather than the product itself.

I didn't say tescos profits weren't high, I said that grocery margins are smaller, thus meaning that you can't really haggle. As it is, tesco often sell stock under the cost price because they can. They're a massive company and can afford to have a smaller margin: after all, one pound in every 7 is spent in tescos at the moment. The reason why they make profit is because their margins are smaller than smaller suppliers. If you buy direct from a farm shop, you will often pay more than at tescos, even if you are buying the same product that is sold on tesco's shelves.

A product only has a specific value IF people are wiling to pay that price. It is always and only about customer perception of value for money.

Yes, you can price an item at x in the expectation of it selling for other factors, ie. label, market, etc. It's value in the customers eyes is still the same though, even though perception may or may not include some or all of the things used to set the price.

In any event, the fact that we still have RRP's shows that there are manufacturers pricing for resellers without knowledge of costs. In effect, setting a figure so many resellers can sell at a discount, or FIXING price in some illegal way; as has been happening a lot.

Bottom line still doesn't change from the point of view of the customer (point of this thread, I believe). If something is ticketed at a price over what a customer believes is good value for money, then they either haggle or go somewhere else.

 

[simon l& and a half]

Mrs L is astonishing at cutting deals. I've seen £20 knocked off the price of a bottle of champagne! I went to the bar, proffered the notes, and there she was telling the barman it was too much and we weren't about to pay it. the poor chap just stood there, shaking his head and reducing the price. As for airline tickets ( carbon footprint) - you wind up feeling sorry for Richard Branson. And don't cross her. The hotel that didn't give us breakfast is now having us back for a free night.

I do find it a tad embarrassing that she has no scruple about squashing the price of my christmas presents - a leather jacket already reduced from £400 to £200 wound up as £100 because of a mark on the sleeve - a mark that I hadn't noticed. The man-bag that some of you may have seen had seventy five quid squeezed out of it.

Watching her in action is to be reminded why she's got on in the world and I haven't.....

 

[papercorn2000]

Hmmm, if she's willing to take a little commission, would she be willing to be official forum bike-stuff buyer?

 

[mickle]

Hagglers used to get right up my goat when I worked in cycle retail. In such a competitive sector very few people are driving around in Beemers. Hagglers expect their independent cycle shop to cut a deal but will happily pay full price in any of the high street majors without even thinking about it.

I had a guy in the shop once who let me spend an hour explaining the pros and cons of three or four bikes at his price point and then said, 'Fine I'll take that one right now if you take £100 off'. I explained very politely that I wasnt prepared to sell it for less than I paid for it, that the most he could reasonably expect off a bike was 10% and that he had missed the sale by a couple of weeks. 'Thats the price' said I, 'But I'm happy to work out a deal involving any accessories you might need'. His wife becoming ever more embarrassed. 'C'mon, what's your best price? etc etc etc etc etc.
'Listen mate' he said 'I've never paid full price for anything!
'Looks like you wont be buying this bike today then' I said and walked away.

An hour of my time in a busy shop I dont mind if I think there will be the possibility of a sale at the end of it, or even an hour of my time if the customer walks away knowing more than they did when they walked in. But twenty minutes haggling is an utter waste of my time. If everyone haggled I would have had to employ an extra member of staff just to cover haggling time. I would have to raise prices to cover that extra member of staff in addition to the price rise I would have to introduce in order to allow for haggled price reductions without sacrificing profitability. No-one is making a lot of money running an independent cycle shop in this country and haggling with small shops is a time wasting piss take.

The guy came back two days later (studiously avoiding me in the process) and bought the bike for full price. £250.00. Tosser.

 

[davidwalton]

I had a guy in the shop once who let me spend an hour explaining the pros and cons of three or four bikes at his price point and then said, 'Fine I'll take that one right now if you take £100 off'. I explained very politely that I wasnt prepared to sell it for less than I paid for it, that the most he could reasonably expect off a bike was 10% and that he had missed the sale by a couple of weeks. 'Thats the price' said I, 'But I'm happy to work out a deal involving any accessories you might need'. His wife becoming ever more embarrassed. 'C'mon, what's your best price? etc etc etc etc etc.
'Listen mate' he said 'I've never paid full price for anything!
'Looks like you wont be buying this bike today then' I said and walked away.

An hour of my time in a busy shop I dont mind if I think there will be the possibility of a sale at the end of it, or even an hour of my time if the customer walks away knowing more than they did when they walked in. But twenty minutes haggling is an utter waste of my time. If everyone haggled I would have had to employ an extra member of staff just to cover haggling time. I would have to raise prices to cover that extra member of staff in addition to the price rise I would have to introduce in order to allow for haggled price reductions without sacrificing profitability. No-one is making a lot of money running an independent cycle shop in this country and haggling with small shops is a time wasting piss take.

The guy came back two days later (studiously avoiding me in the process) and bought the bike for full price. £250.00. Tosser.

as I said before, there are extremists in everything, including the Tossers. By your own words, you were prepared to deal. That would keep me happy with that attitude (as long as the same wasn't being sold much less elsewhere)

I am looking to spend a further £3400 odd on bike gear as well as a bike by beginning of Feb 08. I do expect to make a deal, rather than just pay ticket price on everything. On the other hand, if the shop I go to say no, then I won't wait around unless their ticket price is similar to what I would pay elsewhere.

Hagglers used to get right up my goat when I worked in cycle retail. In such a competitive sector very few people are driving around in Beemers. Hagglers expect their independent cycle shop to cut a deal but will happily pay full price in any of the high street majors without even thinking about it.

I have little experience of independent cycle shops, or most other independents. I will haggle with any business trying to sell to me though. The bigger shops just require more homework, and a little proof of what others do sell at.

 

[longers]

*bump*​

I found this while looking for advice on something and thought it worth a bump.

edited for: editing.
​