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Morning Column
Why Some Cultures Have to Negotiate
By Michael Lee
Did you ever notice that some cultures just seem to have to negotiate every
transaction - big or small? You might even tell them that the price of your
product or service isn't negotiable and yet they still persist. Why don't
they get it?
The answer is simply, "cultural differences." There are two types of
countries in the world - negotiating and non-negotiating. The United States
is a non-negotiating country where we only regularly bargain over the very
largest purchases such as cars and houses because here money is relatively
plentiful while time is a scarce commodity. In fact, we have a saying that,
"Time is money." For instance, in 2004 the average American worker earned
$3,156 a month. We wouldn't bother to haggle for an hour to save five
dollars because it just isn't worth our time.
Yet, most of the world is composed of negotiating countries where money is
scarce but time is relatively plentiful. In 2004, the average annual income
of a worker in India was $52 or about thirty-two cents an hour for a
forty-hour work week. In places like India, Asia, Latin America, the Middle
East and elsewhere saving five dollars can be significant because it could
make the difference between a family eating well and starving so negotiating
is not only important - it is essential. In these cultures people will
haggle over almost everything they purchase or sell all day long so they
become masters at it.
In fact, negotiating is an essential part of their purchasing process to a
point where they feel cheated if there's no opportunity to haggle. In
America we regularly walk into stores and pay the sticker price without ever
thinking of asking for a discount whereas in negotiating cultures this would
be the definition of insanity. For instance, American auto dealers and
retailers who refuse to negotiate the price of their products will often
find Hispanics, Asians and others from negotiating cultures reluctant to buy
because, without an opportunity to haggle, they just feel they paid too
much.
You can see that when people from negotiating cultures come to America they
bring a negotiating mindset with them and if we want their business we must
learn to bargain more effectively. There are many ways to improve your
negotiating skills such as reading a book, taking a class or just going out
and practicing. Start by going to garage sales and becoming comfortable with
the process and then graduate to flea markets where the sellers are more
experienced. Next, visit establishments where prices are not set in stone
like antique or collectibles stores and haggle. The masters' course is going
to places where prices are seemingly-fixed such as department stores and
trying out your negotiating skills. The doctoral level is bargaining over
cars and houses where the stakes can be very high.
As you hone your negotiating skills over time remember the three basic rules
of
master negotiators:
1) Never take "no" from someone who can't say "yes." A retail clerk who is
being paid an hourly salary has no incentive to give you a break on price to
make a sale. However, most managers have the authority to give at least a
ten percent discount to keep a customer from walking out the door without
making a purchase.
2) Never make the first offer. Once you name a price there is only one
direction
you can go from there - up. As a buyer, try to get the seller to make the
first offer by saying something like, "I really like this but it's just in
my budget. How much would you really sell if for?" As a seller, you can
simply say, "Make me an offer."
3) If you must name a price always ask for more than you think you can get.
If you're the buyer and are forced to state a specific amount make it much
lower than you think you could ever get it for. If you're selling an item
make it a princely sum just to get the talks started. The worst thing a good
negotiator ever wants to hear when stating a price is the word "Okay" which
means you could have done better.
If you want to get as good at negotiating as Asians, Hispanics and others
you must make an effort to practice every day just like they do.
ABOUT THE AUTHOR: Michael Soon Lee, MBA, is the author of the new book
"Black Belt Negotiating," a world class negotiator and martial artist. He
has bargained on everything from major real estate purchases to discounts on
gas for his car. Michael shows people how to use martial arts secrets to
gain leverage in any bargaining situation. His website is
www.EthnoConnect.com and his e-mail is: Michael@EthnoConnect.com.
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