Consider them read!!
The fact that out clients are far better negotiators than us is so true. I have negotiated price on nearly every large job I've done. I always think "dam he's good" and try and learn a little from each of my clients skills.
As for good books, one that lays a good foundation is "How to Win Friends and Influence People" by Dale Carnagie. Great book, It's been years since I've read it and I still today apply the highlights I remember.
The bottom line here is if we can't negotiate, all of our knowledge, skill, service is useless.
I think a course by a Motivational speaker like Ron Ball or even Mr. Zig Ziglar (if he's still with us)could prove to be invaluable to our businesses and industry.
Just my 2 cents.
CMack

Apologies for the slow reply, I was away at the weekend closing down country stores.

I bought a lead at the weekend, something I have been meaning to do for ages. An S-VHS lead for Sky to Amp, I paid full price for it. I didn't haggle because the item price was low and there was only one item.

I had already indicated that I don't haggle at supermarkets yet. Do I negotiate the price for a restaurant meal? If it is for one to four people (I travel for work, hence the one, it is not because I am so loathesome that I have to) then I will not ask them to reduce the price. firstly you are dealing with a low price purchase and therefore are probably not dealing with the manager/owner who can make the decision. Secondly the cost of the item and therefore the possible reduction available would not be worth my time.

However, have I ever negotiated the cost of a meal, yes of course I have. My own wedding being one of them, Christmas dinners for the office, rugby dinners etc. In other words when the deal is large enough that I fell there is a possible reduction worth asking for.

The tip thing is almost comic genius. In the UK you are not shouted at by the waitress if you do not tip. They do not chase you down the street. We pay our waitresses a resonable wage (I spent 5 years at college working in restaurants/hotels)and they are not reliant on the tip to feed themselves. Therefore the tip is always negotiable in the UK. You leave a sum based on the quality of your service not an automatic 10% of the bill. Restaurant Bills are generally more expensive in the UK than the U.S. probably becuase we pay our staff a minimum wage and therefore the %age thing doesn't always correspond anyway but yes I always negotiate the tip. I think what was he/she worth and then leave it.

Suggest you guys try selling your items at cost and then ask the customers to tip you based on what they feel the service is worth.

Trying to be more constructive note, rather then just name calling. When selling whole systems the thought as a customer of receiving a single figure for the whole job would not satisfy me. I would ask for breakdown immediately, although some won't.

The method of the breakdown could be a Hardware Total and then a Service Total, possibly listing the times spent on the service part. 2 Hours to draw cables, 1 hour program satellite etc.

I really liked Thons idea to list hardware and service as one line per equipment. This gives a detailed breakdown but still allows some shuffling if they try and haggle on the cost of hardware.

Supply, Deliver, Install, Commission and Test including all accessories and cables.
1 Sat Box $1000
1 Amp $2000
1 Speaker Package $4000

That is really hard for the client to argue with as if they price the hardware up they have nothing to match it with. They could, and some will, ask you for the hardware costs but some won't. Even if they do ask you can ask why and then dump the box price and raise the service charge in the breakdown. If they want the box only then stick on a charge for delivery/collection/processing/time/admin etc to get it back where you need it. I woudl have difficulty against the above approach.

The only negotiation they then have is the bare faced request (I would do this, I have been trained to do this). You want $10000, how about $9000. Some will ask, some won't. Say no, never move first and hope they don't walk. If your business can afford to turn down work then just say no. Assuming like most you need the work then you have to deal.

If they offer $9000 not $10000 then talk about replacing items with cheaper alternatives, different CD etc to reduce the overall cost, with an upgrade later.

This at least lets you know if they have offered less than $10000 because they don't have $10000. If they haven't got it you can't have it.

If they say they want that system at $9000 it means they are dealing, assuming you need to deal then suggest you cannot deal on the whole sum as some things are fixed. As an example Travel Costs to and from site are fixed and not negotitable. Any sub-contractors are not negotiable. Equipment hire if neccessary is not negotiable. If you can get the customer to agree that $4000 of the total is not negotiable then they only have $5000 to negotiate. 10% of $6000 is only $600 dollars. So you have not lost $1000 dollars you have lost $600.

Or once you get to $6000 agree that you can only give 5% on hardware becuase the supply screws you anyway. Then offer 7.5% on labour, because you can pay the guys less. Assuming the $6000 is 50/50 hardware/labour then you give away only $150 and $225. A total of $375 not the $1000 dollars he wanted.

Spend time, the longer it takes the more embarrassed you both get, the smaller the steps the more time is spent. It sometimes is just a reflection that they want you to spend more time with them at the this part of the whole process, it is concern about being conned. They want to know more about you, the company, they have a need to justify this purchase to themselves and wives, friends etc. They are worried if they have spent enough time researching, break the quote down, build it up, spend time, don't rush it.

We install intelligent automatic metering systems and software and so it is similar to a full install for you guys. Hardware, Install, Commission, Pulling cables, testing, user interfaces etc. Other people will undercut us on the metering price but the customer wants the whole deal. The fact he is trying to haggle should give you confidence, the customer wants you, not someone else. He is talking to you. It is the most hated part of the job, but it is part of the job.

We do deal with our suppliers, if I have a big job on then I expect a better price from my supplier. If my customer shows me two other prices that beat mine and I have to give 5% off the deal then I go to my supplier and show him and ask for a further 5% off the hardware price.

I do understand the problems you have.


If it is deal on boxes only for the self installers, most of the people on this site are self-installers, that is why they are on this site, it is much more difficult to hide the costs.

Box A from me at $1000 or Box A from www at $900 requires you to sell him a service deal worth $100 to him. Pre-Sales, you will test his box before supply, Post Sales, if he gets stuck you've used one/ got one in the shop. Support, if it goes wrong then he just has to to drop it in. Try alternatives to cash, such as free leads. To him they are worth $75 to you they only cost $50.

Also try and delay your decision. The manager, the area rep, a colleague, a prtner, anything they want the goods now, if they have to come back to save $50 then they may well just say OK and pay the money, I have.

Hope some of these ideas help you rip us customers off some more (joke).

I've got to get in on this. A lot of customer's will try to "negotiate" with me. My response is more like a grocery store:
YOU: I'd like to pay $15 for this $20 bag of groceries.
ME: No thank you.
The big problem with giving in to a customer asking for a "deal" is that he will brag to all his friends and then everyone will want a deal. Since your deals will tend to be different, you will have keep track of an infinite amount of pricing and since time is money, all this "dealing" and tracking is costing money. I do exactly as Goodfellow suggested and just say no to any request for a price reduction. It is amazing how powerful this word is. BTW the best referral I ever got was from a client who used "the cheaper guy". He later told me that eveything I had warned him about happened on his project. He referred us to a custom builder and we are happily installing equipment in multi-million dollar houses with no price haggling. Having said all this let me share my formula:

1. Blow your prospective client away with professionalism. Have a complete brochure of your services along with references, testimonials, and copies of all relative insurance certificates. This one thing alone will go a long way to justifying higher prices.

2. When you do get a job, make sure your work is flawless. If you did under bid it, suck it up, make it right and then you'll have a real life justification for why things cost what they do. You'll be amazed at how fast the refferals will come in.

3. Always remember that, although price is a consideration, it is not necessarily the primary one. You are selling an ultimate experience and as long as your track record is good, a lot of people will pay for the "sure" thing rather than gamble on what's behind door number 2. How often does Mercedes offer discounts?

4. If you're just starting out, I know it can be difficult to get those first jobs. If you have to give a discount try to do jobs for friends or relatives with the understanding that you are trying to work the bugs out of your system and once you do get it right make sure they give you a testimonial.

5. If there is a job you really want and feel like you have to compete for, offer and extended service contact or other service rather than an outright price reduction.

Hope this helps.

Before I give a response to Mr. Goodbar's novel, I have a few questions for him.

Did I read you correctly when you suggested that we should pay our installers less money to win a job?

Which company do you work for? If I am correct you work with industrial control and metering systems, is this true?

Dear AV Genus

Couldn't possibly name the company but we provide Automatic Meter Reading Software and Energy Management Systems. This can include the meters, data loggers and software. It is not control software. Some is indusrtial metering, some revenue metering.

We are not a large company but if you know the market, you may know the company, email address will probably give it away if anyone wants to look it up.

You did read it correctly, I did say pay the installers less, I didn't really mean permanent employees. We use a lot of sub-contract labour, people we work with a lot but if we need to bid the business competively or if we are asked to improve our price against a proven other bid then we may ask the contractor to reduce his bid to ensure we can win the business. We take some of the hit and they take some.

I can see it didn't come across as I meant, you have indicated my posts are lengthy, and possibly I should proof read them better, but I don't. Touch typing allows me to get a lot of words down very fast. A quick check for typos and then a send.

I will look forward to your more verbose response.

Regards

Dave

I had a guy call me today wanting a 60" name brand plasma tv... He said he dound it on the internet at $10K... BUT.... he told me he knew he would have to pay a premium for someone to deliver it to his house, install it, and warrantee the thing in case of problems.

Disadvantages to buying something on the internet...
number one, you never know if the internet retailer is going to be in business once your item arrives (remember the dotcomm bust)...

number two, you never know who is being honest with you... I won't name names, but one guy on this forum has not only changes his company name, he's changed HIS OWN NAME- c'mon, dude- which one's your real name, or is either one? (not saying he's being dishonest.. probably uses those names so he'll know where the calls are coming from, but, still.....)

number 3... if you order from JoeBlow.com, are they going to drop off your item, do an expert custom installation, do it RIGHT the FIRST TIME, stand by the product they sell, and then answer your questions when you call while i'm watching 'Survivor' or '24'? I don't think so....

I think that the only advice that I can give is this: if you are a shopper looking to get equipment on the internet then I really hope you know what you are doing, and you are willing to take a tremendous risk to get an item for less than you can at a proven shop. The second piece of advice that I can give is to companies, if you come accross that customer that is going to haggle you over X$ at the front is not a customer that you need to be dealing with as the haggling will not stop. Stand by your price and insist that your service is why you are a CUSTOM installation business, not a box mover.

Just the ramblings of a custom designer/sales person/installer.

Wanna bet that he sold you that car for $0 profit?
Guess you never heard of "factory holdbacks"

I have worked at auto dealers since 1977 as a tech, and I can tell you this. A new car dealer NEVER sells a car for 0 profit, never! Even if he showed you what looked to be a factory invoice for the car, at the price you paid. He still made a profit off you on the sale. As your are not seeing all the "invoices" he gets on that car, when it comes to what it realy cost the dealer.

Want to see an example of a hard, but polite, stick-to-your-guns deal? Watch Karate Kid III, when Mike Barnes negotiates for a percentage of the Cobra Kai dojo business.

Larry
www.fineelectricco.com

Match the internet prices and be sure to charge enough for your installation. To say that the extra $$$ for the product is for your expertise, is misleading and that is what is causing the problem. The labor/installation portion of the bill is where expertise comes into play. You are trying to make money off all sides and are mad because people have found you out.

All aspects of an av system are crucial. The first one of which has to be right is system design which you overlooked. Unless of course all of your system is in one box.
You are

Found you out?.... Like we are in business to make money?
Don't think that's a big secret.

Next....

We have a relatively simple way of dealing with an Internet shopper. We point out that we will cover the Manufacturer's warranty, meaning we will deal with installing/replacing/returning any defective unit we install. We point out the additional cost of shipping added to the internet price. We will match MAP of any item we sell.(We normally price items between MAP and MSRP) If this still is not enough to convince a "wipe" (great term btw) we will install the piece for them as long as it meets our design.(IE brand and model specified by us.)Of course, warranty is now up to them. If they still want to haggle, we explain that we are not the A/V dealers for them and recommend someone else. We do this all very politely, of course!
Hope this helps someone..

Mal

By all means, Mr. Customer, by from the 'net! Hope you read Japanese and good luck installing it yourself.

One thing that stands out to me is the amount of time versus the amount of profit to be made from a customer like David Gooodfellow. If your business is flush why deal with a customer that provides the smallest margin possible for you, the dealer. I, as a customer shop items that I purchase but it is up to the vendor how to do it. I do however take notice when value is added and usually don't shop by price alone. Some customers squeeze a nickle so hard the buffalo screams. I find the internet shopper is the person we simply send away when we are busy and use to generate labor dollars when there is a cancellation in our busy schedule. Basically we are a commodity to him and he to us.