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Slow economy revives art of haggling

Michael Roskell of New Jersey and a friend bargained with an electronics store to cut about $1,000 off two 46-inch televisions.

New York Times

Michael Roskell of New Jersey and a friend bargained with an electronics store to cut about $1,000 off two 46-inch televisions.

SAN FRANCISCO — Shoppers are discovering an upside to the down economy. They are getting price breaks by reviving an age-old retail strategy: haggling.

A bargaining culture once confined largely to car showrooms and jewelry stores is taking root in major stores like Best Buy, Circuit City and Home Depot, as well as mom-and-pop operations.

Savvy consumers, empowered by the Internet and encouraged by a slowing economy, are finding that they can dicker on prices, not just on clearance items or big-ticket products like televisions but also on lower-cost goods like cameras, audio speakers, couches, rugs and even clothing.

The change is not particularly overt, and most store policies on bargaining are informal. Some major retailers, however, are quietly telling their salespeople that negotiating is acceptable.

"We want to work with the customer, and if that happens to mean negotiating a price, then we're willing to look at that," said Kathryn Gallagher, a spokeswoman for Home Depot.

In the last year, she said, the store has adopted an "entrepreneurial spirit" campaign to give salespeople and managers more latitude on prices in order to retain customers.

The sluggish economy is punctuating a cultural shift enabled by wired consumers accustomed to comparing prices and bargaining online, said Nancy F. Koehn of the Harvard Business School.

Haggling was common before department stores began setting fixed prices in the 1850s. But the shift to bargaining in malls and on Main Street is a considerable change from even 10 years ago, Koehn said, when studies showed that consumers did not like to bargain and did not consider themselves good at it.

"Call it the eBay phenomenon," Koehn said.

John D. Morris, an apparel industry analyst for Wachovia, said that the ailing economy was not necessarily forcing all retailers to negotiate. But he says he believes that when there is an opportunity for negotiation, the shopper has the upper hand.

"This is one of the periods where the customer is empowered," Morris said. "The retailer knows that the customer is enduring tough times — and is more willing to be the one who blinks first in that stare-down match."

While tough times give people more incentive to change their behavior, it is the wealth of information about products made available on the Internet that gives consumers the know-how to try it. People now can quickly amass information on product availability and pricing, helping them develop strategies to get the best deal.

Michael Roskell, 33, a technology project manager from Jersey City, N.J., said he and a friend play "good cop, bad cop" at electronics stores. While Roskell expresses interest in buying an item, his friend acts as though he is dissatisfied with the price and threatens to leave.

In February, he said, the friends got $20 off a pair of $250 speakers. Earlier, he and the same friend negotiated to buy two 46-inch high-definition televisions at a New York-area electronics chain.

List price: $4,300. Price after negotiation: $3,305.50.

The strategy can even work when buying pants. At least it did for David Achee of Maplewood, N.J., who said he went to a Polo Ralph Lauren store in Manhattan last month and became interested in a pair of pants on the clearance rack for $75. He told the salesperson that he had seen a similar pair on the Internet for $65, adding that he thought the pair on the rack looked worn (even though he did not really think so). He got the pants for about $50, he said.

.Fast facts

How to haggle

Do your research: Use the Internet and competitors' ads to compare prices.

Play "good cop, bad cop": Shop in pairs, with one person interested in a purchase, and the other leery of the price.

Take your business elsewhere: Threaten to go to the competitor.

Buy more: A store might be more inclined to give a discount on electronics if you also purchase an accessory with a higher markup.

Just ask: And if you're denied, try asking another employee.

New York Times

Slow economy revives art of haggling 03/22/08 [Last modified: Sunday, March 23, 2008 9:43pm]
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