Show Them the Money – My Favorite Negotiating Technique

Submitted by Don Doman

An old Eagles Hall used to be our studio in downtown Tacoma. We shared offices with a non-competing video firm. They did a lot of dupe work making VHS copies of 3/4 inch video masters. I would occasionally pass through their control room while copies were being made. I was walking through once and noted a glaring red plaid sport coat on an on-screen salesman talking about car sales and trade-ins. I was caught like a deer in the headlights.

Show them the money and start counting it out . . .

The super salesman was giving a lesson on how to pay less for a trade-in on a used car. For example, the buyer wants twelve hundred dollars for his old car. The salesman only wants to pay nine. What do you do? The salesman suggested pulling out real money from your pocket and then after commenting about how he wants the trade-in and how it’s probably worth what the buyer says, he starts out by putting one hundred dollar bills into the buyer’s hand for payment. In rapid succession counting one, two, three, four and then slowing down with five, six, seven . . . hesitating at eight . . . and then reluctantly placing the last bill . . . nine . . . “No, gee, that’s really all I can do.” He then reaches for the stack of hundred dollar bills in the buyer’s hand. The buyer clutches the nine bills. Nobody ever wants to give back ready money. The result is that the buyer takes a loss of three hundred dollars and the salesman gets an additional three hundred dollars in profit.

I love this technique, but I don’t like putting money in someone’s hands. I’ve altered the gambit just a bit. I show them the money, so they know I have it and am willing to part with it. I don’t ever recall this tactic not working, but I’ll give you two examples of how I made it work for me.

The technique has worked in pawn shops and jewelry stores and everywhere else.

It was getting near our wedding anniversary and I wanted to buy a small gift for my wife. I was at the B & I Circus store on South Tacoma Way. They had a coin/gold jewelry shop. I saw a necklace I thought my wife would really like. The seller and I talked price. The man had already dropped the cost to $120. I pulled out a wad of $20s as if to buy it and then shaking my head I said, “No. I can only go a hundred.” Before the money disappeared back into my pocket, a receipt was being written up at my price. My wife loved the necklace.

My buddies at the studio and I talked about combining our efforts. In the latest Videographer magazine classifieds I had seen a television studio for sale in Houston. The gear consisted of two Nighthawk RCA camera/recorders, a player deck, an editing record deck, and a controller for $25,000. Just so you know the difference between today’s consumer gear and yesterday’s studio quality machines, the decks had handles on either side and weighed ninety pounds each. The professional video equipment was in the M Format. The latest version would have been M-2 Format, so it was one generation behind, but still top drawer. The original price would have been around a quarter of a million dollars. We made arrangements to look over the equipment. I flew to Texas. I was greeted at the airport and taken to the studio.

Never bad mouth what you want to buy. Otherwise, why would you be interested? Praise it.

I looked over the equipment and reviewed footage shot and edited with the gear. It was a prize winning documentary about working tugboats on the Mississippi River. I praised the care that had been taken with the equipment, the skill of the producer, and the beautiful images. I had a return flight that same day. I mentioned that the equipment was in fantastic condition and worth every penny that was being asked. I was going to recommend the purchase. Back in Tacoma I would share the information with my partners who weren’t quite as savvy as I was in broadcast gear . . . however, I pulled out an envelope with a check in it and said, “I didn’t know your equipment was going to be so pristine. I am able to present an offer, but I was only authorized to pay $15,000. The check is made out to you.” I just shrugged my shoulders. I could see the producer’s mind working. After what seemed like an hour, he said, “Who pays shipping?” I answered, “You pack it up and we’ll pay shipping.” I had been hoping to pay $20,000 plus shipping. I was thrilled at the extra $5000 savings. Back home we celebrated.

I’ve done the purchase ploy with automobiles, at pawnshops, and numerous negotiations. In each instance when I’ve used this strategy it’s made clear that I do want to buy, I do have the money to buy, but I am ready to walk away. I show them the money and my intent. It’s like the old saying, “Elvis has left the building.” When Elvis left, you knew he wouldn’t be coming back. So, they make the deal before Elvis takes off.