4 Tips to Negotiate Better During Service Calls

During the past two months we’ve had two significant and unexpected outflows of cash. These experiences have reaffirmed many things for me. First, a rainy day savings account is inestimably valuable and comforting. Second, initial bids from contractors and laborers are always high; don’t get suckered in. When it comes to negotiating with sales representatives — foster boldness, dash fears.

Our first unexpected outlay of cash occurred when a swarm of black, winged insects came pouring out of the wall by our back door. Termites. The first bid we got for treatment from Terminix came in at just under $1400. I’d been warned that extermination would be pricey, but that estimate knocked the wind out of me. By the time the Terminix man was walking out my front door, he had already lowered his estimate to about $1000, simply because I’d asked, “Now is that bid the lowest you’ll do this treatment for?” Satisfied with the $300 concession and horrified by the infestation of wood-eating-insects, I just wanted to sign the paperwork and get some poison pumped around our foundation ASAP.

However, at the insistence of my husband, I made three phone calls to different extermination outfits, and by the time I was done, we had our bid down to $849. With another couple of phone calls, pitting pest-control providers against each other, we had the bid down to $649 plus tax. We paid $703 (total) for the termite treatment. In other words, we kept six hundred dollars in our pockets just for making a few phone calls and holding a few salesmens’ feet to the fire. And we haven’t seen a single sugar ant, let alone a termite, since the service.

The second unexpected outlay of cash happened just last week when we took our car in for a ninety thousand mile inspection and discovered that we needed some extensive work done on our brakes. The first bid we got from the mechanic was almost two hundred dollars higher than what we ended up paying for the work we had done (by the same mechanic who gave us the initial bid.) The principle of dickering for deals is one I’m learning by repetition. And I’m saving our family hundreds of dollars in the process.

Here are a few take home points for negotiating with vendors:

1. Remember that initial bids are rarely (if ever) the bottom line

My husband and I both learned from personal sales experience that the initial quote you offer a customer is always high. The sad reality is that most people will willingly take that first quote sans questions. Don’t be one of those customers.

2. Don’t be afraid to make the situation slightly uncomfortable

Don’t be afraid to make the situation slightly uncomfortable with a follow-up like: “This bid seems pretty high to me; is this the best you can do?”

3. Be upfront

Be upfront with the representative about the fact that you will be calling around to other service providers to compare cost. A lot of times an establishment will want your business badly enough to lower the bid right then, without any competing bids. Especially now with the economy in low gear, many vendors are willing to relax and play nice from the get-go.

4. Follow through with the threat to call around.

Cost compare. And if it’s prudent, take your business elsewhere. Talk to friends and trusted associates about reputable establishments you can contact for alternate bids and start pitting providers against each other.

Almost everything is negotiable; dicker over the price of monthly cell phone rates, pest-control fees, utility rates (especially phone, internet and cable costs,) insurance premiums, car repair quotes, household repairs, etc.

And finally, keep the money you save stashed safely away in your emergency/rainy day fund; life has proven time and time again that you can always expect quite a bit of the unexpected. And whether it’s medical expenses or termite infestation, the resolution of the unexpecteds usually requires money.