There is a simple negotiating technique you can use to save money on many purchases. In the world of high-power negotiators, it is referred to as time investment. The simplest description is this: Spend enough time with a seller and he or she is more likely to accept your offer.
Years ago, when I was a real estate agent, I sold a home for a real decent guy, and the buyer was a lawyer who had just moved to town. This attorney knew all the angles, while I was new to real estate. Without getting into all the dirty tricks he used, I’ll just say that the buyer had everyone involved angry, frustrated and worn down.
As a final blow, he arbitrarily decided that he wanted the price lowered by another $5,000. The seller was almost ready to throw away the whole deal, but he had been trying to sell the home for two years, and we had been working with this buyer for months. None of the agents or brokers involved wanted to see all their effort go for nothing.
There were three agents under two brokers involved in the sale. We all agreed that suing the buyer wasn’t worth it. Instead, we gave in. Each of the three agents and two brokers involved agreed to forfeit a $1,000 of the commission, just to make the deal close by giving the buyer the $5,000 reduction he wanted.
This is an extreme example of using “time investment” to your advantage. After investing so much time, none of us wanted to lose everything. The lawyer knew that, and used it. In this case, there was nothing in the contract that allowed him to renegotiate the price, making it unethical in my mind. But it was effective despite being unethical.
In other cases, it is just good negotiating. If you want to get the best price on a car, do you think you’ll get it after spending two minutes with a salesman? Let him invest two hours showing you cars, and he’ll be begging the manager to let the car go for your low offer – as long as there is still some profit for the dealership.
Save Money With Time Talk
Remind people about time. Whether you are near the end of a negotiation with the head of a large corporation, or just working out the details of hiring a painter to work on your house, let them remember the time they’ve already invested. To do this politely, say something like “Look, neither of us wants to lose the time we’ve spent on this and start all over, so why don’t I…” Then offer some small concession.
They are subtly warned that they could lose their whole time investment with nothing to show for it. The words “start all over” may even scare them. You set the scene, and then you offer a way out. This is non-offensive too, if you do it well. You say “Neither of us…” to let them know you’re both in the same situation, and it’s not just you threatening them.
Time is of the essence. Use this negotiating technique well and you can save money more often than you might think.