Gifts for My Friend’s Upcoming Birthday
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Aparna Shekar
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I went to the Ithaca mall to buy a few gifts for my friend’s upcoming birthday. I found a T-shirt section with a “Buy 1 Get 50% off on the other” offer. I immediately seized this as an opportunity for my negotiation gym 2 and decided to negotiate a deal with the shopkeeper. Since I wanted to get only a single T-shirt, I planned to negotiate for a discount of 50% on that. The conversation with the shopkeeper lasted for about 20 minutes and I ended up paying $14 for the T-shirt which was priced at $22, essentially receiving a 40% discount on it, in addition to an add-on “Birthday Beer Bong” which I practically got for free.
My friend had accompanied me to the mall as I had a fair idea about what I wanted to get and sort of knew that my bargaining power would be strengthened by the presence of an additional person. When I looked at the original price of the T-shirt ($22) and decided to negotiate, my optimal goal was to bring it down to $11 or a 50% discount on the product. I had also fixed my resistance point for buying the T-shirt (the price above which I would not be willing to pay) to be $19. On the other hand, my BATNA was to buy two T-shirts and get the other one for a discount of 50% since I did find another T-shirt which I was genuinely interested in buying but something I thought was not necessary at the moment.
Before I began the negotiation process, I tried to gain some information about the shop I was doing the purchase at and the prices of items similar to the T-shirt I wanted to buy. Firstly, I found out from two other friends of mine, who happened to be regular customers at that particular shop that the sales people who worked there were quite flexible and open to negotiation. Furthermore, I learnt that the price of the same T-shirt online (from multiple sites) averaged up to about $14. This bolstered my confidence and I went into the negotiation with adequate information hoping for a higher probability of success. However, I decided to keep my initial offer at 50% discount on the original price since reducing the price by more than that might seem highly unlikely and would make me look foolish in front of the sales person.
I came up with three main strategies that I wanted to implement during the negotiation. My first aim was to figure out roughly what the resistance point of the seller was through indirect assessment. Having done enough research online about the price of the t-shirt on various websites and having spoken to several people regarding the negotiating style and approach of the
shop’s sales people, I could fairly conclude that the resistance point of the seller would be around $14 and that they have a good amount of experience in dealing with bargaining customers. To gain further insights about the seller and to make a direct assessment, I engaged in a casual conversation with the seller asking him suggestions for a birthday party theme and so on. I carefully listened to all that he said trying to formulate a strategy based on it. During the conversation, I mentioned that I had gone to another shop nearby to purchase a few birthday stuff and that it seemed kind of expensive. This was to drive home the point that I was looking for a cheaper alternative. He immediately listed out all the offers in store at that time.
I sought to take advantage of the situation by making the first offer and trying to anchor the seller. I expressed my interest in the T-shirt on sale with a “Buy 1 get 50% off on the other” offer and told him that I would be willing to pay half the price for one T-shirt. He looked like he was expecting an offer of this nature and that is when I knew that this negotiation process might last longer than I perceived it would. His opening offer was a $2 discount on the product with an additional add-on “Birthday card”. This gave me a leeway and I realized