How to Negotiate With Vendors When You’re Just a Small Business or Individual

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Because you will be purchasing many items throughout the life of your online business, it is inevitable that you will run into a dispute at some point in time with a store, vendor or service that you regularly use.

Especially in the early stages of your business, you’re likely to have very little clout with your vendors which makes even showing up on their radar screen a challenging task.

The unfortunate reality is that small business owners and individuals often get screwed by customer service reps of larger companies because they simply do not know how to negotiate and appear larger than they really are.

This article will help you successfully negotiate with your vendors even if you’re a small business or individual. Special thanks to Anita “the Negotiator”, for contributing to this entry.

Find The Person Who Has Decision Making Power

No negotiation tactics are ever going to work unless you are speaking to someone who has the power to give you what you want. Often times, you will have to navigate your way through a maze of people before you can actually find this person. Politely explain your situation to the customer service rep and ask to speak with the manager or supervisor on duty.

If the customer service rep insists on trying to help you, explain your situation nicely and ask for what you want. The key is to be persistent and wear the service rep down until he capitulates and sends you directly to someone with decision making power.

Disarm Them

Once you’ve gotten through to the person in charge, the real negotiation begins. Most likely, the supervisor is mentally prepped to deal with a very vocal, angry and disgruntled customer so start off by being the complete opposite to throw them off guard. Begin the conversation by praising the company.

Emphasize how you’ve been a customer for years, how you really love shopping here and how you’ve really had positive experiences shopping here in the past. Try to sound excited about having found the company and the products that they offer. Cite examples or positive experiences that you’ve had with previous purchases. Here’s a good example of how to start off.

“First off, I just want to say how much I really love shopping at [insert company name here]. I’ve been a customer for [insert number of years] and I’ve been a very satisfied customer. I really love the [insert product name] that you sell, the great customer service that you provide and I’ve referred you to a bunch of my colleagues.”

Prefacing your dispute with positive statements demonstrates to the vendor 3 key points.

  • You are a long standing and loyal customer.
  • You are a valuable customer because you refer others to their business.
  • It is out of the ordinary for you to be complaining about anything. Because this is a rare occurrence, it is likely that the vendor has made a mistake.

Starting off on a positive note also causes the supervisor to be more receptive to what you have to say.

Present Your Case Clearly and Politely

After buttering the supervisor up with that prologue, state the problem that you are having politely and clearly. Try to be amiable and easy to talk to but stay clear on what objective that you are trying to achieve. If the supervisor bends to your demands at this point, you’re done!

However, depending on the severity of your issue, you may or may not get what you want right away. If politely asking for what you want doesn’t do the trick, you need to resort to one of the 2 following methods.

  • Get angry and pissed off
  • Act hurt and dejected to try and draw sympathy

The challenging part regarding these 2 options is that you have to properly gauge the type of personality you are dealing with.

Know Who You Are Dealing With

Unfortunately, knowing and understanding the type of personality that you are dealing with takes practice and a bit of talent. Being able to read a person’s thoughts is what separates people like Anita “The Negotiator” from the rest of the crowd.

In any case, there are few general guidelines that can be followed when choosing from these tactics.

Use the Angry and Pissed Off Method When…

  1. You are dealing with a small little known company. Most likely this company is still trying to establish their reputation and are deathly afraid of one bad customer trashing them all over the web.
  2. You are dealing with someone who has emotional ties to the company, someone who really cares about keeping customers happy.
  3. You honestly believe that the vendor is clearly at fault. At our store, we occasionally get pissed off customers who blatantly violate our store policies and demand their money back. When they started yelling, we immediately shut down and tune these people out.

Use the sympathy method when…

  1. You are dealing with someone who comes across as really sweet and nice. The sympathetic method seems to work especially well when the supervisor is of the opposite sex.
  2. You have established some sort of rapport with the supervisor. For example, you might belong to the same fraternity or university…etc. Use any information you have gleamed from the conversation to your advantage.
  3. You are asking for something that goes slightly beyond store policy. For example, if you are making a return and are past the return policy date by a few days, eliciting some sympathy will sometimes do the trick

Getting what you want sometimes takes several tries. Try not to switch tactics in mid-conversation otherwise the supervisor will think that you are crazy schizophrenic.

If one negotiation doesn’t work out, call back again on a different day and try your luck with a different supervisor.

Sometimes it pays to be creative. When you feel that your demands are not going to be met no matter what, try and think of alternative solutions that might be acceptable to both parties. Sometimes it pays to think outside of the box.

In a subsequent entry, I will post an example of an actual customer service dialogue in which Anita “The Negotiator” manages to successfully negotiate an upgrade of a hotel room for one of her vacations.

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4 thoughts on “How to Negotiate With Vendors When You’re Just a Small Business or Individual”

  1. nyc says:

    i sell retail and i get calls for “wholesale” orders all the time – i obviously don’t do wholesale but I do give a discount for bulk purchases – here’s the kicker, people call using the method above a lot – except i’m NOT a vendor, heck i’m not even a wholesaler.

    This is an interesting read, but it wouldn’t work with my vendors.. I would feel guilty buying my products any cheaper than i already do haha. I’m sure I get a price that rivals that of many other shops that sell the same products – mainly because when it comes to clear them out, my clearance prices are about 80% cheaper than theirs and I still make a 200% profit.

    I <3 my vendors & I would never haggle with them. They're amazing, kind, and I just pray to god they don't use child labor and bad working conditions.. China is known for that.. still, with the prices, i find it hard that they use anything but those two laborers.. thankfully my customers aren't interested on where my products are made :) great thing when your customers are a pre-teen/teen age.

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