Most of us own something we don’t really want. Maybe we’re riding the train and no longer need a car. Maybe we’re moving and can’t haul the couch. Maybe our fancy bike eliminated the need for a Schwinn.
Opportunities to sell are everywhere. But how to pick a price? I’ve previously suggested setting your first offer as a function of your target. But if you’re like most people, you’re still not sure EXACTLY what figure to propose.
Selecting the number for your first offer is tough. But it’s negotiable! In this post, I’ll offer three strategies that can help you home in on a killer first offer.
For the purpose of this post, imagine that you’re moving into a furnished apartment across the country, thus eliminating the need for your beloved couch “Bessie.” Imagine, further, that your cat hasn’t destroyed your beloved couch, as he has mine. Finally, imagine that $750 is the aggressive yet attainable figure that you have chosen as your target.
That’s all fine and well. But now that you’re standing in front of a prospective buyer, nervously extolling Bessie’s virtues, you’re still not sure exactly what number to offer. Here are three strategies for selecting a figure:
- Be aggressive, not outrageous: If you’re confident that $750 is aggressive yet reasonable, a first offer in the $775-$825 range would probably work well. A first offer in the $1275-$1325 range would not, as research clearly shows that first offers far outside the realm of reason don’t lead to good deals. They lead the other party to bolt before you can say “Bessie.” So offer something somewhat above your target, but don’t offer something outrageous.
- Be precise, not round: If you’re considering a first offer of $800, consider a first offer of $807 instead. Why? Other interesting research shows that precise first offers are more persuasive than round first offers because they suggest that you’ve done your homework. $800 sounds like a dream; $807 sounds like a carefully researched and clearly justified calculation. But don’t overdo it. Don’t offer $807.34, as the same authors have suggested that you then sound like a slimy salesperson. So try to be moderately precise, then extoll Bessie’s virtues when your counterpart probes the underlying calculations.
- Be exact, not wishy-washy: If you’re considering a first offer of $807, say “$807.” Don’t say “about $807,” and don’t say “between $787 and $807.” Your goal is to give your first offer the aura of legitimacy and finality. If you say “about,” the other party hears an opportunity to negotiate. If you say a range, the other party hears the part of the range they like—$787—and your hopes of $807 are gone forever. So do your homework, understand through and through why your beloved Bessie might be worth your first offer (whatever it is). Then advance that offer with confidence, as if it’s the only obvious number that any reasonable purveyor of used couches named Bessie would offer.
These three tips still won’t give you an EXACT answer about what number to offer. In matters of human behavior, exact answers are few and far between. But hopefully they do offer a useful yardstick for calibrating your figure and advancing a first offer with confidence.
What do you think of these strategies?