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Want to learn a skill that can help you make more money in your flipping business?
Today we are going to talk about the one skill you need to master to make more money flipping — it’s negotiations.
There are two parts to negotiating — in the buy and in the sale.
Negotiation In The Buy
The money’s not made when you sell the item, it is really made with how cheap you can get that item. So the money’s made in the buy. You need to learn how to negotiate that by when you go out and find it.
There are two parts to this: in person and the apps. When buying something off of an app such as OfferUp or Facebook Marketplace, I like to negotiate the new price before I even get there to pick the item up. If I do find something else wrong with it, I can negotiate it a bit more, or if I’m already getting it super cheap I just buy it.
Negotiating In Person
For example, we had a commercial Miller paint shaker. It’s one of the machines where they put a gallon into it and it mixes the paint up.
I was delivering something that we sold and I wanted to make the most of the trip so I found this paint mixer. I told the guy when I was going to be in town and asked if it’d be possible to see it. I didn’t negotiate on price in case my plans fell through. He wanted $100 for it. I would have negotiated $75 if it was my local area. I figured I would do it when I got there. The problem with negotiating when you get there, even if you find something wrong with the item, is that they’re already expecting to get full price for that item.
So he already had his mindset that he was going to get a hundred dollars for this. When I got there, the good thing was there was something wrong with it that I didn’t know. The clasp that actually holds the paint can on was broken so he was using a bungee cord around it. So that was my negotiating tactic and tool.
When I got there I asked “Hey, are you negotiable on the price? Would you take any less?” And he said, “No, I really got to get a hundred dollars.” Well, I know how to read people because I’ve been doing this for years and I knew that he would negotiate on price.
So I told him, listen, “I really only want to spend $75 on this, the clasp is broken, it’s going to help me get new pieces to put in there if I can get $25 off on the price.” But he wanted to stick with $100, so I told him “Okay, to be honest with you I’m going to have to pass. I kind of was expecting it to all be here and not broken.”
So I started walking away and he said, “Well can you do $80?” And I stood there for a second, thought about it, and then said yes. And I paid him and walked away with it.
It’s important to be respectful when negotiating. It’s not cool to go up and completely bash an item trying to tear it apart. We try to negotiate on the app before we get there. If something is legitimately broken just be nice and respectful.
If you really want the item you can try and offer them money and then walk away and see if they say anything. But it is awkward if you start walking away and come back and I’ve done this as well. If I read them wrong, I’ll walk away, and then I’ll come back and say, okay, you know what? I’ll figure out how to fix it all.
I know how to read people as I said, and I knew that he would come down on the price. He was out in the country, it had been listed for a little while, and he hadn’t sold it. There weren’t people knocking at his door for this item.
And those are all things that I take into account when I am negotiating. I knew that he wanted to get rid of the item, and I could use that to my advantage.
It’s a fine line to walk to get a good deal and still be in a good place with the buyer.
Negotiating On An App
Typically when you’re negotiating on an app, you just offer them the best price that you’re able to do. They’ll either ignore you, come back with a higher offer, or they’ll come back and say yes. It’s very easy to do that versus in-person and personally, it feels a lot less awkward.
Don’t feel you have to buy an item just because you negotiated on the app. Even if you drove a little bit to go pick something up, and it’s really in bad condition and it’s not worth fixing or cleaning up, it’s sometimes better to say, “Sorry, it’s not what I thought it was.” And just leave. Don’t buy an item because you feel bad.
The other thing you have to get good at is asking questions. If you’re driving an hour away to pick up something that has a good resale value and you’re getting it cheap, make sure to ask questions. Does it have rust? Does it have cracks? If so can you take a picture? Inspect it before you’re going to make a long trip.
Negotiating At Flea Markets
With flea markets and thrift stores you haven’t looked them up on an app and you are usually first seeing the price when you’re standing there.
Sometimes if you just stand there not saying anything, they’ll drop the price just based on your body language. The quieter one is usually the one who gets the best deal.
Our student Stacey told a story about them negotiating in person with a golf cart she bought. The price was $500, and they didn’t negotiate before they got there. When they arrived the lady started talking about it and saying that her family wanted her to get rid of it. It needed XYZ. And Stacey didn’t say anything. She was just looking it over, and the seller dropped it down to $350, and I think she dropped it down to $300 just by them silently looking at it.
A lot of times that works in person, just sitting there inspecting the item.
Sometimes at the flea market, I’ll take a picture of an item and say I’ll think about it and walk away. Then when they see someone walking away they’ll think they lost a sale. I typically always walk away no matter what at flea markets because I need to look up the item and see what it’s selling for.
Negotiating On The Sale
People want to feel like they’re getting a good deal. If you have enough room in your pricing to allow for negotiation then you will leave feeling like you got a good deal, and the buyer will also leave feeling like they got a good deal.
Make sure you’re pricing your items properly so you do have a little wiggle room to negotiate with a potential buyer.
That’s it! Try some of the negotiation tactics and let us know how they worked for you.
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