Let’s Make a Deal: Haggling Abroad

by Chris on May 13, 2009 · 19 comments

in Money & Career, Travel, Travel & Leisure

With summer traveling season just around the corner, the fortunate among us will be setting off for faraway lands in search of adventures of every sort. If your travel plans for the near future include stops in cities or towns known for their street markets, or if you plan on doing any souvenir shopping while abroad, you need to know how to get the most bang for your buck.  Learning how to properly negotiate prices, especially in a street market setting, will save you some of those precious funds and provide an interesting cultural experience at the same time.

Here are some tips for making the most out of your street market experience:

Do the Research

First and foremost, you need to know the area you will be traveling to. Familiarize yourself with currency exchange rates and local customs. Most importantly, find out if haggling is acceptable (or expected) in the country. This information is easily available in most guidebooks and online.

Know Your Limits

So you are standing in front of a street vendor and you see something you want, but how much is it worth to you? One of the most important elements of haggling is deciding what you are willing to pay for an item before negotiations begin. Your brain tends to turn haggling into a competition, and we all want to be winners, right? The problem is, without a set limit in mind, you’ll end up paying twice what you originally planned for that ­­­­­set of nunchuku, and instead of just taking home a cool souvenir, you’ll also be bringing back a memory of that time you got ripped off in China.

Maintain a Low Profile

Often your initial reaction to something you want will entice the dealer to push for a higher price.  If you rant and rave over how much your wife or girlfriend would love to have that beautiful handmade hammock, you can plan on paying more for it as a result. Wear your best poker face at all times. Also, consider putting that gold nugget pinky ring and matching Rolex in your pocket, as these will quickly give away your ability to pay full price. Want to get really serious?  If you are dedicating a good portion of the day to market crawling, consider dressing down a bit. Ditch your high class tourist attire and go for the scruffy look. If you are projecting wealth through your appearance, chances are you are going to pay for it at the market.

There Are No Standards

It is common to find travel advice online advocating a standard percentage that should mark your opening offer, such as only offering 25% of the asking price. Be wary of such all-encompassing standards. The internet is not a place known only to you and other travelers, so there is a chance the seller is aware of this practice and has marked up the product exponentially in an effort to counter it. If there are multiple sellers offering the same product, compare prices and then use them against one another. Always keep in mind what the product is worth to you and what the most likely market value is, and go from there.

Be Extremely Picky

Carefully scrutinize every square inch of the item you wish to buy. Many of the products in open air markets are packed away every night and unloaded every morning, and are likely to incur some damage in the process. If there is a scratch, dent, or mark of any kind, be quick to point it out to the dealer. Assuming you want the product regardless, you are now in the fortunate position of bargaining for a damaged product, no longer worth its original price.

Don’t Be a Pushover

Keep in mind that sellers in some foreign markets will feign indignation at a low offer as a tactic to raise your bid. Feeling that you may have insulted someone may incline you to pay more as a sort of peace offering.  Just remember, at no point are you obligated to buy anything, although you may certainly feel that way during some negotiations.

Stay Composed

Depending on the intensity of the bargaining, you may find yourself in a frustrating situation, especially if the item being bargained for is something you really want. Don’t lose your cool. Remember, the salesman is a salesman for a reason; he needs to make a profit. It does him no good to sell you products at less than cost or market value. Always be courteous. After all, we are gentlemen. Just keep in mind that a gentleman is not a sucker either.

Sweetening the Pot

Market salesman won’t come down to the price you want, but it’s close?  Try agreeing to the price offered as long as something else is included. Tell them you want to look around a bit more, and find another object you like which you consider to be worth the difference in price between your highest offer and the seller’s lowest. Tell them you will pay his offer, but he has to throw in your newfound item as well. This is not a guaranteed deal maker, but if it works, it will have made the transaction worth your while.

Walk Away

Not satisfied with the deal? Tell the seller you are going to have a look around for a better deal.  If he wants to make the sale, he’ll stop you with a better offer. Of course, in doing this, there is the chance the seller will not try and tempt you with a better offer and will just let you go. For this reason, only walk away if you can live without the item in question. If you return later and ask for the negotiated price from earlier in the day, chances are it will have gone up, and you will certainly have lost the upper hand.

The Cash Option

Made a deal and it is time to pay up?  If the market accepts checks or credit cards, always be sure to push for the cash discount.  Often, this is worth knocking a bit off the price for the seller.

Finally, always remember that your best ally when navigating the stalls of the street market is your instinct.  If you feel like you are getting a raw deal on an item, you most likely are and should walk away.  If you feel like you got a bargain for an item, it doesn’t really matter what the item is worth, so long as you are pleased with the price paid.

{ 19 comments… read them below or add one }

1 Backpack Foodie May 13, 2009 at 5:49 am

Unfortunately, I feel this post misses a BIG chunk of the meaning of bargaining. There’s a critical advice left out:

Do it with a smile

Bargaining is more than just a way to get a low price: it exists as a means for the vendor and the buyer to establish a social connection. If you just pick up something and buy it without haggling, then how will the vendor know you? As a consequence, it’s important to go in knowing it’s a social exchange and not a fight.

I’ve seen way too many tourists who thought bargaining was about being a hardass and not giving an inch, and they ended up getting majorly ripped off. (Hint: if you give the vendor a scowl as the first step, he’ll mark up the price expecting a fight.)

Instead, have fun with it. Theatrically fake outrage with a grin on your lips. Make jokes. You’ll discover that the seller will soften up, and bring his price down. If you leave the shop with well wishes and a wave, then you’ve bargained successfully. And hey, you got a little story out of it, too, and possibly even a stranger who will remember you kindly.

Remember it’s a social interaction, and do not focus entirely on the price. Keep your checks in place, and don’t get ripped off… But remember to have fun and to establish a connection, and you’ll get the best price possible.

You’ll start knowing you’re getting close to it when the vendor hesitates a long time, or asks a colleague/the boss whether a price is acceptable… That’s when you’re entering the “local price zone”.

2 Backpack Foodie May 13, 2009 at 5:51 am

By the way, this is the reason I’ll bargain everything, even something inconsequential, and even from someone for whom the money would go a much longer way. If you don’t bargain them, they’ll feel (rightfully so) that you’re treating them with condescension. Bargain them, make them work a bit (but pleasantly so) for the markup, and they’ll feel you’ve treated them with respect, as a businessman or woman.

3 Louie May 13, 2009 at 6:42 am

I might add another tip: Check your funds before the Haggle.

It seems like common sense, which apparently, I lacked while haggling for a wooden chess set in a market in Mexico. I talked the seller down significantly after 10-15 minutes only to find out that I didn’t have the cash that I though I did. It was the essence of humility.

4 Marcus May 13, 2009 at 6:45 am

A social interaction? Nah, I disagree. A seller may feign that he wants to get to know you and have some fun with it but at the end of the day this is a business exchange not a party. You want an item for a certain price and he wants to sell it for a certain price. That’s the essence of it. By all means be nice and smile, but don’t try to become best friends. My dad’s a real ass when he bargains but he always get the best price on stuff.

5 Simon May 13, 2009 at 7:04 am

Having lived in Hong Kong for close to a year, one of the hardest things for me to get used to has been that haggling isn’t confined just to markets. The locals jokingly told me “it’s HK, everything is negotiable,” and while I was initially skeptical, I’ve found it to be true just about everywhere – even in upscale stores in malls.

The other part, which is hard to digest at first, is that there is a certain gweilo premium – this becomes especially apparent going out to eat with locals who always manage to haggle for better deals (even on food!).

Moral of the story – don’t be afraid to ask, worst they can do is say no…

6 Backpack Foodie May 13, 2009 at 7:23 am

Well, it’s not because you’re having a business deal that you can’t be nice about it. It’s the same logic by which the guy trying to sell you a HDTV in North America is trying to chat you up.

All I’m saying is, if you approach this like a hard-nosed negociation, you’ll get ripped off. Vendors are good at acting like victims of your hard bargaining skills, while ripping you off on the side. I’ve seen it.

I’ve lived 3 years in Mainland China, and trust me: go at it with a smile and a sense of humor, and by the end the vendor will be happy to sell you the lowest price he’s sold all day. The best bargainers I’ve met have gotten invitations to dinner out of it. The worst were the hard bargainers who treated the vendors like dirt.

7 Laura May 13, 2009 at 8:38 am

This article makes me smile and think fondly of my dad. He is a haggling GOD. When we were younger and lived in Texas I remember taking trips over the border into Mexico with him just so he could haggle. He would spend hours arguing even if he only managed to get $5.00 taken off the price.

@ Backpack Foodie…I’d have to disagree with you. As harsh as this sounds, the locals are not looking to make friends with you, they want your money plain and simple. If you want to shoot the shit and make friends with the shopkeepers then you should frequent the more expensive stores that don’t deal in haggling. I’m not saying you should be outright rude to them, but being bubbly and friendly simply paints you as an easy target. You can joke around with them, but always keep the appearance that you are in control.

This article could have been written by my dad its so accurate. Good work! One of my favorite parts about traveling is haggling with the locals, and I chalk that all up to my dad’s hard bargaining ways!

8 Nt4thBook May 13, 2009 at 8:42 am

My best advice when it comes to haggling in a foreign land, is to figure the maximum you are willing to pay and isolate that money to a different pocket. Obviously, you should not do this in the presence of the one, in whom, you hope to negotiate. If you can get it for less, great! If he wants more, simply show him the wad of money, saying “This is all I have for this item.” Be firm, but show remorse or disappointment that you can not offer more. More often than not, they won’t let you leave the store empty handed, but you have to be ready to do just that. Save this technique for towns you are passing through or on the last day of your visit.

9 Philip May 13, 2009 at 8:55 am

I will be leaving the states next Monday to work for the summer as a missionary with a media team based in Nairobi, Kenya. Any specific advice?

10 Backpack Foodie May 13, 2009 at 9:45 am

I’m not saying you’re there to make friends. I’m saying this:

In a place like the States where you don’t usually bargain, the buyer is in power, as he can buy or walk out. So the seller has to play it up, put up a facade of friendliness, and pretend to be friends. He needs, in other words, to build rapport. The impetus for this is entirely on the vendor.

But go to a country where bargaining is the norm, and suddenly it’s a two-way street. Act like a jackass, and chances are the vendor will just mark up the price. He’ll set his mental ‘low sell point’ much higher, because he doesn’t like you. But act friendly, establish rapport, and suddenly the vendor will concede a lot more.

The way business is done in the Middle East and in Asia is not as distinct from social exchanges as it is in the West. Vendors expect bargaining because it’s a form of social interaction. Not bargaining is rude, because you’re basically saying you don’t want to interact with someone. It’s like having a nice chat before you enter a business contract.

So yeah, the end result is, the vendor is there to make money, and you’re there to save money on your purchase. But if you go into it ‘strictly business’ with the clear intent of being a hard negociator and not getting ripped off, you WILL get ripped off. I’ve seen vendors RIP OFF tourists so bad because these tourists thought they should speak as little as possible and act like they were negotiating with terrorists or something.

Now, if that doesn’t explain my point, nothing will.

11 Andrew May 13, 2009 at 12:53 pm

I like the advice about “dressing down”. But my question is this: where is the line between deserving of respect and being a rich snob? I would want to dress down to avoid appearing wealthy, but on the other hand, if you look like a complete slob, you might not be treated with as much respect.

12 Dane May 13, 2009 at 1:25 pm

I’m not really excited about this post. I’m assuming that if you’re traveling, and don’t know the local culture, you must have money to spend on luxuries. You’re not in danger of going without food and housing. Can you say the same for the vendor? Certainly, in many cases, you may well be dealing with a well-off businessman who sells cheap junk to dumb tourists for a huge profit. But there is also a good chance you’re dealing with someone making a modest living off of what they are selling you. Do you really need to save $5 by haggling down somebody who eats for a dollar a day? Is it manly to save a relatively little amount at a relatively significant detriment to the other person?

I just want you to think about this when you want to haggle. Why not exercise some generosity and pay the asking price if it is reasonable? If you’d be willing to pay the price for the same thing off a shelf in the US, then why not here?

13 Marcus May 13, 2009 at 1:58 pm

Dane, I’m not sure how much you’ve traveled (perhaps not a lot from your comment), but haggling isn’t one way to do business in street markets it’s *the* way to do it. It’s a cultural thing-that’s how everybody does it from the tourists to the locals. If you read Backpacker’s comments you’d see that in a place like China it’s insulting not to haggle. You don’t do it in America, one because it’s not part of the culture, and two, because things are generally priced at market value. If you go to a street market things are overpriced on purpose. You’ll find a cheap wooden box for $40, when it costs a couple dollars to make. The seller knows this and you know this. All haggling does is get it down to around a fair market price. To me it’s more insulting to treat a vendor who is trying to run a business as a charity. I don’t think they need your pity.

14 Christatos May 14, 2009 at 1:03 pm

The key to haggling everywhere in the world is to never question the quality of the merchandise unless the merchant can’t deny that they were trying to bilk you. You want to respect them, but when it becomes clear the emperor has no clothes, don’t be afraid to go for the throat. Sometimes this will still get you thrown out of the shop, but that is the price of wisdom.

As to the question of dressing down, my view on it, as a man who considers being well dressed a requirement, is that the better dressed you are the gentler a technique you must cultivate. A man in a $2000 suit has no business playing hard ball over the price of an apple, but gently nudging it down if it is bruised a bit is acceptable. Don’t dress down to get a deal, act like who you are, and represent the money in your bank account with honesty. There is a fine line between going for a deal, and being a shark. One is the key to being a responsible but classy man, the other leads to being a greasy shill.

15 Patrick B. June 25, 2009 at 8:22 am

Sure it may be “fun” and “customary” to haggle with street vendors overseas. But, come on. What difference does a few dollars in price really mean to you. So you have a story about how you bargained the third worlder down three whole dollars. That cannot even buy you a cup of coffee in The States, but it could feed his wife and four kids dinner that night. Pay the poor guy and walk away with a momento of your trip and knowing you helped an impovershed person make ends meet for that day.

16 senatorrosewater August 9, 2009 at 4:39 pm

As a sailor, I’ve bought junk all over the world. The article is pretty good, but there’s one thing you missed… tell the merchant that the guy on the next street over is offering the same thing for $X. Can you beat his price? This works every time if you name a realistic price.

I’ve actually found lower prices by naming my price, walking away, and coming back later. If I make it known the ship is leaving that day, so much the better.

Also, consider haggling in US dollars. many world currencies are hard to do the math on, and are very volatile from day to day. People in the 3rd world treat USD like gold. Just make sure your dollars have no rips or tears. People are very suspicious of old money, and most won’t accept it.

17 Robert Elwell November 4, 2009 at 5:00 pm

Was I the only person who balked at the misspelling of nunchaku and its subsequent mislabeling as a Chinese objet d’art?

Doesn’t sound like the author is practicing their own advise of researching.

18 Vaarok April 2, 2010 at 8:34 pm

There’s also the hard-haggle and the soft haggle.

You can criticize, carefully, the flaws in the merchandise, the height of the price, or express your limited time or marginal need of the item in order to force the seller to come down, throw something in, or sell you something better instead. Opening negotiations on a lesser item and then changing your mind reluctantly to what you really want often adds incentive for the seller to be reasonable.

Likewise, you can compliment the merchandise, express your eagerness or use for it, but then lament the price or dismiss your own stated goals, putting the onus on the seller to do better.

It’s a very ritual practice, but it’s both a compliment to the seller and a means of getting better merchandise and a lower price.

19 Dan April 8, 2013 at 10:58 am

One trick I used in Iraq and Afghanistan is to keep small amounts of money in different pockets. That way, when I finally got the price down, I didn’t pull out a big wad of cash and show him that I had the money all along. This is also a technique that will make a potential pick-pocket incident less painful.

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