You will be able to negotiate a big purchase on total cost and walk away when needed.
Daniel is back at the showroom from lesson 6.1, The pressure tactics you will meet. This time he's ready for the deadline and the manager in the back office. What he isn't ready for is the question the salesperson asks first: "What monthly instalment are you comfortable with?" He says about S$900, and the salesperson smiles. "We can definitely work with that."
That answer should worry him more than any tactic. This lesson is about big purchases, such as a car, a laptop, a sofa or a two-year phone contract, where the price is large enough that a careful negotiation is worth an afternoon. All figures are examples.
Showrooms and shops are designed to make decisions feel urgent and easy. So decide your walk-away price before you go, using the same thinking as lesson 2.2, Set a reservation point and a target. What's the most you'll pay for this exact model and specification, all in? What will you do if you can't get it at that price: buy from another dealer, buy a different model, or wait?
Then bring evidence. Print or screenshot the prices you've found elsewhere for the same item: other dealers' quotes, online retailers, the official price list if there is one. A salesperson can argue with "that seems high". It's much harder to argue with a printed quote from a competitor for the same car.
For electronics, the same applies. Check the price of the same model at two or three shops and online before you go, and note any differences in warranty or bundled items, so you're comparing like with like.
The monthly instalment is the easiest number to make look small. Stretch a loan over more years and the monthly figure drops, even though you pay more in total.
Take an example car loan of S$60,000 at a flat interest rate of 2.5% a year, a figure chosen only to show the arithmetic. With a flat rate, the interest is worked out on the original loan amount for every year of the loan. Over five years, the interest is S$7,500, so the monthly instalment is S$67,500 divided by 60 months, or S$1,125. Over seven years, the interest is S$10,500, and the instalment is S$70,500 divided by 84 months, about S$839.
The seven-year loan fits under Daniel's S$900. It also costs S$3,000 more in interest. When the salesperson said "we can work with that", this is the kind of thing he meant.
So negotiate the total price of the car first, as if you were paying in cash. Only when the price is agreed, discuss financing, and compare the total interest across loan lengths and lenders, not just the monthly figure. Car loans in Singapore are also subject to MAS rules on how much you can borrow and for how long, so check the current limits before you plan around a particular loan. If you're financing anything else, a sofa or a phone, the same rule applies: ask for the total you'll pay over the whole term.
Sellers often have more room to add things than to cut the price. A discount on a car or a laptop is visible, sometimes to the seller's head office, and may be limited by policy. Accessories, servicing packages, an extended warranty or delivery may cost the seller far less than they're worth to you.
So once the price is close, change the question. Instead of "can you do better on the price?", try "what can you include?" For Daniel, that might mean asking for a servicing package, window film or a longer warranty. For a laptop, a bag, an extra charger or extended cover. This is the trading currency idea from lesson 3.2, applied at the counter.
Phone and broadband contracts are a smaller, more frequent version of the same negotiation. The time to act is a few weeks before your contract ends, not the day after. Find two or three competing plans first, from other telcos or from the same provider's website, so you know what a new customer would pay.
Then call or visit your provider and ask what they can offer to keep you. Mention the competing plans by name and price. Retention offers are often better than the advertised ones, but you're unlikely to hear about them unless you ask, and you'll only know whether they're good if you've already looked elsewhere. If they won't come close, your BATNA is right there: switch.
The activity asks you to pick a purchase you're planning this year, find two competing prices, and decide your walk-away price and three things to ask the seller to add.
Pick a purchase you plan this year, find two competing prices, and write your walk-away price and three add-ons to ask for.
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