Combat the Closing Techniques - The Make It Affordable Close

Combating the Closing Techniques, a series, explores the tactics companies and salespeople use to separate us from our cash. For background, you may want to read the post that originated this concept, Marketing or Manipulation, featured on Financial Samurai.

craigmurphyWhile most sales staff and customers think that decisions to purchase are most often limited by cost, it is not true. Sure, as consumers we might tell our salesperson that the price is why we won’t buy, but that is often just an excuse. It is an excuse that most use because we believe a salesperson cannot overcome this objection and it will leave us in control.

But salespeople are trained, they know everything is affordable as long as they present pricing in the right scale for a customer.

Let’s look at an extreme example. There has been lots of talk about our national debt and how much that will cost each of us. Depending on which number you want to believe the debt is huge regardless. According to our current debt is nearly $13 Trillion dollars. By any conceivable measure who would think this is affordable?

But then we see references that the debt per U.S. citizen is only about $42,000. OK, so it still seems like a lot, but its debt. Of course, no debts are paid off in full, all in once.

Like a car, if I could give you 5 years to pay for your share of debt it quickly becomes affordable at only $8,400 per year. Is that still too much? Would $700 per month be more acceptable to you? No, how about only $23 per day? Oh, you only make minimum wage? No problem, let me rearrange the payment to just $.97 per hour. Certainly you can afford less than a dollar per hour for the good of your country!

This blog post was featured in the Economy and Your Finances Carnival hosted by OneMint. Please follow this link to other great articles.

Silly, isn’t it. It doesn’t matter if you couch the bill in terms of dollars per second, hour, months or years you are still paying the same amount. Yet sales people routinely use this technique to separate you from your money by making their products appear more affordable.

Telephone companies and car dealers seem to be the kings at this approach. For only “pennies” each day you too can benefit from extra features such as call waiting and caller ID. Just a few dollars each month will get you a theft deterrent system, navigation or the extra airbag option.

This approach is also used on television commercials routinely. You too can own the latest belly buster exerciser for 4 easy payments of just $19.95. Heck, that is cheaper than the national debt! Certainly you can afford $20 a month, no problem!

It is silly when you think about it, but therein lays the problem. Too many consumers don’t think about it. We are predisposed to focusing on only the numbers that are presented.

When we see 4 payments of $19.95, our mind retains the $19.95 and does not automatically calculate the fact that a piece of plastic with some rubber bands costs $80. And don’t forget the hidden shipping and handling charges!

Fighting Back

First and foremost do not negotiate payments, ever. If you are buying a big ticket item never share with the salesperson how much you can afford to spend each month. That will almost guarantee that your payment will be every penny of that amount and maybe a few more.

Negotiate first for the total price of the product. Once you have come to agreeable terms then you can figure out how to best arrange the financing, if required.

Your core defense is awareness. Understand, anytime a company or salesperson presents you with a payment versus a total cost of a product or service, they are playing a mind game. If they don’t provide a total cost up front, ask them for it.

Alternatively, carry a calculator with you. When you hear the terms of a product run the numbers. Once you have the total product price you can then consider the products relative value to you. What are you using the product for, how long will you really need it or how long would you expect it to last?

If you will obtain more value from the product than what it costs you, fine, spend away.

Use the Make It Affordable Close to your advantage.

I pondered this one for awhile. Frankly, I am at a loss for how to use this technique against a salesperson to your advantage. If you have an idea, please comment below.

However, this technique can be applied to other situations to your advantage.

Are you overwhelmed with debt, does it seem too big to deal with? Don’t look at your total debt load; break it down into monthly, weekly or even daily goals. It wasn’t conscious but I used this approach to maintain my motivation when eliminating my debt.

Each bill was broken down and listed on a spreadsheet. Instead of cracking under the weight of $20,000+ of debt I only considered how much I needed to pay off each month (while not adding any more!).

Do you have a goal in mind? Are in interested in a new (to you) car or a new computer? Set up a budget and determine how many dollars you need to save toward your goal each day. At times it may appear impossible to save several thousand dollars but any of us can save $10 each day. At that rate you would have $5,000 set aside in less than 18 months!

Readers: Have you ever signed up for a small monthly payment you later realized was busting your budget? Are you using a similar technique to save for a big purchase, what are you planning to buy?

For more, read: Combat the Closing Technique – The Puppy Dog Close
Combat the Closing Technique – The Power of Suggestion
Combat the Closing Technique – The Assumptive Close
Combat the Closing Technique – Fulfill Your Dreams
Combat the Closing Technique – The Ben Franklin Close

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photo by Craig Murphy

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