Haggling is the tool of a bargain hunter. In the right hands, it can create a workable deal out of an otherwise outrageous price. If you obsess over price then learning how to haggle is paramount to acquiring a good deal.

Like most anything else, haggling is a learned skill, acquired through experience and study. It's a fallacy to think one can simply approach a seller, request a lower price and subsequently receive a good deal. More than likely, you'll either be denied or walk away with an overpriced item cleverly concealed as a bargain.

Haggling is much more complicated than people think. A good practitioner should know how to research all aspects of a sale, including the product, the seller and the market, and likewise read a seller's body language pertaining to adherence to his price or receptivity to yours.

The first step in learning how to haggle is getting over one's natural timidity to discuss price. Most people are not comfortable asking for a lower price or feel it's somehow belittling. There's nothing belittling about saving money; the richest people on the planet didn't get that way by throwing money away. As for fear, the worst case scenario is they say "no", so there's no need to be timid, and that inclination will reduce with practice.http://www.howtohaggle.com/

In this article, we'll explore this essential skill and how to improve your ability to haggle.

The first step to successful haggling is gather pertinent information. The more the better. This will be your arsenal against a would be retailer. Below are some points to consider.

Research the fair market price

For automobiles, houses and collectibles, additional resources are available. For cars, nadaguides.com and kbb.com are good sources for used and retail prices. For houses, zillow.com is good for finding recent sale prices in an area. For collectibles, try searching for "price guides" for the category in question.

If your research doesn't pull up anything or you're in an area where going online isn't feasible, don't be afraid to ask strangers what they paid for an item and if they were able to bargain. At the very least, you'll discover a maximum price you'll pay, providing they're willing to give you any information at all.

Find places open to haggling

In the United States, haggling is usually restricted to (A) informal settings, such as person-to-person sales, flea markets and garage sales or (B) large ticket items such as automobiles and real estate. Major retail chains and grocery stores are usually not willing to negotiate, but sometimes it will still work if you can offer a reason, such as an opened or displayed model, damaged goods or a bulk purchase.

For a truly good haggling experience, find sellers who don't know the fair market price of an item and/or hasn't properly marketed the item. These will generally be "for sale by owner" types. Although most people overvalue their own property, they don't usually know their item's real value, so there's opportunity to get some very good bargains, particularly if their efforts have been in vain for extended periods of time.

Identify the person with power

You won't ever be successful haggling with someone who doesn't have the power to change prices. You need to approach the person of influence. Usually, this is the owner or manager. You can ask for him directly or observe the personnel for the person exerting the most control.http://www.time.com/time/magazine/article/0,9171,1913774,00.html

Assess supply & demand

This is really easier than it sounds. Supply simply means how available the item is. If you've search all over town for an item, and you've only found one place that has it, then supply is low. If the seller realizes that, then he may be difficult to move on price. Likewise, if you have fifty venders, all selling the same wares, supply is very high, and the seller knows you can easily go elsewhere if he doesn't close with you. If he only has a couple left, even in a high supply area, he may still be unwilling to part with them as bargain; in those cases, find a better stocked vendor.

Demand simply refers to how popular an item is. If everywhere in town is sold out, then demand is very high (and supply is low); in these situations, you might find venders unwilling to part with an item for even fair market place, which is considered by some to be price gouging. If an item has a deep layer of dust on it, then demand is obviously low, and the vender may be happy to free up the space at even a loss.

The way you carry yourself and your attitude towards the seller can greatly influence the deal. Remember, he'll be reading you just as closely as you'll be reading him, and if he's an experienced salesman, then he will probably be better at it than you. Here's some tips on how to interact.

Be friendly and polite, but not a pushover

Everyone's probably heard the old expression "you get more flies with honey." That's true in haggling as well. People are more agreeable with others they like or respect. So be friendly and jovial. If you can make him/her laugh, you've already positioned yourself well for a bargain. If you're a jerk, the vendor may walk away from a profitable deal out of spite alone.

Now, this doesn't mean to be overly accommodating. You need to make sure you present yourself as wanting to do right by him, but establish well defined limits. If he thinks you're weak, he'll push harder, so in a friendly way, you need to be firm and control the negotiations. When it's all said and done, if the vender thinks you're a good person trying to respect his interests and not someone easily persuaded from his/her price, you're apt to get a bargain.

Create rapport

Part of this is establishing rapport with a seller. Laughter is a miracle worker when creating rapport, but so is common ground. If you can find a common interest and get him talking about it, then you're establishing rapport. A lot of people find this difficult, but the clues will be all around you. Check out his t-shirt, shoes, hair, pictures on the wall, and curious displays. Try to listen in on previous conversations or find a common theme in his shop. Observation can give you immense insight on his interests, and thus potentially common ground, even if only believably contrived.

Mirroring is another aspect of rapport. This is a type of body language where you mirror his posture. You don't want it to be obvious your mirroring him, but if you can subtly pull it off, it'll build a type of subconscious rapport.

Observe the seller's body language

I'd recommend reading as many books about body language as you can find because it's helpful in everything you do. It's like being able to read a person's mind. If you can tell he's upset by an offer, you can give in a little and try to appease him. Maybe you detect he's overly motivated to sell; then, you can probably go very low on your initial offer.

The two prior steps were setting the stage, now it's time for the full performance. This is when you start to haggle and find an agreeable price. Here's how to begin.

Let the seller quote first

There's a saying in negotiating that says "whoever makes the first offer, loses." Up until the first price is thrown on the table, you don't truly have an understanding of his expectations, nor the point from which you need to work. If he asks you to make an offer, but doesn't offer a starting point, just reply, "Well, what are you hoping to get for it?" If he persists, you can add, "You're the seller...I'm sure you had a general price in mind when you decided to sell. I really haven't had a chance to think about it..." If he still persists, you offer a ridiculously low price with a laugh, saying that's your offer. In most cases, he'll then give in and offer his price.

Counter-offer lower than your stop point

So what if his initial offer is a good one? In most cases, you should still haggle it down. Sellers do not like when a first offer is accepted because it generally means the item could have been bought for less or sold for more. People in areas where haggling is acceptable do not expect their first price to be accepted. In some countries, it's an insult if it is.

Offer additional incentives

If the price isn't moving much, then there's still a few things you can do. If you want multiple items or higher quantities of the same item, then offer a group price. The reason this works is the profit is amplified. If a vendor is only making $5 on an item, he'd be making $25 on five of them, so your offer is obviously more appealing.

Be prepared to walk away

As long as you stand there haggling, the seller has no immediate need to settle. If fact, the longer you do haggle, the more he'll assume you want the item, and the more resistant he'll become. So say, "Thank you for your time. I'm sorry we couldn't work something out" and walk out. Nine times out of ten, he'll give you a lower offer. Keep walking and he may give you a lower offer yet. If it doesn't work, you can always come back if you truly want the item.http://www.wisebread.com/how-haggling-taught-me-about-life

Throwing darts

This is a technique to use when you have no idea what a fair market value. It's basically a technique of offering ridiculous prices to gauge body language. If the seller offers $20, counter with $3. If the seller gets upset and immediately walks away, the item is not a tremendous bargain. You could offer $15, but you will be conceding more than the seller. If the seller continues to bargain, then a good deal can probably be had for less than $10. Keep throwing small incrementally higher offers, each time gauging body language to figure out when you should stop. If you do this right, you can figure out his actual purchase price and give him just a little profit. If the item has been sitting forever, you might just minimize his loss on it. Either way, you'll get a good deal or nothing at all.