Whether you're looking> for a great price on a new car or a haircut, there is strength in numbers.
Many retailers will lower their rates or prices for larger groups of customers, especially during a recession. Men's Wearhouse (MW),
Businesses worried about slumping sales and continued cutbacks in consumer spending are more amenable to offering group discounts, says Shweta Oza, an assistant professor of marketing at the University of Miami. You're enticing them by bringing them in more business, which they're hurting for in today's economy, she says.
You don't have to shop with nine other people at all times to take advantage of these rates. You can form your own buying group to get deals on the items and services you want, and in some cases, you never have to meet your fellow shoppers. Group discounts have been around for ages, but people are realizing that they don't need to leave organizing them to big affinity groups, like their employer or AARP, says Steven Cohen, a for-hire consultant who helps clients negotiate for better deals. In most cases, all you need are a few friends the magic number is 10, but even a few will do for pricier purchases.
Thanks to the web, even shoppers going it alone can take advantage of group discounts. Try these four sites to exercise your collective shopping power:
Freelancers Union: A free national membership organization for independent contractors, Freelancers Union has the collective buying power to offer its members deals on a wide variety of services and products, including health insurance and office supplies, through partner companies. Members can save 15% on 1-800-Flowers orders and 10% off new T-Mobile (DT)
Groupon.com: An offshoot of collective-action site ThePoint.com (see below), Groupon offers a shot at a daily promotion from a local business in each of 10 major cities, including Dallas, Detroit and San Francisco. A recent deal in New York offered a $25 gift certificate to wine-and-cheese bar Casellula for $10 a 60% discount. The catch: Customers only got the reduced price if at least 29 other people opted in within a 24-hour window (with eight hours remaining, 543 people had signed on). Groupon won't charge your credit card unless that collective buying power is achieved, and you can adjust or cancel your order while the deal is on the table.
ThePoint.com: Browse the site's Group Discounts channel for deal opportunities, or post your own to attract like-minded consumers. A sampling of what's currently available: a Chicago contractor promises a 43% discount on light installation if 20 consumers sign up by the end of July, and a Boston sailboat captain is offering half-price ticket pairs for a two-hour cruise if three people join.
Twangu: Users of social networking site Facebook can download this free application which allows you to set up new group buys, or join an existing group. You stipulate how much you're willing to pay for a given item, including shipping, and after five days the service sends out the bid to vendors who may compete for your group's business. A new listing is collecting consumers who want to buy a Nintendo Wii for $200.
Consumers in large groups with a common goal don't have to go online to find group deals. They can use their collective purchasing power in person at local retailers, many of which may be willing to bargain even if they don't advertise those kinds of deals. Once you have your group, here's how to negotiate:
Ask for a manager. Generally, they have the most leeway to offer discounts and can tell you if there's a group discount policy already in place, Oza says.
Plan ahead. Don't expect to walk into a hair salon with nine others and negotiate a group discount on the spot. Allow a few days to come to the deal, and give the business time to prepare. (For example, that salon might need to find time to handle a party of 10, and a retailer arranging a bulk purchase may need to special-order the products.)
Bring in new customers. Businesses may be more likely to work with you if most members of your group aren't already customers, says Robin Walker, a Chicago-based image consultant who routinely arranges group discounts for her clients. A business doesn't want to give their existing customers a discount, she says. It cannibalizes their client base.
Maintain some perspective. How many people you need will depend on the business you approach and what you're buying, Cohen says. A big-box electronics retailer might not be moved to give five people discounts on iPods, but the store may be more agreeable if the desired item is a washer-dryer combo. On the other hand, a local mom-and-pop electronics shop could be thrilled with five new customers who only want to play their MP3s, he says.
Think beyond cash. Not every group deal amounts to a discount. A restaurant manager might not give you 10% off for bringing in a party, but they may throw in two free trays of appetizers, Oza says.
Detail your group. Retailers know the value of a given client, Walker says. So if your group is likely to make more purchases in the future, letting the seller know can only help you. For example, Walker recently talked a cigar shop into offering her clients an informational seminar and store discount by identifying them as professional men who wanted to make informed buying choices that would impress business associates. The shop knew it had a good reason to keep these people coming back to the store.