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By Stephen W. Earnhart, RN, CRNA, MA
CEO, Earnhart & Associates, Austin, TX
Rarely do I ever pay full asking price for any goods or services. This is just a part of how I handle business. Someone might say it is impossible to negotiate the price of everyday items such as food or fuel. But you can! I guarantee that what you are thinking of buying at Whole Foods can be found at a much lower cost at another store or online. The price of gasoline is different at almost every station; you actually are negotiating the price by making an effort to find a station that offers a cheaper option.
Any vendor with which you conduct business, including companies like mine, negotiate the cost of their services. The people who pay full price essentially fund the difference between what you pay and what others negotiate for a lower price. That is business. There is no successful business anywhere that does not understand the concept of paying less for what they offer or purchase.
However, there is one caveat: Before you begin the process of negotiating, you have to be prepared to walk away if you cannot get what you want. Even so, that vendor often will return after a few days when they realize you are serious and must be dealt with and make you another offer. They may not bring you doughnuts, but they will respect you. Remember that vendor representatives have to go to their bosses and explain why they lost you as a client, which never is a good career builder. Saving face is so important in the art of negotiation for many involved. It is important to understand that in some cultures, one must receive something in return for giving something up. If you are a hardcore negotiator who does not care, you run the risk of offending someone with whom you might want or need to have a long-term relationship. Give them something in return.
There are other ways to negotiate, including:
Do not be afraid to dangle a carrot with a vendor for a better price. Let them know that if this item, service, purchase, works out, you might be interested in doing more business with them. Surprisingly, some vendors have given me a better price on things in return for “liking” them on Facebook. This is odd, but it is true more often than you would think.
Avoid putting yourself in a corner when you negotiate (i.e., do not threaten an ultimatum). That irritation can remove any chance of finding common ground with vendors. If that happens, you both lose. Vendors in the healthcare industry talk to each other. You do not want your facility to earn the reputation as “easy” or “accepting any offer.” Also, be careful of the quick “Wow, you are really a great negotiator” tactic and a mediocre decrease in price that comes too easy. It could be that the price was inflated to begin with and you think you are getting a really good deal. In reality, you may be paying the normal price.
Make them sweat or ask them need to secure approval from a higher up. That is when you know you are doing well. Remember that most vendors work on commission. Most commissions are paid at the end of a quarter or the end of the year. Typically, negotiating just before the end of one of those creates more room for flexibility.
Recently, I sat with a group to come up with a situation in which negotiating or finding another path to a better deal did not work. Quite honestly, we could not think of a single good or service that could not be obtained at a different price, location, term, or vendor. Let us know if you have negotiated a better price and how it worked out.
(Earnhart & Associates is a consulting firm specializing in all aspects of outpatient surgery development and management. Earnhart & Associates can be reached at 5114 Balcones Woods Drive, Suite 307-203, Austin, TX 78759. Phone: (512) 297-7575. Fax: (512) 233-2979. Email: firstname.lastname@example.org. Web: www.earnhart.com. Instagram: Earnhart.associates.)
Financial Disclosure: Consulting Editor Mark Mayo, CASC, MS, reports he is a consultant for ASD Management. Nurse Planner Kay Ball, PhD, RN, CNOR, FAAN, reports she is a consultant for Ethicon USA and Mobile Instrument Service and Repair. Editor Jonathan Springston, Editor Jill Drachenberg, Author Melinda Young, Physician Editor Steven A. Gunderson, DO, FACA, DABA, CASC, Author Stephen W. Earnhart, RN, CRNA, MA, Accreditations Manager Amy M. Johnson, MSN, RN, CPN, and Editorial Group Manager Terrey L. Hatcher report no consultant, stockholder, speaker’s bureau, research, or other financial relationships with companies having ties to this field of study.