“Calling Mr. Otis”
You say you’ll not likely be called on to negotiate a treaty to restrict Weapons of Mass Destruction, or handle the company’s real-estate or labor contracts? No matter. You’re still going to find yourself in the midst of a negotiation where your ability to get up and walk away is the key to winning.
There’s an ancient scam in the car business known as “Calling Mr. Otis.” The prospect comes in and to his great surprise is given a fabulous offer for his old beater trade-in and an even better deal on his new car purchase. He shops around, finds the deal is unbeatable, and comes back to the dealer with the terrific proposition.
The salesperson writes up the deal. He has the prospect initial it. Then he asks the prospect casually what the other dealers offered him. At this point, the prospect, flushed with victory, tosses away the most valuable asset he has in the negotiation: information—to wit, the other dealers’ prices.
“Just one last step,” says the salesperson. “The sales manager has to okay the deal. I’ll call him right now.” The salesperson punches the intercom device on his phone and says “Calling Mr. Otis… calling Mr. Otis.” Of course, there is no Mr. Otis. There’s a sales manager, all right, but his name is really Smith or Jones or whatever.
Otis is the name of the company that makes elevators—and this elevator is going up. The sales manager shows up. He pulls the salesperson out of the room to let the prospect stew for a while, the salesperson comes back, says Otis won’t go for the deal, and then proceeds to retrade it up to exactly the same level the other dealers had offered the prospect. Why, you might ask, doesn’t the prospect simply walk at this point?
Because he has too much invested emotionally in cutting the deal right there; he’s already picked out his new car. It’s blue with red upholstery and it’s sitting right there on the showroom floor, waiting for him to drive it off. While he’s in the closing room with the salesperson, his wife is sitting behind the wheel and his kids are jumping up and down on the seats. He’s told everybody at work what a shrewd negotiator he is.
If he doesn’t sign his name, he has to pick up and start all over again… the kids will start crying… again; and they’ll snicker at him down at work… again.
So what’s $1,740.50 more on a $30,000 purchase? Just a few more monthly payments. This is America, pal; thanks a lot, have a nice day, and here’s your payment book. He signs because he can’t walk away from that table without a deal. But you can. And when you do, you’ll end up buying your cars for less money than you would if you fell for this classic scam.
Excerpted from Swim With The Sharks Without Being Eaten Alive
Seven-time, New York Times best-selling author of "Swim With The Sharks Without Being Eaten Alive," with two books among the top 15 inspirational business books of all time, according to the New York Times. He is one of America’s most popular and entertaining business speakers, and currently serves as Chairman at the MackayMitchell Envelope Company, one of the nation’s major envelope manufacturers, producing 25 million envelopes a day.
Please log in again. The login page will open in a new tab. After logging in you can close it and return to this page.