Horse trading is a unique talent. As most talents, you are not born with it. It is learned, and the more you do it, the better you get at it. A typical definition of the term horse trading is to bargain or trade shrewd, to be clever at bargaining.
The basic principles are simple enough. If you are selling, you want to tout each benefit of the item to be sold. It helps to do this with excitement and conviction. Never expose the weaknesses of the product. Some traders are able to do this in a casual way to establish their credibility as a person but then state that they have already discounted the price to take care of the minimal defect. The seller must also create time pressure. That’s why auctions generally work so well. You either bid a price on the spot or your opportunity is lost forever, at least that’s the psychological impression of the situation. Another approach is to mention that you have already had an offer or that someone else has looked at the product and is getting back with you to buy it, but you haven’t committed until money is in hand. So, for the seller it’s “this is the greatest, most unique product in the world, and there is a very limited amount of time to snap it up.”
For the buyer, it’s the opposite. The buyer must establish that he/she can live without the product. Even as the seller establishes urgency, the buyer must slow play, that is to show interest but be in no hurry to purchase. True, you may miss the deal but better to miss the deal than get burnt on either price or quality. The buyer must also identify defects in the product, the timing of the sale such as a bad economy or any myriad of ideas as to why this may not be a good time even though you have an interest.
Both seller and buyer must not be inhibited yet be vocal in their position. Horse trading is just what the word infers. The other person’s position should never be taken personally, and the trader should always be firm, polite and mannerly. What I’ve stated here may be rather obvious. What is not obvious is the multitude of nuances that can be utilized in the process. The key is to pursue the basic elements as I have stated them but to mask them in such a way as not to be obvious to your opposing trader.
I have known some of the best horse traders in the world. It was always great fun for me to watch them work. As a young lad, I worked on a ranch down by Robert Lee, Texas, owned by Skinny Adams. “Skinny” was about 6’4”, 375 lbs. He talked real slow and real low. He never got in a hurry. When Skinny died at age 84, he was a multi-millionaire. He owned ranches, oil royalties and lots of cattle. He acquired it all through his horse trading abilities. His formal education did not go past the fourth grade. He always drove large Cadillacs but never traded one in. When it was used up, he just parked it behind the barn and went to town and bought another one, always from the same dealership. When they saw him coming, the manager would just print out his cost invoice from the factory plus his floor plan rebate. Skinny would pay him $600 over. The dealer would hand him the keys, and Skinny would drive off. This went on for almost sixty years, but the trade basis was established in the very first trading ritual. When Skinny died, there were over 50 used-up Cadillacs behind the barn.
Earlier I mentioned to never take your horse trading seriously. The story goes that one time my father took my mother to see New York City. On 5th Avenue, she saw Tiffany’s and had seen the movie “Breakfast at Tiffany’s.” She just had to go in. She quite admired a diamond in the showcase. I’m sure it wasn’t too large. My mother was not a “high maintenance” woman. My father offered half the price that the ticket showed on the diamond. They quietly asked him to leave.
You find all kinds of styles when it comes to horse traders, but trading is a ritual practiced the world over. Yankee traders and Texas cattle and oil men love the ritual and so should you. People who are good at it have been given all manner of nicknames from “Slick Willie” to “rug salesman”. It’s not what you’re called. It’s how well you do. As you are going to the bank with your latest, greatest trade, what you’ve been called makes little difference.
Here’s to good horse trading!
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