Thoughts on lowballing?

[Balog]

As some of you know I'm trying to sell a bass on Craig's List. Got a super perfunctory email last night offering me less than 1/3 my asking price. Turned it down ofc, but I was curious so I started a dialog with the guy. Apparently he often gets people to accept his ludicrous offers and buys $200 instruments for $20.

This got me to thinking. We're saving like crazy at the moment, and fitting all the hunting stuff I want/need (binos, rifle, scope, orange clothes, reloading rig etc) in the budget is a bit of a challenge. I've been looking for secondary income streams, and this seems like a possibility.

However, the thought of making all these ridiculous offers is embarassing to me. Sure some people will bite, but it's rather insulting to the rest and very annoying.

So what say you APS? Should I start spamming lowball offers then reselling to supplement my income, or is this a repugnant practice not worth the self-degradation I'd endure?

[Gewehr98]

Buy low, sell high.

Probably as old a business tactic as the oldest profession, IMHO, and perhaps not too much different.

[freedom lover]

Buy low, sell high.

Probably as old a business tactic as the oldest profession, IMHO, and perhaps not too much different.

Huh? Hookers don't buy sex. They get paid for it. 

[Racehorse]

It's worth it if it works.

If they're willing to take your offer, then it's a fair transaction.

[Brad Johnson]

However, the thought of making all these ridiculous offers is embarassing to me. Sure some people will bite, but it's rather insulting to the rest and very annoying.

You're actually more correct than you know.  Low-balling to the point of insulting the seller puts them on the defensive, and gives you instant "idiotic cretin" status in their book. Once that's established, getting something bought at your price (or sometimes even a reasonable price) is far less likely. You're better off deciding on the price you want to pay, offer it, and don't budge. If it's reasonable and within what most people would expect as far as price range for the object in question, you're much more likely to get it bought.

I can list you example after example of people who shot themselves in the foot trying to buy a house by low-balling the seller with some abysmally insulting offer. Those who actually succeeded in buying the house usually ended up paying far more for it than they would have if they'd been reasonable in their first round of negotiations. To a person the sellers all said the same thing, "I would have sold it for X, but that guy was such a jerk I wasn't going to let the house go until I made him pay for being such a dumba**."

I have a perfect example of how to be a successful negotiator. I have some investors who buy two houses a year. In every case they make an offer an then don't budge. Ever. Yes, it's usually slightly under the comp value, but only a few percent. Even though the offer is less than the average for homes in the area, but it's close enough to make the seller nervous about not taking it. Their success rate is almost 100%.

Sure, there are guys out there like the one you mentioned. They will shotgun offers on everything hoping to catch those people that might be in a severe financial bind. They can then flip the item at their leisure. But I haven't met very many who can justify the time involved in terms of actual income. The ones who can sure don't do it $200 at a time, though. Their numbers usually have a few more digits left of the dicimal place.

Brad

[Balog]

I'm not really sure what your point is Brad. If I'm trying to buy something solely so I can immediately resell it for profit offering just barely under market value does nothing for me. I suppose if I was trying to do this with houses that'd make sense, but I'm not. I'm speaking about opening a second revenue stream by buying consumer products very cheaply and reselling. A couple percent would mean $2-3 dollars profit; what's the point? I'm struggling to understand why you'd bring up flipping houses into a totally unrelated discussion.

[Brad Johnson]

My point is if you need it, lowballing is not the way to go. If you want it as a revenue stream then understand that the success rate is very low, especially given the amount of time you'll need to dedicate to the endeavor. Chances are you'd generate more net income by using that time to do handyman work or mow yards.

Brad

[Headless Thompson Gunner]

Sounds like an awful lot of legwork for not a lot of money.  I wouldn't say there's anything wrong or bad about it, but it seems kinda pointless.

[crt360]

Someone brought up a similar discussion recently on another forum I belong to.  I think the general consensus was that, of the sellers who are not dumb or desperate enough to bite, a few don't mind (and might try the same thing), most will ignore you, and the rest will think you're an ahole for wasting their time and/or insulting their intelligence.  Some in the latter category will go out of their way to make known your lowballing reputation.  As others mentioned, it's probably a lot more work than it looks like and you'd be better off spending that time honing or applying one of your more lucrative skills.  I think some people are just addicted to the rush of instant gratification they get when they succeed in buying something for much less than they think it's worth - even if they have no personal desire or need for the item.  For them, the downside is probably easier to overlook.


Although a bit different in that they're not flipping, I've encountered an increasing number of people lowballing for legal services - telling me their previous or other lawyer did free first consultations or handled their whole case for some ridiculously small set fee, like I should feel pressured to compete.  Our fees are already average to below average and we do nothing but the highest quality work.  I regularly do pro bono and low cost work for those who need it, but rarely for those who ask for it - especially when I know that person's income is several times what mine is.  I have no problem suggesting that they go back to their "old" lawyer or hire one of the "others" they talked to.  I'll usually keep a name and brief note about them, just in case they call again later.  Maybe we should add a haggling charge to our fee agreement.  What I've always wondered is, if you can figure out how to lowball an attorney, do you really want him/her representing you? 

[Balog]

My point is if you need it, lowballing is not the way to go. If you want it as a revenue stream then understand that the success rate is very low, especially given the amount of time you'll need to dedicate to the endeavor. Chances are you'd generate more net income by using that time to do handyman work or mow yards.

Brad

Ah, I see. My thought process was that I'm already looking through the CL ads, and it takes me 5-10 seconds to dash off an offer. Which I can do at work. Even with a low success rate it seems like the time investment would be minimal.

[Bigjake]

Balog,

Along similar lines, but with more time involved,  try that at gunshows..

Yeah, you run the risk of looking like an ass, but there are definitely deals to be had right now, what with the crappy blue collar job situation. 

Same deals to be had on vehicles and other toys, if one had the money to throw around..

[Hawkmoon]

My point is if you need it, lowballing is not the way to go. If you want it as a revenue stream then understand that the success rate is very low, especially given the amount of time you'll need to dedicate to the endeavor. Chances are you'd generate more net income by using that time to do handyman work or mow yards.

Brad

I think the point is that he doesn't need it. Anything he can buy ridiculously low, he can turn around and resell quickly by simply NOT accepting lowball offers when he's selling. If the seller won't accept a lowball offer ... move on to the next victim seller. No harm, no foul.

[Tuco]

A fellow I once knew wanted to buy a Ford Ranger pickup bed cap from me.  He lowballed, I refused, he left.
I gave the cap to a friend who had a topless ranger.
A few weeks later, the first guy ran into me at the filling station and asked about the cap. 
The joy of telling him was worth every penny I didn't make.

HOWEVER, when buying stuff, I'll ask. 
Like Brad suggested, I figure out what it's worth to me and offer it. 

In my experience, 10-20% off list on the secondary market is common -
Sometimes on stale (listed for over a month) items, 33% off.
I'm talking tools, furniture, kids toys - Garage Sale junk.

[RaspberrySurprise]

Huh? Hookers don't buy sex. They get paid for it. 

Yeah but either way someones still getting screwed! *Cue rimshot*

I gave the cap to a friend who had a topless ranger.

Now that's just funny right thar.

[red headed stranger]

I'd give it a go for a couple weeks and see what you can make of it.  It may or may not work out for ya.  It sounds like a pretty low risk proposition. 

Back in the early days of eBay I would browse the Music gear and buy items that were misidentified, misspelled, or underpriced and turn them around.  I had clean looking HTML ad templates and I added really good pictures.  Sometimes I made a HUGE profit.  Alas, with the huge userbase on Ebay now, it is much harder to make money like that anymore. 

[jackdanson]

I've had people offer riduculous trades before.  A well used Olympic AR for an unfired, in box, m1a. 

Doesn't hurt to try.  I just say "no thanks".  I'm not really insulted or anything.

I'm much too lazy to try it myself.  I'll offer someone what I consider a "fair" price for something.

[KPT]

I've had a few real lowball offers for things I've advertised on craigslist. I usually don't respond.

Craigslist isn't good for selling larger items really. I had no luck selling a boat and a Cherokee. Nothing but tire kickers and lowballers. Had much better luck going to paid sites to sell larger items.