Would you rather have a fast nickel or a slow dime?
Would you rather have a fast nickel or a slow dime? (Non-US readers: Nickel = $.05. Dime = $.10).
That’s the question a successful real estate investor asks when he decides whether to accept a profitable, below-market offer on a property, or hold out for a higher price. In his opinion, a fast nickel beats a slow dime every time. He takes the profitable below market offer to cash out fast.
Most sales books tell you to hold out for your best price.
I disagree. When I hold out, I generally get the pride of sticking to my price, but don’t win the deal often enough.
When I let the client feel like they’ve negotiated me down a bit, I might not get my best price, but I still make a good margin. And I close quickly. That’s a lot better than losing a deal because I priced it too high.
(Note to the anal retentive reader — your price still needs to be in the ballpark for you, not something that costs you money if accepted).
We are selling the invisible. Our pricing should always have some room for give — especially if you price on the high end, based on value.
So buck common wisdom. Take a fast nickel over a slow dime.
What if your client doesn’t respect you? Well, you still get a client, and if you play it right so that they think they are getting a good deal that won’t be repeated, well then, both of you win.
For me, the fast nickel beats the slow dime any day.