On haggling in Indonesia

As a rather analytical mind I was always a hopeless negotiator in various street situations, either when you want a better price or need to persuade someone to do / don’t do something. No wonder that travelling across Indonesia with my family turned out to be a little challenge. In Indonesia (or at least the places I have been to – Bali, Eastern Java, Sulawesi, Eastern Kalimantan) haggling and negotiating price is a must or you will be ripped off. Always. As a tourist (or a walking ATM in local terms) you will be considered rich and therefore any price is affordable for you. You’ll be gone next day anyway and probably never come back to complain.

Whenever you ask for the price, what you get is 4x-5x what you should pay. So either check with someone trusted upfront and then quote your price or haggle. Or just pay what you find appropriate and then argue the price if the other side does not like it.

The problem with most of these situations is not the price though. It is the lack of respect for another human being. I understand that both sides want the best deal. This is fine. I have an issue with the way they try to reach the agreement. The first quote, without even a blink of an eye, is 400-500% of the real price. When you respond with a more realistic figure, most of them are surprised at first. Then they realise that you know. Then attitude changes and the 2nd quote is significantly lower and then we can have a productive discussion about the price. There are however exceptions. Sometimes they try to continue their play. Usually I hear that something is dangerous or not allowed. For me playing on a basic human need of safety and security is above the limit and my initially positive feelings towards the person immediately disappear. At this point I either reduce my quote even further or just walk away. As a walking ATM I probably can afford paying a bit more with the next seller and they know it. They also know that if they do not sell, someone else does. Given the competition in most places they can make one, two deals a day so each one is precious. Each time I walked away, I was being chased. In most cases they agreed to my quote without any further discussion. This may sound not nice but hey, it is them who wanted to rip me off in the first place. Moreover they wanted to push me to pay more by appealing to my need for security in an unknown environment.

I started to put this all together and here it is:
– Both sides want to make a deal but in most of my cases (family on a road trip) there are far more sellers than buyers. Knowing this gives you an advantage.
– You do not have to accept any proposal, no matter how much time you spent discussing it. Walking away is as viable as any other outcome. Always. If I do not like the deal, I walk away. There is always plan B.
– This is only about the price and conditions of the deal. Nothing more. Not about what they will think about you. This is not a beauty contest and after it is over you do not have to love one another (although if the process does not leave a bad taste in your mouth, it is still better than not).
– This is a game in which there is usually a high degree of information asymmetry and not in your favour. Any attempt to negotiate is likely to give a better outcome than not trying at all. Even if you do not get the “fair” price, it will in most cases be better than the starting one. Even if you end up thinking you looked stupid, at least you tried and scored better than if you had not tried at all.

Bunaken<< >>Sukau, welcome to Borneo

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