Showing posts with label price. Show all posts
Showing posts with label price. Show all posts

Sunday, August 24, 2008

Yay! Worst in the class!

Since the end of the month is drawing near, last week I decided that it was time to put my gymstalking plan into action. A year and a half ago, a friend gave me a one-week membership pass to the gym I've zeroed in on, so I went into the branch closest to my home and activated it. A vacant-eyed redhead took the pass and a photocopy of my driver's license and asked me to fill out an information card. (I found out later that she promptly lost all of the paperwork.) She then sent me off to work out right away, which was somewhat surprising: I was expecting a tour and a sales pitch first, but I certainly wasn't going to quarrel about not getting bullied about signing up right away.

I trotted off to the locker room to stow my bag, and the first thing I noticed was how clean the place was. It was a massive, monumental change from the gym I used to go to. I also saw a great many amenities I've never seen at a gym before, including a towel warmer, a mouthwash dispenser, and courtesy razors, shaving cream, hair mousse, hairspray, and deodorant. Outside the locker room, there were two exercise studios, a cycling studio, two rooms of free weights, and a vast array of cardio machines - all functioning and all in good condition.

I had a great hour of exercise and then headed back to the front desk to pick up my week-long membership card. Nothing doing, as it turned out: after I reminded the vacant-eyed redhead that she had taken my information an hour before, she told me that the card wasn't ready yet and I could pick it up on Friday or Saturday. There was a rather large snafu involving the lost paperwork, and I ended up speaking to a membership coordinator on Saturday morning to explain why I was at the front desk without a membership card. She saw that she obviously had a live one and invited me into her office to discuss.

I wasn't ready to enter into negotiation, so I realized I was going to need to take control of the interaction quickly. I told the membership coordinator that I'm previewing several gyms over the course of the week and that if I like what I see at this one, I'll make an appointment with her on Thursday. I added that I do not want to have any kind of a discussion about membership before then, and she backed off quickly. I did get her to confirm the pricing, however, and she also volunteered that there is a promotion for 50% off of the extortionate initiation fee on at the moment, which brings it to around $245.

(I'm aiming for zero, but there was no reason to tell her that just yet. I don't think there will be much benefit in trying to talk down the monthly membership rate. I've read some extensive reviews online and apparently the monthly rate is completely inflexible.)

I continued trying out the gym by taking a yoga class this weekend. I've been a runner for about 27 years, and I rarely stretch. I was easily the worst in the class and probably a source of great amusement for everyone else, but after all the unnatural twisting and stretching was done, I actually felt slightly more limber and that was encouraging. All in all, I like this place.

I'm planning to be ready with a list of questions for the conversation about membership on Thursday, and this is where negotiating down the initiation fee comes into play. Here's what I have so far:

--Please talk me through each of the different membership plans and pricing.

--What is the normal annual membership fee increase and when does it take effect?

--What happens if I join a single club and then later on want to upgrade to all clubs? Can I do that, and if so, at what cost?

--What happens if I join all clubs and later on want to ratchet down to membership at a single club? Can I do that, and if so, at what cost?

--What is your guest policy?

--Are there any additional fees for certain classes? If so, which classes and how much do they cost?

--Do you give any discounts on other chargeable amenities, like spa services, for members?

--Do you have any preferential pricing for [my employer]?

--Can I suspend my membership temporarily for any reason?

--You mentioned that the initiation fee is currently half price. I'm actually looking to waive the initiation fee altogether. What are the available options that would make that possible?

--If I sign up for a two year membership instead of a one year membership, can you waive the initiation fee?

--My friend received a $60 initiation fee offer in June. (I have a copy of it and will bring it when I meet with the membership coordinatory.) If you can't waive the fee, can you match this offer?

--I'm looking at [X] club a couple of blocks away as well. Their initiation fee is [Y] and their monthly rate is [Z]. Can you match their initiation fee?

That's a lot, but I don't plan to be nasty or confrontational about any of it; this is one of those situations where being pleasant but firm will get me much closer towards what I want than being argumentative.

What am I missing?

Feel free to chime in with any own good or bad negotiation experiences of your own, too.


Tuesday, August 5, 2008


I followed up the Great Mortgage Payoff by quitting my disgusting and inconvenient gym a couple of days later. (They didn't even try to keep me, which was surprising.) I'm gymless for the next couple of weeks, and in that time I'm pulling together a strategy for approaching the nice and pricey gym in order to get the most bang for the buck.

It would all be easy if I got to drive the negotiation, but I'm well aware that since the nice gym is in the role of trying to get me to buy something, they're going to hit me hard with the pressure tactics. I wrote about what some of the common pressure tactics used in sales are and how to resist them a while ago, so I'm not going to go back over old ground. Aside from what's covered there, I think there are some things I can do to make the pricing work more to my advantage. Here's what I have lined up so far:

I've read that gyms have monthly sales quotas to meet, so going in at the end of the month when the sales quota period is closing is likely to give me more negotiation leverage. Hopefully, the fact that the economy is so turbulent will actually work to my benefit on this one: gym membership is a discretionary expense that is often among the first to get cut during hard times, so there's a good chance that the gym will not only be under quota but significantly under quota as well.

Play one gym off against another
There's another halfway decent (better than I go to now) but not great gym one block away from the nice one. I have no intention of signing up there instead, but the people at the nice gym don't know that.

Gyms are really tight-lipped about their pricing policies because it gives them an advantage in sales pitches, but from talking to current members and scouring the internet, I've found out the pricing for the regular membership for one person at one club ($137 per month) as well as for access to multiple clubs (a breathtaking $175 per month). The initiation fee is nearly five hundred DOLLARS. From everything I've heard and read, there is zero give on the monthly rate. Instead of trying too hard to influence the monthly rate, I'm aiming for no initiation fee and as short a contract as possible. If I can't get zero initiation fee, I do have a copy of an offer a friend forwarded me for June offering $60 initiation. I don't see why they can't match that.

No is a complete sentence
I mean No as in,

Can I ask why you're leaving your current gym?

Or, to be a little less blunt, I don't care to discuss it. Why give up information that will surely be used to better target the sales pitch?

I feel like I'm about to walk into a cave of lions that couldn't care less about me but would be delighted to eat my wallet. How does my action plan look so far? Any other suggestions for how I can walk out of that cave without losing a load of cash in the process?


Saturday, June 7, 2008

Luxury goods reality check

The Hermes Birkin handbag is supposed to be the it bag of all time. It's sported by celebrities, celebrity wanna-bes, and people who just spend like celebrities. Walking around the streets of New York, it's a relatively common if not everyday sight. If ordinary people like me want to obtain this uber-bag, we would have to invest time and money in dressing up to go to the Hermes store, suck up to salespeople by spending a few thousand dollars on other crap, start building a relationship with said salespeople by taking them out to lunch or bringing in homemade treats, and then maybe - maybe! they'd be willing to give us the chance to drop $8000 or more on a single handbag.


Am I the only person that thinks this is the most impractical, butt-ugly handbag ever?

Today's snark is brought to you by a severe and ongoing viral infection, and I'm going back to bed now. You're welcome.


Sunday, March 9, 2008

Shredder on steroids

Let me preface this by saying that in this age of identity theft, I think everyone should have a home shredder. I shred everything that has my name on it and if you send me something in the mail, then by golly, I'll shred your name too on the grounds that do unto others is all part of the great circle of life.

On Friday night, I spent a wild night as a single woman in New York doing something really fantastic and out there:

I shredded my 2006 non-tax financial documents.

Aside from the normal day-to-day junk mail shredding, I normally keep a year's worth of financial documents on hand, so after tax season I do the scintillating task of shredding the year before last's documents, usually all in one night. I've managed to burn out the motor on a couple of shredders over the past few years, and Friday night my current model (five concurrent pages max, irritatingly small bin) also went to the home office graveyard.

Going through three shredders in less than seven years is a pretty clear stamp of the obvious that the price I'm willing to pay doesn't match the horsepower I need, so I resolved to go to Staples and find a machine that can handle the workload. Saturday was dumping rain, but after running sixteen miles I came home to a six-inch pile of shredding, so I cleaned up and went right back out.

Staples in Manhattan carries shredders only under their own brand these days, and they range from little tykes shaped like a mayonnaise jar that only run three sheets at once to great big monsters that handle thirty sheets or more at a pop.

I think I've graduated to a monster.

The monster shredders were really expensive, so I walked around slowly trying to calculate price differentials by continuous run time and the number of sheets that can go through at one time. I had almost settled on a model that met my price point and most of the functionality I wanted (but with a disagreeably small bin) until I saw It.

It was a behemoth among shredders. Standing only a few inches below my waist, the label on the display model boasted a twenty-four concurrent sheet capacity, twelve minutes of continuous running time, and a thirty-gallon bin. Best of all, it was a clearance model, so all in-house stock was on sale for half price, $69.50.

I corralled a sales dude walking around aimlessly and said That's the one I want, but I don't see it out here. Do you have any left in the storeroom?

Sales dude thought.

Naw, he said. We don't got any more.

So, basically sales dude was telling me that for all intents and purposes, Staples had a bait and switch operation in progress.

Bait and switch chaps my ass.

Well, it shouldn't be out on the sales floor, then, should it? I asked icily.

Sales dude shrugged. I dunno, he said, and strolled away.


I looked at my choices again and still felt dissatisfied. Sales dude #2 came up shortly thereafter.

I understand that you don't have anymore of these, I said. What kind of a discount will you give me if I buy the floor model?

Sales dude #2 said he didn't know, but he went off to find out. When he returned, he told me that there was no discount for floor models, but that the one-year service guarantee was applicable.

Well, what to do? It was either:

a. Stick to my price point and buy a shredder I knew I wouldn't be happy with and would probably kill within a year or two,
b. Go way beyond my price point and buy the monster shredder I knew I really needed, or
c. Buy the floor model of the perfect shredder that was exactly at my price point, save the guarantee document and receipt, and be happy if it lasts longer than any of my prior models.

I opted for c. To my great pleasure, an additional $8.00 fell off the price when the cash register recognized that I was buying the last model in stock and correctly flagged it as a floor model. To my slight irritation, there was no box available (Box? the clerk asked vaguely when I requested one. I dunno. I guess we don't got one), so I faced up to the prospect of wrangling a monster shredder with plastic bags taped all over it through the New York City subway system in a pounding rainstorm.

I actually thought I would be able to do this.

I got as far as outside and then immediately gave up and splurged on a cab ride, which serendipitously cost exactly $8.00 including a generous tip.

I'm happy to say that the shredder is an animal. It fits exactly under my desk (but wheels out for accessibility), and it accepts not only 24 sheets of paper at a shot, but DVD's and credit cards as well. I got through the remaining six inches of documents in less than five minutes, and a thirty-gallon bin means that I won't be emptying it all that frequently.

Floor models aren't always much of a bargain, but in this case I think I got maximum bang for the buck.

Got anything you need shredded?


Saturday, October 6, 2007

The costs of telecommuting

I've never been an early adopter of technology because it usually ends up costing me money. The first time I got a cell phone was in 2006, when I changed jobs within my company and the new bossman told me that I was expected to use a Blackberry. The year before, as the accessibility and availability of broadband grew and the expected price drop kicked in, I finally decided to stop ganking my neighbor's unsecured wireless connection (yes, I know, this is a horrible thing to do) and get DSL at home.

I had a secondary reason for getting DSL when I did. The network-based applications I need to use at work are growing ever larger and more sophisticated, and that means greatly increased download speed. Although I had and still have access to an 800 number that connects to a modem bank in New Jersey, the fastest connection I can get using that route is 50.6 kbps. By early 2005, that speed was severely impacting my ability to work at home one day a week, so my choices were pretty obvious: give up my flexible work arrangement and be in the office five days a week, or bite the bullet and upgrade my technology to an appropriate level.

Well, what would you do?

It was an easy choice, made easier by the fact that I often work on the weekends. Having to deal with 50.6 kbps connectivity on the weekend was making me insane: I'd rather spend less time waiting for data and more time off doing all the fun stuff after finishing my work in less time. My FWA is reversible; if either my management's not satisfied with my job performance or the arrangement is no longer working for me, either party can terminate it at any time.

Telecommuting has some pretty terrific benefits, but it also also carries some costs that aren't always immediately obvious. Is working at home cheaper or more expensive than working at work?

Here's how it affects my bottom line:

How working at home saves me money
1. Commuting costs
The interstate jitney costs $109 for a monthly pass, or $6/day if I buy individual tickets. If I work five days a week in the office for an average twenty-two days a month, the monthy pass works out to costing $4.95 per workday. In that case, commuting is a heck of a lot cheaper with a monthy pass. If I work four days a week in the office for an average of eighteen days a month, the monthly pass works out to $6.05 a day. As a result, it's cheaper to buy individual tickets. This works out to $1 per month in realized savings.

(New Yorkers: I'm not counting the Metrocard here. I use the subway so much that I'd buy the monthly pass regardless of the number of days I'm in the office.)

2. Clothing
It's all sweats, all the time around here when I'm working at home. This means one less shirt to wash and iron every week. That's probably about a nickel in realized savings.

3. Technology
I'd probably have high-speed internet and a nationwide phone plan whether I telecommuted or not. My employer recognizes this as well, so I'm limited to charging only 25% of monthly phone and DSL costs against company expenses. That 25% works out to $18.67 more in my pocket.

Sounds like a pretty good deal so far, right? Let's take a look at the costs.

How working at home costs me money
1. Electricity
I mentioned in my last post that my electric bill has skyrocketed in the past year because of increased rates. This increase is compounded by the fact that when I'm working at home, I'm burning a huge amount of electricity relative to what my utilization would be if I went to the office. I have nine high-hat ceiling lights in the kitchen and living room, plus two globe lights near the front door. The natural light in my apartment isn't great, so when I'm working at home, all of those are on. In addition, my laptop is plugged in. If it's summer and it's really, really hot, the air conditioner will be on intermittently. Finally, there's a whole host of energy-sucking small appliances that I use when I'm at home: the radio, the coffeepot, and the microwave, to name just a few. I'd guesstimate that working at home adds about $20 to my electricity bill every month. I try to mitigate the effect as much as possible (such as by fully charging my Blackberry at work during the workday so I don't have to do it at home), but there are certain things (like giving up coffee) that I just can't or really, really don't want to do.

2. Coffee
I drink coffee. I drink a LOT of coffee. Ten cups is standard, sometimes twelve if I haven't slept well. I make it at home and schlep it from Costco on the West Coast every six months or so, and that's a lot cheaper than Starbucks. Still, it's an expense. Coffee is free at work, so I've trained myself not to drink it until I get there on the days I go to the office. When I'm working at home, I drink home-brewed coffee most of the day. It probably works out to about $1 a month that I wouldn't otherwise spend.

The rest is pretty much a wash; I bring lunch to work, so I don't think there's any tangible cost differential there. I do my own ironing and work is a business-casual environment anyway, so there aren't any dry-cleaning costs to consider. As a result, here's how the numbers fall out:

Savings from telecommuting: $19.72

Costs of telecommuting: $21.00

There you have it: telecommuting costs me money.

In that case, why continue to do it?

Easy. The intangibles. I get an extra hour of sleep on my work-at-home day. Since I usually get less than six hours of sleep a night during the week, this means a great deal. I hate ironing; spending five minutes less doing it because of one less work shirt is meaningful to me. As far as work goes, I'm more productive because I don't have people interrupting me all day long. In addition, my stress level is far lower than it would be in the office or trying to get to or from the office. Although I work at home on average an extra two hours beyond what I would do in the office, having a thirty second commute instead of a two to two and a half hour commute is something I enjoy and appreciate tremendously.

All of that is worth the extra $1.28 a month that telecommuting costs me. Truthfully, I'd be willing to pay a whole lot more.

You can bet on one thing, though: I'd never tell the bossman that.


Wednesday, April 4, 2007

cheaper isn't always better

One common misconception many people have about frugal living is that it emphasizes cost as the single most important determining factor in selecting a product or service.

Well, that's not always true. Every time you choose between a variety of products or services, you're making a trade-off between price and a variety of perceived outcomes. These outcomes can be categorized as personal effects, which represent how the individual relates to the product or service, and interpersonal effects, which reflect how the buyer perceives the product or service will affect his or her relationship with others. The personal effects are identified as:

  • perceived quality (how good the product is)

  • perceived emotional value (the pleasure or happiness derived from it)

Interpersonal effects are:

  • perceived conspicuous value (others will be impressed by it)

  • perceived unique value or snob appeal (it's a prestigious product and only a select few will get to have it)

  • perceived social value (yay! Everyone has one, so I need one too!).

More than one of these conditions can be present in any purchase. Put them together with varying levels of price sensitivity, and the balance between these factors becomes a fascinating insight into human behavior.

Of course, sometimes imbalance leads to bad decision-making. This is the case with my phone service.

First, a little background: I didn't cave and get a cell phone until last year, and the only reason I did was that the bossman, Mr. Zero Boundaries, made me. Call on Saturday morning? Sure! Phone at 6:00 a.m. during the week? Why not!

My cell phone is paid for by my employer; I would never let anyone irritate me like that for free. I thought about dumping my land line, but cell service in my concrete-bound Manhattan apartment is iffy and my parents have a hard enough time hearing me bellowing down the receiver without adding static into the mix. As a result, I decided to keep my land line.

My land line, as a rule, is an annoyance. While it's nice to be able to call anywhere in the country for a fixed rate, the taxes and fees that go along with a standard land line service are astronomical. I muddled along with it for years, though, until one day I was motivated to change. My DSL provider, Earthstink, sent me notices on a weekly basis advertising their high-quality, high availability VOIP service plus DSL package for significantly less than it costs to get the two services from different providers. In January, I finally took the bait.

How sorry I am.

I have had phone outages every three weeks like clockwork ever since. It normally takes between thirty minutes and three hours to reach a first-level technician, and my call usually has to be passed up the line to levels two and three. This transfer involves more wait time, along with the same damned conversation, over and over: No, I have no dial tone. No, I don't have another phone to plug into the jack; I only have one phone. Yes, I only have one phone. I can't plug my phone into another jack; there's only one. Yes, one jack. Have you ever been in an apartment in Manhattan? I have had between seven and nine phone outages in total since getting Earthstink phone service, and each time it requires a committment of two to six hours to get a resolution or at least a trouble ticket. Trouble tickets often take two days to resolve.

While it's great that I have a cell phone to call in reports about my land line not working, the fact that service is iffy means that I frequently lose connections halfway through. Once I got a callback from a concerned agent, but normally it means lining up in the tech support queue all over again.

When going through this yet again last night (three hours in total plus a callback at 1:45 a.m. to tell me that my phone line was operational), I realized that twenty bucks a month in savings is not worth the rage and spikes in blood pressure I get from dealing with Earthstink tech support. When you trade away an expensive but perfectly good service for a lemon, as I did, what recourse do you have?

1. Do your homework before you change service providers. The Better Business Bureau is an outstanding resource for making an informed decision about what you're getting into.

2. Document, document, document. Each time you have a failure of service, write down who you spoke with, the substance of the conversation, when you spoke, and how long it took. Nothing speaks louder than a written record.

3. Keep your cool. At least one person I spoke to was willing to say anything just because he wanted to get the crazy white lady off the phone. While going medieval on some schmuck whose job it is to answer the phone may make you feel better in the short run, in the long run it's counterproductive: no first point of contact you reach has any significant decision-making power, and yelling at the first point of contact doesn't inspire that person to want to be helpful.

4.Ask to speak to a supervisor. Unfortunately, this didn't really work too well with Earthstink. Each time I asked, I was told that it wasn't possible to speak to a supervisor, but that my complaint would be escalated (my ass it was), or I could send a complaint through the website feedback form. The website feedback form is cathartic in a way, but similar to yelling at the person on the other end of the phone, it doesn't generate a response.

5. The Better Business Bureau can help. The BBB does an excellent job of investigating complaints, and their records are public. Once consumer issues are brought to the BBB's attention, the path to resolution usually gets a lot shorter.

6. Get familiar with other consumer advocacy groups in your area. A quick Google search turned up Consumer Advocacy, Consumer Action, the FTC Consumer Complaint form, and many others. Before contacting a consumer advocacy organization, however, make sure that the organization is a legitimate non-profit, rather than a thinly disguised ad for paid legal services.

7. If all else fails, get a lawyer. I don't agree with how litigious US society is, but if you're truly at the end of your rope or there are genuinely heavy personal damages, sometimes legal help is in order.

I'm not a legal expert, so don't follow this advice blindly: look at your individual circumstances and make your own conclusions about the best course of action. In my case, the BBB now has a long and bitter complaint about Earthstink on their hands. I can hardly wait to see how it plays out.

In the meantime, if you're considering the combined DSL and phone package through Earthstink, make sure you save steps 1 through 7 above; you'll probably need them.

You have been warned.


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