I Negotiated, and Now I Have a Free Private Driver
Recently, I wrote a post emphasizing the importance of negotiating. Maybe I didn’t stress this enough but ALWAYS negotiate. Life is a non-stop negotiation in one form or another. Be aware of this, and keep your eyes open for opportunity. Continue reading to find out how I negotiated my way to a free private driver!
Related: How to Negotiate and Win!
Why Do I Need a Driver?
Why does a blogger need a private driver? Why is a FIRE blogger, of all people, talking about this??? Let me explain.
In the “real” world, I’m a management consultant. I advise the C-level executives of large global companies. This requires me to be at the client’s site 47 or 48 weeks of the year. Every week, I take two flights, stay in a hotel for three days, and take various Uber rides.
I live in the suburbs of Boston. At 5:00 am, it is difficult to find an Uber or Lyft driver in my area and obtaining a ride is far more difficult than it needs to be. However, I need to show up for my flight on time. If I take a train, I lose out on another hour of sleep. If I drive, I contend with traffic. However, if I use a driver via Uber or Lyft, I get to the airport and get to read, do work, or nap during the trip.
The Opportunity Presents Itself
Marco is a Brazilian immigrant and Uber/Lyft driver. He came to pick me up at my house at 5:00 am several weeks ago. He’s courteous, professional, and polite. He also lives ten minutes away from me.
Marco has a problem. He likes to start his day early so he can spend his evenings with his wife and daughter. Remember how I said that service is spotty and unreliable in my area? He has the same issue, but on the flip side: there’s a lack of steady demand in our area.
I spoke to Marco during our ride to the airport. Maybe it annoys some drivers, but I always try to chat if the situation permits. This is how I found out about his particular case. Marco was very chatty, and we immediately hit it off. He asked if I needed another ride to the airport the following week and a lightbulb went off in my head.
My house keys slipped out of my pocket into Marco’s car. He texted me and promptly returned my keys to my house on his way back home. Marco went out of my way to help me and didn’t rob me blind, so this established a basis of trust.
“Marco, how would you like to have a reliable customer 48 weeks of the year?”
Marco didn’t believe me at first. I explained what I do to him, and he understood.
“Moose, that sounds great!”
Marco also has another problem. Uber takes 35% of his earnings. The 65% that he keeps is taxed. So Marco pockets maybe half of his ride fare.
I told Marco about Square, a software/hardware combo that allows anyone to charge a credit card.
“Marco, set up a Square account. This way, you’ll only be paying a small fee to Square, and you’ll get to keep the rest of the fare. You’ll have to pay taxes on that later, but why use Uber if you don’t need them? Since we’ve got our setup, they shouldn’t get a dime. Uber’s job is to connect us, and here we are already, so forget them.”
Let’s say I take a $100 ride with Uber. Let’s, for the sake of simplicity, say I’m a bunghole and don’t tip Marco at all.
Uber takes $35.
So Marco gets $65, right?
Not really. He has to pay taxes on that $65, so in reality, he gets around $50.
Now, let’s look at my arrangement with Marco.
I pay Marco $100 with my credit card. Square takes 2.75% of all swiped transactions. So they get $2.75.
Marco’s pre-tax cut is $97.25. If Marco is in the 22% tax bracket, he hands over $21.40 to the IRS. This leaves him with $75.85.
This is 49.6% higher than if he uses Uber!
It’s an old trope: look for the win-win scenario where both parties in a negotiation benefit.
This situation is a win-win-win.
I win because I get reliable service from a driver I trust. Marco is always on time, he’s trustworthy and hardworking, and he’s a good dude. I can sleep in longer because I don’t have to take into account the time to try to find a driver in the morning. On the way back home, it takes half as much time to hop into Marco’s car at the airport than it does to wait around for an Uber rider to accept my ride, not cancel it, then swing around the maze-like Logan Airport rider pickup area. I get home to my family sooner.
Marco wins because his earnings increase by approximately 50% versus Uber. My business is worth around $200 per week, or $800 per month. After tax, for 48 weeks per year, Marco makes $7,281.60 from having me as a client in this deal I structured! I don’t make him wait, and I’m not a tough customer. With another baby on the way, this extra earning power is significant to Marco.
My clients win because my deal with Marco has a fixed price. My clients are billed for all my business travel expenses (that’s why it’s free for me). Sometimes, the ride to the airport with Uber is $75. Sometimes, it is over $130. The price swings wildly based on demand. On average, my deal saves my client money.
Focus on Unmet Needs!
I like to think abstractly. When you do this, you sometimes come up with silly ideas. However, you often come up with gold.
One abstract model I think of frequently is that of unmet needs.
My unmet need is evident to me. I need a driver at a specific time twice per week, every week. Your own unmet needs are almost always obvious.
The trick is thinking beyond yourself, and seeing what value you can add to the other parties involved.
Marco works his ass off to get more money. Being a full-time Uber driver is hard work, and it doesn’t pay amazingly well. Uber is a viable side-hustle, but it’s hard to do full-time. Marco needs more money, a predictable income stream, and a customer near his house in the morning.
My client honestly doesn’t care much about how much I spend on my ground transportation as long as it’s within reason. My current client controls more money than the GDP of many small countries. Chances are, they won’t even notice the fact that I’m saving them hundreds of dollars per year. Unnoticed or not, they still benefit. My client needs to minimize their business expenses and maximize profits.
This post is long(ish), but the takeaway is short.
Focus on unmet needs. Always Negotiate.
This is a skill. You aren’t born knowing how to do this. Like a muscle, this skill needs repetitive use under load to grow.
I challenge you to find unmet needs, structure a deal, and win.
What did you come up with?