CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

The aim of marketing is to meet and satisfy target customers’needs and wants better than

competitors. Successful marketing requires that companies fully connect with their

customers. This calls for adopting a holistic marketing orientation which means

understanding customers and gaining a full turn-around view of both their daily lives and the

changes that occur during their lifetimes so that the right products are marketed to the right

customers in the right way. These consumers have varied influences that affect their buying

decisions and among these are the pricing tactics and strategies of the marketing firm (Kotler

and Armstrong 2007:5).

Brassington and Pettitt (2003:392) defined price as the value that is placed on something.

Usually, the price is measured in money, as a convenient medium of exchange that allows

price to be set quite precisely. This is not necessarily always the case.However, goods and

services may be bartered, or there may be circumstances where monetary exchanges are not

appropriate.

Zeithaml (1998:17) noted that from the buyer’s perspective, price represents the value they

attach to whatever is being exchanged. Up to the point of purchase, the marketer has been

making promises to the potential buyer about what this product is and what it can do for that

customer. The customer is going to weigh up those promises against the price and decide,

whether it is worth paying.

1

There is much competition for consumers’ disposable income. This is reflected in both the

range of different product markets available for them to spend in and the variety of products

competing in any one market. Consumers also have a great deal of discretion over whether

they spend or not. There are very few real necessities and, on many occasions consumers buy

because they want to, rather than because they need to (Achumba 2001:17).

Also, as a result of the fact that consumers are largely buying to please themselves, their

assessments of competing products in most markets is often informal, non-rational or

emotional or even none existent. McCarthy and Perrault (2005:172) stated that psychological

factors can play a much greater role than analytical skills. Even where hard product

information is provided, the consumer does not necessarily make the effort to digest it

properly or retain it. Price too, as has already been pointed out, may be interpreted variously,

depending on the individual customer.

Most consumers are utility maximizers; many of them always look for value-to-cost when

they make buying decisions. In some situations, consumers are extensively involved in

haggling in order to justify economic value for their purchase. Stanton and Sommers

(1985:17) opined that in Business to Business (B2B) markets and major open markets in

consumer buying situations where high-value purchases are involved, haggling usually takes

place. This determines the final price agreed between the parties and the nature of the offer

package that will be provided for that price. Price haggling, according to Lysons (1993:215),

is concerned with communication processes that take place between the two parties to arrive

at a mutually acceptable bargain.

2

Baily (1987:101) stated that price haggling is also known as negotiation. In marketing

parlance, negotiation is usually used. Baily (1987:101) further defined negotiation as any

form of verbal communications in which the participants seek to exploit the relative strengths

of their bargaining positions to achieve explicit or implicit objectives within the overall

purpose of seeking to resolve the identified areas of disagreement.

Many price haggling issues revolve around price and/or cost trade-offs with the rest of the

commercial packages offered. Thus, a buyer may agree to pay a slightly higher price than

he/she had intended, if the seller agrees to deliver more quickly than originally suggested. It

must be noted that price haggling (or negotiation) is not only limited to the purchases of

expensive, highly complex products. Also, in the Nigerian contemporary open markets, the

issue of “hagglling” has become the most fundamental. It is only in selected departmental

stores and large-scale retail outlets that price haggling may seem not to be effective (Kotler

&Armstrong 2010:396).

Basing the discussions on the open markets, price haggling (or negotiation pricing) can never

be overemphasized in this area of marketing. Olakunori (2009:162) asserted that haggling in

Nigeria markets is a fundamental phenomenon that did not start yesterday or today. He

pointed out that this can be traced back to the early 1860s when market structure started

developing in Nigeria.

Olakunori (2009:172) defined haggling as a type of negotiation in which the buyer and seller

of a good or service dispute the price which will be paid, and the exact nature of the

transaction that will take place, and eventually come to an agreement. Haggling or

bargaining is an alternative pricing strategy to fixed prices. Optimally, if it costs the retailer

3

nothing to engage and allow bargaining, the retailer can define the buyer’s willingness to

spend. It allows for capturing more consumer surplus as price discriminationwhich is a

process whereby a seller can charge a higher price to one buyer who is more eager or

desperate.

This research work therefore examines the effects of price haggling as a strategy on consumer

buying decisions in selected traditional markets in Ibadan, Oyo State, Nigeria. It must be

realised that decision making, according to Kotler and Keller (2013:163), consists of how

individuals, groups, and organizations select, buy, use and dispose goods and services, ideas

or experiences to satisfy their needs and wants.

1.2 Statement of Research Problem

One major phenomenon that is a driving force in many Nigerian open markets is haggling.

This has to do with what should be the established product price between sellers and buyers.

Some of our open markets are being despised especially in the large cities mainly because of

haggling problem. Some

Consumers have tended to shift their buying outlet to departmental stores and

supermarketswhere prices most times are fixed. In addition, some traders in selected markets

in Ibadan complained severally on delay in time and purchase decision which frequently

occurs during haggling or negotiation process. This, sometimes to them, may eventually lead

to consumer not finally buying the product or even using reference psychological price.

Many buying decisions are predominantly determined by haggling outcomes. Some

consumers widely articulated that when making purchases in open markets, such as that of

selected traditional markets, the haggling price arrived at sometimes may determine their

4

repeat purchases and selected retail traders in the subsequent purchases. Furthermore, in

recent times, it has not been ascertained whether the issue of price haggling or negotiation is

effective. This is so because many consumers, especially those who are not price sensitive

and purchasing experts, are usually exploited. Haggling could result in permanent

relationship that may even give rise to price waivers, and may result in crises that leads to

boycott of trading outlets and most often these may strengthen or weaken the system. Both

traders or marketers and consumers in these open markets have positioned their interests in

favour of haggling as a way of enriching the system. Both may end up satisfied or

dissatisfied.

In the long-run, their purchases in the open markets are affected negatively and this is

supported by the fact that many consumers usually use unfavourable expressions and

critically criticize the operations of the open market such as in selected traditional markets. It

is in the light of the above problems that the researcher seeks to determine the effects of price

haggling as a strategy for consumer decisions in buying products at selected traditional

markets in Ibadan. Thus, this research will assess the degree of adequacy and continuous use

of price haggling as an instrument of negotiation in traditional markets in Ibadan, in spite of

the likely implications of time wasting, lack of trust and false pricing embedded in the

transactions.

1.3 Objectives of the Study

The broad objective of this study is to evaluate the effects of price haggling as a strategy for

consumer buying at selected traditional markets in Ibadan. In the course of achieving this

broad objective, the following specific objectives are formulated:

1. To assess the effects of price haggling on consumers’ buying decision making.

5

2. To determine the effects of price haggling on consumers’ repeat patronage.

3. To ascertain the effects of price haggling on open market operation.

4. To examine the effects of price haggling on consumer/seller relationship.

1.4 Research Questions

To achieve the above objectives, the following questions are raised for the study:

1. What is the effect of price haggling on consumers’ buying decision making?

2. What is the effect of price haggling on consumers’ repeat patronage?

3. What is the effect of price haggling on open market operations?

4. What is the effect of price haggling on consumer/seller relationship?

1.5 Research Hypotheses

In addition to the research questions, four (4) hypotheses are formulated as follows:

1. Price haggling does not have significant effect on consumers’ buying decision

making.

2. Price haggling does not have significant effect on consumers’ repeat patronage.

3. Price haggling does not affect open market operation.

4. Price haggling has no significant effects on consumer/seller relationship

1.6 Significance of the Study

This study is aimed at contributing to the knowledge in the area of Marketing, Marketing

Planning and Control, and Marketing Management. It would help marketing managers in

decision making, customer relationship management, as well as marketing research and

consumers’ survey.

6

Johnson (1986:16), the anthropologist said “the only way a scientist can start to understand

something is to describe it, to measure it and name it”. Therefore this work attempts to

evaluate the effects of price haggling as a strategy for consumers’ buying decision making,

and this involves examining the practices, relating these to the theoretical norms, and making

inferences from observed differences.

1.7 Scope of the Study

The scope of this study is the effects of price haggling as a strategy for consumers’ buying

decision making in the selected traditional markets in Ibadan. Thespecific markets are Dugbe,

Mokola, Bodija, Alesinloye, and Ojoo, being among the biggest local markets in West Africa.

Ibadan is the biggest city in West Africa (Laolu 2009:16). This study limits its scope to price

haggling.

The work analyses and presents the methodological approaches for utilizing and employing

haggling pricing strategies. The effects of this on the consumers’ buying decision will be

sought. Consumer buying decision making is the major concern of the work and open

markets, which are Dugbe, Mokola, Bodija, Aleshinloye and Ojoo in Ibadan serve as the

coverage areas. This research work is therefore limited to consumer goods and how price

haggling affects the buying decision making.

1.8 Limitations of the Study

The task of getting all necessary information is not very easy. There are limits to the amount

of information as well as the quality of information. These are the problems that the

researcherfaced in the course of gathering and processing necessary data.

7

These problems include the un-cooperative attitudes of the respondents; i.e. market traders

and consumers; the paucity of research literature which are relevant to the topic in Libraries.

These challenges serve as constraints to the researcher in carrying out a more elaborate

research work, thereby affecting the scope and quality of the study.

8

REFERENCES

Achumba, I.C. (2001) Consumer Behaviour. Lagos: Macmillian Publishers Ltd.

Baily, P.J.H. (1987) Purchasing and Supply Management. London: Chapman and Hall.

Brassington, S. and Pettitt, F. (2003) Principles of Marketing. London: Prentice Hall Inc.

Johnson, D. (1986) Roles of Research. Lagos: Lifeline Printing Press.

Kotler, P. and Armstrong, G. (2007) Principles of Marketing. USA: Prentice Hall Inc.

Kotler, P. and Armstrong, G. (2010) Principles of Marketing. USA: Prentice Hall Inc.

Kotler, P. and Keller, K. (2013) Marketing Management. India: Pearson Publisher Ltd.

Laolu, M.I. (2009) “Traditional Markets in Ibadan City.” Journal of Sociological

Development. Vol. 23 (May)

Lysons, C.K. (1993) Purchasing. M&E Handbooks. London: Pitman Publishing.

McCarthy, E.J. and Perrault, M. (2005) Basic Marketing; A Global Managerial Approach.

USA: McGraw-Hill Inc.

Olakunori, S. (2009) Marketing in Nigeria. Ibadan: Spectrum Books Ltd.

Stanton, W. J. and Sommers, M.S. (1985) Fundamentals of Marketing. Canada: McGrawHill

Inc.

Zeithaml, V.A. (1998) ‘Consumer Perceptions of Price, Quality and Value’. London: Journal

of Marketing 52 (July).

9

CHAPTER TWO

REVIEW OF RELATED LITERATURE

2.1 Introduction

This chapter attempts to review the related literature on the effects of price haggling as

strategy for consumer decision making. The following issues are reviewed in this chapter,

the concept of marketing, marketing mix and market budget, price as an element of marketing

variables, meaning of price, price haggling, haggling theories, price haggling strategies, rules

of price haggling, buying decision making and consumer markets.

2.1.1 Operational Definition of Terms

Notable operational terminologies are used in the work. The simple meanings are defined

below:

Buyers – generally, the buyers are the consumers or individuals that purchase product

(goods/services) to satisfy needs and wants.

Consumer Decision – Consumer decision is the behaviour that consumers put up or exhibit

when buying and using product that satisfy their wants and needs.Decision making is the

process of buying, using and consuming products that satisfy needs and wants.

Consumer Products – Consumer products are those goods/services that are purchased for

personal consumption and not for resale or reproduction. They are want satisfying offer.

CRM – This means Customer Relationship Management. It entails all functions and tasks

performed in order to retain consumers for future business transactions.

Price Haggling – It is any type of price negotiation or a verbal contest for agreeable and

payable price for a product between the price offered by the seller and the price acceptable to

be paid by the buyer.

10

Traditional Market – This is a city square where traders set up stalls and buyers browse the

merchandise. Contextually it is a collection of stalls and/or lock-up shops that are provided

where various goods are sold at bargain able prices, with the local language being popularly

used as the medium of transaction.

2.2 Conceptual Framework

2.2.1 The Price as an Element of Marketing Variables

Adeoti (2004:344) argued considerably that price is not just a thing on a tag. Prices go by

many names. Price is all around us. We pay rent for our apartment, tuition for the education,

and a fee to the physician or dentist. The airline, railway, taxi and bus companies charge

fares; the local utilities call their price a rate; and the local bank charges interest for the

money that is borrowed. The price for driving a car from one place to another is a toll, and

the company that insures a car charges a premium. The guest lecturer charges an honorarium

to tell a story about a government official who took a bribe to help a shady character who

stole dues collected by a trade association. Clubs and societies to which a person belongs

may make a special assessment to pay unusual expenses. The “price” for an executive is a

salary, the price of a sales person may be a commission, and the price of a worker is a wage.

Finally, although economists would disagree, many of us feel that income taxes are the price

we pay for the privilege of making money. If all these are prices, what then is the meaning of

price?

Price is one of the major elements of the marketing mix. Brassington and Pettit (2003:87)

stated that price is the one element of the marketing mix that produces revenue; the other

elements produce costs. Prices are perhaps the easiest element of the marketing programmed

to adjust (Kotler and Keller 2013:516). Product features, channels and even communications

11

take more time. Price also communicates to the market the company’s intended value

positioning of its product or brand.

2.2.2 Meaning and Definition of Price

Kotler and Amstrong (2011:396) stated that in the narrowest sense, price is the amount of

money charged for a product or service, but more broadly, they see price as the sum of all the

values that consumers exchange for the benefits of having or using the product or services.

Historically, price has been the factor affecting buyer choice. This is still true in poorer

nations, among poorer groups and with commodity products.

Baker (1985:124-142) argued that price is the value that is placed on something. Usually, it

is measured in money, as a convenient medium of exchange that allows prices to be set quite

precisely. This is not necessarily always the case, however. Goods and services may be

battered, or there may be circumstances where monetary exchange is not appropriate.

Agbonifoh et al, (1998:312) opined that the price we paid for a product is not the monetary

worth of the physical products or service done. The price covers the volume of the physical

product or service plus the value of the accompanying services such as installation, branding,

packaging, servicing, guarantee, delivery, after sales services etc. In fact, price is taken by

consumers to be a combination of some or all of these. Price therefore is something of value

exchanged for satisfaction or utility. Farayola and Adeyanju (2008:84) defined price as the

amount of money needed to acquire a given quantity of goods or services. It is the money or

consideration exchanged for the ownership or use of a good or service.

12

The importance of price cannot be over-emphasized as it offers many benefits to an

organization as well as consumers. Zeithaml (2004:211) identified the benefits that price

offers to the seller/organization.

To the seller, price is important in so many related ways (Zeithaml, 2004:211-225):

(i) The price of a product determines along with others, the quantity that can be

sold in a given period.

(ii) Price has an impact on the profit or loss margin of the seller. Profit is simply

the positive amount by which price per unit exceeds cost per unit.

(iii) Price has some impacts on the seller’s overall public image.

To the consumers, product prices are also important elements. Adeoti (2004:278-279)

discussed the roles of prices to buyers and consumers:

(i) The higher the price of commodities, the lower the quantities which the buyer

can afford. Thus, the standard of living of a buyer or consumer is closely tied

to the reigning prices of goods and service, for instance, the increase in

petroleum product has adversely affected the living standard of many

Nigerians.

(ii) The price of a commodity may confer some prestige or feeling of importance

or superiority on the buyer or consumer of the product. Some goods become a

status symbol since their use, ownership or consumption tells some things

about the social – economic status of the owner.

From the above viewpoints, McCarthy and Perrault (2005:341 – 346) stated that it is a vital

thing for every marketer to give pricing an adequate attention. This attention is particularly

needed when:

13

(a) New products are being priced

(b) The company seeks to charge its price whether in reaction to other company’s

actions or on its own initiative.

(c) Middlemen or consumers are dissatisfied with the current price.

(d) The government, for whatever reason, intervenes or seeks to intervene in the

market by fixing or regulating price e.g. petroleum products.

(e) Suppliers of the company’s input change their prices.

2.2.3 Price Haggling

Lysons (1993:215) stated that price haggling is sometimes known as bargaining. Lysons

further defined it as “any form of verbal communication in which the participants seek to

exploit the relative strengths of their bargaining positions to achieve explicit or implicit

objectives within the overall purpose of seeking to resolve the identical areas of

disagreement.” Many haggling/negotiation issues revolve around price and/or cost trade-offs

with the rest of the commercial package offered. Thus a buyer may agree to pay a slightly

higher price than it had intended if the sellers agree to deliver more quickly than originally

suggested.

Baily (2007:111) identified four main situations in which price haggling/ negotiation may be

used:

(i) An established supplier wants to increase the price or to change the offer

package.

(ii) The buyer wants an established supplier to reduce the price or to change the

offer package.

(iii) A potential supplier wants to oust the existing supplier.

14

(iv) There is no regular supplier and it is a new task purchase.

Coles (1998:42) defined bargaining or haggling as a type of negotiation in which the buyer

and seller of a good or service dispute the price which will be paid and the exact nature of the

transaction that will take place, and eventually come to an agreement. Bargaining is an

alternative pricing strategy to fixed prices. Optimally, if it costs the retailer nothing to

engage and allow bargaining, he can define the buyer’s willingness to spend. Harris

(1998:44) argued that price haggling allows for capturing more consumer surplus as it allows

price discrimination, a process whereby the seller can charge a higher price to any buyer who

is more eager (by being richer or more desperate). Haggling has largely disappeared in parts

of the world where the cost to haggle exceeds the gains to retailers for most expensive goods.

(Wood: 2008:146).

Pent (2006:127) stated that haggling is the process of bargaining between the buyer and the

seller until a mutually agreed price can be settled upon. Many people are uneasy about

initiating a haggle, feeling that it insults the seller and should be something reserved for

bazzars and market places. However, there is no reason that in many everyday buying

scenarios, you cannot negotiate price to your advantage, thereby saving money.

Lysons (1993:233) postulated that the concept of haggling is based on the idea that you, a

buyer, come out of a purchase having paid a fair price for a product. It neither involves

cheating the seller nor you being cheated. It is worthwhile remembering that the aim of a

haggle is always to settle on a fair price; it is not about trying to trick the seller into knocking

an unreasonable amount of money off the asking price. It must be noted that the seller must

make a profit.

15

Having said this, Baily (2007:46) believes that many sellers will intentionally price their

products higher in anticipation of that price being haggled down by customers particularly in

private sale or second hand goods shops. So there is often elbow room for you to pay less

money than is being asked while still allowing the seller to make profits. Brassington and

Pettitt (2003:457) stated that there are many potential areas of the offer that might have to be

haggled or negotiated.

Quality Packaging Product Requirement Specification

Price Quality

Terms of payment Future contract options

Discounts Cancellation compensation

The Contract

Transport Charges Remedies for major or minor default

Trade-in allowances Guarantee and Warranties

Cost of Samples Exclusivity Delivery Details Development Inspection

Support in Production arrangements

Figure 2.1: Haggling/Negotiation Variables

Source: Bransington, S. and Pettitt, F. (2003) Principles of Marketing. London:Prentice

Hall, Inc. page 457.

The key skill in effective negotiation is the ability to negotiate elements of the package in

term of a trade-off. Figure 2.1 highlights typical arrears of concerns. Of course, this will vary

from situation to situation. Thus, the trade-in allowance may be increased if the payment is

16

made in total up front, or a discount may be increased if the customer collects the item at his

own expense. Not all elements of haggling or negotiation will involve price, but virtually all

of them will involve cost.

Coles (1998:42) explained that haggling is another word for bargaining where the people

involved negotiate over the price to be paid for product or service and the nature of

transaction and intimately reach an agreement. People often haggle before making a deal, be

it common items or consumer products which are more expensive products. Haggling no

longer exist in a place where the cost to bargain is much higher than the profit gained by the

retailer for common goods.However, haggling has advantages to the retailers while selling

expensive goods to uninformed buyers. Haggling for small items may take a few minutes

while those involving bigger and more expensive goods may take a longer time. During the

haggling process, the shopkeeper may indulge the customer with refreshments and

informative talk, extolling the features of service or product.

Makaleley (2001:17) added that haggling is an alternative pricing to fixed prices. By

following the process of price discrimination, the seller can sell his goods at a higher price to

the buyer who can afford it. Haggling may be a common feature in some places of the

worldwhile it may be unheard of in certain regions. Visitors who have no experiences of

haggling may have a tough time shopping in a region where haggling is a common practice.

Lysons (1993:47) stated that it is necessary to haggle in some markets as the sellers usually

quote a much higher price expecting the customer to indulge in haggling. Hence as a

customer, it is necessary to have a basic understanding on the value of an item and set a

reasonable standard so as to avoid getting cheated. Many government shops have fixed prices

17

which could give the customers some ideas on the price of item. Consequently, if the other

retailer has quoted a very high price, the customer can express astonishment that would force

the retailer to quote a more acceptable price. Coles (1998:45-46) described the dimension on

how haggling works. He stated that during the transaction process, the retailer may quote a

price for the item picked up by the customer who reacts with shock to hear the highly quoted

price. The customer demands a much lower price which is however not acceptable to the

seller. So this starts the bidding and haggling with the retailer justifying the cost of the item

by stressing on its unique features while the customer quotes the price on the basis of

previous buys by the other known people. Ultimately, the consumer buys the product after

reaching an agreeable price to both the parties.

2.2.4 History and Development Structure of Price Haggling Activities

The works of Winberley, citing Graeber (1995: 143) gave a description of trade in line with

price system and usage. Winberley (2013: 48) explained that some people quite enjoy

haggling, some do not, but it is always tiring and time-consuming. Economists have long

been fascinated by the process of market negotiation. They even have seen it as a paradigm

for human interaction. Smith (1946:12) defended self-interested arm’s length trade as a more

solid economic base for society than unreliable benevolence.

Walras (1976:16) upped the stakes with his powerful idea of a general equilibrium. But to

construct it he needed to spin a fairy tale of an autarkic village market, to which peasants

bring their produce and discuss prices until everybody is in subjective equilibrium, when

thebell strikes and all the contracts are consummated. It’s too bad that no such market has

ever been seen. And that counts as realistic by the standard of later general equilibrium

18

models, with perfect information and zero transactions costs across the whole industrial

economies.

Across the globe, the style or pattern of haggling is not much different. Pent (2006: 46)

argues that the method for negotiating on price tends to be similar with buyers looking for the

cheapest price whatsoever and the sellers wanting profit. Often, Makaleley (2001:46) stated

that the language tone tends to be official or unofficial depending on the market structures,

literacy level of both the buyers and sellers as well as what the market conditions dictate.

In many parts of the world, the haggles thrive in poorer countries and have less room to

manoeuvre in richer ones. The issues of haggling are still very popular as it operates in all the

systems of Nigeria Market Structures (Adekeye 2008:146). This is particularly witnessed in

the very high price setting for goods/services, based on the premise that the consumer/buyer

will always want to haggle, even when he/she is told the cost price of the product. This

accounts for the situation where a product’s ‘asking price’ that is N1, 500 can be actually

bought for N600. Price setting that encourages haggling. This is enshrine in the culture of the

people as they belief that their next neighbour will always want to take undue advantage of

them, and the culture of suspicion and mistrust results in haggling, which then causes the

sellers to set high prices for commodities, in anticipation of price haggling.

Lindsay (2012:1-9) gave some very general rules around the world about haggling situations.

a. Western Europe, Australia, New Zealand: Haggling cultures are

similarin the US and Canada, with the exception of large immigrant

populationswho may operate outside of them, enthusiastically haggling in

their neighborhoods or in stalls or markets they run and are frequent.

19

b. Central and South America: Stores that use price tags may not practice

haggling, but in markets and at souvenir shops one is free to bargain

away.

c. The Middle East: This is the Haggling Centre of the world! Even in

countries dripping with oil wealth, the foreigner attempting a purchase in

a store or shop should be wary of being overcharged and also be ready to

bargain.

d. Asia and Africa: Haggling is traditional and still expected. Although the

old patterns are being whittled away, they seek local guidance. Typically a

street or market seller will offer a first price that is unreasonably high. A

notable exception is Japan, where people ask for a lower price.

The main discussion by Lindsay (2012) shows the trend of price haggling around the world

with a main fact signifying that it is not only in Nigeria and Africa, but in almost all parts of

the world across different cultures.

2.2.5 Price Haggling Strategies; The Tactics of Where, When and How to Haggle?

Makaleley (2001:42) postulated that several strategies can be utilized when making effective

and efficient haggling decisions. He discussed themunder three (3) separate headings:

(i) Where to haggle?

(ii) When to haggle?

(iii) How to haggle?

20

2.2.5.1 Where can Consumers Haggle?

Pent (2006:133) stated that consumers can’t negotiate price everywhere. Some prices stay

fixed as advertised and that’s that. Some sellers won’t move on price, even under the

solicitations of the smoothest tongued haggler. However, there are plenty of places

consumers can put haggling tactics to good use. Here are Pent’s (2006: 133-134) opinions.

(a) Jumble sales or any sales of used goods are prime haggling territory. The seller will

be looking to get rid of items they don’t want, and so will be willing to drop down in

price in order to make a sale.

(b) If consumers are buying anything from a private seller, a certain amount of haggling

is usually expected, especially on items where the sellers state ‘ONO’ (Or Nearest

Offer)

(c) Car dealerships are another good example of a buyer-seller exchange where the price

is expected to be subject to negotiation.

(d) Damaged-goods in stores or retail outlets can have a great amount of opportunity to

haggle.

(e) Products of high value are more likely to be discounted by the seller than low-value

items, where there isn’t much point in haggling in the first place.

(f) The independent retailers are perfect places to haggle because the owners have

ultimate discretion over the price of their goods.

Cole (1998:74) claimed that consumers should bear in mind that sometimes it is entirely

inappropriate to haggle over a price. In Nigerian open market, however, consumers can

haggle everywhere except department stores, supermarkets, petrol stations and a few other

places.

21

2.2.5.2 When should Consumers Haggle?

Makaleley (2001:43) went on further to support Pent’s (2006:133) opinions by stating the

conditions necessary for consumers to haggle. Here are some of them.

(a) If a consumer is intending to haggle in a shop, it is best to try his/her luck when the

premises are quiet. Never haggle when there is a queue, as the seller as well as the

other waiting customers will quickly lose patience with the consumers.

(b) The appropriate time to haggle is towards the end of a sale, where items have already

been discounted. Items that have already been slashed in price are more likely to be

discounted further especially at the end of a sale, where the seller wants to get rid of

as much surplus merchandise as possible.

(c) If the consumer is coming to the end of a phone or internet contract, it is worth

reviewing what he or she is paying when compared to other providers. If the

consumers feel that there is an uncompetitive rate, he/she can either switch providers

or haggle with the current one.

(d) Another good time to haggle is when a product is nearing the end of its shelf-life or

becoming obsolete. For example a seller is more likely to lower the price on outdated

mobile phones to make for new models.

However, in contemporary open markets in Nigeria, consumers can haggle at any time of the

day in the market overt. (Onah and Okoli 2014:47)

2.2.5.3 How can Consumers Haggle?

When a consumer has decided to enter into a haggle, he/she needs to remember that there can

only be two outcomes, either the consumer outright refuses any money off, or he/she comes

away with a discount. Either of the ways, the consumer has nothing to lose in trying his/her

luck. Pent (2006:136) noted that the first thing the consumer needs to do before entering into

22

discussion with the seller is to do his/her research by checking the price of his/her desired

product elsewhere. The consumer can compare prices online, or hurt down the best deals on

the high street.

This will arm the consumer with the knowledge to make an informed offer when it comes to

haggling, and also enable the consumers to tell the seller how much cheaper he/she could buy

the same item elsewhere. Often, simply telling the seller that the consumer has come across

the item at a lower price will encourage the seller to knock the price down, in order to try and

secure the business.

Before a consumer starts to haggle, it is also necessary to have a set price in mind that he/she

will not exceed, whatever happens. If the consumer finds that the seller can’t push the price

any lower than this, he/she should simply walk away from the haggle. The consumer never

has an obligation to buy until the price has been agreed upon.

2.2.6 Rules of Price Haggling: the Do’s and Don’ts of Haggling

In order to be effective in the contemporary price haggling situations, researchers have

formulated certain rules and guidelines that can guarantee efficient haggling decisions. Coles

(1998:17-34) and Harris (1998:16-18) pointed out the following do’s and don’ts.

Coles (1998:17-34), while developing the work earlier made available by Harris (1998:16-

18), listed the following rules:

(i) Keep yourself cool. If you lose your temper, a haggle can quickly become an

argument.

(ii) Be friendly and build rapport with the seller.

23

(iii) Be honest and straight-forward in your haggling approach.

(iv) Don’t use the argument that you can’t afford the item. If you couldn’t afford it, you

wouldn’t be trying to buy it.

(v) Don’t argue over pennies (money)

(vi) Don’t demand a discount – sellers never have an obligation to lower prices;

however,sometimes you might find them lowering prices.

In Nigerian open markets, however, the parties in haggling process engage several strategies

and tactics such as concessions where the parties shift grounds to agree on a mutual price for

the product. Also a party may come up with a counter offer instead of saying yes or no to the

first offer. Sometimes a party that has a stronger position or advantage in the negotiation

process may engage bluffs strategy to win the other party. In some instances a party may turn

down an offer and request for another because he is not willing to give more than necessary.

(Onah and Okoli 2014: 46)

2.2.7 Merits and Demerits of Price Haggling.

Moncrieff (2010:1) posits that haggling, or the process of steady negotiation towards a price

that is acceptable to both parties but (almost always) lower (and never higher) than the

original asking price, is actually an elegant if somewhat time consuming process that

improves economy efficiency. Put simply, everyone is better off where haggling is possible.

Unfortunately, it is generally not considered acceptable in developed countries to haggle with

shop keepers for a particular item. Partly this is because, often, the person dealing with

customers would not know the value of the item and therefore would likely make a loss for

the store, or partly because it would be time consuming to haggle over an entire day in a large

supermarket, and partly because culturally it just isn’t the one thing. The buyer should either

want the item at the asking price or he/she goes somewhere else.

24

Moncrieff (2010: 2) added that haggling benefits everyone in the transaction. The key idea in

haggling is that every consumer has different preferences, meaning that some are willing to

pay more for this items and some less. In an economy where the price is fixed, those that are

happy with this price will pay it and go away with the goods. Those that place a higher value

on the goods will gain more satisfaction than those that are not willing to buy, and those that

are not willing to buy lose out completely. Crucially, the shop keeper also losses out on these

sales if the price he sets is only just high enough to cover his costs. So haggling would not be

in his interest. But in most cases, the shop keeper and trader could afford to cut his price at

least slightly. This is where haggling comes in. The trader knows that some of his customers

are willing to pay more and some less. If all he can observe is whether they buy at the set

price, then he cannot extract more money from the customer who is willing to pay more. But

if he can haggle (and especially, if he is good at it) then he can learn a good deal through the

negotiating process about how willing his customer is to pay more or less.

But it cuts both ways. Mint (2004:17) added that the customer is learning about the market

trader too. If the customer pushes too hard i.e. by demanding a price that is too low for the

seller to cover his costs then the seller rejects the offer and the customer must either choose to

go away empty handed or raise his offer. In any case, the walk-out is the crucial point in the

negotiation; this is the last calling of your opponent’s bluff, and the customer has to be

willing to gamble the loss of the item against the chance that the market trader will relent and

lower his price.

Makaleley (2001:16) stated that haggling is beneficial to both sellers and buyers. Of course,

in some cases one or even both of the parties will do worse than in the fixed price would

because of imperfection in the negotiation process. However, in general where there is an

25

ability to haggle, the benefits for the parties will be greater. According to Onah and Okoli

(2014: 15), quarrels and disagreements among people are reduced through haggling and close

contact at market centres. Where even they show up it is easier to resolve them.

Chartered Institute of Purchasing and Supply (CIPS; UK) (2004) gave some fundamental

advantages and disadvantages of haggling/negotiation. It believed that a successful

negotiation leads to commonly accepted resolutions. Haggling/negotiations take place not

only between merchants and customers but also between state and organisation leaders to

resolve major political and economic issues. The following are the combined advantages and

disadvantages of haggling based on (CIPS; UK) submission:

a. Haggling /Negotiating can prevent disagreement or conflict that may arise in purchasing.

b. Haggling /Negotiation often open new economic opportunities

c. Haggling/Negotiation can show weakness of either of the parties involved.

d. Negotiation/Haggling require competence and skill and once lacking, can lead to

purchasing problems

2.2.8 Factors Responsible for Price Haggling

Timothy (2004:18) presented multiple factors that led into how consumers think about a

brand beyond pricing. However, many of them, like in store experiences, and perception

about quality, take much time and effort to change. In between a pricing change and sales in

those other areas will be a period in the wilderness.

Archarya (2012:4) postulated that there are some points that can really influence haggling

process. Haggling is a process where each party involveds in it tries to gain advantage for

them by the end of the process. Here are the factors identified by Archarya (2012:4-10):

26

a. Goals: what goals do the first party and the other party wants to get out of the

haggling activities?

b. Trade: what do the first party and the other party have that they want to enter into?

c. Alternatives: if the agreement with other party can’t be reached, what alternative

do the parties have? Are they good or bad?

d. Relationship: what is the history of the relationship?

e. Consequences: what could be the possible consequences when the parties don’t

reach an agreement? Who will be affected? By what extent?

f. Power: who has power in the relationship?

g. Possible solution: based on all of the considerations, what possible compromises

might be those?

It must be noted that Lysons (1993:17) stated that the nature and origin of the product also

determine the level of how such products are haggled. Imported goods, according to him, are

less haggled or priced in contrast to the traditional products. Lysons (1993:46-48) further

explained that, most of hagglings on notable complex buying situations are anchored on price

of the goods, the product quality, the delivery terms, the market trends, competitive offers,

retailers/middlemen characteristics, as well as environmental phenomenon. He recommended

that manufacturers must adequately take all these factors into consideration so as to facilitate

positive product positioning in the consumers’ mind.

2.2.9 Price Haggling and Fixed Price Strategy

Brassington and Pettitt (2003:465) defined the term ‘fixed price” as a phrase that is used to

mean the price of a good or a service that is not subject to bargaining. The terms commonly

indicate that an external agent, such as a merchant or the government, has set a price level,

27

which may not be changed for individual sales. In the case of governments, this may be due

to price controls.Bargaining is very common in every part of the world, outside of retail

stores in Europe or North America or Japan. This makes it an exception from the general

norm of pricing in these areas. In pricing, most of the open markets often allow bargaining or

haggling to occur. Howeverin many supermarkets and departmental stores (e.g. ROBAN

STORES, SHOPRITE etc.) prices for all the goods are fixed with no room for negotiation.

Adekeye (2008:18) gave some benefits of fixed price against haggling price. These according

to him are:

(i) Fixed price save time and reduces unnecessary stress from consumer’s view point.

(ii) It makes selling and marketing jobs easier for trading stores or outlets.

(iii) It ensures customer relationship and repeat purchases because the consumer always

believes he/she is not cheated

(iv) Finally, fixed pricing develops marketing system and commercial policy of a nation.

In the work of Pent (2006: 16-46), while analysing the concept of bargaining as it is

concerned in the African continent, he noted that four (4) categories of people tend to haggle.

These are:

(i) Low income earner and lower uppers class stratum of the social class elites.

(ii) Average/middle level educators who always want value for cost when they buy.

(iii) Parents and well-acquainted students who are very rigid in consuming all the times.

(iv) The literates who are more concerned of value and cost-to-satisfaction when

purchasing products. (Pent, 2014:17)

In the work of Adekeye (2008:18), not all products are haggled, as many of beverages, beer

and drinks are fixed from many manufacturers. Adekeye further identified perishable goods,

28

agricultural produces, clothes and fashions, complex products, electronics and

materials/goods of high prices as those that consumers haggle most on.

2.2.10 Barriers to Effective Price Haggling

Landes (2005:46), in his work on consumerism, gave several barriers to effective price

haggling. Landes further stated that it is in any consumer’s best interest to try to get the

lowest price on all purchases. Yet haggling, negotiating, or bargaining, at least in

manyculture, is a social norm other than in specific situations such as buying a car that is not

a non-negotiable brand like Saturn or Scionwhere haggling is uncommon.

Landes (2005:47-48) identified several emotional barriers to haggling. Here are a few of

them:

a. The Impression of Strangers: As haggling is a normal social activity, someone who

considers haggling might refrain from doing so for the fear of being seen as abnormal.

Most retailers operate in public, so it is more than likely, other people will be able to

purchase. Once the consumers ask a sales person in a retail store “what is the best

price he/she can offer” The consumer gets stares from strangers. The opinion of

strangers is irrelevant. It is simply in the best interest of the seller to sell what the

consumer wants for the best price possible. The best way to by-pass this barrier is to

ignore everyone other than the sales person, the sales manager and consumer

himself/herself.

b. The consumer’s self-image: One thing that might be preventing the consumer from

starting the dance of number-offering is the idea that the strangers might be right. If

the item to be purchased is something that the consumer can legitimately afford, there

may be no need to engage in haggling at all. People buy things they can’t afford every

29

day without negotiating the price. Perhaps, consumers think they should be the people

haggling while those who can afford the purchase should be happy to pay the full

price. The only reason consumers’ self-image is at stake is because of today’s culture.

But if the consumer would feel inadequate for trying to pay less than other people,

he/she should take himself/herself out of the picture.

c. Fear of Rejection: This is the powerful force that stops awkward boys from asking

girls on dates. The word ’no’ is one of the most displeasing sounds to the human ear

and brain, and people will try to avoid hearing it at all costs. The avoidance means

that many important questions will not be raised because of fear. The right question

would never result in a yes or no answer. For example, “considering that it is a

discounted product and consumers are making room for new model, what is the

lowest price he/she could pay for it?” Rather than, “can the consumer do any better

than that?” If the consumer’s line of questioning doesn’t result in any savings, at least

the consumer tried.

Smith (1946: 11), while adding more on discussions of the barriers to price haggling or

bargaining, gave three(3) main obstacles to the price haggling or bargaining and these are:

(i) Cultural and social norms

(ii) Prevailing market conditions and trends taking place

(iii) Consumers’ perception regarding haggling price versus fixed price tactics.

2.2.11 Price Haggling and Consumer Decision Making

As already related earlier, Kottler and Keller (2013:190) explained that marketing scholars

have developed a ‘stage model’ of the buying decision process. The consumer passes through

five stages: problem recognition, information search, evaluation of alternative, purchase

30

decision and post purchase decision/behaviour. Clearly, the buying process starts long before

the actual purchase and has consequences afterward.

Often, consumers do not always pass through all the five stages in buying a product. They

may skip or reverse some stages. A woman buying her regular brand of toothpaste goes

directly from the need for toothpaste to purchase decision, skipping information search and

evaluation.Even when consumers decide to buy, many factors affect the purchase decision

among which is price and product-quality. Brassington and Pettitt (2003:468) explained that

price negotiation is one of the main factor that affect buyers at the purchase decision stage.

Other notable factors are anticipated situation factors, attitude of others and perceived risks.

2.2.12 Price Haggling and Consumer Price Sensitivity

Price haggling and price sensitivity tend to be highly related. The relationship is simply that

haggling tends to be more intense when consumers are more price sensitive. Jobber

(2013:572) established the relationship. To him, the demand curve shows the markets’

probable purchase quantity at alternative prices. It sums the reactions of many individuals

who have different price sensitivity. The first step in estimating demand is to understand what

affects price sensitivity. Generally speaking, customers are most price sensitive to products

that cost a lot or are bought frequently. They are alsofewer price sensitive when the price is

only a small part of the total cost of obtaining, operating and servicing the product over its

lifetime. A seller can charge a higher price than competitors and still get the business if the

company can convince the customer that it offers, the lowest total cost of ownership (TCO).

Companies prefer customers who are not price sensitive. The firms need to understand the

price sensitively of their customers and prospects and the trade-offs people are willing to

make between price and product characteristics.Stewart (1995:142) said that the sensitivity

31

price is based on the information that most of the consumers have in their memory and alsoas

a result of price haggling activities that are often undertaken from time to time in open and

traditional market places.

2.2.13 Price Haggling and Choice by Buyers

Buying choice and loyalty are inputs of effective price haggling. Rogers (2006:11) opined

that prices are a key positioning factor and must be decided in relation to the target market,

the product and service assortment mix and the competition. All the retailers and market

traders want loyalty from buyers, and in order to achieve this and high volumes they must

pay attention to pricing tactics. Many of them will put low prices on some items to serve as

traffic builders or loss leaders. Others plan mark downs on slower-moving merchandise as

well as allow the bargaining process to be very free and flowing to encourage customer

loyalty. Poor negotiating/bargaining activities have led to missing of many profitable buyers

who may not only buy presently from the seller, but who may also expedite repeat purchase

and buying.

2.2.14 Price Haggling and Customer Relationship

Kotler and Keller (2013:184) defined customer relationship management as the process of

managing detailed information about individual customer and carefully managing all

customer “touch points” to maximize customer loyalty. Customer relationship enables

companies to provide excellent real-time customer service through the effective use of

individual account information. Based on what they know about each valued customer,

companies can customise market offerings, service, programmes, messages, and media.

Customer relationship management is important because a major driver of company

profitability is the aggregate value of the company customer base (Gbede 2001:78)

32

In relationship to open markets, customer relationship is one of the main tasks needed by the

market sellers/traders so as to boost patronage and repeat buying from the established buyers

(Achumba, 2004:78). Gbede (2001:92) identified several conditions that can affect the

customer relationship activities of many Nigerian open markets. Among the cardinal

conditions mentioned is the price tactics used by the operators of these markets. In line with

the outcome of his research, Gbede (2001:93) stated that there are frequent brand/seller

switching behaviour prevalent in many open markets and these come from poor bargaining

process; and lack of good character and behaviour from the market traders/sellers.

2.2.15 Price Haggling Model

In this section, we review one of the most known models of haggling/bargaining which is

known as Rubin Stein Bargaining Model. A Rubinstein bargaining model refers to a class

of bargaining games that feature alternating offers through an infinite time horizon. The

original proof is due to Ariel Rubinstein in a 1982 paper. For a long time, the solution to this

type of game was a mystery; thus, Rubinstein’s solution is one of the most influential

findings in game theory.

Requirement of the Model

A standard Rubinstein haggling/bargaining model has the following elements:

a. Two players.

b. Complete information.

c. Unlimited offers- the game keeps going until one player accept an offer.

d. Alternating offer- the first player makes an offer in the first period, if the second

player rejects, the game moves to the second period in which the second player makes

an offer, if the first rejects, the game moves to the third period and so forth.

33

Desirability of the model

Rubinstein bargaining/ haggling model has become pervasive in literature because it has

many desirable qualities:

(i) It has the entire aforementioned requirement, which is thought to accurately

stimulate real - world bargaining.

(ii) There’s a unique solution.

(iii) That solution is pretty clean, which wasnot necessarily expected given the game is

infinite.

(iv) There’s no delay in transaction.

(v) As both players become infinitely patient or can make counteroffers increasingly

quickly then both sides get half of the pie.

(vi) The result quantifies the advantage of being the first to propose (and thus

potentially avoiding the discount).

(vii) The generalisation result quantifies the advantages of being less pressed for time,

i.e. of having a discount factor closer to 1 than that of the other party.

This model reflects the real situation within every haggling process, where as long as both

parties are patient, the processes of offering and counter-offering continues until an agreed

price that is suitable to both parties is reached.

2.2.16 Consumer Decision Making

We have discussed in details price haggling and negotiation. This section will address

consumer buying behaviour in the contexts of market in which buyers haggle/negotiate to

reach a buying choice.

34

Market means different things to different people. Kotler (1980:145) highlighted several

definitions of markets. To him, some people consider market as being “a fixed geographical

location where goods and services are bought and sold”. Some regard it as “the aggregate

demand for a given product” (Jhighan 2006:321), while others believe that market exist in a

widely dispersed offices connected for transaction by telephone, telegrams, letters etc.

Bransington and Pettitt (2003:17) saw market as follows:

“A market for a product or service consists of individuals or organisations that have

purchasing power and that are current or potential buyers of the product or service.”

This definition clearly states the conditions for the existence of a market. These include:

(a) The presence of individuals

(b) They can be organisations

(c) They have purchasing power

(d) They are willing to buy the product.

Kotler and Amstrong (2011:188) therefore added to the definition by stating that markets are

individuals or organisations who are either actual or potential buyers of a product. Consumer

Markets according to Stanton and Sommers (1981:16) comprised individuals, groups of

individuals and organisations buying products for consumption motive only. Therefore,

goods bought in these markets are destined for final consumption. They are not buying or

willing to buy to make profit but to satisfy certain basic or psychological needs, wants or

aspirations. The consumer markets include all those who have financial and credit

capabilities to purchase a given product.

35

When a consumer buys and uses a particular product, he/she engages in buying decision

making. Kotler and Keller (2013:213) defined consumer behaviours as the study of how

individuals, groups and organisation select, buy, use and dispose goods, services, ideas, or

experience to satisfy their needs and wants. The study of consumer provides clues for

improving or introducing products or services, setting prices, devising channels, crafting

messages and developing other marketing activities. Firms must understand every facet of

consumer behaviour. The best way to understand how consumers buy is to map the actual

stages they pass through to reach their buying decision. Each stage suggests certain things

that marketers can do to facilitate or influence the consumers’ decision making.

The lists below provide some key consumer behaviour questions in terms of “who, what,

when, where and how?” In line with Jobber (2013:291), the lists are:

(i) Who buys our product or service?

(ii) Who makes the decision to buy the product?

(iii) Who influences the decision to buy the product?

(iv) What do the customers buy? What needs must be satisfied?

(v) Why do customers buy a particular brand?

(vi) Where do they go to look to buy the product?

(vii) How do they buy? Any seasonality factors?

(viii) How is our product perceived by customers?

(ix) What are the customers’ attitudes toward our product?

(x) What social factors might influence their decision?

(xi) How do personal or demographic factors influence the purchase decisions?

36

Engel et al, (1978:16-44) have developed a “Stage-Model” of buying process. The consumer

passes through five stages i.e. “problem recognition, information search, evaluation of

alternatives, purchase decisions, and post-purchase decision/behaviour”. The buying process

starts long before the actual purchase and has consequences long afterwards. The model of

buying decision process is shown below:

Figure: 2.2 Consumers Buying Decision Process

Source: Kotler, P. and Keller, K. (2013) Marketing Management; India: Pearson. Page

378.

2.2.16.1 Problem Recognition

McCarthy (2005:171) stated that the buying process starts when the buyer recognises a

problem or need. The need can be triggered by internal or external stimuli. With an internal

stimulus, one of the person’s normal need: hunger, thirst, sex etc. rises to a threshold level

and becomes a driver or a need that can be aroused by an external stimulus.

2.2.16.2 Information Search1

An aroused consumer will be inclined to search for more information. Schiffman and Kanuk

(2005:163) differentiated between two levels of arousal. The milder search state is called

heightened attention. At this level a person simply becomes more receptive to information

about a product. At the next level, the person may enter an active information search,

looking for reading materials, phoning friends, going online and visiting stores to learn about

the product. Buyer’s information sources fall into four (4): personal, commercial, public and

37

Problem

Recognition

Information

Search

Evaluation

Alternative

Purchase

Decision

Post-

purchase

Decision

experimental. The information received about a product, helps the consumer place a value on

the product, and based on the perceived value of the product, he/she is able to determine

whether the price set for the product is worth it or not. This leads to the haggling process,

which aims at ensuring that an agreeable price is arrived at by both parties.

2.2.16.3 Evaluation of Alternatives

This deals with how consumer process competitive brand information and make a final value

judgment. No single process is used by all consumers or by one consumer in all buying

situations. There are several processes; the most common models see the process as

cognitively oriented. That is, they see the consumer as forming judgment largely on

conscious and rational basis. The final value judgement determines the price the consumer is

willing to buy the product, and if at variance with the seller’s price,it leads to a haggling

situation.

2.2.16.4 Purchase Decision

In the evaluation stage, the consumer forms preference among brands in the choice set. The

consumer may also form an intention to buy the most preferred brand. In executing a

purchasing intention, the consumer may take up to five sub-divisions: brand, dealer, quality,

timing and payment. Even, if consumer form brand evaluations, two general factors can

intervene between the purchase intention and the purchase decision. The first factor is the

attitude of others and the second is the unanticipated situational factors. This heavily

influences his decision on the value to place on the product and what to pay for it,

irrespective of what the seller is offering. This conflict leads to haggling.

38

2.2.16.5 Post-Purchase Behaviour

After the purchase, the consumer might experience dissonance that stems from noticing

certain disquieting features or hearing favourable things about other brands, and will be alert

to information that supports his or her decision. Marketing communications should supply

beliefs and evaluation that reinforce the consumer’s choice and help him or her feel good

about the brand. Marketer’s job therefore does not end with the purchases. They must

monitor post-purchase product use. This can be achieved by haggling, in this respect, not

only on the price value but also on the quality of the product and rightness of the buyer’s

choice.

2.2.17 Factors Affecting Consumer Buying Decisions:

A multitude of factors play some roles in influencing buying behaviour of consumers. These

factors are sorted into four by Kotler (1980:137). For Kotler, there are those associated with

the buyer, with the product, with the seller (firm) or with the situation. This is shown below:

Buyer Seller

Situation

Figure 2.3: Factors Affecting the Buying Process

Source: Kotler P. (1980) Marketing Management USA: Prentice Hall Inc. page136.

39

Product

The various factors associated with each of the major components are described below:

a. Product Characteristics:Various characteristics of product will influence the buying

decision. Buyers will pay attention to product features, styling, quality, prices and

back-up services.

b. Seller Characteristics: The characteristics of the seller will influence the buying

outcomes. In this case, buyers will form an opinion about the manufacturer, its retail

outlets, knowledge ability, friendliness and services.

c. Situation Characteristics: Various situational factors also influence the buying

decision. One such factor is the time pressure felt by the buyer. Other factors include

the time of the year, weather change, and meeting with friends who have opinions

about the products.

d. Buyer’s Characteristics: Several characteristics of the buyers would affect its buying

behaviour. This will include cultural, social, personal and psychological factors that

operate in the buyer. Cultural factors include the culture from which the buyers come,

the subculture identity and the social class. Social factors include the influence

ofother people in the buyer’s life, particularly reference groups, family roles and

statuses. Personal characteristics include age, life cycle position, occupation,

economic circumstances, life style and personality. Finally, psychological

characteristics include buyers’ motivation, perceptions, attitudes, beliefs and learning.

40

BUYER

Cultural Social Personal

Cultural Reference Age & Life PsychologicalgroupsSubculture Family OccupationMotivationSocial Day Role & Economy Perception

Status Life Style Learning

Attitude

Figure 2.4: Buyer Characteristics Influencing Buying Decision

Source: Kotler, P. and Amstrong, G. (2011) Principles of Marketing, USA: Prentice Hall

Inc. page 254.

2.2.18 Buying Situation and its Causes

The complexity of buyer behaviour will of course vary with the type of purchase. There are

great differences between buying toothpaste, a tennis racquet, an expensive camera and a new

car.Howard and Shelth (1975:16-24) suggested that consumer buying can be viewed as

aproblem solving activity and have distinguished between three (3) classes of buying

situations:

2.2.18.1 Routinized Response Behaviour

This is the simplest type of buying behaviour which occurs in the purchase of low cost,

frequently purchased items. The buyers are well acquainted with the product class and aware

of the major brands and their attributes, and have a fairly well-defined preference order

among the brands. However, an unexpected change in their anticipated product price and/or

41

quality leads to a re-evaluation of their perceived value of the product, and hence what they

are willing to pay for it, which then leads to haggling between the buyer and seller.

2.2.18.2 Limited Problem Solving

Buying here is more complex when buyers confront an unfamiliar brand in a familiar product

class. It requires information before making a purchase choice. The limited problem solving

involves that buyers are fully aware of the product class and the qualities they want but are

not familiar with the entire brand and their features. Considering their lack of familiarity

with the product, the buyer perceives the seller may want to take advantage of him and

ensures this is not the case by extensively haggling on the product to be satisfied that he is

getting a good deal.

2.2.18.3 Extensive Problem Solving

Buying reaches its greatest complexity when buyers face an unfamiliar product class and do

not know the criteria to use. In his own opinion, Assael (1987:87) describes three (3) types of

consumer buying behaviour based on degree of differences among brands. These are:

2.2.18.3.1 Dissonance Reducing Buying Behaviour

This occurs when consumers are highly involved with an expensive, infrequent or risky

purchased product but see little differences among the brands. Since little differences are

observed among brands, the consumers value the products on the same pedestal and try to

acquire them at the same or almost the same price. This results to haggling as it may not be

the basis upon which the seller sets the price for the goods.

42

2.2.18.3.2 Habitual Buying Behaviour

This occurs under conditions of low consumer involvement and the significant brand

differences. For example, salt. Consumers have little involvement in this category; they

simply go to the store and reach for a brand. If they keep reaching for the same brand, it is

out of habit rather than strong loyalty. Consumers appear to have low involvement with

most-cost frequently purchased products. When a newer brand is introduced, that is

particularly less popular, the consumer assumes the product is not as qualitative as the one

he/she habitually buys, and attaches less value to it. This could lead to haggling between the

consumer and seller.

2.2.18.3.3 Variety-seeking Buying Behaviour

Consumers undertake variety-seeking buying behaviour in situations characterized by low

consumer involvement but significant brand differences. In such cases, consumers often do a

lot of brand switching.The consumer may stick to the choice of a particular brand if the

product price agrees with his/her perceived product value, which may not be that of the

seller’s perception, thereby resulting in haggling.

2.2.19 Pricing Issue and Characteristics in Different Prevailing Market Contexts

Brassington and Pettitt (2003:396-398) summarized the impact on pricing of the issues and

characteristics prevailing in various kinds of markets. They highlighted the fact that pricing

is not just a cost-driven exercise, but a skill that requires knowledge and understanding of

both the customer and the external environment. Here are the discussions of various market

characteristics.

43

2.2.19.1 Consumer Markets

Jobber (2013:323) stated that there is much competition for consumers’ disposable income.

This is reflected in both the range of different product markets available for them to spend

onand the variety of products competing in any one market. Consumers also have a great

deal of discretion over whether they spend or not. There are very few real necessities and, on

many occasions, consumers buy because they want to, rather than because they need to.

As a result of the fact that consumers are largely buying to please themselves, their

assessment of competing products in most markets is often informal, irrational, or even non-

existent. As already stated in the earlier discussion, psychological factors can play a much

greater role than analytical skills. Even where hard product information is provided, the

consumer does not necessarily make the effort to digest it properly or retain it. It may simply

be used selectively as support for a decision that has already been made. Price too, as has

already been pointed out, may be interpreted variously, depending on the individual

customer.

All of the above make it very difficult to identify the scope for price negotiation and, indeed,

McCarthy and Perrault (2005:161) argued that, in most consumer markets, the unit price of

the goods is so low that there is no need for such a tool. The price is on the product. There

are some exceptions, however. Consumers expect to negotiate the price with the dealer; the

dealer recognises this and sets the opening price at a level where he can afford to be beaten

down 10 or 15 percent.

Nevertheless, price is still an important element of the consumer product’s marketing mix.

Price banding can be a useful addition to a market segmentation exercise. Brassington and

44

Pettitt (2003:397) posited that a consumer for whom price is the primary consideration in

comparing competing offerings is said to be price sensitive. In dealing with such consumers,

marketers have to be particularly careful to get the price right because customers are less

likely to be seduced by non-price factors into moving outside their preconceived price band.

2.2.19.2 Retail and Wholesale Market

Stanton and Sommers (1981:163) explained that retail and wholesale markets take a far more

rational approach to price interpretation than do consumer groups. As intermediaries, they

have to look in two directions, at both the manufacturer and the consumer. They have to be

realistic about what price they themselves can charge for a product to their customers, and

this in turn establishes what kind of price they are looking to pay to the manufacturer, if they

are to maintain a reasonable profit margin. This price also needs to reflect the services in

respect of selling the product that the intermediary has to perform.

Stanton and Sommers (1981:164) stated further that looking in the opposite direction at the

consumers, retailers and wholesalers will also expect pricing structures to reflect demand.

For example, if a product is going to have a mass-market appeal and will sell in high

volumes, then the intermediaries will need to be able to sell it at a competitive price,

especially if it is a new brand entering an established market.Price discipline is also expected,

in the sense that manufacturers should not be seen to be selling directly to the public at lower

prices than the retailers could set. Price discipline sometimes goes further than this, and

retailers become upset if they think that manufacturers are selling to other retailers at lower

prices.

45

Kotler and Keller (2013:178) revealed that when pricing is considered alongside retail and

wholesale structures, these intermediaries are very knowledgeable about alternative product

offerings and will therefore use price as a bargaining weapon where they can. Manufacturers

in turn may well be willing to make price concessions in order to gain distribution through a

powerful retail chain. Another means by which the retailer can keep prices lower is by

offering own-brand goods.

2.2.19.3 Service Markets

Zeithaml (2004:14) states that because a service is intangible, it is very difficult to assess its

quality before purchasing it. Often, price comparison is the nearest a potential buyer can get

to working out the relative quality of similar competing offerings. Another peculiar feature

of services is that they are perishable, in that they happen at a particular time and place, and if

there is no customer there, the product is lost. A service pricing is somehow very complex

and more tasking. This encourages haggling, as the question of the real value of product as

against the price set arises.

2.2.19.4 Non-Profit Markets

Non-profit organisations, according to Baker (1985:172), differ in that they see themselves as

existing and operating for the benefit of the public rather than for the creation of profit. Their

objectives, therefore, are to encourage people to use their services or products, or to

participate in their activities. Pricing can have a major role in achieving that, if goods and

services are sold at cost or subsidized to a point where they are visibly below market rates.

Some activities, such as minority interest, arts and events, could not be produced on a

commercial basis unless ticket price were atomically high, and therefore public subsidy or

sponsorship is essential to keep prices down to an affordable and accessible level. Kotler and

46

Armstrong (2011:399) added that unlike the practice in most ordinary consumer markets,

where price is directly exchanged between the buyer and the seller, in the non-profit sector,

price sometimes passes through a third party. When this happens, it can blunt the consumer’s

price sensitivity but haggling may still be an issue.

2.3 Theoretical Framework

2.3.1 Haggling/Bargaining Theories

The following are the theoretical approaches used in negotiation/haggling studies reviewed

for this work.

The personality theory emphasizes that the type of a person’s personality, determines the

bargaining process and its outcome. Behavioural theory deals with a distinction between

hard-liners and soft-liners. Kent refers to hard-liners as warriors (Kent 1974:14) while soft-

liners are shop keepers. It varies from region to region. Haggling may take place more in

rural and semi-urban areas than in a metro city.

Haggling or bargaining games refers to a situation where two or more players must reach

agreement regarding how to distribute an object or monetary amount (Pent 2006:124). Each

player prefers to reach an agreement in these games, rather than abstain from doing so.

However, each prefers that agreement which most favours his interests. Analysing these

kinds of problems requires for a solution specifying which component in dispute will

correspond to each party involved.

Players in a bargaining/haggling problem can haggle for the price objective as a whole at a

precise moment in time. The problem can also be divided so that parts of the whole objective

become subject to bargaining during different times. In a classical haggling situation, Kent

47

(1974:17) argued that the result is an agreement reached between all interested parties, or the

status quo of the problem. It is clear that studying how individual parties make their

decisions is insufficient for predicting what agreement will be reached. However, classical

bargaining theory assumes that each participant in a bargaining process will choose between

possible agreements, following the conduct predicted by the rational choice model.

Makaleley (2001:171) added retail prices as one of the theories of haggling/bargaining.

Makaleley stated that the retailers can choose to sell at posted prices or allow bargaining:

selling at a public posted price commits the retailers not to exploit buyers once they enter the

retail store, making the store more attractive to potential customers, while a bargaining

strategy/haggling has the advantage that allows the retailer to price discriminately between

different types of customers. In some markets, Kotler and Keller (2013:395) stated that firms

post prices but consumers are open to haggle. When the proportion of haggling consumers

goes up, prices tend to rise.

“Integrative approach refers to the potential for the parties’ interests to be (combined) in ways

that create joint value or enlarge the pie.” Potential for integration only exists when there are

multiple issues involved in the negotiation. This is because the parties must be able to make

trade-offs across issues in order for both sides to be satisfied with the outcome.

Integrative Haggling (also called “interest-based bargaining”or“win-win bargaining”) is a

negotiation strategy in which parties collaborate to find a win-win solution to their dispute.

This strategy, according to Pent (2006:131), focuses on developing mutually beneficial

agreements based on the interests of the disputants. Interests include the needs, desires,

concerns, and fears important to each side. They are the underlying reasons why people

become involved in a conflict.

48

Narrative theory is a different approach to conceptualising bargaining because it is as co-

construction of a social narrative, where narrative, rather than economic logic drives the

outcome. (Cole, 1998:63).

The game theories developed from the classical work of Von Neumann and Morgenstern

(1944), Theories of games and economic behaviour. This approach has been used and

expanded by Rapoport (1964) and his associates (1976, 1984)

As a theoretical approach to the study of negotiation as complex, dynamic human behaviour,

this approach has more limitations than advantages. Game theories focus on fixed-sum

dilemmas, where there are only winners and losers. In practice, this is hardly ever the case as

there are usually shared gains and losses (Walton, Mckersie 1995). Secondly, communication

in the negotiation process often changes the participant’s objectives, preferences and

expectations. As a static model, the game theory does not allow for such changes, especially

where objectives are set in advance. Thirdly, the game theory oversimplifies the underlying

assumptions that there are only a set number of participants, issues and courses of action

available, and that participants are always rational in their actions (Putnam 1985; 3).

The limitations discussed here prohibit the transfer of the research findings (mostly done

under simulated or laboratory situations) for application in practice (Kohan 1980)

The bilateral monopolistic theories address themselves to real negotiation problems, but their

research designs do not reflect this advance in their knowledge. Their concepts can only be

put into operation with difficulty, or not at all, and many variables that are present and

fluctuate in practice, have been omitted or strictly controlled in research of this nature.

Strauss’s (1977:33) statement supports this: “Bargaining theory made little allowance for

49

such complexities as mixed-motive situations, past history and socio-economic environment,

intra-organisational bargaining, or the institutional needs of the parties.

The verbal type theory approach includes research based on various theoretical perspectives

such as transactional analysis, exchange theory, systems theory, and is combined with a wide

variety of research method such as case studies, historical analysis and interviews with

negotiators.

These studies have contributed greatly to the understanding of negotiation, by diverting from

the previous types of theories in reaction to the deductive methodology that was employed.

Researchers using this approach do not favour the limiting quantitative techniques of the

game theory and usually concentrate on in-depth discussion of a few (or a single) case

studies. Knowledge gained by such an approach brought a new, in-depth dimension to the

existing knowledge of negotiation. The results obtained by these studies, as there are no

standards, measures, or observation guidelines that can be compared, and the research

designs (if any) do not allow for external validation. The research available within this

grouping of research approaches, therefore, does not at present contribute to systematic

theory development in the negotiation field (Kohan 1980, Bercovitch 1983)

2.3.2 Future Theoretical Development

None of the available research in these theoretical approaches explains negotiation as a

complex and dynamic process of human behaviour. It has, however, led to the development

of various models of negotiation. By systematising and comparing the underlying structures,

strengths, and limitations of these negotiation models, it is possible to establish guidelines for

a productive model that can represent negotiation in a more realistic and productive way.

50

Gulliver (1979) advises the use of an approach and a model that are less restrictive in terms

of the negotiating process, and that make allowance for various negotiation situations and the

many variables and issues that influence the process. Such an approach, and models resulting

from it, should assist in the understanding or negotiation as a complete, complex process that

takes place in a social and organisational context.

2.4 Empirical Review

Rapport et al., (1995) carried out “An Experimental Study of Buyer- seller Negotiation with

One-sided Incomplete Information and Time Discounting Documentation and Source Code

for Two-person Sequential Bargaining Experiments”. They studied a multi period bargaining

mechanisms in which a seller negotiates with a buyer over the price of an indivisible good.

Their findings revealed several behavioural regularities, which do not support the sequential

equilibrium for this bargaining mechanism. They concluded that in line with development in

behavioural decision theory and game theory, which assume bounded rationality, they found

that subjects follow simple rules of thumb in choosing strategies, reflected in behavioural

consistencies observed in their study.

Srivastava et al, (2000) carried out a study on “Price and Margin Negotiations in Marketing

Channels: An Experimental Study of Sequential Bargaining under One-Sided Uncertainty

and Opportunity Cost of Delay”. They sought to examine price/margin setting in marketing

channels within a sequential bargaining framework. In doing this, they adopted the

Grossman and Perry’s game-theoretic model in predicting bargaining behaviour and

outcomes in marketing channels. This was achieved by studying a manufacturer and an

independent distributor negotiating sequentially to establish transfer (wholesale) price of an

indivisible good in a one-sided incomplete information game. They were able to derive both

51

point predictions and directional implications from this sequential equilibrium (SE)

bargaining model. This tested how manufacturer’s uncertainty about distributor value

(consumers’ reservation price), opportunity cost delay, and the actual reservation price (total

surplus) should influence bargaining outcomes. The findings from this study revealed that

point prediction of the sequential equilibrium model fell considerably short in describing

bargaining behaviour and outcomes. The study revealed that high uncertainty impeded

efficient negotiation, eliciting high first offers from manufacturers and increasing bargaining

duration. Also it was observed that higher reservation prices (higher surplus) lowered

bargaining duration, increased bargaining efficiency, and raised profits for both parties. The

study further revealed that higher delay costs produced quicker agreements but distributors

did not benefit from their informational advantage.

Perks and Oosthuizen (2013) carried out a study on “Exploring Supplier Negotiation Best

Practices and Supplier Relationships Strategies in South Africa”. They focused on exploring

the supplier negotiation best practices and the supplier relationships created beyond the

supplier agreement in South African businesses. They specifically tried to provide a

theoretical overview of negotiation best practices of supplier agreements and strategy for

creating long-term supplier relationships, explore what South African businesses perceive as

best practices when negotiation supplier agreements. They explored strategies by

businessesin South Africa to create long-term supplier relationships and provide guidelines to

businesses in South Africa on supplier negotiation best practices and strategies, fostering

long-term supplier relationships. Their study revealed that it is important to negotiate the

best possible terms with suppliers.However, long-term supplier relationships are not created.

This is revealed in their findings that suppliers’ contract is renegotiated quarterly and records

of suppliers defect rates are kept as well as how suppliers resolved conflict and use discussion

52

as a means of resolving supplier disputes. Their study also showed that small businesses are

more concerned about negotiating sound supplier agreements whereas large businesses are

more concerned about creating long-term supplier relationships.

2.5 Summary of Literature Review

Marketing is the scientific study of exchange relationships, and as such it is the set of human

activities directed at facilitating and consummating exchanges. It is observed that in most

cases, mutually beneficial relationship exists between the seller and consumers, hence,

haggling is a type of negotiation in which the buyer and the seller of a good or service dispute

the price which will be paid and the exact nature of the transaction that will take place, and

eventually come to an agreement.

Haggling is an alternative pricing strategy to fixed prices and the process of bargaining

between consumer and seller continues until a mutually agreed price can be settled upon.

This exercise takes the form of verbal communication in which the participants seek to

exploit the relative strength of their bargaining positions to achieve the explicit or implicit

objectives within the overall purpose of seeking to resolve the identical areas of

disagreement.

Personality theory in bargaining emphasised that the type of personality determine the

bargaining process and its outcome. In this instance, various research papers refer to

hardliners as winners. Haggling has largely disappeared in parts of the world where the cost

to haggle exceeds the gains to retailers for most expensive goods and may even take place

more in rural and semi-urban than in a metro-city.

53

Classical bargaining theory assumes that each participant tries to exploit the weakness of the

other in a bargaining process, while integrative theory refers to the potential for the parties’

interest to be (combined) in ways that create joint value. Potential for integration only sets in

where there are multiple issues involved in the negotiation. This calls for parties to make

trade-offs across issues of interest in order for both sides to be satisfied with the outcome.

There are several strategies that can be utilized when making effective and efficient haggling

decisions under these separate headings thus: where to haggle, when to haggle and how to

haggle. In any case, consumers never have an obligation to buy until price has been agreed

upon. The major advantage of haggling is that it is a process of negotiating towards a price

that is acceptable to both parties and that everyone is better off where haggling is possible.

Consequently, haggling benefits everyone in the transaction as a product of compromise.

Several emotional barriers to haggling have been identified as impression of strangers,

customer’s self-image and fear of rejection. Also, main obstacles to haggling are cultural and

social norms, prevailing market conditions and trends taking place, as well as consumers’

perception regarding haggling price versus fixed price tactics. It is noted that while some

people quite enjoy haggling, some do not, but it is always tiring and time consuming. It also

shows the trend of price haggling around the world with a main fact signifying that it is not

only in Nigeria and Africa, but in almost all parts of the world across cultures. Haggling

seems to be the rule and not exception in open markets partly because of traditional rule, lack

of trust and doubts in the value system.

Price haggling and price sensitivity tend to be highly related. The relationship is established

as the demand curve shows the market’s probable purchase quantity at alternative prices.

This sums up the reaction of many individuals who have different price sensitivity. Also

54

buying choice and loyalty are greatly an input of effective price haggling. The consumer

passes through a number of stages which starts long before the actual purchase and has

consequences long afterwards. Also, there are a multitude of factors that play roles in

influencing behaviour of consumers. However, this study is focused on price as one of the

major determinants of consumers’ buying decisions.

2.6 Gaps in Literature

From the literature reviewed in this study, the works of Rapport et al, (1995), Srivastava et al,

(2000) and Perks and Oosthuzien (2013) were reviewed and found relevant to the study.

However, certain gaps were identified.

Though the study by Rapoport et al, (1995) on Experimental Study of Buyer-seller

Negotiation with One- sided Incomplete Information and Time Discountingrevealed that

consumers reflected behavioural consistencies in following simple rules of thumb in choosing

strategies, their study, however, did not show how negotiation (in the context of this study

known as haggling) influenced decision making.

Srivastava et al, (2000) who showed that high uncertainty impeded negotiation and resulted

in delays in their study on Price and Margin Negotiations in Marketing Channels: an

Experimental Study of Sequential Bargaining under One-sided Uncertainty and Opportunity

Cost of Delay, failed to identify if bargaining (price haggling) while impeding negotiations

and resulting in delays could hinder repeat patronage or not.

Perks and Oosthuzien (2013) in their paper on Exploring Supplier Negotiation Best Practices

and Supplier Relationships Strategies in South Africa, showed the practice of negotiation and

55

re-negotiation to ensure best practices in business but did not determine whether negotiation

(price haggling) was equally effective in the open market system. Also, while trying to

establish suppliers’ relationship, they did not show if negotiation was a determinant to the

consumer/seller relationships.

Therefore, this study seeks to address these highlighted gaps, as already outlined in the

objectives of this study.

56

REFERENCES

Achumba, I. C. (2004) Consumer Behaviour. Lagos: University Press Ltd

Archarya, G. (2012) “Towards Constructive Price Haggling Theory”. Journal of Marketing,

MA. Volume VIII (September)

Adekeye, M. (2008) Nigeria Marketing System and Theory. Ekiti–Nigeria: Excellence Prints.

Adeoti, O. (2004) Principles and Practices of Marketing. Ibadan: Noiseless Effective

Communications.

Agbonifoh, B. A, Ogwo, O.E. and Nnolim, D. A. (1998) Marketing in Nigeria. Onitsha:

Afritowers Limited Publishers.

American Marketing Association (1960) “A Collection of Marketing Definition” In

Achumba, I. C. (2004), Consumer Behaviour. Lagos: University Press Ltd.

Assael, H. (1987) “Consumer Buying Behaviour”, In McCarthy, E. J. and Perrault, M.

(2005), Basic Marketing: A Global Managerial Approach. USA: McGraw Hill

Incorporation.

Baily, P.J.H. (2007) “Purchasing and Supply Management”, In McCarthy, E. J. and Perrault,

M. (2005), Basic Marketing: A Global Managerial Approach. USA: McGraw Hill

Incorporation.

Baker, M. J. (1985) “Marketing: An Introductory Text”, In Farayola, O. and Adeyanju O.

(2008), Fundamentals of Marketing. Ibadan: AkaCom Publishing.

Bartch, M. (1968) “Theory of Marketing Management”, In Brassington, S. and Pettitt, F.

(2003), Principles of Marketing. London: Prentice Hall Inc.

Brassington, S. and Pettitt, F. (2003) Principles of Marketing. London: Prentice Hall Inc.

Chartered Institute of Marketing. (CIM; UK) (2001) Definitions of Marketing. London: CIM

UK Press.

57

Chartered Institute of Purchasing and Supply (CIPS; UK) (2004) “Negotiation in the

ContemporaryTimes” Journal of Purchasing & SupplyVol. II (October)

Coles, N.T. (1998) Pricing and Negotiation. Canada: Westminland Printing Press.

Copper, (1996) “What exactly is marketing? Quarterly Review of Marketing”. Journal of

Marketing; AMA 1996.Vol IV (February)

Drucker, P. (1954) “Marketing Management”, In Kotler, P. and Amstrong, G. (2008),

Principles of Marketing. India: Pearson Publishers Ltd.

Engel, J. F, Blackwell R.D and Kollat G. (1978) “Consumer Behaviour”, In Jobber, D.

(2006), Principles of Marketing. New York: Prentice Hall Inc.

Enis, T. (1977) “Marketing Theory and Practice”, In Kotler, P. and Keller, K. (2006),

Marketing Management. India: Pearson Publishers Ltd.

Farayola, O. and Adeyanju O. (2008) Fundamentals of Marketing. Ibadan: AkaCom

Publishing.

Gbede, G. O. (2001) Strategic Sales Force Management. Lagos: Westboume School Print.

Graeber, M. (1995) “Historical Development Structure of Haggling”. Journal of Marketing

Research(September)

Harris, G. (1998) ‘Islanders Discover Sheep-Day Return’. The Times (October)

Hodder B. I. O. and Ukwu I. U. (1969) Markets in West Africa: Studies of Markets and Trade

among the Yoruba and Igbo. Ibadan, University Press.

Howard, S. and Shelth, M. (1975) “Buying Behaviour”, In Makaleley M. M. (2001), Theory

of Pricing in Marketing. Ontario-Canada: McGraw Hill Inc.

Institute of Marketing, UK, (1996) “The Marketing Definition”. Journal of Marketing, July,

(Quarterly Publication)

Jhighan, M.L. (2006) Macro-Economic Theory. India: Vrinda Publishers.

Jobber, D. (2013) Principles of Marketing. New York: Prentice Hall Inc.

58

Kent, M. (1974) “Price Haggling in Contemporary World”, In McCarthy, E. J. and Perrault,

M. (2005), Basic Marketing: A Global Managerial Approach. USA: McGraw Hill

Incorporation.

Kotler, P. (1980) Marketing Management: Analysis, Planning and Control. London: Prentice

Hall International.

Kotler, P. and Keller, K. (2010) Marketing Management. USA: Prentice Hall Inc.

Kotler, P. and Amstrong, G. (2011) Principles of Marketing. India: Pearson Publishers Ltd.

Kotler, P. and Keller, K. (2013) Marketing Management. India: Pearson Publishers Ltd.

Lancaster, G. and Massinghan, L. (2010) Essentials of Marketing. USA: McGraw Hill Inc.

Landes T. (2005) “Understanding Haggling Tactics and Strategies”. Journal of Empirical

Pricing. School of Economics, Malaysia.

Laolu, M.I. (2009) “Traditional Markets in Ibadan City”. Journal of

SociologicalDevelopment. Volume 23 (May)

Lindsay, M. (2012) Rules Governing the Haggling Situation in the World. Access from

www.ebuzz.com. On 17th July, 2012.

Lysons, C. K. (1993) Purchasing: M&E Handbooks. London: PitmanPublishing.

Makaleley, M. M. (2001) Theory of Pricing in Marketing. Ontario-Canada: McGraw Hill

Inc.

Mandela N. (2010) Conversation with Myself. Farrar, Strans and Givout, NewYork, USA.

Mazur, Z. (1947) “Roles of Marketing in Economic Development”, In Perks, S. and

Oosthuizen, N. (2013), “Exploring Supplier Negotiation Best Practices and Supplier

Relationships Strategies in South Africa” Society of Interdisciplinary Business

Research, 2(1), access from www.sibresearch.orgon July, 2013.

McCarthy, E. J. and Perrault, M. (2005) Basic Marketing: A Global Managerial Approach.

USA: McGraw Hill Incorporation.

59

Mint, F. (2004) Understanding Pricing. London: Macmillan Publishers.

Moncrieff, W. (2010) “Haggling Pricing Strategies: the Merit and Demerit”. Journal of

Marketing, Vol. 17 (June)

Onah, J.O. and Okoli, B.I.C. (2014) Traditional Markets and Marketing in Nigeria. Enugu:

Ezu Books Ltd.

Pent, W.J. (2006) Pricing Strategies in Developing Economies. New Jersey: Prentice Hall

Inc.

Perks, S. and Oosthuizen, N. (2013) “Exploring Supplier Negotiation Best Practices and

Supplier Relationships Strategies in South Africa” Society of Interdisciplinary

Business Research, 2(1), access from www.sibresearch.orgon July, 2013.

Putnam, H. (1985) Philosophy of Mathematics Selected Readings. New Jessy: Prentice Hall.

Rapoport, A., Erev, I., and Zwick, R. (1995) “An Experimental Study of Buyer-Seller

Negotiation with One-Sided Incomplete Information and Time Discounting”,

Management Science, 41(3), March.

Rapoport, et al. (1964), Two-Person Game Theory: The Essential Ideas, Ann Arbor:

University of Michigan New York.

Rogers, M. (2006) Theory of Marketing. London: Westline Prints.

Rubinstein, A. (1982) “A Bargaining Model”. Journal of Economic Research, Vol. 17 (July)

Schewe, T. and Smith J. D. (1983) Modern Marketing. London: Macmillian Press Ltd.

Schiffman, L.G. and Kanuk, L.L. (2005) Consumer Behaviour. USA: Prentice Hall Inc.

Smith, A. (1946) “Economics”, In Wood, T.N. (2008), Negotiation in Business. Sri-Lanka:

WestGate Prints.

60

Srivastava, J., Chakravarti, D., and Rapoport, A. (2000) “Price and Margin Negotiations in

Marketing Channels: An Experimental Study of Sequential Bargaining under One-

Sided Uncertainty and Opportunity Cost of Delay” Marketing Science, Vol. 19, No. 2.

(Sept)

Stanton, W. J. and Sommers, M.S. (1981) Fundamentals of Marketing. Canada: McGraw Hill

Incorporation.

Stewart, S. (1995) Marketing Strategy: A Consumer Drive Approach. New York, USA:

The Free Press.

Timothy, I. L. (2004) Marketing in Developed Societies. India: Vrinda Publishers.

Vagale L. R. (1974) Anatomy of Traditional Markets in Nigeria: Focus on Ibadan City.

Ibadan: Spectrum Books.

Walras, L. (1976) “Economics Bargaining: a Futuristic Strategy”, In Winberley, M. (2013),

History of Bargaining. American Journal of Contemporary Research. Vol. 13 (sept.)

Walton and Mckersie (1965) A Behavioural Theory of Labour Negotiation. USA: Jastor

Book.

Winberley, M. (2013) History of Bargaining. American Journal of Contemporary Research.

Vol. 13 (September)

Wood, T.N. (2008) Negotiation in Business. Sri-Lanka: WestGate Prints.

Zeithaml, V. A. (2004) ‘Consumer Perception of Price, Quality and Value’, Journal of

Marketing, Vol. 52 (July).

61

CHAPTER THREE

RESEARCH METHODOLOGY

3.1 Introduction

The main aim of research is to provide a dependable solution to problems through objective,

planned and systematic collection, analysis and interpretation of data. This research adopts a

“survey method” and design because survey research focuses on the people, the vital facts of

people and their beliefs, opinions, attitudes, motivation and behaviour.

3.2 Research Design

Research design and methodology adopted gave the procedures and methods of data for the

research. In other words, they highlighted the relevant information for the work done in the

best way. As it is generally known, the research methodology is a programme that gives the

researcher the process of collecting, analysing and interpreting observation under study. It is

a module of proof that allows the researcher to draw references concerning the study.

Luck and Rubin (1999:23) defined research design as the overall master plan of how the

researcher intends to execute the entire research study. This research employed “Survey

Method” to determine the effects of price haggling as a strategy on consumers’ buying

decision in the selected traditional markets in Ibadan. Survey Method was chosen because of

its relevance in the use of important research tool such as questionnaire which is a veritable

instrument that can be utilized to elicit necessary information from the respondents (Onodugo

et al, 2010:65).

62

3.3 Area of the Study

The area of this study consists of selected traditional markets in Ibadan. Five main traditional

markets were selected, and these are Dugbe, Mokola, Bodija, Aleshinloye and Ojoo markets

in Ibadan, Nigeria. The markets are generally the main open markets in Ibadan (Laolu 2009:

24). Ibadan is the largest city in sub-saharah West Africa. It is the capital city of Oyo State

and the third largest metropolitan area by population in Nigeria, after Lagos and Kano, with a

population of 1,338,659 according to the 2006 census. Ibadan is also the largest metropolitan

geographical area(Laolu 2009: 43). There are several markets and commercial centres in

Ibadan with Dugbe, Mokola, Bodija, Aleshinloye and Ojoo as traditional open markets

selected for this work. They have very unique characteristics of being known as major

traditional open markets.

3.4 Population of the Study

Onwura (1998:45) stated that population is the set of objects or individuals about which

statistical investigation is carried out. The population for this work consists of the traders in

the selected traditional markets in Ibadan (Dugbe, Mokola, Bodija, Aleshinloye and Ojoo) as

well as consumers that patronize the markets. Hence, there are two sets of population for this

study.

The registered market traders in these markets as at the time of this research are;

Markets Registered Number of Traders

Dugbe 587

Mokola 88

Bodija 242

Aleshinloye 216

Ojoo 143

TOTAL 1276

Source: Market Registry of the Local Government(s).

63

This figure was given by the head of Market Registry at each of the markets appointed by the

various Local Government Authorities. The registered traders consist of both shop and Kiosk

owners, excluding other roadside sellers. The study population limits its application to only

registered traders in the markets.

The population of consumers, in the selected traditional markets, which is the second set of

the potential population is not known.

3.5 Sample Size Determination

Having defined the population, the researcher determined the size of the sample. This is so

because time, cost, and large representation of the entire study population may not allow the

researcher to have general full representation of the whole population. Hence, sample size

determination is necessary. The sample size of the population of both “traders” and

“consumers” were determined statistically.

Since the population of the study has already been stated as consisting of “traders” and

“Consumers”, the sample size for the two groups are determined below. Because the

population of the study for traders is known and finite and due to the fact that it consists of

1276 registered traders in all of the selected markets, we use Yamane’s (1979: 172) formula

to determining the sample size. The formula is shown below.

n = N 1+N(e)2

Where: n= Desired Sample size

N= population size

e= limit of tolerable error (usually 95%, that is 0.05)

Hence, the sample size for trader will be 305. (Appendix IX)

64

Using the formular:

nh = Nh x n N

Where nh = Sample size for each study group

N = Population size

Nh = Population of each study group

n = sample size for the population

Each of the traditional markets is calculated to have the following samples;

Dugbe =140

Mokola =21

Bodija =58

Aleshinloye = 52

Ojoo = 34 (Appendix IX)

3.6 Sample Size of Consumers

Pilot survey is usually on a small scale, carried out prior to the main survey, primarily to gain

information to improve the efficiency of the main survey. In this work, a pilot survey was

used to test the questionnaire as well as the effective size of the sampling unit of consumers.

Hence the researcher conducted pilot survey with twenty-five (25) consumers who regularly

patronize each of the traditional markets selected to understand their views regarding the

haggling strategies as they affect their buying decision making. The main aim for conducting

a pilot survey was to enable the researchers draw inference about the instruments that was

used. Eighty per cent of the studied consumers have a positive response toward pricing

haggling as it affects their buying decision, 20% were in the negative opinion. (Appendix III

and IV)

65

Working on 95% confidence level and a tolerable error of 5%, the formula for determining

sample size for infinite population (Williams 2001) is used to estimate the sample size of the

consumers, since they are infinite and unknown.

n = pq (Z2) or Z2pq e2 e2

Where; p = frequency of occurrence or probability of responses/positive success.

q = 1 – p

n = Desired sample size

z = Desired level of confidence (1.96)

e = estimated tolerable error or standard error (0.05).

Hence, the sample size for the consumers is calculated to be 246 respondents.

This is shared randomly among the selected five markets equally. (Appendix X)

3.7 Sampling Techniques and Method

The non-probability convenience sampling was used as the sampling technique for this study.

No pre-set condition is considered for the selection of the elements of the study groups. Thus

this sampling technique is adequate as it is used when elements are included in the sample

without pre-specified or known probabilities of being selected (Anderson et al, 2011). The

respondents were selected in the market at the convenience of the researcher.

3.8 Sources of Data Collection

Data for this study was collected mainly from primary source. Data was gathered from the

primary source through questionnaire that was self-administered on the respondents. The

respondents consisted of traders and consumers.

66

3.9 Instrument for Data Collection

The major instrument that was used in collecting the necessary primary data for this study isa

questionnaire. The questionnaire was designed in a simple way to elicit information from

both the traders and the consumers. Since we were dealing with two sets of respondents, two

sets of questionnaire were developed. One administered on the traders and the other on the

consumers.

The researcher made the questionnaire for traders to be as simple and direct as possible as

some of them did not have formal education to respond to difficult questions. The

questionnaire for the consumers was detailed and comprehensive as the research is mostly

directed at them.

Altogether, five hundred and fifty one (551) copies of questionnaire were printed, three

hundred and five (305) were directed to the selected traders while two hundred and forty-six

(246) were given to the customers. The questionnaire was divided into two sections – A and

B. Section A addressed the respondents biographical and psycho graphical data while section

B addressed questions relating to the objectives of the research.

3.10 Validity of Research Instrument

Validity, according to Uzoagulu (1998), is the appropriateness of an instrument in measuring

what it tends to measure. To validate the research instrument, the researcher ensured that the

structured questionnaire is subjected to the combination of face and content validity.

The instrument was sent to validators who are marketing professionals and the type of

validation needed was specified. This is to make sure that the inappropriate items in the

research instrument that may confuse the respondents are completely removed or re-cast.

67

Content validity is the extent to which the items of an instrument are representative of the

contents and behaviours specified by the theoretical concept being measured. Therefore, the

researcher’s supervisor helped in checking that the instrument contains all the aspects of the

subject that were included in the questionnaire.

3.11 Reliability of Research Instrument

Reliability on the other hand, is defined as the degree to which a given measurement

procedure will give the same description of that phenomenon if the measurement is repeated

(Ebo, 2009). In carrying the reliability of the research instrument, the Cronbach’s Alpha is

used. Cronbach's alpha (α) is an estimate of reliability, specifically the internal consistency,

of a test or scale. When internal consistency is present in a test, it is interpretable (Cronbach,

1951). Cronbach's alpha seeks to measure how closely test items are related to one another

and thus measuring the same construct. The formula for Cronbach's alpha is as follows:

Where;

n = number of items,

si2 = variance of the ith item, and

sT2 = total score variance (Cronbach, 1951)

When test items are closely related to one another, Cronbach's alpha will be closer to 1, and

when test items are not closely related to one another, Cronbach's alpha will be closer to 0.

Anα of 0.90-0.95 is desirable for clinical interpretation of tests (Bland and Altman, 1997).

To achieve this, the data collected from the 25 respondents that actively and fully participated

in the pilot study were used. Using the SPSS (17.0) computer software, the Cronbach’s

68

alphafor the research questionnaire was determined based on the responses captured in the

questionnaires. Alpha of 0.83 (for consumers – see Appendix III for detailed result) and 0.81

(for market traders – see Appendix IV for detailed results) were obtained. These values being

closer to 1 indicated that the research instruments were very reliable and thus could be used

for the study.

3.12 Method of Data Analysis and Presentation

All the data on both biography and psychographic variables (e.g. age, sex, education etc) are

presented in simple percentage distribution tables. Furthermore, analysis and interpretation

of the data in these tables were based on the frequency of each data. The researcher utilized

simple average and frequency table to present the results of the questionnaire. It was also

used to present the results collected for demographic and biographic data. The primary data

obtained from the questionnaire was presented in absolute figures and where necessary in

percentage or proportion.

Test proportions were used to analyse the responses to the questions and were used to test the

hypotheses. Questionnaire was the main data collection instrument to test each of the

hypotheses formulated. The responses of the respondents in relation to the raised questions in

the questionnaires were data to test the hypotheses. The linear regression analysis wasused to

test hypotheses one and four while the Z-test statistics was used to test the hypotheses two

and three.

69

The general formula for the Regression Analysis is:

Y = a + βX + e … (1)

Where; Y = Dependent Variable (consumer decision making and consumer/seller

relationship)

X = Independent Variable (price haggling)

a = constant

β = coefficient of X

e = error margin

Decision Rule

Reject H0 where |p < 0.05| given the computed value of the coefficient β for each of the

independent variables in the model.

The formula for Z-test is;

Z = x−μ

σ√n

… (2)

Where;x = population meanµ = sample meanσ = standard deviationn = sample size

Decision Rule

Reject H0 if |p < 0.05| given the computed value of Z. Otherwise, accept it.

70

REFERENCES

Anderson, D.R., Sweeny, D.J. and Williams, T.A. (2011) Statistics for Business and

Economics. USA: South Western Cengage Learning.

Bland J.M. andAltman D.G. (1997) “Cronbach's Alpha”, BMJ; 314: 572 (May)

Cronbach, L. J. (1951) “Coefficient Alpha and the Internal Structure of Tests”,

Psychometrika 22(3), (First quarter)

Ebo, C. (2009) Social and Economic Research: Principles and Methods. Enugu: African

Institute for Applied Economics.

Laolu, M.I. (2009) “Traditional Markets in Ibadan City”. Journal of Sociological

Development. Vol. 23 (May)

Luck, D. and Rubin, D. (1999) Marketing Research. India: Prentice Hall Incorporation.

Onodugo, V., Ugwuonah G. and Ebinne, S. (2010) Social Science Research Principles,

Methods and Applications. Enugu: El’ Demark Publishers.

Onwura, E. A. (1998) Introduction to Academic Research Methods. Enugu: Gostak Printing

and Publishing Co. Ltd.

Uzoagulu, A.E. (1998) Practical Guide to Writing Research Project Report in Tertiary

Institutions. Enugu: John Jacob’s Publishers Ltd.

Williams, E.A. (2001) Sample Size Determination for Social Research. USA: Prentice Hall

Inc.

Yamane, T. (1979) Statistics for Beginners. London: McGraw Hill Inc.

71

CHAPTER FOUR

DATA PRESENTATION, ANALYSIS AND INTERPRETATION

4.1 Introduction

Data collected is presented and discussed descriptively using frequency and percentage

tables, mean and standard deviation, while inferential statistics were used in testing the

validity of various study hypotheses. These were done with the aid of the SPSS 17.0

statistical software.

4.2 Data Presentation

Data collected from the study are presented below.

4.2.1 Questionnaire Distribution and Response

Out of the 551 copies of the questionnaires that were administered to the respondents 505

copies were correctly filled and returned (giving a 91.7% success rate) while 46 copies were

incorrectly filled or not returned (giving a 8.3% failure rate). Since, the success rate is

91.7%, the data collected from the field is deemed adequate enough for the study. The details

of the return rate are presented in Table 4.1.

Table 4.1: Questionnaire Distribution Response

Consumers (%) Traders (%) Total (%)

Administered 246 (100.0) 305 (100.0) 551 (100.0)

Correctly Filled and Returned 225 (91.5) 280 (91.8) 505 (91.7)

Incorrectly Filled or Not Returned 21 (8.5) 25 (8.2) 46 (8.3)

Source: Field survey, 2014

72

4.2.2 Profile of Respondents

The distributions of the respondents according to their various demographic characteristics

are presented in Table 4.2 to 4.8.

4.2.2.1 Gender

The distribution of the respondents according to their gender is presented in Table 4.2.

Table 4.2: Gender Distribution of RespondentsGender Consumers (%) Traders (%) Total (%)

Male 103 (45.8) 172 (61.4) 275 (54.5)

Female 122 (54.2) 108 (38.6) 230 (45.5)

Total 225 (100.0) 280 (100.0) 505 (100.0)

Source: Field survey, 2014

As presented in Table 4.2, majority (54.5%) of the respondents that participated in the study

are males. However, more (54.2%) of the consumers that participated in the study are

females while more (61.4%) of the traders that participated in the study are males.

4.2.2.2 Age

The age distribution of the respondents is presented in Table 4.3.

Table 4.3: Distribution of Respondents by AgeAge Consumers (%) Traders (%) Total (%)

Less than 18 years 38 (16.9) 70 (25.0) 108 (21.4)

18 – 34 years 65 (28.9) 105 (37.5) 170 (33.7)

35 – 50 years 95 (42.2) 80 (28.6) 175 (34.6)

Above 50 years 27 (12.0) 25 (8.9) 52 (10.3)

Total 225 (100.0) 280 (100.0) 505 (100.0)

Source: Field survey, 2014

73

The data presented in Table 4.3 reveals that more of the respondents that participated in the

study were aged 18 to 50 years. In particular, a greater percentage (42.2%) of the

consumersthat participated in the study are aged 35 to 50 years while the a higher percentage

(37.5%) of the traders that participated in the study are aged 18 to 34 years.

4.2.2.3 Occupation

The distribution of the consumers that participated in the study based on their occupation is

presented in Table 4.4.

Table 4.4: Distribution of Respondent by OccupationOccupation Frequency Per cent (%)

Businessman 50 22.2

Public/Civil servant 59 26.2

Student 38 16.9

Private Employee 31 13.8

Researcher/Consultant 18 8.0

Apprentice/Unemployed 29 12.9

Total 225 100.0

Source: Field survey, 2014

Table 4.4 shows that the participation of the respondents in this study virtually cuts across all

occupations. However, Public/Civil Servants and Businessmen had higher percentage

participation of 26.2% and 22.2% respectively.

4.2.2.4 Religion

The respondents’ distribution by their religious affiliations is presented in Table 4.5.

Table 4.5: Distribution of Respondents by ReligionReligion Consumers (%) Traders (%) Total (%)

Christianity 112 (49.8) 123 (43.9) 235 (46.5)

Islam 98 (43.5) 144 (51.5) 242 (47.9)

Traditional Religion 15 (6.7) 13 (4.6) 28 (5.6)

74

Total 225 (100.0) 280 (100.0) 505 (100.0)

Source: Field survey, 2014As presented in Table 4.5, most (47.9%) of the respondents practice Islam as their religion.

4.2.2.5 Marital Status

The distribution of the respondents according to their marital status is presented in Table 4.6.

Table 4.6: Distribution of Respondents by Marital StatusMarital Status Consumers (%) Traders (%) Total (%)

Single 89 (39.6) 104 (37.1) 193 (38.2)

Married 99 (44.0) 132 (47.2) 231 (45.8)

Divorced 16 (7.1) 32 (11.4) 48 (9.5)

Widowed 21 (9.3) 12 (4.3) 33 (6.5)

Total 225 (100.0) 280 (100.0) 505 (100.0)

Source: Field survey, 2014

Table 4.6 shows that higher percentages (45.8%) of the respondents are married. This is

followed by the percentage (38.2%) of the respondents that are single.

4.2.3 Line of Products

The distribution of the traders that participated in the study according to their line of products

is presented in Table 4.7.

Table 4.7: Distribution of Traders by Selected Products CategoryLine of Products Frequency Per cent (%)

Clothing and Textiles 52 18.6

Cooked Foods/Snacks 60 21.4

Raw Food Items 59 21.1

Ram/Goat/Cow 34 12.1

Drinks 49 17.5

Unclassified 26 9.3

Total 280 100

Source: Field survey, 2014

75

The data presented in Table 4.7 shows that more of the respondents traded on cooked

foods/snacks (21.4%), raw food items (21.1%), clothing and textiles (18.6%) and drinks

(17.5%).

4.2.4 Sales Level per Day

The distribution of the traders that participated in the study according to their sales level per

day is presented in Table 4.8.

Table 4.8: Distribution of Traders by Daily Sales LevelSales Level Frequency Per cent (%)

Less than N5,000 40 14.3

N5,000 – N15,000 70 25.0

N15,000 – N32,000 101 36.1

N32,000 and above 69 24.6

Total 280 100

Source: Field survey, 2014Table 4.8 reveals that only few of the sampled traders (14.3%) have a daily sales level of less

than N5, 000. Respondents that earn between N15000 and N32000 are more (36.1%) than

the respondents from other daily sales levels. The sales level typically represents the volume

of transactions between sellers and buyers, and also could imply the level of haggling and

success of such level between the sellers and the traders.

4.2.5 Data Presentation based on Study Objectives

The presentations of data collected from the field are presented below according to the

various study objectives.

4.2.5.1 Effects of Price Haggling on Consumers’ Buying Decision Making

76

The respondents’ perception on the effects of price haggling on Consumers’ buying decision

making is presented in Tables 4.9 and 4.10.

Table 4.9: Consumers’ Perception of Price Haggling Effects on buying Decision Making

SA

(%)

A

(%)

NO

(%)

D

(%)

SD

(%)

Mean Std.

Dev.

I haggle when making buying decisions 77

(34.2)

110

(48.9)

0

(0.0)

26

(11.6)

12

(5.3)

3.95 1.13

Bargaining affects all my products and

brand buying choices

90

(40.0)

105

(46.7)

15

(6.7)

10

(4.4)

5

(2.2)

4.18 0.90

As a consumer, I believe in haggling as

against fixed price strategy in making

effective buying choice

49

(21.8)

115

(51.1)

20

(8.9)

24

(10.7)

17

(7.6)

3.69 1.15

Haggling on price does not have significant

effects on the buying decision making of

consumers

3

(1.3)

4

(1.8)

9

(4.0)

122

(54.2)

87

(38.7)

1.73 0.74

Price haggling tends to be related to price

sensitivity when making buying decision.

38

(16.9)

100

(44.4)

48

(21.3)

23

(10.2)

16

(7.1)

3.54 1.11

Source: Field survey, 2014

As presented in Table 4.9, 77 (34.2%) respondents and 110 (48.9%) respondents strongly

agreed and agreed respectively that they haggle/bargain when making buying decisions while

26 (11.6%) respondents and 12 (5.3%) respondents disagreed and strongly disagreed

respectively that they haggle/bargain when making buying decisions. Having a mean

response score of 3.95 + 1.13, majority of the sampled consumers haggle/bargain when

making buying decisions.

Ninety (40%) respondents strongly agreed that bargaining affects all their products and

brands choices. 105 (46.7%) respondents agreed, 15 (6.7%) respondents did not have any

opinion, 10 (4.4%) respondents disagreed and 5 (2.2%) respondents strongly disagreed. With

77

a mean response score of 4.18 + 0.90, the respondents agree that bargaining affects all their

products and brands buyingchoices.

From the mean response score of 3.69 + 1.15 and the responses of 49 (21.8%) respondents,

115 (51.1%) respondents, 20 (8.9%) respondents, 24 (10.7%) respondents and 17

(7.6%)respondents who strongly agreed, agreed, did not have any opinion, disagreed and

strongly disagreed, the respondents agreed that as consumers, they believe in haggling as

against fixed price strategy in making effective buying choice.

With 3 (1.3%) respondents strongly agreeing, 4 (1.8%) respondents agreeing, 9 (4%)

respondents having no opinion, 122 (54.2%) respondents disagreeing and 87 (38.7%)

respondents strongly disagreeing as well as a mean response score of 1.73 + 0.74, the

respondents disagree that haggling on price does not have significant effects on the buying

decision making of consumers.

In response to whether price haggling tends to be related to price sensitivity 38 (16.9%)

respondents strongly agreed, 100 (44.4%) respondents agreed, 48 (21.3%) respondents had

no opinion, 23 (10.2%) respondents disagreed and 16 (7.1%) respondents strongly disagreed.

With a mean response of 3.54 + 1.11, the respondents agreed that price haggling tends to be

related to price sensitivity when making buying decision.

78

Table 4.10: Traders’ Perception of Price Haggling Effects on Buying Decision MakingSA

(%)

A

(%)

NO

(%)

D

(%)

SD

(%)

Mean Std.

Dev.

As a trader, I have initiated

haggling/bargaining activity in my

selling efforts towards consumers.

75

(26.8)

152

(54.3)

24

(8.6)

16

(5.7)

13

(4.6)

3.93 1.00

Haggling affects all buying choices of

the customers regarding the final

product, its price and the choice

traders.

144

(51.4)

124

(44.3)

12

(4.3)

0

(0.0)

0

(0.0)

4.47 0.58

Haggling on price does not have

significant effects on buying

decision making of consumers.

30

(10.7)

48

(17.1)

19

(6.8)

139

(49.6

)

44

(15.7)

2.58 1.24

Price haggling tends to be related to

price sensitivity when consumers

make their buying decision.

95

(33.9)

117

(41.8)

33

(11.8)

20

(7.1)

15

(5.4)

3.92 1.11

Source: Field survey, 2014

As presented in Table 4.10, 75 (26.8%) respondents strongly agreed that they have initiated

haggling activity in their selling efforts, 152 (54.3%) respondents agreed with this statement,

24 (8.6%) respondents had no opinion and 13 (4.6%) respondents strongly disagreed. With a

mean response score of 3.93 + 1.00, majority of the respondents agreed that they have

initiated haggling/bargaining activity in their selling efforts towards consumers.

From the responses of 144 (51.4%) respondents who strongly agreed, 124 (44.3%)

respondents who agreed, and 12 (4.3%) respondents who had no opinion, as well as the mean

response rate of 4.47 + 0.58, the respondents agree that haggling affects all buying choices of

the customers regarding the final product, its price and the choice traders.

79

With a mean response score of 2.58 + 1.24, and 30 (10.7%) respondents strongly agreeing, 48

(17.1%) respondents agreeing, 19 (6.8%) respondents having no opinion, 139 (49.6%)

respondents disagreeing and 44 (15.7%) respondents strongly disagreeing, the respondents

did not agree that haggling on price does not have significant effect on the buying decision

making of consumers.

As indicated from the respondents of 95 (33.9%) respondents and 117 (41.8%) respondents

who strongly agreed and agreed respectively and the responses of 33 (11.8%) respondents, 20

(7.1%) respondents and 15 (5.4%) respondents who had no opinion, disagreed and strongly

disagreed respectively, as well as the mean response score of 3.92 + 1.11, the respondents are

of the opinion that price haggling tends to be related to price sensitivity when consumers

make their buying decisions.

4.2.5.2 Effects of Price Haggling on Consumers’ Repeat Patronage

The opinion of the sampled consumers and traders on effects of price haggling on consumers’

repeat patronage are presented in Table 4.11.

Table 4.11: Consumers’ Perception of Price Haggling Effects on Repeat PatronageSA

(%)

A

(%)

NO

(%)

D

(%)

SD

(%)

Mean Std.

Dev.

Price haggling outcomes often

affectsconsumers’ repeat purchase

and loyalty.

55

(24.4

)

108

(48.0)

17

(7.6)

23

(10.2

)

22

(9.8)

3.67 1.23

Price haggling is the main factor

that affects buyers’ patronage

regarding the product choice.

29

(12.9

)

128

(56.9)

24

(10.7)

27

(12.0

)

17

(7.6)

3.56 1.10

Price haggling does not always

bring about repeat patronage.

21

(9.3)

68

(30.2)

63

(28.0)

35

(15.6

)

38

(16.9)

3.00 1.23

Source: Field survey, 2014

80

Table 4.11 shows us that 55 (24.4%) respondents strongly agreed that price haggling

outcomes often affects the consumers’ repeat purchase and loyalty, 108 (48%) respondents

agreed that it does, 17 (7.6%) respondents had no opinion whether it does or not, 23 (10.2%)

respondents disagreed that it does while 22 (9.8%) respondents strongly disagreed that it

does. Having a mean response score of 3.67 + 1.23, the respondents agreed that price

haggling outcomes often reflect the consumers’ choice of seller and loyalty.

From the responses of 29 (12.9%) respondents who strongly agreed, 128 (56.9%) respondents

who agreed, 24 (10.7%) respondents who had no opinion, 27 (12%) respondents who

disagreed and 17 (7.6%) respondents who strongly disagreed as well as the mean response

score of 3.56 + 1.10, the respondents are of the opinion that price haggling is the main factor

that affects buyers patronage regarding the product choice.

As can be gathered from the responses of 21 (9.3%) respondents, 68 (30.2%) respondents, 63

(28%) respondents, 35 (15.6%) respondents and 38 (16.9%) respondents who strongly

agreed, agreed, had no opinion, disagreed and strongly disagreed, and the mean response

score of 3.00 + 1.23, the respondents did not agree that price haggling does not always bring

about repeat patronage.

Table 4.12: Traders’ Perception of Price Haggling Effects on Repeat PatronageSA

(%)

A

(%)

NO

(%)

D

(%)

SD

(%)

Mean Std.

Dev.

Price haggling outcomes often

affects traders’ sales.

96

(34.3

)

115

(41.1)

24

(8.6)

22

(7.9)

23

(8.2)

3.85 1.21

Price haggling is the main factor

that determines traders’ repeat sales.

120

(42.9

148 12 0 0 4.39 0.57

81

) (52.9) (4.3) (0.0) (0.0)

Price haggling doesn’t always bring

about customer retention.

38

(13.6

)

49

(17.5)

38

(13.6)

78

(27.9)

77

(27.5

)

2.62 1.40

Source: Field survey, 2014

As presented in Table 4.12, 96 (34.3%) sampled traders strongly agreed that price haggling

outcomes often affects traders sales, 115 (41.1%) sampled traders agreed with this, 24 (8.6%)

sampled traders had no opinion, 22 (7.9%) sampled traders disagreed with this and 23 (8.2%)

sampled traders strongly disagreed with this. With a mean response score of 3.85 + 1.21, the

sampled traders agreed that price haggling outcomes often affects traders’ sales level.

One hundred and twenty (42.9%) respondents strongly agreed that price haggling is the main

factor that determines traders’ repeat sales, 148 (52.9%) respondents agreed with this and 12

(4.3%) respondents had no opinion. Having a mean response score of 4.39 + 0.57, the

sampled traders are of the opinion that price haggling is the main factor that determines

traders’ repeat sales.

Having a mean score of 2.62 + 1.40 and 38 (13.6%) respondents strongly agreeing, 49

(17.5% respondents agreeing, 38 (13.6%) respondents being having no opinion, 78 (27.9%)

respondents disagreeing, and 77 (27.5%) respondents strongly disagreeing, the sampled

traders do not agree that price haggling does not always bring about customer retention.

4.2.5.3 Effects of Price Haggling on Open Market Operation

The respondents’ perceived effects of price haggling on open market system are presented in

Tables 4.13 and 4.14.

82

Table 4.13: Consumers’ Perception of Price Haggling Effects on Open Market Operation

SA

(%)

A

(%)

NO

(%)

D

(%)

SD

(%)

Mea

n

Std.

Dev.

Haggling is often done when making

buying decisions in an open market

operation.

43

(19.1)

117

(52.0)

19

(8.4)

22

(9.8)

24

(10.7)

3.59 1.21

Price is the only variable that I

haggle on during an open market

operation.

34

(15.1)

115

(51.1)

28

(12.4)

32

(14.2)

16

(7.1)

3.52 1.13

In an open market operation, my

perception regarding haggling prices

as against fixed price tactics is

positive.

15

(6.7)

63

(28.0)

119

(52.9)

21

(9.3)

7

(3.1)

3.26 0.84

Haggling wastes time during open

market operation.

110

(48.9)

115

(51.1)

0

(0.0)

0

(0.0)

0

(0.0)

4.49 0.50

My perception of open market

operation is bad when traders refuse

my proposal when haggling.

38

(16.9)

120

(53.3)

57

(25.3)

7

(3.1)

3

(1.3)

3.81 0.80

Source: Field survey, 2014

From Table 4.13, 43 (19.1%) respondents strongly agreed that they haggle in an open market

operation, 117 (52%) respondents agreed that they do so, 19 (8.4%) respondents did not have

any opinion on whether they haggle in an open market, 22 (9.8%) respondents disagreed that

they haggle in an open market while 24 (10.7%) respondents strongly disagreed that they

83

haggle in an open market. Having a mean response score of 3.59 + 1.21, the respondents

agreed that they haggle when making buying decision in an open market operation.

Thirty four (15.1%) respondents strongly agreed that they haggle only on price or on other

marketing variables, 115 (51.1%) respondents agreed that they haggle only on price or on

other marketing variables, while 28 (12.4%) respondents had no opinion. However, 32

(14.2%) respondents disagreed to haggling only on price or on other marketing variables and

16 (7.1%) respondents strongly disagreed with this. Having a mean response score of 3.52 +

1.13, the respondents are of the opinion that they haggle not only on price but on other

marketing variables during an open market operation.

Fifteen (6.7%) respondents strongly agreed that they have positive perception regarding

haggling prices as against fixed price tactics. 63 (28%) respondents agreed that it is positive,

119 (52.9%) respondents did not have any opinionand 21 (9.3%) respondents disagree with it

while 7 (3.1%) respondents strongly disagree with it. With a mean response score of 3.26 +

0.84, the respondents are of the view that their perception regarding haggling prices as

against fixed price tactics is positive in an open market operation.

All the respondents agreed that haggling wastes time during market operation. This is

captured in the responses of 110 (48.9%) respondents who strongly agreed and 115 (51.1%)

respondents who agreed to this assertion as well as the mean response score of 4.49 + 0.50.

Thirty eight (16.9%) respondents strongly agreed that their perception of open market is bad

when traders refuse their proposals. 120 (53.3%) respondents agreed with this assertion, 57

(25.3%) respondents did not have any opinion, 7 (3.1%) respondents disagreed with this

assertion and 3 (1.3%0 respondents strongly disagreed with this assertion. Having a mean

84

response score of 3.81 + 0.80, the respondents noted that their perception of open market is

bad when traders refuse their proposals when haggling.

Table 4.14: Traders’ Perception of Price Haggling Effects on Open Market OperationSA

(%)

A

(%)

NO

(%)

D

(%)

SD

(%)

Mean Std.

Dev.

Haggling activities consume much

time and efforts of trader in open

market operation.

205

(73.2)

75

(26.8

)

0

(0.0)

0

(0.0)

0

(0.0)

4.73 0.44

In open market operations, my

perception regarding haggling price

against fixed price is positive.

108

(38.6)

108

(38.6

)

31

(11.1)

25

(8.9)

8

(2.9)

4.01 1.06

My perception of haggling in an

open market is bad when consumers

refuse my proposal when haggling.

25

(8.9)

47

(16.8

)

80

(28.6)

80

(28.6)

48

(17.1

)

2.72 1.19

Source: Field survey, 2014

As presented in Table 4.14, 205 (73.2%) respondents strongly agreed that haggling activities

consume much time and efforts of traders in open market operations and 75 (26.8%)

respondents agreed to this statement. Since the mean response score is 4.73 + 0.44, it shows

that all the respondents agreed that haggling activities consume much time and efforts of

traders in open market operations.

Having 108 (38.6%) respondents that strongly agreed, another 108 (38.6%) respondents that

agreed 31 (11.1%) respondents that have no opinion, 25 (8.9%) respondents that disagreed

and 8 (2.9%) respondents that strongly disagreed and a mean response of 4.01 + 1.06, the

85

respondents agreed that consumers’ perception regarding haggling price against fixed price is

positive in an open market operation.

The sampled traders did not agree that consumers perception of haggling in an open market is

bad when they (traders) refuse their proposal This is reflected in the mean response score of

2.72 + 1.19, and the responses of 25 (8.9%) respondents who strongly agreed, 47 (16.8%)

respondents who agreed 80 (28.6%) respondents who had no opinion, 80 (28.6%)

respondents who disagreed and 48 (17.1%) respondents who strongly disagreed.

4.2.5.4 Effects of Price Haggling on Consumer/Seller Relationship

The respondents’ perception on the effects of price haggling on consumer/seller relationship

is presented in Table 4.15.

Table 4.15: Perception of Price Haggling Effects on Consumer/Seller RelationshipRespondent SA

(%)

A

(%)

NO

(%)

D

(%)

SD

(%)

Mean Std.

Dev.

Haggling can cause

disagreement or

conflict that may

arise in purchasing

Consumer 55

(24.4)

56

(24.9

)

47

(20.9)

34

(15.1)

33

(14.7

)

2.32 1.07

Trader 90

(32.1)

103

(36.8

)

57

(20.4)

20

(7.1)

10

(3.6)

3.87 1.06

Source: Field survey, 2014.

Table 4.15 shows that 5 (2.2%) sampled consumers strongly agreed that haggling can cause

disagreement or conflict that may arise in purchasing, 33 (14.7%) sampled consumers agreed

with this, 47 (20.9%) sampled consumers did not have any opinion on this matter, 84 (37.3%)

sampled consumers disagreed with this view and 56 (24.9%) respondents strongly disagreed

with this view. Having a mean response score of 2.32 + 1.07, the sampled consumers are not

of the opinion that haggling can cause disagreement or conflict that may arise in purchasing.

86

However the sampled traders agreed that haggling can cause disagreement or conflict that

may arise in purchasing. This is captured in the traders’ responses which showed 90 (32.1%)

sampled traders strongly agreeing, 103 (36.8%) sampled traders agreeing, 57 (20.4%)

sampled traders being undecided, 20 (7.1%) sampled traders disagreeing and 10 (3.6%)

sampled traders strongly disagreeing, as well as the mean response score of 3.87 + 1.06.

4.3 Test of Hypotheses

4.3.1 Test of Hypothesis One

Table 4.16: Summary Responses on Variables to Measure Effect of Haggling on

Consumers’ Buying Decision Making

Groups SA A NO D SD TOTAL

Consumer 257 434 92 205 137 1125

Trader 344 441 88 175 72 1120

Total 601 875 180 380 209 2245

Source: Field Survey, 2014.

Price haggling does not have a significant effect on consumers’ buying decision making

Table 4.17: Summarised Regression Results for Hypothesis One

Groups R R2 RegSSResS

SF Sig. Α βHagg

t-value

Consumers0.88

8

0.78

8174.834

46.98

1

829.83

40.000

1.24

10.946

28.807

Traders0.85

7

0.73

4100.021

36.27

9

766.02

10.000

2.46

10.536

27.685

Source: Appendix V

4.3.1.1 Analysis of Data from Consumers

87

R, the correlation coefficient, which has a value of 0.888 indicates that there is a relationship

between the dependent variable (Buying Decision Making) and the independent variable

(haggling). R square, the coefficient of determination, shows that 78.8% of the variation in

the dependent variable is explained by the model.

The regression sum of squares (174.834) is greater than the residual sum of squares (46.981)

which indicates that more of the variation in the dependent variable is explained by the

model. The significance value of the F statistics (0.000) is less than 0.05, which means that

the variation explained by the model is not due to chance. The Hagg coefficient of 0.946

indicates a positive relationship between haggling and buying decision making, which is

statistically significant (with t = 28.807).

These results reveal that from the consumers’ responses, price haggling has a significant

effect on their buying decision making.

4.3.1.2 Analysis of Data from Traders

R, the correlation coefficient, which has a value of 0.857 indicates that there is a relationship

between the dependent variable (Buying Decision Making) and the independent variable

(haggling). R square, the coefficient of determination, shows that 73.4% of the variation in

the dependent variable is explained by the model.

The regression sum of squares (100.021) is greater than the residual sum of squares (36.279)

which indicates that more of the variation in the dependent variable is explained by the

model. The significance value of the F statistics (0.000) is less than 0.05, which means that

the variation explained by the model is not due to chance. The Hagg coefficient of 0.536

88

indicates a positive relationship between haggling and buying decision making, which is

statistically significant (with t = 27.685).

These results reveal that from the traders’ responses, price haggling has a significant effect on

their consumers’ buying decision making.

4.3.1.3 Decision

Based on the above analysis, the null hypothesis is rejected and the alternative hypothesis

accepted accordingly. Hence, price haggling has a significant effect on consumers’ decision

making.

4.3.2 Test of Hypothesis Two

Table 4.18: Summary Responses on Variables to Measure the Effect of Price Haggling

on Repeat Patronage.

Groups SA A NO D SD TOTAL

Consumer 105 304 104 85 77 675

Trader 254 312 74 100 100 840

Total 359 616 178 185 177 1515

Source: Field Survey, 2014.

Price Haggling does not have significant effect on consumers’ repeat patronage.

Table 4.19: Z-Test Results for Hypothesis TwoGroups Mean Std. Dev. Z-value Sig.

Consumers 3.4074 1.1502 3.971 0.000

Traders 3.6190 0.9955 2.786 0.000

Source: Appendix VI

4.3.2.1 Analysis of Data from Consumers

89

With a Z-value of 3.971, which is greater than the critical Z of 1.96 (at 95% confidence

interval), it is observed that the consumers responses on the effectiveness of price haggling

on consumers’ repeat patronage is uniformly distributed. With p < 0.05, this result is

significant.

4.3.2.2 Analysis of Data from Traders

With a Z-value of 2.786, which is greater than the critical Z of 1.96 (at 95% confidence

interval), it is observed that the traders’ responses on the effectiveness of price haggling on

consumers’ repeat patronage is uniformly distributed. With p < 0.05, this result is significant.

4.3.2.3 Decision

From the foregoing, the null hypothesis is rejected and the alternative hypothesis accordingly

accepted. Hence, price haggling has significant effect on consumers’ repeat patronage.

4.3.3 Test of Hypothesis Three

Table 4.20: Summary of Responses on Variables to Measure Consumers’ Perception

of Price Haggling Effect on Open Market Operation

Groups SA A NO D SD Total

Consumer 240 530 223 82 50 1125

Trader 338 230 111 105 56 840

Total 578 760 334 187 106 1965

Source: Field Survey, 2014.

Price haggling does not affect open market operation.

90

Table 4.21: Z-Test Results for Hypothesis Three

Groups Mean Std. Dev. Z-value Sig.

Consumers 3.8074 0.8327 2.620 0.000

Traders 3.8527 0.8266 3.057 0.000

Source: Appendix VII

4.3.3.1 Analysis of Data from Consumers

With a Z-value of 2.620, which is greater than the critical Z of 1.96 (at 95% confidence

interval), it is observed that the consumers responses on the positive effects of price haggling

on open market operation is uniformly distributed. With p < 0.05, this result is significant.

4.3.3.2 Analysis of Data from Traders

With a Z-value of 3.057, which is greater than the critical Z of 1.96 (at 95% confidence

interval), it is observed that the traders’ responses on the positive effects of price haggling on

open market operation is uniformly distributed. With p < 0.05, this result is significant.

4.3.3.3 Decision

From the foregoing, the null hypothesis is rejected and the alternative hypothesis accordingly

accepted. Hence, price haggling has positive effects on open market operation.

4.3.4 Test of Hypothesis Four

Table 4.22: Summary Responses on Variables to Measure Consumers’ Perception of

Price Haggling Effects on Consumer/Seller Relationship

Groups SA A NO D SD Total

Consumer 55 56 47 34 33 225

Trader 90 103 57 20 10 280

91

Total 145 159 104 54 43 505

Source: Field Survey, 2014.

Price haggling has no significant effects on consumer/seller relationship

Table 4.23: Summarised Regression Results for Hypothesis Four

Groups R R2 RegSSResS

SF Sig. Α βHagg

t-value

Consumers0.88

4

0.78

1200.661

56.29

9794.811 0.000

-

0.7041.013

28.192

Traders0.93

0

0.86

4269.772

42.33

91771.339 0.000 1.012 0.880

42.087

Source: Appendix VIII

4.3.4.1 Analysis of Data from Consumers

R, the correlation coefficient, which has a value of 0.884, indicates that there is a relationship

between the dependent variable (Consumer/Seller Relationship) and the independent variable

(haggling). R square, the coefficient of determination, shows that 78.1% of the variation in

the dependent variable is explained by the model.

The regression sum of squares (200.661) is greater than the residual sum of squares (56.299)

which indicates that more of the variation in the dependent variable is explained by the

model. The significance value of the F statistics (0.000) is less than 0.05, which means that

the variation explained by the model is not due to chance. The Hagg coefficient of 1.013

indicates a positive relationship between haggling and consumer/seller relationship, which is

statistically significant (with t = 28.192).

92

These results reveal that from the consumers’ responses, price haggling has significant effects

on consumer/seller relationship.

4.3.4.2 Analysis of Data from Traders

R, the correlation coefficient, which has a value of 0.930 indicates that there is a relationship

between the dependent variable (Consumer/Seller Relationship) and the independent variable

(haggling). R square, the coefficient of determination, shows that 86.4% of the variation in

the dependent variable is explained by the model.

The regression sum of squares (269.772) is greater than the residual sum of squares (42.339)

which indicates that more of the variation in the dependent variable is explained by the

model. The significance value of the F statistics (0.000) is less than 0.05, which means that

the variation explained by the model is not due to chance. The Hagg coefficient of 0.880

indicates a positive relationship between haggling and decision making, which is statistically

significant (with t = 42.087).

These results reveal that from the traders’ responses, price haggling has significant effects on

consumer/seller relationship.

4.3.4.3 Decision

Based on the above analysis, the null hypothesis is rejected and the alternative hypothesis

accepted accordingly. Hence, price haggling has significant effects on consumer/seller

relationship.

93

REFERENCES

Brassington, S. and Pettitt, F. (2003) Principles of Marketing. London: Prentice Hall Inc.

Gbede, G. O. (2001) Strategic Sales Force Management. Lagos: Westboume School Print.

Jobber, D. (2013) Principles of Marketing. New York: Prentice Hall Inc.

Kotler, P. and Keller, K. (2013) Marketing Management. India: Pearson Publishers Ltd.

Makaley, M.M. (2001) Theory and Practice in Marketing. Ontario-Canada: McGraw Hill

Inc.

Moncrieff, W. (2010) “Haggling Pricing Strategy” Journal of Marketing, Vol. 17(July)

Onah, J. O. and Okoli, B. I. C. (2014) Traditional Markets and Marketing in Nigeria. Enugu:

Ezu Books Ltd.

Rogers, M. (2006) Theory of Marketing. London: Westline Prints.

94

CHAPTER FIVE

SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS

5.1 Introduction

This chapter focuses on the summary of findings, conclusion and recommendations for this

research.

5.2 Summary of Findings

The following are the summary of major findings based on the analyses of the research

questions and the tested hypotheses of the study.

Price haggling has a significant effect on consumers’ buying decision making. It was

found out that haggling process facilitates final purchase decision making.

Consumers’ willingness to buy is a consequence of favourable haggling process. It

was established that haggling affects the buying choices of the consumers.

Consequent upon the price sensitivity of consumers, most consumers prefer haggling

to fix price strategy in making buying decisions.

Price haggling is significantly effective on consumers’ repeat patronage. Repeat

purchase rather than trial purchase is germane to sustenance of business. It was

discovered that haggling makes consumers feel that they are part of the business.

After all, they participate in the process of arriving at the final price of the product.

This removes mistrust and suspicion, thereby building confidence in the consumer to

repeat purchase and return to the seller. Thus,repeat sales enhance the seller and

consumer relationship.

Price haggling has positive effects on open market operation. Findings revealed that

prices for most goods are not fixed in the selected traditional markets in Ibadan. It was

also discovered that even when certain goods have fixed prices, some consumers have

always attempted haggling on the prices. To most consumers, haggling practice is

95

convenient and fosters better relationships. It also fosters better knowledge of the

goods and their substitutes. The negative effect of time consumption is justified in the

belief that both consumers and traders have a lot to gain from the haggling process.

Price haggling has significant effects on consumer/seller relationship. It was found out

that healthy consumer-seller relationship is paramount in the mind of every trader.

The relationship has the capacity to create an informal information transaction

between the seller and the consumer. It was discovered that the relationship ensures a

personal touch which makes the seller and the consumer to be closer. Also the parties

have a better understanding of each other when involved in haggling. Friendship is

created as a result of familiarity arising from haggling. This oftentimes gives rise to a

situation where both parties have intimate discussions on personal issues beyond

business transaction.

5.3 Conclusion

This study on effects of price haggling strategy on consumers’ decision making in selected

traditional markets in Ibadan, Oyo State, Nigeria, focused on ascertaining the effects price

haggling as a strategy has on the buyer – seller process in traditional markets. Price haggling

has been established to exist, particularly in open markets. Sellers and buyers alike are

involved in the price haggling process, as it takes two to tango.

Price haggling as a marketing strategy plays a very important role in ensuring that consumers

make informed decisions on goods they want to purchase. The decisions are informed

because consumers do not only haggle about the prices of the goods, but they also get to

know more about the features of the goods being haggled over. In some cases, the haggling

process has enabled the consumers to make better choices of buying alternate products which

96

are better than the ones being haggled over, or detecting sellers that are not sincere. In all,

the price haggling process has the benefit of ensuring that consumers make appropriate

decisions on their buying process, create a good seller – buyer relationship which could result

in repeat patronage and could enhance sincere trading activities in the open market.

While in certain occasions, price haggling has resulted in time wastage and misunderstanding

between the parties involved, it has,on the other hand, ensured that the gains of personal

marketing are achieved. We can admit that the haggling process still has more room for

improvement. When improved upon it will ensure that the trading process in open markets is

more constructive, objective, honest and satisfying.

5.4 Recommendations

Based on the findings of this study, it is being recommended that;

Improvement should be made on the haggling process that will ensure trust, fairness

and justified price for product purchase. When this is done, it has the potentials of

ensuring that consumers are able to make buying decisions faster, thereby reducing to

thebarest minimum time wasted in haggling repeatedly over certain goods.

Manufacturers should set retail price range which has a minimum price and maximum

price on goods, thereby creating a situation where no party in the haggling process is

or feels cheated.

Consumers and sellers alike should develop effective communication and haggling

skills, which have the ability to ensure quick intelligibility, could foster better

relationships and ensure effective bargaining process.

While haggling is viewed in some settings as ‘war’, it should be very strategic in

implementation with little or no hostilities being experienced between the parties.

This will ensure repeat patronage by consumers to the particular sellers.

97

5.5 Contribution to Knowledge

98

Consumer SellerOffer

Counter Offer

Strengths & Weaknesses

PersonalityEmotional Barriers

ImpressionSelf Image

Fear of Rejection

Product BarriersInformationAlternativesCompetitorsPlaceTime

Environmental BarriersCultural & Social NormsPrevailing Market ConditionsTrends taking placePerception of haggling price against fixed price tactics

Product Purchase

False PricingLack of TrustTime WastageNo Purchase

A conceptual model has been developed arising from the models reviewed to address

the problem of time wasting, lack of trust, lack of confidence and false pricing that

may be subjected to haggling.

Fig. 5.1:

Researcher’s Conceptualised Haggling Process Model

Three major setbacks to haggling have been noticed as emotional barriers, product barriers

and environmental barriers. These setbacks were arrived at based on various theories

reviewed in the research work. Smith’s (1946) work on main obstacles to haggling

highlighted the impact of the environmental barriers presented in the conceptualized model.

In his work, Makaleley (2001) showed the effects of barriers such as place and time on

99

haggling while Pent (2006) introduced Integrative Theory, which formed the basis of product

barrier concept in the model. The Personality Theory reviewed by Kent (1974) revealed that

the personality of the seller and the buyer play a significant role in initiating offers and

counter-offers in the process of bargaining, which Coles (1998) termed to be the Negotiation

Process. Also, in the Classical Bargaining theory reviewed by Kent (1974) it was argued that

the strength and weakness of either party determine the trend of the negotiation. If a

compromise is reached, a purchase is effected, but if not, the whole process is punctuated

with false pricing, lack of trust, time wastage and consequently no purchase is effected. In

case of negative outcome (i.e. no purchase), the process starts all over again in another shop

until purchase is made.

5.6 Suggestions for Further Study

This study basically focused on effects of price haggling strategy on consumers’ decision

making. It pointed out that price haggling does aid the consumer in making buying decisions.

However, in the course of the work, the need for effective haggling process is highlighted.

To this end, the researcher suggests that further studies should be carried out on models and

strategies of implementing effective haggling processes in business transactions.

100

BIBLOGRAPHY

Achumba, I. C. (2004) Consumer Behaviour. Lagos: University Press Ltd

Adekeye, M. (2008) Nigeria Marketing System and Theory. Ekiti–Nigeria: Excellence Prints.

Adeoti, O. (2004) Principles and Practices of Marketing. Ibadan: Noiceless Effective

Communications.

Agbonifoh, B. A, Ogwo, O.E. and Nnolim, D. A. (1998) Marketing in Nigeria. Onitsha:

Afritowers Limited Publishers.

American Marketing Association (1960) “A Collection of Marketing Definitions” In

Achumba, I. C. (2004), Consumer Behaviour. Lagos: University Press Ltd.

Anderson, D.R, Sweeny, D.J., and Williams, T.A. (2011) Statistics for Business and

Economic. USA: South Western Cengage Learning.

Archarya, G. (2012) “Towards Constructive Price Haggling Theory”. Journal of

Marketing,IMA.Volume VIII (September)

Assael, H (1987) “Consumer Buying Behaviour”, In McCarthy, E. J. and Perrault, M. (2005),

Basic Marketing: A Global Managerial Approach. USA: McGraw Hill Incorporation.

Baily, P.J.H. (2007) “Purchasing and Supply Management”, In McCarthy, E. J. and Perrault,

M. (2005), Basic Marketing: A Global Managerial Approach. USA: McGraw Hill

Incorporation.

Baker, M. J. (1985) “Marketing: An Introductory Text”, In Farayola, O. and Adeyanju O.

(2008), Fundamentals of Marketing. Ibadan: AkaCom Publishing.

Bartch, M. (1968) “Theory of Marketing Management”, In Brassington, S. and Pettitt, F.

(2003), Principles of Marketing. London: Prentice Hall Inc.

Bland J.M. and Altman D.G. (1997) “Cronbach’s Alpha”, BMJ; 314:572 (May)

Brassington, S. and Pettitt, F. (2003) Principles of Marketing. London: Prentice Hall Inc.

101

Chartered Institute of Marketing. (CIM; UK) (2001) Definitions of Marketing. London: CIM

UK Press.

Chartered Institute of Purchasing and Supply (CIPS; UK) (2004) “Negotiation in the

Contemporary Times” Journal of Purchasing &Supply 2004Vol. II (October)

Coles, N.T. (1998) Pricing and Negotiation. Canada: Westminland Printing Press.

Copper, (1996) “What Exactly is Marketing? Quarterly Review of Marketing. Journal of

Marketing; AMA 1996. Vol. IV (February)

Cronbach, L.J. (1951) “Coefficient Alpha and the Internal Structure of Tests”, Psychometrika

22(3), (First quarter)

Drucker, P. (1954) “Marketing Management”, In Kotler, P. and Amstrong, G. (2008),

Principles of Marketing. India: Pearson Publishers Ltd.

Ebo, C. (2009) Social and Economic Research: Principles and Methods. Enugu: African

Insstitute for Applied Economics.

Engel, J. F, Blackwell R.D and Kollat G. (1978) “Consumer Behaviour”, In Jobber, D.

(2006), Principles of Marketing. New York: Prentice Hall Inc.

Enis, T. (1977) “Marketing Theory and Practice”, In Kotler, P. and Keller, K. (2006),

Marketing Management. India: Pearson Publishers Ltd.

Farayola, O. and Adeyanju O. (2008) Fundamentals of Marketing. Ibadan: AkaCom

Publishing.

Gbede, G. O. (2001) Strategic Sales Force Management. Lagos: Westboume School Print.

Graeber, M. (1995)“Historical Development Structure of Haggling”. Journal of Marketing

Research. (September)

Harris, G. (1998) ‘Islanders Discover Sheep-Day Return’. The Time,(October)

Howard, S. and Shelth, M. (1975) “Buying Behaviour”, In Makaleley M. M. (2001), Theory

of Pricing in Marketing. Ontario-Canada: McGraw Hill Inc.

102

Institute of Marketing, UK, (1996) The Marketing Definition. Journal of Marketing,July,

(Quarterly Publication)

Jhighan, M.L. (2006) Macro-Economic Theory. India: Vrinda Publishers.

Jobber, D. (2013) Principles of Marketing. New York: Prentice Hall Inc.

Johnson, D. (1986) Roles of Research. Lagos: Lifeline Printing Press.

Kent, M. (1974) “Price Haggling in Contemporary World”, In McCarthy, E. J. and Perrault,

M. (2005), Basic Marketing: A Global Managerial Approach. USA: McGraw Hill

Incorporation.

Kotler, P. (1980) Marketing Management: Analysis, Planning and Control. London; Prentice

Hall International.

Kotler, P. and Keller K. (2010) Marketing Management. USA: Prentice Hall Inc.

Kotler, P. and Amstrong, G. (2010) Principles of Marketing. India: Prentice Publishers Ltd.

Kotler, P. and Keller, K. (2013) Marketing Management. India: Pearson Publishers Ltd.

Lancaster, G. and Massinghan, L. (2010) Essentials of Marketing. USA: McGraw Hill Inc.

Landes T. (2005) “Understanding Haggling Tactics and Strategies”. Journal of Empirical

Pricing. School of Economics, Malaysia.

Laolu, M.I. (2009) “Traditional Markets in Ibadan City”. Journal of Sociological

Development. Vol. 23 (May)

Lindsay, M. (2012) Rules Governing the Haggling Situation in the World. Access from

www.ebuzz.com. On 17th July, 2012.

Luck, D. and Rubin, D. (199) Marketing Research. India: Prentice Hall Incorporation.

Lysons, C. K. (1993) Purchasing: M&E Handbooks. London: Pitman Publishing.

Makaleley M. M. (2001) Theory of Pricing in Marketing. Ontario-Canada: McGraw Hill

Inc.

Mandela N. (2010) Conversation with Myself. Farar, Strans and Givout. New York: USA

103

Mazur, Z. (1947) “Roles of Marketing in Economic Development”, In Perks, S. and

Oosthuizen, N. (2013), “Exploring Supplier Negotiation Best Practices and Supplier

Relationships Strategies in South Africa” Society of Interdisciplinary Business

Research, 2(1), access from www.sibresearch.orgon July 2013

McCarthy, E. J. and Perrault, M. (2005) Basic Marketing: A Global Managerial Approach.

USA: McGraw Hill Incorporation.

Mint, F. (2004) Understanding Pricing. London: Macmillan Publishers.

Moncrieff, W. (2010) Haggling Pricing Strategies: the Merit and Demerit. Journal of

Marketing, Vol. 17(July)

Nwaizugbo C. and Onah J. (2004) “An Appraisal of Pricing Methods in Nigeria and their

Marketing Implications” Nigerian Journal of Marketing, Vol. 5, No. 1, April.

Olakunori, S. (2009) Marketing in Nigeria. Ibadan: Spectrum Books Ltd.

Onah, J.O. and Okoli, B.I.C. (2014) Traditional Markets and Marketting in Nigeria. Enugu:

Ezu Books Ltd.

Onodugo, V; Ugwuonah G. and Ebinne, S. (2010) Social Science Research Principles,

Methods and Applications. Enugu: El’ Demark Publishers.

Onwura, E.A. (1998) Introduction to Academic Research Methods. Enugu: Gostak Printing

and Publishing Co. Ltd.

Pent, W.J. (2006) Pricing Strategies in Developing Economies. New Jersey: Prentice Hall

Inc.

Perks, S. and Oosthuizen, N. (2013) “Exploring Supplier Negotiation Best Practices and

Supplier Relationships Strategies in South Africa” Society of Interdisciplinary

Business Research, 2(1), access from www.sibresearch.orgon July 2013

Putnam H. (1985) Philosophy of Mathematics Selected Readings. New Jersey: Prentice Hall.

104

Rapoport, A., Erev, I., and Zwick, R. (1995) “An Experimental Study of Buyer-Seller

Negotiation with One-Sided Incomplete Information and Time Discounting”,

Management Science, 41(3), March

Rapoport et al. (1964), Two-Person Game Theory: The Essential Ideas, Ann Arbor:

University of Michigan, New York.

Rogers, M. (2006) Theory of Marketing. London: Westline Prints.

Rubinstein, A. (1982) “A Bargaining Model”. Journal of Economic Research,1982, Vol. 17

(July)

Schewe, T. and Smith J. D. (1983) Modern Marketing. London: Macmillian Press Ltd.

Schiffman, L.G. and Kanuk, L.L. (2005) Consumer Behaviour. USA: Prentice Hall Inc.

Smith, A. (1946) “Economics”, In Wood, T.N. (2008), Negotiation in Business. Sri-Lanka:

WestGate Prints.

Srivastava, J., Chakravarti, D., and Rapoport, A. (2000) “Price and Margin Negotiations in

Marketing Channels: An Experimental Study of Sequential Bargaining under One-

Sided Uncertainty and Opportunity Cost of Delay” Marketing Science, Vol. 19, No.

2 (September)

Stanton, W. J. and Sommers, M.S. (1981) Fundamentals of Marketing. Canada: McGraw Hill

Incorporation.

Stewart, S. (1995) Marketing Strategy: A Consumer Drive Approach. New York, USA:

The Free Press.

Timothy, I. L. (2004) Marketing in Developed Societies. India: Vrinda Publishers.

Uzoagulu, A.E. (1998) Practical Guide to Writing Research Project Report in Tertiary

Institutions. Enugu: John Jacob’s Publishers Ltd.

Vachani S. and Smith C. (2005), “When the Price Isn’t Right” Business Strategy Review,

Vol. 16 Issue 2, summer.

105

Vagale, L.R. (1974) Anatomy of Traditional Markets in Nigeria: Focus on Ibadan City.

Ibadan: Spectrum Books.

Walras, L. (1976) “Economics Bargaining: a Futuristic Strategy”, In Winberley, M. (2013),

“History of Bargaining”. American Journal of Contemporary Research. Vol. 13.

Walton and McKersie (1965) A Behavioural Theory of Labour Negotiation. USA: Jastor

Book.

Williams, E.A. (2001) Sample Size Determination for Social Research. USA: Prentice Hall

Inc.

Winberley, M. (2013) History of Bargaining. American Journal of Contemporary Research.

Vol. 13 (September)

Wood, T.N. (2008) Negotiation in Business. Sri-Lanka: WestGate Prints.

Yamane, T. (1979) Statistics for Beginners. London: McGraw Hill Inc.

Zeithaml, V. A. (2004) ‘Consumer Perception of Price, Quality and Value’, Journal of

Marketing, Vol. 52 (July).

106

APPENDIX I

QUESTIONNAIRE FOR CONSUMERS

The attached questionnaire will be given randomly to consumers in the selected traditional markets in

Ibadan, Oyo State. It is strictly for academic purpose.

Letter to Respondents (consumers)

Department of Marketing,

Faculty of Business Admin.

University of Nigeria,

Enugu Campus,

July, 2014.

Dear Sir/Ma,

I am a post graduate student of the University of Nigeria pursuing an M.Sc degree in marketing. In

partial fulfilment for the award of the masters’ degree, I am carrying out the research on the topic

EFFECTS OF PRICE HAGGLING STRATEGY ON CONSUMER DECISION MAKING IN

SELECTED TRADITIONAL MARKETS IN IBADAN, OYO STATE.

In furtherance of this endeavour, I humbly request you to fill the attached questionnaire faithfully,

please. It will be appreciated if all the questions are answered fully. I wish to assure you that all

information given will be treated in confidence and used for the purpose of the research.

Thank you for your cooperation.

Yours faithfully,

Signed

Farayola Solomon O.

107

SECTION APlease tick ( ) as appropriate in the following questions.1. Sex: Male ( ) Female ( )2. Age: Less than 18years ( ) 18 – 35years ( ) 35 – 50years ( ) 50years and Above ( )3. Occupation: Businessman ( ) Public/Servant ( ) Students ( ) Private Employee ( )Research/Consultant ( ) Others ( )4. Religion: Christianity ( ) Islam ( ) Traditional ( )5. Marital Status: Single ( ) Married ( ) Divorced ( ) Widowed ( )

SECTION BPlease Tick ( ) against the appropriate answer(s) to each question. The answer/options are as follows:SA – Strongly Agree, A – Agree, N – No Opinion, D – Disagree, SD – Strongly DisagreeSN QUESTIONS SA(5) A(4) NO(3) D(2) SD(1)6 I haggle when making buying decision.7 Bargaining affects all my products and brand buying

choices.8 I frequently haggle in an open market.9 As a Consumer, I believe in haggling as against fixed

price strategy in making effective buying choice10 Haggling on price does not have significant effects on

the buying decision making of consumers.11 Price haggling tends to be related to price sensitivity

when making buying decision.12 Price haggling is the main factor that affects buyers’

patronage regarding the product choice.13 Price haggling does not always bring about repeat

patronage.14 Haggling is often done when making buying decision in

an open market operation.15 Price is the only variable that I haggle on during an open

market operation.16 In an open market operation, my perception regarding

prices as against fixed price tactics is positive.17 Haggling wastes time during open market operation.18 My perception of open market operation is bad when

traders refuse my proposals when haggling.19 Haggling can cause disagreement or conflict that may

arise in purchasing.20 I can initiate Haggling/Bargaining activities under all

shopping circumstances21 In many markets, products like beverages, beer, and

drinks are fixed. I have attempted to haggle on these22 only perishable goods such as agricultural products are

those that consumers haggle most

108

SECTION CPlease Tick ( ) against the appropriate answer(s) to each question. The answer/options are as follows:SA – Strongly Agree, A – Agree, N – No Opinion, D – Disagree, SD – Strongly DisagreeSN QUESTIONS SA(5) A(4) NO(3) D(2) SD(1)23 Haggling can prevent disagreement or conflict that may

arise in purchasing.24 Haggling on Price does not have significant effects on

the decision making of consumers.25 People who haggle more are the consumers in the low

social structure and economic base and not the rich ones.26 Price Haggling outcomes often reflect the consumers’

choice of seller and loyalty.27 Pricing is the only key area of product that are always

haggled on28 Price Haggling tends to be related to price sensitivity and this

affects the buyers’ choice.29 Psychological and sociological beliefs of the consumers serve

as the reference price point for haggling in market places.30 Price Negotiation /Haggling is the main factor that affect

buyers regarding product choice, seller choice and purchase actions in the buying decision stage.

31 Price Haggling does not always bring repeat sales to sellers and consumers relationship

32 Haggling needs skills and competence from both parties involved and once these are lacking it can lead to purchasing problems such as wrong product choice to buyers or lower price than normal for the sellers

109

APPENDIX II

QUESTIONNAIRE FOR MARKET TRADERS

The attached questionnaire will be given randomly to registered traders and sellers in the selected

traditional markets in Ibadan, Oyo State. It is strictly for academic purpose.

Letter to Respondents (market traders)

Department of Marketing

Faculty of Business Admin.

University of Nigeria

Enugu Campus,

July, 2014.

Dear Sir/Ma,

I am a post graduate student of the University of Nigeria pursuing an M.Sc degree in marketing. In

partial fulfilment for the award of the masters’ degree I am carrying out the research on the topic

EFFECTS OF PRICE HAGGLING STRATEGY ON CONSUMER DECISION MAKING IN

SELECTED TRADITIONAL MARKETS IN IBADAN, OYO STATE.

In furtherance of this endeavour, I humbly request you to fill the attached questionnaire faithfully,

please. It will be appreciated if all the questions are answered fully. I wish to assure you that all

information given will be treated in confidence and used for the purpose of the research.

Thank you for your cooperation.

Yours faithfully,

Signed

Farayola, Solomon O.

110

SECTION APlease tick ( ) as appropriate in the following questions.1. Sex: Male ( ) Female ( )2. Age: Less than 18years ( ) 18 – 35years ( ) 35 – 50years ( ) 50years and Above ( )3. Occupation: Businessman ( ) Public/Servant ( ) Students ( ) Private Employee ( ) Research/Consultant ( ) Others ( )4. Religion: Christianity ( ) Islam ( ) Traditional ( )5. Marital Status; Single ( ) Married ( ) Divorced ( ) Widowed ( )6. Line of Products: Clothing and Textiles ( ) Foods ( ) Consumables ( ) Ram/Goat/Cows ( ) Drinks ( ) Unclassified ( ) 7. Sales level per day: Less than N5000 ( ) N5000 – N 15000 ( ) N15000 – N32000 ( ) N32000 and above ( )

SECTION BPlease Tick ( ) against the appropriate answer(s) to each question. The answer/options are as follows:SA – Strongly Agree, A – Agree, N – No Opinion, D – Disagree, SD – Strongly DisagreeSN QUESTIONS SA(5) A(4) NO(3) D(2) SD(1)8 As a trader, I have initiated haggling/ bargaining activity

in my selling efforts towards consumers.9 Haggling affects all buying choices of the consumers

regarding the final product, its price and the choice traders.

10 Haggling on price does not have significant effects on buying decision making of consumers.

11 Price haggling tends to be related to price sensitivity when consumers make buying decision.

12 Price haggling outcomes often affects traders’ sales.13 Price haggling is the main factor that determines traders’

repeat sales.14 Price haggling doesn’t always bring about retention.15 Haggling activities consume much time and efforts of

trader in open market operation.16 In open market operations, my perception regarding

haggling price against fixed price is positive.17 My perception of haggling in an open market is bad

when consumers refuse my proposals when haggling.

111

SECTION CPlease Tick ( ) against the appropriate answer(s) to each question. The answer/options are as follows:SA – Strongly Agree, A – Agree, N – No opinion, D – Disagree, SD – Strongly Disagree.SN QUESTIONS SA(5) A(4

)NO(3) D(2) SD(1)

18 Haggling can cause disagreement or conflict that may arise in purchasing.

19 People who haggle more are the consumers in the low social structure and economic base and not the rich ones.

20 Price Haggling outcomes often reflect the consumers’ choice of seller and loyalty.

21 Pricing is the only key areas of product that are always haggled on

22 Price Haggling tends to be related to price sensitivity and this affects the buyers’ choice.

23 Psychological and sociological beliefs of the consumers serve as the reference point for price haggling in market places.

24 Price Negotiation /Haggling is the main factor that affect buyers regarding product choice, seller choice and purchase actions in the buying decision stage

25 Price Haggling doesn’t always bring repeat sales to sellers and consumers’ relationship

26 Haggling needs skills and competence from both parties involved and once these are lacking it can lead to purchasing problems such as wrong product choice to buyers or lower price than normal for the sellers

112

APPENDIX III

CRONBACH’S ALPHA RELIABILITY ANALYSIS RESULTFOR RESEARCH QUESTIONNAIRE - CONSUMERS

Scale: ALL VARIABLESCase Processing Summary

N %

Cases Valid 25 100.0

Excludeda 0 .0

Total 25 100.0a. Listwise deletion based on all variables in the procedure.

Source:SPSS 17.0 Output File

Reliability Statistics

Cronbach's AlphaCronbach's Alpha Based on

Standardized ItemsN of Items

.832 .851 26Source:SPSS 17.0 Output File

113

APPENDIX IV

CRONBACH’S ALPHA RELIABILITY ANALYSIS RESULTFOR RESEARCH QUESTIONNAIRE – MARKET TRADERS

Scale: ALL VARIABLESCase Processing Summary

N %

Cases Valid 25 100.0

Excludeda 0 .0

Total 25 100.0a. Listwise deletion based on all variables in the procedure.

Source:SPSS 17.0 Output File

Reliability Statistics

Cronbach's AlphaCronbach's Alpha Based on

Standardized ItemsN of Items

.811 .821 20Source:SPSS 17.0 Output File

114

APPENDIX V

Regression Results for Hypothesis One

ConsumersDescriptive Statistics

Mean Std. Deviation N

deci 4.0644 .99511 225

hagg 2.9852 .93424 225

Correlations

Deci Hagg

Pearson Correlation deci 1.000 .888

hagg .888 1.000

Sig. (1-tailed) deci . .000

hagg .000 .

N deci 225 225

hagg 225 225

Model Summaryb

Model R R SquareAdjusted R

SquareStd. Error of the

Estimate Durbin-Watson

1 .888a .788 .787 .45900 .083

a. Predictors: (Constant), hagg

b. Dependent Variable: deci

ANOVAb

Model Sum of Squares df Mean Square F Sig.

1 Regression 174.834 1 174.834 829.861 .000a

Residual 46.981 223 .211

Total 221.816 224

a. Predictors: (Constant), hagg

b. Dependent Variable: deci

Coefficientsa

Model

Unstandardized Coefficients Standardized Coefficients

t Sig.B Std. Error Beta

1 (Constant) 1.241 .103 12.093 .000

Hagg .946 .033 .888 28.807 .000

a. Dependent Variable: deci

115

TradersModel Summary

Model R R SquareAdjusted R

SquareStd. Error of the

Estimate

1 .857a .734 .733 .36125

a. Predictors: (Constant), hagg

ANOVAb

Model Sum of Squares df Mean Square F Sig.

1 Regression 100.021 1 100.021 766.439 .000a

Residual 36.279 278 .131

Total 136.300 279

a. Predictors: (Constant), hagg

b. Dependent Variable: dec

Coefficientsa

Model

Unstandardized CoefficientsStandardized Coefficients

t Sig.B Std. Error Beta

1 (Constant) 2.461 .066 37.044 .000

Hagg .536 .019 .857 27.685 .000

a. Dependent Variable: dec

116

APPENDIX VI

Z-Test Result for Hypothesis Two

Consumers

One-Sample Kolmogorov-Smirnov Test

hypo2

N 225

Normal Parametersa,,b Mean 3.4074

Std. Deviation 1.15016

Most Extreme Differences Absolute .265

Positive .104

Negative -.265

Kolmogorov-Smirnov Z 3.971

Asymp. Sig. (2-tailed) .000

a. Test distribution is Normal.

b. Calculated from data.

Traders

One-Sample Kolmogorov-Smirnov Test

hypo2

N 280

Normal Parametersa,,b Mean 3.6190

Std. Deviation .99547

Most Extreme Differences Absolute .167

Positive .167

Negative -.164

Kolmogorov-Smirnov Z 2.786

Asymp. Sig. (2-tailed) .000

a. Test distribution is Normal.

b. Calculated from data.

117

APPENDIX VII

Z-Test Result for Hypothesis Three

ConsumersOne-Sample Kolmogorov-Smirnov Test

hypo3

N 225

Normal Parametersa,,b Mean 3.8074

Std. Deviation .83270

Most Extreme Differences Absolute .175

Positive .076

Negative -.175

Kolmogorov-Smirnov Z 2.620

Asymp. Sig. (2-tailed) .000

a. Test distribution is Normal.

b. Calculated from data.

Traders

One-Sample Kolmogorov-Smirnov Test

hypo3

N 280

Normal Parametersa,,b Mean 3.8527

Std. Deviation .82655

Most Extreme Differences Absolute .183

Positive .083

Negative -.183

Kolmogorov-Smirnov Z 3.057

Asymp. Sig. (2-tailed) .000

a. Test distribution is Normal.

b. Calculated from data.

118

APPENDIX VIII

REGRESSION RESULTS FOR HYPOTHESIS FOUR

CONSUMERS

Descriptive Statistics

Mean Std. Dev. N

haggling can prevent disagreement or conflict that may arise in purchasing 2.3200 1.07105 225

Hagg 2.9852 .93424 225

Correlations

haggling can prevent disagreement or conflict that

may arise in purchasing hagg

Pearson Correlation haggling can prevent disagreement or conflict that may arise in purchasing

1.000 .884

Hagg .884 1.000

Sig. (1-tailed) haggling can prevent disagreement or conflict that may arise in purchasing

. .000

Hagg .000 .

N haggling can prevent disagreement or conflict that may arise in purchasing

225 225

Hagg 225 225

Model Summaryb

Model R R SquareAdjusted R

SquareStd. Error of the

Estimate Durbin-Watson

1 .884a .781 .780 .50246 .087

a. Predictors: (Constant), hagg

b. Dependent Variable: haggling can prevent disagreement or conflict that may arise in purchasing

ANOVAb

Model Sum of Squares df Mean Square F Sig.

1 Regression 200.661 1 200.661 794.811 .000a

Residual 56.299 223 .252

Total 256.960 224

a. Predictors: (Constant), hagg

b. Dependent Variable: haggling can prevent disagreement or conflict that may arise in purchasing

119

Coefficientsa

Model

Unstandardized CoefficientsStandardized Coefficients

t Sig.B Std. Error Beta

1 (Constant) -.704 .112 -6.267 .000

Hagg 1.013 .036 .884 28.192 .000

a. Dependent Variable: haggling can prevent disagreement or conflict that may arise in purchasing

Traders Model Summary

Model R R SquareAdjusted R

SquareStd. Error of the

Estimate

1 .930a .864 .864 .39025

a. Predictors: (Constant), hagg

ANOVAb

Model Sum of Squares df Mean Square F Sig.

1 Regression 269.772 1 269.772 1771.339 .000a

Residual 42.339 278 .152

Total 312.111 279

a. Predictors: (Constant), hagg

b. Dependent Variable: q18

Coefficientsa

Model

Unstandardized CoefficientsStandardized Coefficients

t Sig.B Std. Error Beta

1 (Constant) 1.012 .072 14.096 .000

Hagg .880 .021 .930 42.087 .000

a. Dependent Variable: q18

120

APPENDIX IX

121

Sample Size Determination

122

The formula is shown below.

123

n = N

124

1+N(e)2

125

126

Where: n= Desired Sample size

127

N= population size

128

e= limit of tolerable error (usually 95%, that is 0.05)

129

Hence, the sample size for market trader is

130

n= N___

131

1+N (e)2

132

133

n= 1276

134

1+1276(0.05)2

135

136

n= 1276

137

1+1276(0.0025)

138

n= 1276

139

1+3.19

140

141

n= 1276

142

4.19

143

144

n= 304.5

145

146

Sample size for the market traders is 305.

147

Each of the traditional markets has the following samples;

148

Dugbe = 587/1276 x 305=140

149

Mokola = 88/1276 x 305=21

150

Bodija = 242/1276 x 305=58

151

Aleshinloye = 216/1276 x 305=52

152

Ojoo = 143/1276 x 305=34

153

APPENDIX X

Pilot Survey

The researcher conducted pilot survey with twenty-five (25) consumers who regularly

patronize each of the traditional markets. Working on 95% confidence level and a tolerable

error of 5%, the formula for determining sample size for infinite population (Williams 2001)

was used to estimate the sample size of the consumers, since they were infinite and unknown.

n = pq (Z2) or Z2pq

154

e2 e2

155

Where; p = frequency of occurrence or probability of responses/positive success.

156

q = 1 – p

157

n = Desired sample size

158

z = Desired level of confidence

159

e = estimated tolerable error or standard error.

160

The sample size is

161

z = 95% or 1.96

162

p = 80% or 0.80

163

q = 1 – 0.80 = 0.20

164

e = 0.05

165

n = pq (Z2)

166

e2

167

168

n = (0.80) (0.20) (1.96) 2

169

(0.05) 2

170

171

n = 0.16 x (39.2) 2

172

n = 0.16 x 1536.64

173

n = 245.86

174

The sample size for the consumers was 246 respondents.

175

This was shared randomly among the selected five markets equally at 49.

176