O.K. youre patting yourself on the back for all of the homework youve done on your perspective car that you are going to buy so youre fired up and ready to go right?
Its great that youve done much homework on the car that youve got your eye on good job. But, consider this have you given any thought at all as to what your negotiating game plan is going to be? If you really want to maximize your car deal, it only makes sense to give this area some additional consideration.
Negotiating is skill that can be learned and gets better with practice. Throughout everyones life first as children then as parents negotiation occurs rather regularly. Now that youre looking at stepping onto a car dealership, you shouldnt suddenly feel as though youve never been involved in negotiations Ill bet that you have.
First and foremost, plan to succeed. Simple thought I know, but it is part of the preparation. If you go into the process thinking that you would really like to get the selling price down to a certain figure, but at the same time youre telling yourself that this probably wont happen then guess what it wont. You wont have the confidence, and the sales person or sales manager will get work on your shaky expectations and get you off your target price.
Be mindful of the other hand though. If you go into the car selling price negotiating process like the proverbial bull in a china shop youll probably trip the sales persons and the sales managers hot button and they will push back just as vigorously creating a negotiating chasm.
The key as a polished negotiator is to stay calm and pleasant and present win-win scenarios.
Secondly Be prepared. Dont go into any type of transaction such as buying a car unprepared. Dont just know about the car and what you want your car to come with know what each of these options cost dont guess or assume There is profit to be negotiated upon across the board at any given dealership. Knowledge is confidence, and sales people will pick up on the fact that you know of which you talk and this will significantly cut down on the sales b.s.
Next Leave yourself wiggle room inside your cocoon of happiness target. In other words never start with the price you want to pay. Remember, by definition here we are negotiating with another person if you start with the price you want to pay; youll have no choice but to negotiate your way up and out of it. So, if youre will to spend say $15,000 then start at $14,000 and work to create a win-win somewhere in between. And, oh by the way no one in the dealership other than you has or will have NO IDEA of what youre willing to pay.
Heres a bonus tip if the sales person kicks off the negotiations with the first offer, dont counter with a number thats right no counter number instead counter back with a pleasant Im afraid thats somewhat beyond my budget make them come back with another offer to get you in the game. Now you just gotten a newer offer and you havent even jumped in yet. The first offer from the dealer is usually their home run swing they dont really expect you to serve yourself up at this point (although some do and hence the home run in profit).
Keep in that this is not a one way street. Youll have to participate and make some concessions in order for your deal to be a winner. For instance, if you cant get to the selling price you want then get more for your trade, get an extended warranty at dealer cost, get some no cost service or oil changes, floor mats, anything that keeps the deal moving forward and the negotiations open dont get hung up on beating you opponent over just one aspect of the deal.
This is where many people get frustrated and either walk away after getting so close or just give in as a result of the frustration. Negotiating a car deal is a package not just a selling price. Sure the selling price is the focal point, but you have to give the appearance that you are offering some concession as well. In fact, as your target price get within range, dont just agree on the price and then begin the delivery process. If you do you will be in a much weaker position to negotiate any extras you may want such as that extended warranty you see make sure all potential aspects of the deal are in place before you shake hands on the price.
Tags: Bet, Car Deal, Car Dealership, Chasm, China Shop, Confidence, Game Plan, Good Job, Homework, Hot Button, Negotiating Tips, Negotiation, Negotiations, Negotiator, Sales Managers, Sales Person, Scenarios, Simple Thought, Target Price, Time YoureRelated posts
I had what I thought was an interesting question sent in to me the other day and that is the topic of this article. The question asked was essentially; out of all of the car buying tips, the car deal negotiating tips, and out of all the dos and dont dos when you are car shopping and ultimately buying, what is the single most important area to have under control as the buyer.
I had to preface my answer by saying that in order to get your best deal when buying a car, there are many pieces to the car buying puzzle. They are all individually important because when you put all the buying processes together they make up your deal. And all of these car buying puzzle pieces are what dealerships are all about. They each represent an opportunity to sell you something and therefore make a profit on that sale.
Having said that, this is a great question and you would probably get many different answers. But, since you asked and I have pondered Ill give you my thoughts.
I would have to say financing. You must take the time to do such things as:
Get and understand your credit report.
Shop around for your financing options and ultimately get yourself pre-approved so you will know the amount, the interest rate you qualify for, and the length of your loan.
If you dont get your financing questions answered and in order, you can literally cost yourself thousands of dollars. So, while all of the other aspects of buying a car are indeed important, such as the price of the new car, what you get for your trade, and all of the research that goes into these areas; you can literally give it all back and much more in the dealers finance department.
If I get all my financing lined up ahead of time, why would I even bother with the dealers finance department?
A Good question; and there are a couple of aspects to the answer. First, once you know what you qualify for (a bird in hand), you can then give the dealers finance manager the opportunity to do even better for you. Secondly, even if you have no intention of using the dealer financing option, youll still have to have a seat in the finance office just to sign all the paperwork. Which means the finance person will do their best to sell you their financing package. So being prepared is the best answer.
If you have your financing in hand and know all your numbers ahead of time, youll be able to fend off the monthly payment approach by the car dealers sales person. Buying a car based on monthly payments is good for the dealer; bad for you.
Also, your financing homework becomes even more important if your credit is less than grade A. Be mindful that just the difference in just a couple of percentage points on your interest rate can represent over a thousand dollars to you during the life of your loan. And if your credit score leaves a little to be desired by potential lenders, you will probably see a wider range of qualifying quotes that you get back. So it is even more important that you get your car financing house in order before you head out to the dealership.
Certainly, financing is but one piece of the car buying puzzle. But, its a big piece. And you can rest assured its a big piece (for potential profit) for the dealer. Many people dont realize that this is yet another area at the dealership that you can and should try to negotiate on the road to getting your best car deal.
If you have done your research and homework to give yourself the best possible chance on the front end of the car buying process (new car & trade-in), dont give it all back on the back end of the deal (financing & insurance F&I) by not knowing what your financing numbers and options are.
Tags: Bird In Hand, Buying A Car, Buying Car, Car Buying Tips, Car Deal, Car Shopping, Control, Credit Report, Dos, Finance Department, Finance Manager, Financing Options, Good Question, Interest Rate, Negotiating Tips, New Car, Opportunity, Preface, Puzzle Pieces, Thousands Of Dollars