Stories from the Sales Frontlines

socala4

they are in competition with other dealers if the customer sees their cars as viable alternatives.

Exactly. The customer's objective should be to get the dealer to believe that these alternatives are, in fact, suitable (even if they really aren't.) The more that you make it clear that you want something specific, the more that you can be sure that the other guy is going to make you pay for it.

corvette

Settling for 2nd place is like kissing your sister.

It depends on what the situation is. My family will never own another Volkswagen product as long as we live here due to abysmal customer service at all the nearby VW dealers. We've never encountered that situation with other makes.

larryallen707

I concur. To add to that, I think he is suggesting you use the "possibility" of buying another car as a negotiating chip in your favor. You say to the salesguy, "I do love the Subie Outback... but maybe I should spend $3k more and get the xxxx...." Make him think you might (even a small chance) be looking at other cars and it's to your advantage. If you are (and I exagerrate the point) the 16 year old girl saying, "daddy I want the red convertible... and ONLY THAT RED CONVERTIBLE" you are limiting your negotiation ability in my opinion. I negotiate for a living... and apparently, according to what I am sending to the IRS, doing well at it.

larryallen707

It depends on what the situation is. My family will never own another Volkswagen product as long as we live here due to abysmal customer service at all the nearby VW dealers. We've never encountered that situation with other makes.

... and they make crappy cars! ALL of them with possible exception of '84 GTI.

socala4

We want what we want. Settling for 2nd place is like kissing your sister.

You confuse getting what you want with wearing your wants on your sleeve so boldly that you can't help but overpay for getting what you want. I manage to get exactly what I want, the difference is that the other side is convinced that I compromised.

Effective negotiation is all about the appearance of compromise. Notice the use of the word "appearance" -- one key to a good negotiation is the art of getting what you want without making it obvious that you came away a total winner.

qbrozen

Settling for 2nd place is like kissing your sister.

It depends on what the situation is. My family will never own another Volkswagen product as long as we live here due to abysmal customer service at all the nearby VW dealers. We've never encountered that situation with other makes.

LOL!

ummmm... i'm just not even sure how to respond. I have NO idea what that has to do with my statement. You had me reeling for a second there when I read my quote and then you started with, "it depends on what the situation is." Man, I thought we had one heck of a story about to come through the wires there. :0

snakeweasel

Exactly. The customer's objective should be to get the dealer to believe that these alternatives are, in fact, suitable (even if they really aren't.)

Granted but a good salesman, like a good poker player, should be able to pick up tells. Plus most people have the model they want in mind when it comes down to negotiation. If someone comes in and starts negotiating on a AWD subaru wagon the smart salesman will not consider many other vehicles as competition for the sale.

socala4

I think he is suggesting you use the "possibility" of buying another car as a negotiating chip in your favor.

Bingo, that's exactly right, it's all about gaining leverage. The more options that you have, the more fungible the price becomes.

qbrozen

Well, yes, now that you've added the word "appearance", that changes everything, and I completely agree. (and its certainly no deep secret that a buyer should pretend to be uninterested in the car)

If your original post clearly stated that you are just pretending to consider alternatives, none of this conversation would have taken place.

larryallen707

We want what we want. Settling for 2nd place is like kissing your sister.

You confuse getting what you want with wearing your wants on your sleeve so boldly that you can't help but overpay for getting what you want. I manage to get exactly what I want, the difference is that the other side is convinced that I compromised.

Effective negotiation is all about the appearance of compromise. Notice the use of the word "appearance" -- one key to a good negotiation is the art of getting what you want without making it obvious that you came away a total winner.

1,00000000000000000% agree. I see, by your name, you are in So Cal, apparently? I grew up in West LA. Maybe we are long lost kin. Good posts. I think everybody has different approaches to buying (as do sellers have different sales techniques) but I agree with your approach. World goes around with everybody doing things their way and if everybody negotiated like you and I we would not have a leg up on them!

corvette

Yeah, looking back, that came out wrong... I would enjoy driving a 2.0T Jetta (even though it's not as great as the 3-series), and would prefer paying Jetta prices, but, since all the nearby dealers are shady, and there is a frequent need to visit them because it's a Volkswagen, it's not a practical option.

socala4

Your point about the skilled salesman is well taken, but a smart buyer should still have the advantage. Whereas it is the job of a salesman to sell, with his performance as a salesman judged in part by his inability to close a hot prospect and his time investment representing an opportunity cost that he'd like to convert into dollars, the smart buyer is free to walk at any time.

That makes a failed negotiation more costly for the seller than it is for the buyer, and motivates the seller to close it once it seems to be within his reach. Of course, if you make it clear that you must have that specific car on the lot, you will be awarded with a higher price, because your hot button has been pushed, and you have more to lose from failure than does the salesman. That's not a good position for a buyer to be in.

au1994

ok, "appearance" clinches it for me as well.

Maybe me using a Subie was a bad idea. I was just using that example since there are few dealers in my area. Plus as has already been pointed out they have kinda cornered the market in AWD wagons. Not totally, but close.

If you're sitting down to negotiate an Accord, then its a whole different ball game. You might casually mention that nice Camry you jst drove down the road or how you are on your way to the XXX dealership next.

But, a good dealer/salesman knows his competition and for me, had better make that 1st pencil a good one.

socala4

World goes around with everybody doing things their way and if everybody negotiated like you and I we would not have a leg up on them!

That's totally true (I really laughed out loud when I read that), but I wouldn't worry about it. A lot of people are really committed to a certain style and perspective, even if it doesn't work or even if there is an abundance of information to the contrary.

Anyway, I should leave this thread to the salespeople, this is supposed to be their chance to rant, not ours...

qbrozen

yes, please, someone give us a good story to put a halt to this silliness.

snakeweasel

Your point about the skilled salesman is well taken, but a smart buyer should still have the advantage.

In a test between the skilled seller and the smart buyer the one who gets the advantage is the one that doesn't make the first mistake. The major disadvantage that most car buyers have is being inexperienced while their "opponent" is very experienced.

The real advantage the buyer has over the seller is if they make the mistake they can walk a lot more easily than the seller.

Of course, if you make it clear that you must have that specific car on the lot, you will be awarded with a higher price, because your hot button has been pushed, and you have more to lose from failure than does the salesman. That's not a good position for a buyer to be in.

I agree that is a mistake,but I disagree with you that you would have more to lose than the salesman. You can always walk from the deal and I know for a fact that there has to be another dealer selling those cars somewhere. Unless you 100% positively absolutely have to have the car now or you will a.) die (no I mean actually die as in stop living and get buried), b.) won't be able to get to work tomorrow and will be fired or c.) be late to your wedding and not get married (may not be such a bad thing) you are in no worse shape walking then when you went into the dealership.

You should never be in the position to lose anything but the time spent by walking out.

But you are right, it is best to at least give the impression that you have a backup plan, better to actually have one.

socala4

You can always walk from the deal and I know for a fact that there has to be another dealer selling those cars somewhere.

I agree with that wholeheartedly. My intended point above is that those buyers who convince themselves that they must have Car X will likely pay more for Car X than they need to, because their attitude won't permit them to walk away. The mindset of the buyer will make or break his ability to negotiate effectively.

travler

It's always the same posters chewing the same issues over and over. You might go to a more interesting site.

travler

I've never had these issues either. in fact, if the phone rings 5 times I'm happy. Usually when it does one of them is a buyer. It depends on where and how you advertise. I use local car publications like Car Scope, or Trade-N-times.
If you have these types of publications in your area I highly recommend them. If someone is looking for a car they'll have to make a trip to the store and purchase it. They're not joy riders if they go to that trouble.

Questions to ask: How will it be paid for? If financed is financing approved. If not decline the test ride until it is.
Who will the car be for? Get them talking. If they don't seem to have a plan be wary.
Do they have insurance? Ask them to bring proof of insurance when they come, and drivers license.

Suggestions: Meet them at a public place like a plaza or gas station.

Hold their car keys while they're driving. check insurance card and ID.

Park under lights if it is dark outside.

Collect cash or certified check.

If the phone doesn't ring the car is either priced to high or there is no market for it. You may as well trade it in and be done with it.

cluedweasel

And my old sales manager would ask you "how many cars do you want to buy for your fleet?"

cluedweasel

In my neck of the woods, every dealer has ADM on every car. As they see it, if you want to go to another dealership for a particular make then it's a 3.5 hour drive. Went I bought my Subie, the first thing I told the salesman that the ADM had to go or there was no point in proceeding. It went and was never mentioned again but apparently the majority of people start negotiating downwards from MSRP+ADM!

bigdveedubgirl

nooooo kidding what happened to my sales peeps????? I thought this was the forum for us to tell our stories of woe and victory...Im about to get snotty right now but I like our host and I like to read my posts over again. :P

isellhondas

larryallen,

Socal used to really get under my skin but I do understand him. The So. Calif market is a cesspool. Screamer ads, stores that pull every dirty trick in the book and customers who are so hardened by all of this that they will also pull every trick in the book themselves.

If is a horrible market that has been ruined by buyers and sellers alike. I couldn't work there.

Born and grew up (?) in San Pedro.

Having said this, there are some decent stores there that try hard to do the right thing. Hopefully things can change.

isellhondas

Back in the old days, there were a lot of us sales types who would come here but most have left.

larryallen707

but apparently the majority of people start negotiating downwards from MSRP+ADM!

I think that's the impression the dealer wants you to think. However, I don't think there are too many people dumb enough to pay ADM... well, not very many anyway. Bottom line, I think the dealer wants us to think we are getting a special low price but in reality I think most people pay pretty similar prices. Take a car with a $35k msrp. I bet the vast majority pay $33,000. Some of us pay $31k and some might pay $35k but most are right about $33k. I think!?

mark156

Clued.... I asked the salesman why every car had an ADM (which was listed as a "market adjustment"} and he said that it was for financing purposes if someone was upside down on their trade. I found it to be a real turn off and I would avoid a dealer like that myself. A lot of people are not payment buyers like myself and find it to be very offensive.

My local Mercedes dealer never puts ADM stickers on anything. They might want MSRP but never go above that. I guess they feel if they can get MSRP, that's enough and the car will sell quickly without looking like a gouger. :surprise:

Mark

larryallen707

Sorry to intrude but I wish I had sold cars at some point in my life. I find it a fascinating transaction.

I hope you are still a Dodger fan even if you have left LA!

british_rover

I had a call not too long ago that went something like this...

I answer the phone and start the normal Good evening/morning/afternoon blah blabh this is blabhabh speaking how may I help you.

Well I don't even get through the good morning part before this guy goes.

Customer: I want to speak to your fleet manager.
Me: We don't have a fleet manager.
Customer: Well I want to speak to your internet manager.
Me: Well we don't have one of those either.
Customer: Well who do I talk to get the best day then!!!

Me (Internal Dialog): He was gruff at first but by now he is almost yelling and I wanted to say something to the effect of you haven't bought a Land Rover before have you. Or well you don't want to talk to me I am the highest paid sales person we have let me transfer you to the guy next to me. I restrained myself.

Me: Well sir we only have four people in our sales department, two sales guides and two managers, and we all work together to get the best deal that is right for you.

Customer: Huh yeah sure whatever I guess YOU can help me then. I want a....

Epilogue: I worked out a leas quote for him on a Range Rover Sport and called him back with it. Went over it with him set up a time for him to come down and drive the car cause he had never even touched one yet. His appointment time came and went he never showed up. I called him to check on him make sure he was ok and not in an accident he told me he got held up and would need to reschedual.

Ok so we reschedual for the next day and he never comes in again. I call again to check and make sure he is ok and his phone goes to voice mail. I leave a message and he never calls back.

Now why did he not bother to show up for two appointments? Maybe the deal was not good enough?
Maybe he was blowing smoke completly?
Who knows he never gave me a chance to even work with him.

petomlin

your deal wasn't good enough, and he was probably too embarrased to admit it.

mark156

Some people are just nuts. I had a chain of retail stores for several years and some people are just NOT all there. I can only imagine what car sales would be like with people like this.

I think the "car business" is very interesting, but if I worked in it, I'm sure my perception would change. My skin may not be thick enough. :sick:

Mark :mad:

isellhondas

british rover,

One of two things happened...

1. He was a "stroke" and I would guess Land Rovers attract these in droves. or

2. He just took your price and shopped it.

Question, what is a sales "guide"?

british_rover

Oh I am sure it blew him out of the water. At the time all Land Rover dealers were asking full MSRP for Range Rover Sports and they were not budging a bit off sticker.

Now although most still start at sticker there are discounts to be had if you try hard enough but no one is giving thousands of dollars up.

I remember the day after Ford announced that they would do employee pricing to match GM we had at least a dozen calls over the next few days wondering if we would do the same.

The reply always was you don't see Aston Martin, Jaguar or Volvo doing that do you?

corvette

Now why did he not bother to show up for two appointments?

We may never know, but no-shows are one of my pet peeves.

As has been said here, most people that walk into a dealership are not Edmunds-educated car buyers. If I'm not familiar with a car, I'd want to see, feel, touch, and drive the car (and probably several others) before talking price.

div2

I just don't understand why buying a car has to be such an ordeal. If I'm trading a car(a very, very rare circumstance) and/or buying used, I get some prices from Terry in "Real World Trade-In Values". I calculate the sales tax and come up with an OTD number. If the salesperson gets within a few hundred dollars of that figure I'm good to go. As a matter of fact, two of my last three purchases have been from the same salesperson. In both case he gave me an OTD number, I counter-offered, he came back with another number and the deal was done. The only reason I didn't buy the other car from him is because I wanted a specific vehicle that he didn't sell new and didn't have in his used inventory. But that deal turned out OK as well; I was serving on the board of a NFP agency and one of the ladies on that board happened to be the mother of the guy who owned a large dealership that sold the truck I needed. I mentioned to her what what I was looking for and she told me to let her handle it. In less than ten minutes the owner was calling me on the phone asking what vehicle I wanted. I got an OUTSTANDING deal...

british_rover

We didn't used to get too many Strokes untill recently but with the expansion in our product line and the increase in tier one advertising we are getting more of them. Land Rover is planning to launch five new models in the US in five years and so far they have two down with the third one slated for release sometime next year.

We don't get as much price shopping as most dealers because there are only three of us in the whole state and they are widely spaced apart.

In addition Land Rover's policy of witholding business builder, our version of holdback, if a sale is made outside of your dealerships market area really discourages dealerships from stealing deals from outside your territory.

On the edges of each dealers territory there is some overlap where in some of the hot markets you will some serious competition but that does not happen very often. This mainly happens in the major metro areas like boston where you have three or four dealers all around the outskirts of the city and they fight over deals actually in the city. If you happen to have a zipcode that falls in a space overlapped by a couple of dealers then the competion is more intense.

Sales guide is what Land Rover calls its sales people. See you aren't buying a vehicle when you buy a land rover you are buying life style and we guide you down that path by helping you chose the right vehicle for you life style.

It is also a bit of a word play on the whole idea of a person being an off-road guide and spotter when using your Land Rover vehicle. They train us how to do that to at least to some extent. There are classes offered at LRU(Land Rover University) called ASCENT courses that teach you off-road skills. I can't remember what ASCENT is an acronym for but there are four courses of increasing difficulty.

There is even this whole philospby that you are supposed to follow as a Land Rover Retailer called the Land Rover Way. They do surprise audits once a quarter on the Land Rover Way. Throughout the quarter they will also do secrety shopper phone calls and emails to check things.

lemko

...what's a "stroke?"

danf1

A stroke is something that my golf game and my business have far too many of. Typically, it is a customer with no intent to purchase, but wants to drive everything on the lot. Or someone who makes appointments and doesn't show or even have the courtesy to call. Maybe the guy who just left a competing dealer looking at the same car, but their price was thousands less than ours. Or they were giving them thousands more for their trade in. Generally, just a waste of time.

isellhondas

And there is nothing worse than to get hooked up with a stroke on a busy Saturday,

bdr127

Now why did he not bother to show up for two appointments?

We may never know, but no-shows are one of my pet peeves.

Don't you wish you could be like the doctor or dentist and still charge if you don't show up or cancel at least 24 hours in advance?... hehe... :P

graphicguy

Just to keep on track....for whatever reason, I'm a "sucker" sometimes for cars that strike my fancy.

I'll predicate the following by saying I'm fortunate enough to work in an industry where I qualify for supplier pricing for anything Ford (that includes Rovers, Jags, Lincolns, Mazdas and Volvos) or Nissan (including Infinities) makes. My brother-in-law is a GM employee, so I qualify for his employee discount on anything GM makes. About the only brands I don't qualify for hefty employee/supplier discounts on are Toyota and Honda products (working on that, though).

I've had two "ADM'd" purchasing expereinces in the past few years. The first one was in early '04 when I was smitten with a Mazda RX8 when they first came out. Went to the first dealer. Sure enough, ADM sticker was present to the tune of an extra $2K over MSRP. They didn't even bother to make it look like a value proposition by including pinstripes, etching, etc. Told them I qualified for "S" plan pricing. They declined the S plan deal and tried to negotiate from the ADM. They waster my time and there's. Went to a Mazda dealer 5 miles away, who agree to "S" plan pricing immediately....easy-peasy....quick deal, no muss no fuss.

Fast forward a couple of years and I became smitten with the new Mustang GTs. Again, ADMs accompanied the MSRPs. Those of you who have seen the new Mustang phenomona know that until just recently, these cars have been scarce....especially the GTs and convertibles. First dealership I went to tried to negotiate from the ADM (which at the time, was about $5K above MSRP). I was looking at "X" plan pricing. That meant about a $7K swing from what the dealer wanted and the deal I was seeking. Found a dealer who would order a GT at X plan pricing. Got it 7 weeks later.

Moral of the story....if/when I ever want another car that the ADM dealers carry, I'll skip over them and go to the dealerships that don't put the ADM stumbling block in the way of a transaction.

No doubt, there are some people who may pay that ADM or are willing to negotiate from the ADM sticker, it's just another unwanted step to getting to a deal, IMHO!

I have to believe that most car buyers are more savy these days about invoice, finance mark-up, etc. So, for a dealer to be competitive, I don't see the need for ADMs.

That said, watching the King of Cars, I have to admit I wasn't aware that people still buy payments instead of bottom line price.

Want to make a deal? Remove the obstacles (in this case, ADM).

jipster

one key to a good negotiation is the art of getting what you want without making it obvious that you came away a total winner.

True if it is someone you have an ongoing business relationship with. But, why would it matter if there is no intent on going back to the same salesperson or dealership?

danf1

Sounds like you made four dealers happy. Two that got to sell you a car. They didn't make much money on you, but they made a nice easy sale. And two more that probably got the full mark up on two hot cars. Everybody wins here.

au1994

Does a stroke ever turn into a buyer? Maybe not that day but a resonable amount of time later?

british_rover

I had a huge stroke last saturday which reall pissed me off.

We are not typically really busy with a lot of floor trafic even on Saturdays so when he first came in and I thought he might be a stroke I didn't really mind. It was fairly early in the morning and no one was there so I had no problem entertaining him for a while. The problem came that when it did get busy and we were three or four customers deep I could not get rid of him.

He had a mercedes that was pretty much identical to one I had taken in trade last week so I already knew what it was worth. I made a couple of cars to make sure nothing had changed and see if there was anybody specificly intersetd in this color.

The guy had already told me that he had bought it about two years ago as CPO mercedes car and he paid 45,000 for it. Well while I was getting his registration out of the car I found his orginal bill of sale.

he really bought it eight months ago and paid 35,000 for it. Now that does not change what it is worth at all cause when he bought it or what he paid for it doesn't matter as far as real current value is converned. What could change its value is that he didn't buy it as a CPO mercedes car he bought it from a body shop that has a less then stellar reputation. That cause some flags to fly up and makes me think he is not the second owner. I run a carfax on it and hey guess what he is really the third owner and the car was repossed from the second owner.

With all that in mind and considering the car just drives a little funny we adjust the value down a good bit from what we originaly thought.

Now I go sit down with the guy and go over all of the numbers. Keep in mind I am holding onto a copy of his original bill of sale. I tell him what it is worth and he is just stunned.

Him: Well I paid 45,000 for it less then two years ago I don't see how it could have dropped so fast. I was hoping for about 30,000.

Me: Well according to the bill of sale here you bought it in August of last year and paid 35,000 for it and honestly when you bought it or what you paid for it have nothing to do with what it is really worth. The car is a three owner, car without the factory wheels, that drives a little off and was repossesed from its second owner.

Him: Well I mean come on what does it matter if it was reposessed that doesn't really effect the value of the car. If you can give me 28,000 for it I will do the deal right now.

Me: Nope sorry 24,000 is all the money in the world.

Him: Well I am sorry we could not do business but I can't let you just steal my car like that.

GRRRRRRRRRR.

Waste of two hours of my life.

au1994

Now that, I can see ticking you off. I can't imagine why in this day and age of technology someone would try and do that. With a few key strokes you can find out more than you ever wanted to know about a car or person for that matter.

I always like to have my payoff number in hand before I walk on the lot. Also, if I'm still in "tire kicking" mode, I'll do that over lunch during the week. Not on a Saturday when it is a waste of both of our time.

socala4

A lot of it comes down to ego and the appeal to fairness: It's human nature (at least within western culture) to resent being required to compromise if the other party isn't required to do the same, irrespective of whether or not the relationship is ongoing.

Many of us seem to define "fairness" as "a deal in which not everyone is entirely happy," so you need to appear to have sacrificed at least as much as your opponent for your opponent to be emotionally willing to accept your deal. It's OK for you to be happy, but the salespeople may be more inclined to kill a perfectly good deal if they perceive that you came away with a big kill, and they had their faces rubbed in it. (In these situations, a bit of humility from the buyer is a good thing.)

Another aspect is competitiveness. Particularly with professional negotiators such as car salespeople, once negotiations are underway, their inclination is to continue negotiating until they are no longer able to obtain deal points for their side of the deal. If you as a buyer have given up nothing, then the seller is inclined to keep negotiating because a buyer who hasn't given up anything has probably not yet reached his highest price point. By "sacrificing" during the negotiation, you have sent a signal to the dealer that because you have given things already, and that you are closer to reaching that point at which you won't be inclined to continue compromising. At the end of the haggle, you want to become the proverbial turnip -- if you're out of blood and they know it, they're going to stop squeezing.

isellhondas

Of course, sometimes they do and we still treat them very well.

ateixeira

Back in '91 I wanted a Protoge ES, so I drove a Ford Escort GT (same powertrain) for reference. Guess you call me a stroke because I had absolutely no intention of buying that car, I just wanted a reference. I didn't even have the title to my trade.

I drove home in that Ford. It happens.

-juice

yurakm

Of course, it is nitpicking, but I thought that there are four LR dealerships in CT: Darien, Milford, Gilford, and the yours?

lrguy44

I might also add that in many Land Rover stores (like the one I am at), the Sales Guide does the entire transaction, from demo to pricing to financing and delivery. Thus, the Sales guide does guide the entire sale.