Did you recently take on (or consider) a loan of 84 months or longer on a car purchase?
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Make Me a Better (Online) Car Salesman!
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When I was selling boats, on the expensive cruisers we would actually celebrate the day a boat belonging an unreasonable customer went "out of warranty",
Well then you will be happy to know that we ended the life of one of those expensive cruisers early. Its fiberglass hull was no match for our reinforced steel hull, sliced right through her. Thats what you get for sitting in the water at night without navigation lights on.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
This is my personal time calculator:
1 hour of life vauled $75
15 dealerships visited or corresponed via phone or email average of 2 hours each.
So....
$75 x 30hrs = $2250.00
300 miles driven total going from dealer to dealer 35 cents per mile. (labor costs and gas is on the rise) = $105.00
Well, I must give credit to our salesfolks for trying to come up with every possible way to justify customers paying a higher price over paying a lower price.
-For one, most people don't have employers who value their time at $75, so they may have an exaggerated sense of the value of their weekend Playstation or Netflix video hours if they use such an inflated figure to determine the "price" of car shopping.
-For another, I'll go with the notion that dealing with the sales guys is a bona fide form of entertainment. Watching ISellHonda type dude drool over this me playing the role of dumb customer (read: me) who ends up paying $100 over invoice for a car (and one that's a new model with no marketing incentives, at that) after a couple of hours of playtime is really quite fun.
At the end of the day, I don't find that I'm spending any more time car shopping than do people who pay far more, so the savings is practically pure profit. Most of my shopping process includes my pre-purchase test drives, reading reviews, reviewing Edmunds, etc., all of which don't even take place on the actual purchase day, and helps me to make a better purchase that won't lead to a high priced version of buyer's remorse. If I can have fun haggling AND save $1-2,000 compared to the average buyer, why wouldn't I want to do that?
I could grind someone for an extra few dollars in very purchase I make but frankly after a point it is not worth the aggravation and I would just walk away or if it was something I really wanted just buy it.
I used to manage a small business for the owner and work for UPS as a night shift supervisor at the same time. I have spent a few years working 70, 80 or even more hours a week and I value my free time now that I work only 49 hours a week for slightly better money minus the fantastic UPS benifits.
They can call me! Is that so difficult?
Nope, I have no "moral misgivings" about "stealing" a customer from another store.
Just like you would probaby spend two hours with me driving cars and asking questions only to shop my number in an effort to save 100.00!
2 hours at each dealer???? Yeah right.
The reason there were 15 dealers was because I was looking for a White Civic Coupe. It was hard to find and I had to check with a lot of dealers. I was simply stating that out of 15 dealers only one didn't play any games.
For the online-oriented customer trying to avoid contact, it is difficult to call you because they find it annoying.
Instead of trying to force everyone through the same funnel, you might actually profit by learning from this discussion.
I'll bet that the average online buyer is mostly motivated by avoiding the annoyance factor -- not many people like car shopping or car dealers -- and to avoid the dirty feeling of being ripped off.
That means that if you provide superior service and a positive shopping experience (both as the customer defines it), they may very well leave some money on the table to do business with you, because you are less annoying and possibly even nice to deal with.
Why don't you just try that and see how it works? Is it going to kill you to reach customers in a way that most other dealers won't bother trying? You might just capture some sales that the other dealers scare off.
I understood you loud and clear. The dealers are just using a misinterpretation of your comment in order to pitch their side of the story, nothing more.
Does it work the other way around? Are dealers who grind for the last $50 or $100 out of the customer also unhappy, miserable people to do business with?
Edmunds info:
Invoice $30,280
TMV: $31,458
MSRP: $33,595
I gave the green light to a guy to call me later today.
Typical example. Someone offers me a stupid low ball ofer for a vehicle say like a 8 grand discount off of list. I am going to reject that right off the bat and just tell the person that the number they have is imaginary and impossible to reach.
I won't even make a counter offer. If they get up and walk out, no one ever has, then I would guess they were serious about that number. No one has ever pulled a bobst and walked away so they were just low balling to find the floor. But they low balled too much and I didn't give them a floor. So, we start again and if they make a more reasonable offer I might bump them a little bit or say that is something I can take for a final approval and let on of our managers bump them.
In any case I have never had negotiations where I was doing all the work last more then 30 minutes. If it drags on longer then that I drop out and let one of our managers take it cause I am not getting any where. These are the people that are grinding over the last 100 bucks which is just so dumb when the car costs 50 grand. One of our managers is a little high strung. Basicly he is me when I am in a managment position which is why I wanted to get out of managment for a while. The other is very laid back and cool. When either one of them is working with one of these grinders though they pretty much act the same way. The differance is at the end our laid back guy grumbles a little bit has a coffee and then is laid back and cool again within a little while. At least untill the CSI score comes back and the guy gives us a 50 then he gets mad again.
Our high strung guy is pretty much always high strung just below the surface so the effects of working with that customer last longer. He will be grumpy for maybe the rest of the day.
Oh god this is off topic. See this is why we need an ignore feature. I have been on various online forums for a decade the ignore feature is the greatest forum tool. There are people here I would just, not talking about you biancar, ignore cause I know they are just posting to get a rise out of someone. Normaly I have the restraint to recognize that and not comment on the post but I am human and cannot always resist making the mistake. The ignore feature lets you self moderate your forum. People that are just posting to get a rise out of someone can be ignored so you never even see their posts.
-IMO, based upon what I saw during car shopping, I found that I could beat TMV by a fair margin. It may be accurate as a measure of average market prices, I really don't know, but it didn't apply to a well-conducted haggle.
-Research the availability of dealer and customer incentives, and deduct those from your offer. If a car could sell for $300 over invoice, but there is a $2,000 incentive to either party, then you should be able to pay $1,700 under invoice. (In your case, there is no dealer marketing incentive monies for the Pilot -- this is much more commonly available for Big 2.5 cars, not so much for the popular imports and transplants except for model year closeouts, etc..)
-The margin above invoice is not your dealer's only source of inflow. Honda pays a holdback of 3% of MSRP, which means your dealer would gross about $1,000 on a sale at invoice price. Plus, the end of the month is coming up, so there will be extra money flying around to move inventory.
Automotive News publishes information about average inventories and weekly sales figures, which will give you an idea whether the car is "hot." But even if it is "hot", it may not be so hot to a dealer who is sitting on a large pile of inventory, so keep that in mind as you haggle.
I look at auto brokers to see what they're charging. If you take their quoted price and reduce it by a few hundred bucks (the fee they build into the deal), that should provide you with a sanity check as to what you can get away with. But a well-managed haggle will ultimately fetch you a lower price.
Those that have been in the business for a while know about it but don't care. From my past career I had to forecast all kinds of data from income, profit, volume inventory turns, etc and doing it on Excel and tracking sales was/is second nature. Attempting to get the normal auto sales person to even understand how to track his monthly sales is an incredible feat. Forecast profit and income per vehicle sale? Are those terms Russian or Navajo?
Most are still learning the greeting and walk around.
Quit thinking that all salespeople have an Agenda. All I want to do is sell cars, make customers happy and have fun doing it. I am good at my job and I have the highest CSI in my store because of my attitude and that I dont play games with my people. IF YOU GO IN THINKING YOU ARE GOING TO HAVE A BAD EXPERIENCE YOU WILL!
I agree. And failing to get a good price is sobering and depressing enough for most people (at least those with any pride and sense of consciousness) to make it a bad experience.
I've never once met a buyer who felt unhappy because he got a great price. I've met plenty of folks who feel foolish that they got cheated.
I already told you, I have a lot of fun buying cars, because the experience is easy to unravel once you've figured it out, and because I don't pay very much. You seem to associate overpaying with having a great time, a weird sentiment for a society that loves to shop at Costco, or to otherwise "get a great deal".
That's exactly right. If you travel in some places and don't negotiate even modest purchases, you're missing out on a vital aspect of local culture.
Make negotiation a game, with the cash you save a method by which to keep score. It's a pleasure to go up against a worthy competitor, while overpaying is absolutely no fun at all....
Kdh fishy ... THEY INVENTED THE DAM GAME!!!
Most are still learning the greeting and walk around.
You're right in respect to the average sales guy (with typically a short lifespan), but the sales manager, fleet manager or F&I guy are all generally experienced and savvy. The real wheeling and dealing is ultimately going to come from the senior people, who invariably do know what they're doing and make a good living doing it.
he did agree to play a best 2 out of 3 matches in backgammon for one price or the other.
Kdh fishy ... THEY INVENTED THE DAM GAME!!!
That's a good story, thanks for the laugh.
By the way, you deserve kudos for being as candid as you have been about your side of the desk. I'm glad that you see the value of looking at dealmaking as a sport for either side, the salespeople here could learn a lot from you.
I just don't put price quotes in writing.
People generally like working with me.
Well, then expect to lose some prospective internet sales, because some of them want to buy a car from you in the same fashion that they would buy a TV online from Best Buy -- find a fair price, click the button, pay the money. Maybe there are enough other internet leads to make up for these online types, but the Biancars of the world will be lost to you.
(By the way, I wouldn't mind getting the quote over the phone at all, but since I'm not seeking an online experience, that doesn't help matters. When a guy who isn't interested in it finds the method more appealing than one who is interested, then I see a disconnect there.)
You seem to think all cars should be sold for invoice. You also seem to think holdback falls to the bottom line as profir.
Sorry, but things don't work that way.
Two questions:
1.) do you give one over the phone?
2.) Will you honor that one?
Not to be insulting or anything but I have gotten quotes over the phone that never were to be. I would get song and dances such as "You misunderstood me" or "I thought you ment the other [lower priced] trim" and even once a complete denial that the quote was made.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
You may be right, but this just proves my point that the online sales experience is not going to be what the internet customers on this thread want it to be unless you have a change of heart, which will not occur because you have no desire to change the system.
My theory is that you are probably losing more sales than you realize by not offering a more satisfying online experience. Admittedly, these volume-oriented sales might produce lower margins, but if the decline in margins would not be made up by the higher volume and the reduced amount of time needed to close each deal, then I'd speculate that either (a) your customers are overpaying (at least relative to me) by paying excessively high margins above invoice, or (b) you are at a lower-volume dealership that believes it can't profit from sales strategies that are volume oriented. Not really a problem for me, but the online customers are going to hate you for this.
And, OF COURSE I will honor my verbal quote!
And this is another reason I like to talk to my customers. Not everyone is as savvy as the people who frequent these forums. I can't begin to tell you how often I get this...
" It looks like you are in the market for a new Pilot, is this correct"
" Ah...isn't that what Honda calls their smaller SUV?"
" Do you mean a CRV?"
" Yeah...I think so...what was that? a CVR?"
Etc....
I guess to you, a "satisfying online experience" means an invoice or below invoice written price quote?"
You have no idea of the volume we do...none
whatever.
People who are happy with their overall experience and the price they ended up paying did not "overpay".
The online customers don't hate me either and the ones that do, I'm better without.
Actually, I said the opposite to you. I surmise that IF you make the experience easy and hassle-free, and keep it as electronically oriented as possible, with a service edge, that customers will leave some money on the table happily, swapping user friendliness for price. No, they won't pay top dollar, but that won't be scapping the bottom as I would, either.
You seem to miss my previous point that I am not the ideal online customer. I don't find car buying to be a hassle, and I don't fear salesmen, so I am not motivated to use the internet to avoid them. You seem to miss that my points about what I personally like to do have been quite different from my assessment of what I think an online customer would want.
I initially mentioned my own buying philosophy in order to contrast it to the typical consumer's attiude as a way to illustrate my belief that the internet is NOT the best way to get the very lowest price. I think you miss how you could be reaching customers who, unlike myself, HATE the buying process, and would absolutely love a guy who avoids the same tactics that are used on the showroom floor if only they could do so by using a keyboard and a mouse.
They deserve you and you deserve them.
That is absolutely true, but it is not the emotional response two minutes after the sale that is the determining factor - it is the feeling two days, weeks, months... even years afterward. Of course, this does not affect the dealer in terms of the sale just made, but it does affect possible future transactions. I have friends who are perfectly content with paying prices that I find laughable and insulting, and they do not care that they "overpaid" because, according to them, they did not overpay at all. The deal is in the eye of the beholder. Sadly though, some dealers allow those sales to influence their willingness to sell to "savvy" buyers - especially in relatively isolated markets such as mine. :sick:
That really has nothing to do with either my desire to save money, or my assessment that an online business model that caters to the Fear of Salesmen crowd (not me, by the way) could work if properly executed, and not succeed strictly on price.
Car sales tactics are the same throughout the country. Perhaps the level of customer gullibility varies with geography?
When I make a large purchase, I spend the necessary time researching things before I pull the trigger. If I think it's a good value, I'll buy.
I don't look back and agonize over whether I paid "too much". I move on with life, content with my purchase.
And it sounds like your friends are the same way. The prices you find "laughable and insulting" are prices they were happy with. I do hope you don't rain on their parades by telling them they "overpaid". Let them be happy, the will live longer and laugh more.
Some recent events have caused me to relax a bit and realize that life is, indeed short.
Like when we bought our Honda last March. They accepted our price but the car was not on the lot. It was off-site somewhere nearby and needed to be cleaned up and to have a scratch fixed.
We said that was fine. We would go have lunch and come back in about an hour and take it for a test drive.
Before we left, the sales manager asked us to sign a form of some kind and I refused. I said, "If the car is here when we come back, we will go for a test drive. If not, that's OK." I saw no reason to sign anything.
It all worked out fine. We came back, went for a test drive, loved the car, paid for it, and drove it home.
By the way, this DG is supposed to lower our blood pressure, not increase it. OK?
Bob
They deserve you and you deserve them.
I worked in the SoCal area in Pasadena, and that Market is brutal on both ends. I thought I would never sell cars again after 2 years of that Hell. The customers would literally call every day "I have 200 over invoice @ Ontario VW can you beat that?" But It has made me a better salesperson and made realize that My Job is to provide a service, not to be a doormat yes girl.
SOCALA4 Let me ask you this, what do you think a fair price over invoice is on lets say an A4? Remember we have no holdback. I want to see what you think is fair.
Before I bought my last car, I can remember being quoted $2000 below invoice on new Nissan Maxima's. I suppose they wanted to move the remaining cars before the next new body style showed up on the lots...hmmm
With the amount of info available on the internet, I'm still a little unclear as to the value added of a salesperson? I usually go directly to the manager who can greenlight a deal. Otherwise why the back and forth?
I have to agree with Socala4; the internet shopper isn't necessarily looking for the absolute lowest price. What I'm looking for first is the specific car (color, trim level, etc.). Second is a fair price from a dealer with a good reputation for service, honesty, those good intangible things. Doesn't necessarily have to be the absolute rock-bottom price; I'm more interested in getting the specific car I want at a *fair* price; if it's close enough to TMV or whatever other pricing guide I'm using, then fine.
Isell, you've made it clear you don't give written quotes. Do you at least confirm in writing that you have the specific car someone is asking for?
Socal is also right that you're likely to lose the Bianca's of the world, because while you're insisting that I call you, I probably have already moved on to another dealer (perhaps like brit rover) who can either use e-mail or instant message to communicate.
But that's what competition is all about; you deal with your customers in the way you find most comfortable, and people like me will deal with other vendors who are comfortable with other methods. We don't all have to be alike.
Right now, for instance, I'm in touch with a Volvo dealer a few hundred miles away, who is very experienced in overseas delivery. I might end up buying a car through him without ever meeting the guy. Fine by me, and fine by him. I'll get the car in Sweden and he'll arrange for me to pick it up wherever I want back in the U.S. Not a bad plan.
Boy does this make the process a lot easier for those not in the mood or used to the negotiation process. There are also lots of little perks a client like rayng get as well that no one else will ever see.
In your case the salesperson is the paperwork preparer.
I might try again after this new lease is up.
You would probably pay a bit more somewhere else but money isn't the most important thing to you like it is to so many others.
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Oooh, I understood every word of it .... if it took you 15 dealers for you to purchase a vehicle, then there "might" be something incorrect in your thinking and/or your attitude -- 15 dealers.?? .. it's gotta be a record ...
This kinda reminds of a friend that's been down here in Florida trying to purchase a home for the last 5 months ... 7 different agents, 14 offers and he's still staying at the Motel 6 .... time to look into the mirror - wouldn't you say ....?
Terry :shades:
And Nissan tacked on some special financing rates- I recall it as being 1.9APR/36 Months or 2.9APR/60 Months.
They were really good deals assuming you could find the right combination you wanted.
I remember being quoted "cost" minus $2000 from a dealer in August, GA for their sole remaining I35 in March 2005.
Getting a good deal does make the consumer feel much better, and in my case, the dealership was glad they were dumping their "old" inventory.
You took your time, you spoke to many people on the boards (including me) you shopped different area's of the country and knew what the going price was because of the incentives ... even though they were in short supply (by that time) you ended up getting a great vehicle for a superb price ....
What you didn't do.? .. you didn't run around half-cocked, misled and making yourself or the dealer nuts - both won .... that's why it worked.
Terry.