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Not necessarily so. The ideal is not to get a low price but the best price with reasonable effort. My last negotiation on a car I actually got lower than I though would be a good price. If I would have gone in with that good price and made that as an offer I would have paid more.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Yep it had a sticker of just under 16K and they bumped it up to just under $20k on a Suzuki SX4. This was just as they came out and I suppose someone might have seen that got them down to sticker (or maybe even 1-2 grand over) and thought they got a good deal. As David Hannum said "There's a sucker born every minute"
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
You may go into the dealer thinking that $22K is a very good price, but once you get the dealer down that low, you may have the skill to get him down to $21K. Good for you.
In my case, while you were still negotiating, I would have paid the $22K, driven the car home, and be watching "Ghost Whisperer" re-runs. Yeah, I think Jennifer is hot.
However, the point of my original post was that I believe grinding for a few hours will not make a dealer accept a lower price. If a dealer will not accept my easy $25K OTD offer, then he will not accept a $25K OTD offer from a grinder.
Exactly! Having confidence in your number, that someone...somewhere will accept it, is the key. Knowing that the number is a skinny deal, and that you aren't going to take a lot of time to buy the car, makes the dealership more willing to accept it. Easy-peazy.....quick in/quick out.
Now, if the stars line up correctly and the winds blow warm, a 2-3 hour grinder may be able to save a few more dollars. But, then again, maybe not.
Some feel that unless they're at the ngotiating table a long time is a precursor to getting a good deal. Maybe they will, maybe they won't. Making our skinny offer up front, we know we're getting a good deal.
I still say, the longer you're at the negotiating table, the more you're being bumped and the more convoluted the deal gets. Sales person and management have no place to go. They can and will keep you there as long as they can to grind it out.
My last customer last night had gotten quotes from 3 different dealerships. They were upset by the treatment that they received at the highest volume dealership in GA. It's a green pea store that whores everything out. The sales staff turns over every month. Management turns over every 3.
They leave and call up to my dealership. I catch the phone call. They ask for a price and availability. I call back quickly with both and they come over.
We sit down and I present my offer to them. The woman (who is purchasing the vehicle) asks if I can do any better. We grind for a little bit over numbers. Then they tell me they are going to go to another dealer and see if they can beat my price. However, they assured me if they couldn't, they would come back to me.
I laugh and tell them that we can all play this game all day long. What do we need to do? I caught them in two lies as we are discussing numbers and finally cut my original offer by $200 and we seal up the deal. But they were willing to drive over to another dealership and grind some more for a couple hundred bucks.
These folks knew they were getting a good deal, but somehow they still needed to keep searching. It has to end somewhere!
-Moo
-Moo
Yes but the thing is people like you don't like to negotiate and are willing to take a chance that they will pay a slight bit more for the convience of not negotiating. There is nothing wrong with that.
In my case, while you were still negotiating, I would have paid the $22K, driven the car home, and be watching "Ghost Whisperer" re-runs. Yeah, I think Jennifer is hot.
Don't be so sure. Last time I negotiated I got below what I figured was a pretty good price and it only took 20-25 minutes. I actually think that spending hours in negotiating a car price is wrong, something is wrong if it takes that long.
If a dealer will not accept my easy $25K OTD offer, then he will not accept a $25K OTD offer from a grinder.
Actually in any negotiation the longer someone is in on the negotiation the better chance they will settle for something less. The dealer might accept less than $25K from someone they invested a few hours with and not accept $25K from someone they have no real time invested in. (of course this works both ways.)
Also remember that many negotiators will not accept the first offer no matter how good it is. The rejection of your $25K offer may have just been a ploy to see how much they could get out of you and that they were really willing to take less.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
I don't know if you would actually call that grinding. If someone puts out feelers looking to see if the price will come down a bit is that really grinding? Now if they continue to do so repeatily asking for more off I would call that grinding.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Unless you say you're buying a car every other weekend, I fail to find any reason in the "My time is worth a lot of money" excuse. If you are to busy to spend an extra hour at the dealership once every 3 or 4 years(works out to about a second a day)... then "something is wrong".
That said... to each his own. :P
Edited: For the record I do no characterize myself as a grinder (tries to get down to the last nickel), but a hard negotiator.
This question must have responses from both sides to be meaningful.
Now, as a guy not in the biz, I say grinding kicks in at the 1 to 1 1/2 hour time period and usually manages to save $150 or less. Everyone here knows I only spend 30 minutes buying a car. Therefore, by my definition, I'm not a grinder and should be loved by all dealers.
jmonroe
'15 Genesis V8 with Ultimate Package and '18 Legacy Limited 6 cyl
I agree but I believe it is hard to stop and smell the roses when you are spending 3 hours to save $200.
Unless you say you're buying a car every other weekend, I fail to find any reason in the "My time is worth a lot of money" excuse.
Its just the opposite, unless you are buying a car every other weekend there is no need to save every nickel on every deal.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
I doubt that is really true.
They will accept my $25K offer if it is in their best financial interest. If they turn down my offer and let me walk out, then I guess selling the car for that price was not in their best interest.
Even if you talk with them for a long time, it will still not be in their best interest to sell you that car for $25K, so why would they do it?
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
It only works if you have a one of a kind vehicle that is high in demand, hence the ADM.
This tactic I believe will not work on a run of the mill car, especially when I have 20 of them on the lot, and especially when there are 5 other dealers in the area, each hungry to sell it.
It would be foolish to do that (refuse to sell at MSRP) from a dealer's point of view.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
It is a tactic that can and often does work and is a basic negotiation strategy.
It would be foolish to do that (refuse to sell at MSRP) from a dealer's point of view.
Who said anything about refusing to sell at MSRP? Be honest how many people come in and offer at sticker? Bobst is talking about doing your research and finding what would be a reasonably low price. Now tell me if someone comes in and offers way below sticker but near the bare minimum that you will take would you accept the offer right away or would you try to bump him up? You would be foolish not to at least try to bump him up.
Bobst himself will tell you that there have been times when a dealer refuses the offer then comes after him to accept it when he simply says thank you and leaves.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
But, I think another variable that needs to be considered, besides time and money, is attitude. The grinder has the attitude that the deal is more important than the car. After squeezing down to the last nickel, he'll go home and phone everyone about the good deal he got... instead of talking about his new wheels.
While time and money are symptoms of this dreaded disease called "grinding", they in an of themselves would not be the sole indicator. A person spending 3 hours at a dealership may not be a grinder, instead they may be one of those people who put themselves in situations in which they don't know what they hail they're doing. Or, as the snake would say,"Something is terribly wrong". Many other reasons why a negotiation session could extend into a couple hours without a grinder present. I would think you would need to get to the 1 1/2, 2 - 3 hour marker before the person with the grinders attitude could be considered a true grinder.
If faced with a skinny deal that goes quickly, or one that takes a long time, which would you more readily accept (if you accept a deal at all)?
Once I started to walk out, I think you would realize that I would not increase my offer and you would be happy to accept my $25K. If not, why not?
I am so not interested in making a couple extra hundred dollars on a deal that I won't be paid on. Let's sell a car and move onto the next one. Maybe the next one will be profitable.
That's just me though.
-Moo
The problem is that many times these people come in with unreasonable prices that I just can't meet.
Just for example this woman I have been dealing with that wants our white XC90. She only wants to pay 27,000 dollars for the car with the volvo certified warranty. The problem is that she is below auction value for that particular car and I am losing a little over 2,000 dollars at her price.
When she first came in I gave her a price of just under 31,000 dollars. She held firm at the 27,000 and actually I think she might have started out closer to 26,000. I let her leave and she called back a week or so later. We decided we would blow the car out to her for 30,000 on the button plus tax and tags. I think that came to about a 800-900 dollar profit deal for us.
She stayed firm on the 27,000 and would not budge. This has been going on for almost a month now. I will be glad when the car goes to another dealer next week for 27,500.
You get involved in a marathon negotiation session, and the motivation to close a skinny deal goes down....kind of the point of diminishing returns.
BR....I would imagine if someone comes in with unrealistic expectations, that would be frustrating. There too, wouldn't you just cut bait and tell them "good luck, nice talking to you, hope you find what you're looking for, but no deal".
But when you arm these people with facts about buying, they decide that emotional buying is best and what they THINK they should pay for a vehicle is the best price.
This reminds me of a story from my Nissan days. I met a couple of ladies from New York who loved the Nissan Armada. They wanted to purchase new, but I didn't have anything in stock that matched what they were looking to buy. I checked my used lot and found the EXACT vehicle they wanted.
I had them test drive and demo'ed the vehicle. She loves it! Awesome. I know I've got a deal as long as the price works out best. My first offer to them was 9,000 dollars above what we had in the vehicle. They were putting $15k out of pocket, so I knew the carry wouldn't be a problem.
She balked initially and I cut the deal by about $1,500. She liked the price, but still wasn't sure because it was a pre-owned vehicle. This was a very emotional, very unstable woman who had a very difficult time pulling the trigger.
Long story short, I cut the deal $5,000. She thought she was getting the best deal ever on a vehicle because I kept cutting and cutting the price. She bought LoJack and all the extra security features we had and then kept asking if there was anything else she could do to secure the car. Unreal. She buys.
A salesperson needs to create the perception of a good deal in order to sell. Emotional buyers can be very difficult as you can see from both spectrums.
Nice deal for me though and she loved the vehicle!
-Moo
Why wouldn't you give her a call just before it goes to offer it to her at $27,500 plus the cost of the Volvo warranty. You're losing nothing but maybe gaining a customer.
There are certain customers that I just know won't move off their price and I don't spend much time negotiating with them.
This may seem a little harsh, but on Saturday I had a gentleman who offered me a $2k bracket deal. I told him we couldn't do it. Where do we go from here?
He asks me, well what can you do? And this is after I've already shown him a discounted price. I repeated myself again. Mr. Patel, I can't do your price. If you're willing to pay more for the vehicle, then I'll be happy to work with you. If not, there are about a hundred people on the lot who are interested in actually purchasing a vehicle and paying profit. I need to start working those! Thanks for coming by.
And then he was ushered quietly and efficiently out. It just never makes much good business sense to sell a car for no profit. I haven't heard of anyone who has been able to give me a good reason yet for doing that.
GG, remember the analogy? Fishing in well stocked ponds.
-Moo
I don't work in the auto industry, but see it in my work every week. These are people who have all the time in the world, and apparently nothing better to do. In the business world, they truly can't see the forest from the trees, and on a personal level, are willing to spend a lot of time, for very little. I'm guessing that to them, concessions are like trophies - each little "win" (no matter home minute) is another bit of validation.
I hope it makes them feel good, since I'm positive all the others around them are exhausted and frustrated, and I don't think they come out ahead. The next person, who comes in with a lower offer overall, but says "if I get this, we're completely done right now", usually comes out ahead, both in the short run and in the long run IMHO. At least that's my experience - oh yeah, and both sides are usually much happier
Mike
The truly hard-core grinder never stops negotiation. He just keeps going always asking for more right up until delivery and sometimes even after delivery.
That is just to make my position clear.... a deal is a deal. If you can't do that deal, then just say so. Once you go for the first bump, they never stop coming.
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She wouldn't budge off of her number and now the car she was going to sell on her own is actually going to be a trade. 27,000 was the final number and she would not move. I needed about 2,000 dollars more to make it work.
She wants about 1,500 dollars more then it is worth becase that is what some other dealership put on the car. That other dealership is going to sell her a year newer XC90 with less miles and the same equipment for 28,000...
If she is getting such a good deal on that car and they are offering her fantasy money for her trade why is she here?
I just told her I could not meet her price.
Better to cut bait and move on than to waste time on someone who wouldn't know a good deal if it kicked them in the rear.
I probably wouldn't last a day in the car business. Offer a good deal to someone, who refuses to recognize it....I'd be kicking people to the curb.
As mentioned, I'm in a different industry, but I'll cut some margin to do a quick easy deal. My company (as well as I) loses interest really quick in working with someone (some company) that wants to waste a lot of our time. My guys (and gals) come to me with someone who wants us to sell at, or below cost (or below my margin goals), they're fishing in the wrong pond.
I've got margins I have to hit to keep us a viable company. Try to eat at them, I get real disinterested, real quickly.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
If I can't beat their price, then I just say so.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
She was either lying or being lied to. I am not sure which.
Both.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
You are right I think it was both.
I just found the car she was talking about. She gave me enough info to find it...
Its not the same car as mine.
My volvo is a T6 and the one she is looking at is a T5 with 5,000 more miles and a funky color.
Crystal Green is one of Volvos worst colors as far as resale go. I bet that dealer stole that volvo considering it has three strikes against it.
1. Bad Color
2. Wrong engine
3. High miles relative to year
Hehe, with something like this?
“I wish we could assist you. Unfortunately your offer has been rejected. Hopefully you will find a dealer able to do that for you.
Best Wishes,”
This is an actual reply to my email offer. I did exactly that at a lower price than I offered to them. Since then the SM and GM called me three times begging for my business, and I keep on telling them that I followed their advice, but they keep on trying. :P
Dealerships sure are strange sometimes.
-Moo
If it's on good merchandise, they'll cut you loose.
Why am I thinking you know that already, though?
Good deals on popular/hot cars don't happen that often.
That's right. GREAT deals happen!
Deals that include lots of money for your salesmen and dealership.
-Moo
But honestly as long as you are not paying over sticker for a hot car you are probably doing ok.
I can't think of many hot cars in the past few years that have really been worthy of over sticker prices.
Excluding truly limited production vehicles like true Exotics and such.
I have to imagine selling two cars warrants some kind of special pricing.
Might just be me though.
I prefer to work one car at a time.
I certainly agree that if there are two cars being bought, there should be some special treatment. Hard to say without knowing what vehicle you are purchasing and whether or not the dealership is making any money.
If 1 car is bought or 2, the deals still need to make sense.
I have a feeling this isn't helping you much, Shaff. Care to share a little more about what you think would be fair and what vehicles you're considering?
-Moo
Sorry 'graph', but I just haven't seen that with this guy.
Grinders usually stick with grinding. Market conditions have nothing to do with a car purchase. :surprise:
jmonroe
'15 Genesis V8 with Ultimate Package and '18 Legacy Limited 6 cyl
We are looking at a Mazda3 4 door and a Mazda CX-7 AWD. We both have trade-ins. At this point, I'm not really sure what would be fair. What do I think is fair? I don't really know as I don't know the margin on these cars.
The things I would first consider is:
- we both have very good credit so if we went thru the dealer financing, I would hope for special financing rates
- special pricing on options
- $2k or so reduction in MSRP for each purchase.
Typically with Hondas, at least in my dealership, when ever I have a two car deal (let's say Civic for example) you will get maybe $300 off extra (on top of a regular courtesy discount) on each car and accessories at cost.
However I don't know what the margins are on Mazdas, so can't comment on specific prices for those.
2016 Audi A7 3.0T S Line, 2021 Subaru WRX