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Old 20-03-2011, 11:17 PM   #4
Menai Mark
Regular Member
 
Join Date: Aug 2010
Posts: 53
Default Re: So where should I start on $$ negotiations?

Heaps 79

As per your previous post this is part of what I advised: If you're leasing a car (eg novated lease) then use the discount that they give the Fleet company to bring the cost down.
Tip: I dealt directly with the dealership and they gave me the full discount they would have given the Fleet company (without them keeping some of this for themselves. (refer to other thread for further info on this.)

However if you're purchasing it privately here's some tips (from an ex car salesman):
1. Take your time - its a marathon not a sprint. The more you put in the more you'll get out $$.
2. Sales cycles are month to month. Do all your looking around / research etc at the start of the month, go and speak to sales people, you'll be surprised what they tell you. Be open and frank and earn their trust. Only deal with those sales people that are open and honest with you. If they can't be honest with you before the sale - wait until after the sales done!
Do all your hard negotiations at the end of the month, especially the last weekend. The sales person and the dealer want to get their numbers up by the last weekend. If the numbers aren't there for them then they'll be more open to negotiating in your favour.
3. Cars have 2 levels of profit built in for a dealership - sales profit, and hold back. Roughly both are the same amount. Sales profit is what the sales person / manager plays with and affects his / her commissions. Hold back is what the dealership wants as a profit from the car including costs (ie finance to hold a vehicle on the lot, administration etc. My guess would be that there's around $3500 Sales profit built into the Titanium, leaving roughly $3500 hold back. The sales profit, if you play your cards right you should be able to get as a reduction reasonably easy. Hold back is a lot harder and it all depends how desperate they are to sell the car to get their numbers up. Some deals they just won't do. You know you're getting into hold back territory in the negotiations when the sales manager is heavily involved and he's also calling the Dealer Principle or owner.
4. The longer you spend with a sale person the more they'll be on YOUR side. Take the car for a LONG test drive with them when they offer. Get him to tell you all about the car, all its features, share some of these features with him / her if they don't know. If you spend 2 hours with a sales person BEFORE talking price he knows you're keen and they won't want to let you go. They want that sale and by god they're going to get it! I'm mean you've just spent 2 hours with them, they won't want to feel that their times been wasted, especially if one of the other sales guys has made a sale during this time! Tip: A good sales month for a sales person is around 12, any less and the dealership will be slowly increasing the pressure to get the numbers up, depending how short of this total they are. If they're sitting on 8 or 9 towards the end of the month they'll be putty in you hands!
5. The negotiation does not really start until the sales manager is involved, if you only shake hands on the deal with the sales person, then you haven't done your job - but he's done his. Sales managers are smarter operators than sale people, but they're bound by numbers, just like the sales people he looks after. Go low with an offer, but not so low they won't take you seriously. Be prepared to come up from your initial offer, but only after you have had further negotiations with the sales manager - and take your time. Stick to your guns, be stubborn, but also be fair and reasonable. Once you're about $1000 to $1500 away from their price vs yours, start asking for extra's. Say, if you threw in this, this and this I may be able to meet you at $x ($600 less than their offer). Throw in 4 or 5 things that can be used to sweeten the deal. You don't need to wait for them to offer, plus you get what you really want eg window tinting rather than fabric protection.
6. At the end of the day be prepared to walk. (Especially if you're feeling too pressured, threatened or just have a bad feeling about the whole situation. Remember you still have to deal with these people after the deal is done and sometimes the cheapest deal is not the best deal.) The dealership down the road is selling exactly the same car but at a better price - and tell them that when you go to leave. If they let you walk then you know you've got their best offer and the dealership down the road will probably not do too much better - maybe a tank of fuel, but at least its something. Let this be your judgement too. Do you want to go through the same stuff again just to get a tank of fuel?
7. The best sales person to do business with is the one you feel the most comfortable with, be friends with the sales person (to a point), it's the Sales manager you can be an AH to if necessary. It may also be that the sales person you feel most comfortable with, you won't necessarily get the cheapest deal but in the long run it'll be the person you get the BEST deal from and you won't feel like you've been screwed over.

Hope this helps. Let me know how you go.
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