Dealing With Dealer Tricks
As mentioned before, salespeople are trained in scores
of techniques and have spent many months and even years
applying them. So it is helpful if you also have a chance
to learn these schemes that the dealerships use. And if
you know when a method is being tested on you, it becomes
easier to ignore it and move on with your business - buying
the car of your choice at the lowest possible price. Below
is a list of tricks used by professional salespeople.
Take it or leave it
This is the standard marketing policy all Americans are
familiar with. When you visit a restaurant or clothing store,
you "take it or leave it" according to the price marked
on the item. In the car business, however, you don't have
to "take it or leave it." You can bargain for it. You can
easily leave it now and come back later and take it. In
fact, it is good practice to leave it before taking it.
"Take it or leave it" is usually a ploy to force you into
to make an early decision.
Guilt
The salesperson may attempt to make you feel guilty to force
you into a purchase. He may tell you how desperately he
needs the sale, or that he may lose his job if he doesn't
make a sale this week. He may play with your emotions by
revealing that he considers you his "friend," or he may
question your motives by asking if you are truly serious
about purchasing a vehicle. Do not yield to these tactics.
If a salesperson has issues with his sales records, this
is his problem; don't make it yours. You are not there to
make friends or solve the world's social problems. If you
show any kind of sympathy, you will only encourage more
of these guilt trips. Keep a businesslike distance between
you and the salesperson.
The written word
We are not as apt to question a deal that is in writing.
The written word has a certain power of legitimacy. Car
dealers are armed with loads of written facts, figures,
forms and rules that they claim are etched in stone. Always
assume that anything written is negotiable, that prices
are meant to be tested and that any item can be adjusted.
From your homework you will know what all items cost, what
costs are fixed and what costs are not. The fact that a
dealer has something written down doesn't mean it is true.
Question everything.
The direct approach
Chances are, at some point you will hear the dealer ask,
"What must I do to get you into a car today?" His goal here
is for you to list objections that he can work out, so you
will be further committed to buying a car. In this situation,
you can ask the salesperson to stop pressuring you, and
tell him that you know what a good deal is and that you
will ask for it.
Good guy/Bad guy
The dealer acts as though he is your ally and escorts you
through several roadblocks, until you depend on his guidance
and his opinion. Behind the scenes, his sales manager may
create phony obstacles for your friendly salesperson to
solve, all to gain your confidence. Remember to maintain
a proper distance between yourself and the salesperson.
The team approach
In some dealerships there are groups of salespeople, and
each group has a different responsibility. One greets you,
another takes you for the test drive, another opens the
sale, and another closes it. It may feel as though several
salespeople are ganging up on you in a quasi-tag-team fight.
There is only one of you, but, it seems, an infinite amount
of them. The best way to handle this situation is to insist
that only one salesperson work with you. It also helps to
arrive late to the dealership, when most salespeople have
already gone home. Don't allow them to double-team. Leave
if you can't control this situation.
Delay
Sales staff can drag out negotiations in many ways - by
sending in other salespeople, losing the keys, or forcing
you to wait around so long that you grow anxious or tired
and care only about finishing the deal as quickly as possible.
Dealers will only use this tactic if they think you will
accept this type of treatment. So while you wait for the
salesperson to return with a counteroffer, make him uneasy.
Tap your fingers, get up, walk around, go outside. The customer
who can successfully control the pace of negotiations is
more likely to steer the bargaining his way.
Going, going, gone
It is quite common to hear a dealer claim that the dealership
only has one car left like the one you like. This "limited
supply" claim is another maneuver to force you to make a
rash decision. To counteract and if you are feeling pressured,
you should be willing to let the car you like go. Another
version of this strategy is, "This deal is good for one
day only -- today. You should reply that you will have to
miss the deal. Stick to your own agenda, not the salesperson's.
Only the monthly payments are important
This cannot be further from the truth. Occasionally, the
accurate cost of the vehicle can be hidden when the salesperson
tries to give you the lowest monthly payment possible. Beware
of this trick. You may gain a lower monthly payment, but
you may also have a significantly longer payment plan and
a higher down payment. If you are not careful, you may lose
track of how much the car actually costs. Dealers use this
method only when the buyer stalls on a high price. Never
worry about your payments until you speak with the financing
department. Always know what your final cost will be, and
always fight for the lowest car price.
Only the cost difference is important
Not true. The salesperson will aim to convince you that
all that really matters in your negotiation is the difference
between the new car price and the trade-in price. Your salesperson
is deliberately trying to confuse you. If you are not careful,
every time you convince the dealer to lower the cost of
your new car, somehow the agreed price for your train in
suddenly drops as well. It is critical to get the price
for each separately, and keep track of each separately.
This will prevent unnecessary confusion. It may also prevent
you from losing money on your trade-in. Beware of "allowances."
Always demand fixed prices for each item in the negotiation.
The price of your new car should not be dependent on the
allowance for your trade-in. Allowances never work in your
favor.
Low-balling
To enhance their profits, car dealers usually quote a severely
lower price for trade-in vehicles than they are worth, because
their profits on new cars are sometimes limited by the amount
of money banks will lend toward new car transactions. There
are several elements of a car deal, and even though you
attain a low price for the new car, you still must get a
reasonable price for your used car. Low-balling is used
when the salesperson determines that you are concerned about
new car prices, but not as worried about what you get for
your trade-in. He will try to focus your attention on a
reasonable price for the new car and yet underestimate the
price for your trade-in. While you are dazzled by the incredible,
$500 savings on your new vehicle, you may be losing thousands
on your trade-in. The reverse can also be true. If the salesperson
feels you are mainly concerned with getting a good price
for your trade-in (t use for the down payment on your new
car, for example), he may quote you an unbelievable price
for your trade-in, but charge you above list price for the
new car and tie both prices together as a package deal.
To counter this, first make the salesperson believe that
your main concern only lies with your trade-in. Once this
is settled, switch gears and then make him think that the
only important issue is a low new-car price -- but don't
give back the great trade-in price. It is helpful to write
down the agreed trade-in price, especially if you required
the salesperson acknowledge it in writing at some point
in the deal.
Bait and switch
If you are not cautious, you can walk into a dealership
to purchase the car you thoroughly researched, and drive
out instead with one that merely caught your eye. If you
find yourself tempted this way, leave the dealership until
you can think your way through the situation and do the
necessary homework.
Verbal promises
During your buy, the dealer may verbally make an abundant
amount of promises. Each time something is offered -- write
it down and keep a list. Even better, have the salesperson
or his manager initial the items you agree on. Save this
list for later. They will most likely attempt to take back
some of the items they conceded to earlier.
Limited authority
Lacking authority would appear to weaken one's position
in negotiations, but in fact the best stance is to have
no authority at all. A salesperson can back out of any agreement
he makes by merely stating that he is not authorized to
make it. Verify with the salesperson at the outset of the
discussion if he has the authority to make a deal. His usual
response will be not to answer or be evasive. At this point,
you should say that if he as no authority, you would rather
deal with someone who has. Persuading the customer to say,
"yes". This theory is that if you say "yes" to a line of
successive questions, it will then become easier for you
to say to say "yes" to a less than adequate deal. Do not
concede to everything the dealer suggests. Say "no", or
"maybe" to a few of his offers. Other options are to change
the subject or to get the salesperson to agree to one of
your own demands.
Bartering
Car dealers are excel at asking for a line of concessions.
Before you know it, you have relinquished the entire deal.
If you notice this happening, start asking for small concessions
of your own. Don't give away anything without asking for
something in return. For example, if the salesperson wants
you to agree to a higher price before he presents the offer
to his manager, use your concession as an opportunity to
ask for free air-conditioning and an upholstery upgrade.
Don't be afraid to barter. No one will give you anything
unless you ask for it.
Temporary concessions
You may find that concessions granted at earlier stages
of the deal have disappeared in financing. All of those
compromises you fought so hard for are sometimes forgotten
the minute you open your checkbook. The salesperson may
have promised you free leather seats but may have failed
to mention that to the financing department. To prevent
this from happening, write down all points agreed on in
your discussions, and don't sign any documents until you
have everything you were promised. Refuse to move any farther
in the deal if promises don't materialize.
Refusing to negotiate
Some car companies claim they don't negotiate. While they
may not be flexible on new car prices, they may still give
you a higher trade-in price, throw in extra accessories,
or allow you a lower financing rate. Regardless of what
the dealership claims to be its policy, keep digging for
concessions or shop elsewhere for a better deal.
Quoting averages and statistics
If lengthy lists of figures, facts and statistics confuse
you, simply block them out. Move the conversation to something
you feel more comfortable with.
Appealing to your sense of fairness
Sellers may be the only people who ever demand that you
recognize their need to make money and get what they consider
their due is. It is the car manufacturer's responsibility
to correctly price vehicles so that the dealer makes his
fair profit -- not yours. Don't get dragged into this debate.
This is merely another version of a guilt trip.
The silent treatment
If you notice the salesperson has stopped talking, you are
experiencing the silent treatment. Though it's normal to
fee awkward, restart the conversation with comments on any
topic - sports, politics, gardening. If that doesn't work,
go elsewhere.
"I'm new here."
Any good salesperson will try to gain your sympathy. Even
if he is a brand-new employee and is naíve about sales tactics,
he certainly is backed by an experienced, competent sales
manager. Who will back you up if you make a costly mistake
based on his false information? Opt for a more experienced
salesperson; thank the new dealer for his time and ask for
someone with more sales expertise.
The good-faith deposit
Offering a deposit is perhaps one of the strongest signs
of commitment. Don't do it unless you are prepared to go
through with the deal. If the salesperson will not take
an offer to his boss without a credit check or deposit,
demand that he do so. Tell him that until a firm price is
agreed on, you will not commit to the sale. If he refuses,
threaten to walk.
Taking your keys and registration
It's a nightmare to have the dealer "lose" the keys to your
car, so that you are forced to stay and negotiate. Always
bring an extra set of keys, and don't negotiate until you
get your keys and registration back.
"If I can do ______for you, will you do________?"
This is another technique used often to make customers commit
to the purchase. Salespeople use this strategy to see if
you are a serious buyer. The best way to counteract this
technique is to keep saying that you will indeed purchase
the car immediately, but only if you get the deal you want.
You are always free to change your position later.
Stonewalling
This is a classic negotiating tool, in which concessions
are granted slowly and reluctantly. The average customer
quickly grows impatient and discouraged and compromises
to move the discussion forward. You must be willing to wait
out the salesperson or to come in at a time that is inconvenient
for him, so he will be more willing to concede to rush the
process.
Upcoming price increase
This scheme is not used much and is designed to push you
to make a quick decision. To do this, the dealer may threaten
that there will be a large price increase soon. Buy now,
he pleads, because the price will increase by 10 percent
by the weekend. Ask the salesperson to prove this price
hike. If he has a flyer mentioning the increase, make note
of it, and check if it applies to the car you are interested
in. If he can't document his statement, then you can probably
assume the prices will remain, and keep negotiating at your
own speed.