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 naïve 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.
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