Tuesday, June 17, 2008

What is "The Best Deal?"

Have you ever went into a dealership with a car already picked out and told the salesman to give you his "best deal", only to take it to another dealership and have it beat by a significant amount? Chances are, you paid too much. Everytime a customer made this demand of me, my sales manager would give me a deal with a good bit of money still in it. I have also been on the recieving end where a customer would come in with an offer from another dealership and I would make good money every single time.
If you really want the best deal, and you don't want to have to pack a lunch to the dealership to get it, I am going to use my 8 years experience to give you a little advice for free.
1. Make sure it's the car you want. If you get a rock bottome deal on a Ford Focus but you really wanted a Mustang GT, then what does it matter if you got a great deal on it? Keep in mind, the salesman wants you to be happy, but he also wants to maximize his profits. In order to do this he wants you to drive the car and get excited about it. When this happens, sometimes the emotions take over in the negotiating process, and you are leaving money on the table. I am not saying don't test drive, it is important to test drive. Just don't let the salesperson know how excited you are and don't let the excitement take over your good judgement.
2. Research. Chances are, if you have found this blog that is what you are doing right now. Know what the rebates are before you leave the house. Some dealerships do stunts like advertise $100 below invoice, $1000 below invoice and so on. This confuses the customer. Say you buy a car at $100 below invoice, but the rebate was 2k, and the rebate goes to the dealer. If the car only has $900 dollars mark up, the dealership just made $900 on your deal. A better deal would be invoice - rebate.
3. Negotiate price, not payments. If your salesperson comes down with a payment, send him back to get a price. Payments can have a ballooned interest rate, gap insurance, extended warranty and things of that nature loaded into them without being disclosed to you while you are at the salesman's desk. After you agree on a price (invoice minus rebate would be good), then ask what the payment is, and what all it includes. They have to disclose it to you.
That's all I have for you today, in the next few days I will be going over things like the finance office, interest rates, and dealer holdback so stay tuned!


Kay said...

Honest Ed,
Your information came in very handy when I went to purchase a new vehicle. I do believe I received "The Best Deal" possible...I even got exactly what I wanted.
I couldn't have done it without your blog!
Thank you so very much!

Ed said...

I'm glad I could help! :)