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December 16, 2018

Negotiating Tip 55: Car Buying Negotiations

We’ve discussed five of the common negotiating mistakes people are prone to make when buying cars.  Let's explore some tactics and techniques to level the playing field in car buying negotiations.

Technique#1: Do Your Homework

In this age of information overload and easy (internet) access, there's no excuse for not researching car prices, values and options before you visit the dealer.  Many of you remember the day when we would try to befriend someone who had access to the famous 'blue book'.  That reference guide listing the wholesale and retail value of all the car makes and models.  It was the reference that everyone used.  Armed with that data, we would know what was a good deal or bad.  Those days are long gone.  With just an hour or two online, we can determine a close range of value for any car we might be interested in.

Technique #2: Keep Your Options Open 

If you are set on getting that one make, that one model, you are at a disadvantage.  Broaden your target.  This technique alone can save you thousands.  We all see that one car that catches our fancy, but ask yourself, "What would I do if I couldn't buy that one?".  If you would answer by saying you would get another car, then you have acceptable alternatives and options.  Everyone has to make these type decisions on their own, but know that the more narrow your target the more costly it will be. 

Technique #3: Don't Go Alone

If we buy into the fact that car buying is a somewhat emotional purchase then we better have someone there to save us from ourselves.  When we are alone our 'self talk' says,  "I really want this.  I really need this.  This will be really cool to have."   Car dealers seem to sense when we are thinking this way and encourage us to step out and make the move.

What if, however, you brought along a partner who is there simply to change the dynamics, be a stabilizing influence and save us from ourselves.  That would be their assigned role before heading to the dealership.

Technique #4: Don't Buy on the First Visit

The inertia and momentum that car buying negotiations often take can be a slippery slope.  Consider the strategy of not making a decision on the first visit.  That means that at some point in the discussions, you will leave, walk away and establish terms of your possible return.

The thoughts and reflections you will have after leaving the lot are priceless.  The dealer will know too that you are not a vulnerable, impulse buyer likely to overpay. This 'leave and return' technique, which the dealers refer to as the "I'll be back", isn't unknown to them.  Frankly, it is how the negotiating game is played.  Buying on the first visit is rarely a wise decision.

Technique#5:  Negotiate First for What You Don't Want

This one asks you to focus the early discussions with the dealer on a vehicle that you are not very interested in acquiring. It sounds strange but try it. You will proceed by making an aggressive 'low ball' offer. After all, wouldn't you sincerely want a deep discount to have to buy something you didn't want?  You are demonstrating the kind of negotiator you are and that you're not shy about making aggressive offers.

Why do this? Two reasons. First, it conveys that you are tactfully aggressive in making offers.  This will be important when you make an offer on the vehicle you really want.  Second, it conceals the actual car you are interested in.  It seems to say that you're looking for the 'best deal' ahead of selecting the car you might want to drive.  We could even add a third reason.  Think of how strong and confident a negotiator you will be when negotiating for something you DON'T want.  That attitude will carry over and influence negotiations later on.

In Summary   Regardless of the techniques employed, winning at a car dealership is a daunting challenge.  At the risk of sounding defeatist, maybe we should adopt the realistic posture of saying that 'winning' isn't as crucial as getting a fair and good deal.  Adopt the techniques that can make that happen.

Here's the best part.  When reviewing the five techniques included above, ask yourself, could I apply these when negotiating the purchase of other items besides cars?  Absolutely.

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