Negotiating Tip: Car Buying Negotiations Part 2
Hello Good Negotiators,
Last week's Negotiating Tip identified five of the common negotiating mistakes people are prone to make when buying cars.
We talked about the mistake of being complacent, of having little car negotiating experience, of being unable to match the dealer's expertise and having to negotiate on the dealer's home court.
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.
Here's the sad truth. Everyone knows this technique of 'Doing Your Homework' in advance. Regrettably, only a small percentage ever get that homework done. Be one of the few. Let the other guy overpay so the dealer can afford to give you a better deal. Don't enter a negotiation, car buying or otherwise, where your opponent has more (and better) information than you.
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.
Put another way, car buying is in large part and emotional purchase. We yield to the sizzle and ignore the steak. We often buy the image or impression we will make in a car more than we concentrate on reliable and reasonable transportation.
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.
Keep in mind, your partner doesn't have to be an expert negotiator or car buyer. Simply being there, being mostly silent and being a sounding board (when needed) is a powerful and valuable force. To be able to excuse yourself from the discussions with the dealer and confer with your partner sends a message that you are not going to make a rash and foolish decision.
Having a partner along is more critical than who can serve as your partner. A spouse or significant other can do the job, but a buddy or pal seems to work even better. Be sure to review with your partner the key points in the other techniques you want to employ.
Did you ever notice that your salesmen always seems to have a 'higher authority'? Someone that they need to check with? If they can check with their manager, their boss or their expert, why can't you?
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.
Don't leave saying that old tired phrase, "I need to think about this." Be different. Be focused. Be prepared. Consider saying instead, "I need to take some time to crunch some numbers and check with my bank (or whomever)." Or, "This car has possibilities but I need to investigate two other options (other cars) in more detail. When can I get back to you?"
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
I suspect you are with me in strategy for the first four techniques. This one will test your mettle. 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 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.
You are probably doing what I did when I first heard of this technique. You are saying "Why would I do that?" Why would I feign interest and even make an offer on something I don't want?
First, is conveys that you are tactfully aggressive in making offers. This will be important when you make an offer on the vehicle you really want.
Secondly, 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 care 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.
Consider what most people do at a dealership. Their first comments share what they want, why they want it and probably when they want it. Why not just walk in carrying a white flag and a box full of money? Armed with that information, dealers can almost always leverage a good deal for themselves.
If they don't know what you want (specifically), but think you are open to 'anything' and notice that you are not shy about making aggressive offers the dynamics change radically in your favor.
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 a 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 these apply these when negotiating the purchase of other items besides cars? Absolutely.
Good negotiators take positive and assertive steps to make sure their negotiating playing field is level. They employ techniques that enhance their chances of getting that 'good deal'.
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Negotiating Tip 60: Reading Your Opponent
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Negotiating Tip 59: Avoid Outright Rejection
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Negotiating Tip 61: The Interruption Strategy
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Negotiating Tip 57: S-L-O-W Down
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