Derek has studied business administration, psychology, and economics, and writes about personal finance.
The Song and Dance
We've all been there… sitting at a table in some dealership waiting for the salesperson to come back and give us numbers that we know could be better. The whole song and dance of buying a car can be time consuming and aggravating and at the end of the day you may walk away from the table never knowing if you really got a good deal. It’s as if the forces of capitalism are against us but there is a very simple way to turn the tables and get a deal that you know is good. Quite simply, we turn capitalism against the salespeople.
We all know how an auction works. A bunch of people want one thing and they present the best offer they can to get it. I figured I could try and recreate this with the salespeople. For anyone interested in trying this I warn you it is a bit time consuming and requires patience. I met with a lot of people over multiple days and most of them lied right to my face but in the end it was definitely worth it.
Goal: Create an Auction for My Money
It all starts with the initial contact. The first dealer I met with set the direction for the rest of my adventure. You know how it goes, first you look at a few cars, they ask you some financial questions, and they present an offer.
The First Offer
This first offer is important because it became my reference as I carried out my plan. I didn't really negotiate the first time, you can if you want, I simply took the numbers and left. I imagine this is the part where they think you will wait a few days and come back, and I did come back but with another deal for them to beat.
The Second and Third Offers
From here I went to the next dealer. Same song and dance with looking at a car and going through basic questions except when they got ready to talk numbers I told them about my offer from the first dealer. The person I met with had no trouble beating that first deal (surprise) and I thanked them for their time and left.
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Now I went to the third dealer and again they beat it. Depending on how many dealers are in your area you will probably end up going back to the same people, which is fine and that's what I ended up doing.
The Next Round
I still wasn't satisfied after my first cycle so I went back to the same people and told them what the most recent dealer offered me. It got interesting. They would ask if I had the offer in writing or if my deal included this extra or that extra. I knew I was getting somewhere.
When I did this I rotated between four dealers that I went to in the order that I first approached them. Eventually I got to the point where my salesperson told me they couldn't beat the other dealer’s numbers. I actually had one guy tell me if I’m really getting that deal from someone else then I should sign with them, to which I responded, “I think I will” and left.
How I Knew I Was Done
At this point you are reaching the point of getting a true good deal. This is the point in the auction where those that are all talk drop out and you’re left with two or three serious contestants. Once I reached this point I felt comfortable signing with the salesperson that offered me the deal that others couldn't beat. My deal ended up being $1,500 down and $144 a month, with 15k miles a year over three years, which I was pretty happy with.
Good Things Take Time
This method may be a little more time consuming than some back and forth with a single salesperson, but cars are expensive, and I’d certainly prefer to put in a couple extra days of dealing with salespeople to save a couple thousand dollars. If you feel the same way, then I encourage you to try this out next time you’re in the market for a car or really anything that is sold by a number of dealers.
We, as buyers, have the greatest power of all – walking away. Dealers don’t want you to walk away; never forget that. Getting dealers to compete gives us the advantage of side-stepping their usual tactics and letting them know we are serious buyers who want to be taken seriously.
This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.
© 2019 Derek