Buying a new car is either fun or a nightmare, depending on who you ask. No matter if you’re buying a sports sedan, hundred-thousand-dollar car or efficient econobox, you want to pay as little as possible. Unfortunately, getting a great price on a new car is often easier said than done.
It really comes down to practice. Car salespeople spend all day, everyday negotiating. It’s their job, and they’re good at it. The average person only buys a new car every six-and-a-half years, not exactly often enough to become an expert. No wonder 34% of shoppers find the negotiating process stressful.
So, how do you turn the tables and swing a bit of the power toward the buyer’s side? The answer involves some study, psychology, economics and a whole lot of resolve.
Here’s are 5-steps to help you get the best price on your next car.
STEP 1. Do your homework.
According to a recent study, 67-percent of car buyers do research before buying a car. Doing your homework is probably the most important step toward getting a good deal. Incentives, dealer stock… They all change on a daily basis. Before stepping into a dealership, do some research so you know what car you’re going to see. If you know what deals are already out there and what cars are in stock, you have a great starting point.
Researchdealerships, too. Read reviews and ratings of your target dealers. Reviews can help guide you to the right dealership and even to the right salesperson.
STEP 2. Know what model, trim and options you want.
Step 2 is just an extension of the research in Step 1. The worst thing you can do is walkinto a dealership with no idea of what you want. There’s nothing wrong with window shopping, but when you really plan on buying a car, you need to know what you want.
Know what model, trim level and options you want and don’t want. Build your car on the manufacturer’s website and check what incentives and discounts apply. Going in blind is a good way to end up with options you don’t want or more car than you need.
STEP 3. Go to the dealership at the end of the month.
Just like any sales position, car sales people have monthly goals. On the last day of the month, sales teams are all scrambling to get the last deals of the month. That puts quite a bit of power in your hands. Because of that month’s-end eagerness, you can push for a lower price and are more likely to get it.
STEP 4. Know the amount you’re willing to pay and STICK TO IT.
If you’ve done your homework and know the car you want and any discounts that apply, you should know the starting price at which to begin your negotiation. But, you also need to know how much you’re willing to spend either per month or for total price of the car. Make sure that price is reasonable. You can’t try to go buy a brand new Lamborghini and demand to pay no more than $600 per month.
While negotiating, start low and work your way up. Once you hit your max price, don’t go over. Stick to your limit and don’t be afraid to walk out. Even if you and the dealer are only $75 a month apart, say “Thanks for your time, but I don’t think this will work,” and leave. You’ll be surprised how many times you get an email from the salesperson a bit later with a better offer.
STEP 5. Play “good buyer – bad buyer”.
This is where the psychology comes in. Even if you stick to steps 1 through 4exactly, if you walk into a dealership with all the excitement of a kid in a candy store, fawning over a car, you won’t get the best price. There’s no need to sell you on the car. Conversely, if you’re completely cold and indifferent, the salesperson will assume you’re not really interested and won’t put much effort into selling you the car.
There needs to be a balance. Bring someone with you and play “good buyer – bad buyer”. One person should be really into the car. The other should be unsure if it’s really the right car or the right price. Don’t overdo it. If the dealer sees there’s a chance to sell the car, but they need to work to do it, they will.
Follow these 5 steps, and you’ll be well on your way to getting the car you want at a great deal. What do you do with your old car? You have options there, too. If it’s in great shape, you can trade it in. If it’s not exactly in the best condition or doesn’t really run, you can sell it directly to car buyers who specialize in less-than-perfect cars. Cars are fun. Buying them should be, too.
