Car Dealer Insider Tips: 7 Mistakes To Avoid At The Dealership

7 Tips To Avoid Common Mistakes At The Car Dealership

Everyone wants to think they can negotiate a great deal but a car dealer is a professional who spends all day honing his craft: the approach, pitch and close. If you want a fighting chance against the pros, you need every advantage you can get. Follow these tips to make sure you bring your A-Game to the dealership.

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1. Being Certain Before Shopping

   Since buying a car is a major purchasing decision it only stands to reason that you should do your homework and walk into a dealer’s location knowing exactly what you want – and more importantly – what you need. Shoppers who enter the “lion’s den” with only the vaguest ideas of what they want and what they can spend are easy prey on the showroom floor. Car dealers have honed their sales pitch to overcome objections and steer potential car buyers quickly down a path to purchase. That’s their job and they are VERY good at it. Don’t go into battle unprepared and under equipped. With the internet, all the information you need is only a click away. Even the dealers themselves have had to bring their game to the web and that allows you to easily price shop and compare between dealers online long before you have to step foot on the battlefield.

2. Not Taking a Spin Around

   This one came as a bit of a shock to us as we have never missed an opportunity to test drive a vehicle. But according to some of the dealers we spoke with almost twenty percent of car buyers didn’t test drive the car they ended up purchasing. And only 30% bothered to at least take the vehicle around the block. Bad. Idea. You don’t get much of an idea of how a vehicle suits you without logging some real miles behind the wheel. And perhaps even more important is this tip: Test drive more than one vehicle! Here’s a good rule of thumb: go to at least two or three dealers and test drive at least a few vehicles at each lot. If you know the type of vehicle you want, then drive cars in similar classes. Otherwise, pick and choose based on your interest and inclinations. Remember, the dealer is working for YOUR business. Let them. It’s not as easy to return a car as it is a pair of shoes. You need to make sure the fit you get is the fit you want before you step (or drive) away.

3. Going Off the Sticker Price

   Maybe you’ve never really thought about what MSRP really stands for. A Manufacturer’s Suggested Retail Price is just that a suggestion. When it comes to discussing the final price you’ll pay, don’t bother looking to the MSRP as your starting point. Instead, you should use one of the many online resources that provide you with an idea of the “dealer’s invoice” – this is what they actually have to pay for the vehicle, so it gives you a much better gauge of how good of a deal you’re getting from the salesman in front of you. Can you get a deal better than the invoice price? Yes, you can. Not always but there are times when the dealers are working toward other incentives than the car’s price. You may have picked a car that isn’t a popularly selling model and the manufacturer is paying the dealer an additional amount to move them off the lot by selling them for less.

4. Banking Where You’re Buying

   Just as you’re shopping your vehicle purchase around to several dealers, you need to shop your finance options to make sure you get the best deal. You can read more about how to get good financing terms (regardless of credit) with our article here. Be sure to check out your own bank or credit union who may issue you pre-approval on a vehicle purchase at a much better rate than the dealerships offer. This way you’ll be able to see if the dealership can really make you a better offer and when they do make their pitch, you’ll be able to counter for better being armed already with a financing option.

5. Negotiating Your Monthly Payment

   At the table, never ever tip your hand. This is information the dealer will use to keep the terms of the deal focused around that one number – to keep you distracted from the actual cost to you. Negotiate the sale price first. Once you have that at an acceptable number, you can open up the conversation to the actuals of the deal: whether you’ve got a trade-in, your down payment, etc. There are several online calculators and mobile apps you can use to quickly calculate loan balance, term and interest to find out what the monthly fee will be.

6. Discussing Your Trade-In Too Early

   We mentioned above that you should only discuss the details of your financials once you have a sales number that’s acceptable. That includes whether or not you have a car to trade-in. You will, in almost every case, get more money for your vehicle by selling it to a private party than a dealership. So if you can resist trading in at the moment of purchase, do so. A lot of consumers prefer the convenience of driving their old car to the lot and their new car away which is fine. As long as you understand the cost to you. Research the used in value of your car before heading to the lot and DO NOT discuss a price for it until after you’ve finalized the price of your purchase.

   SPECIAL NOTE: If you owe a lot on your current car, our recommendation is that you either (a) forego getting a new car altogether or (b) sell your old car privately to get as much for it as possible. Do not take a dealer’s offer to roll the old debt over to your new car payment.

7. Walk Away – Even If You Have to Take the Bus

   No one ever won by sitting at the negotiating table with a ‘I have to do this’ attitude. Do not sit down to discuss terms unless you and anyone else involved in the purchase is ready and willing to walk away. We thought about putting this at the top as it is the MOST IMPORTANT rule to negotiating, but prefer to put it here, at the end so it is fresh in your mind. High pressure sales tactics like, “I can give you this price today, but my manager won’t let me honor it next week.” Or any other line is just that, a line. It’s designed to create a sense in urgency in you and push you toward closing the deal. Don’t fall for it.

Friendly Reminder: Don’t forget to take advantage of our dealer connection service partner. They will put your business in front of dealers in your area so they go to work to earn the sale from you. Competition breeds a better price for you. 🙂
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