Negotiating Price Only


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The salesperson should always start the price negotiation. Your management team has to empower your sales people and communicate that having sales people able to start the price negotiation is very important to the process. The sales person will start with a one to two per cent discount at the most. In some situations, used cars for example, you can present the customer with no starting discount.

Note: if the customer has come to your dealership on an advertised special sale, the following negotiating technique would not be used.

The following is a word track process for a price negotiation.

Step 1.

Tell the Customer: “I can give you this savings right now. The MSRP is $30,000, minus $300 bringing the total to $29,700. All you have to do is approve this and I’ll get the vehicle ready for you as soon as possible.”

As you are saying this, immediately turn and show the customer your worksheet with these numbers.

MSRP or selling price $ 30,000
Your discount $   – 300
$ 29,700

Step 2.

The customer will react when you present this number. If the customer overreacts, because your discount is not enough, which is most likely, tell them: “Mr. Customer my job is to assist people in selecting a new vehicle. Please let me see what I can do about the price. Can you tell me what number you were thinking of?”



Remember to react as the customer makes their counter offer.

Customer Say: “We only want to pay $27,000 and that’s it.”

At this point in the negotiations, keep your pen out of your hand; everything is verbal now. Writing down their first number will make them think they are close to a deal.

Your response to the customer’s number is: “Can you tell me where and how you came up with this number for our vehicle?”

Wait and listen to their response, because you and your manager will need this information to know how to work the negotiation from this point. The customer’s response to this question will get them right to the point and they will tell you how they arrived at their number.

Step 3.

It’s important in a counteroffer to slowly work back from your number, not up from theirs. Also, do not write your verbal numbers on your worksheet. The reason you are doing this is to get another number from the customer. You must get a second or third verbal offer from the customer. Then write it on your worksheet.

Tell the Customer: “What if I could get you the vehicle for $29,600?” and wait for their answer. Whatever number they say, follow it up with $29,550 or say you can try for $29,500.

If they are not moving up on their number or even if they have moved a bit, say to them: “You are going to have to help me out a bit here. We are still X dollars apart on the price and if you can be a little more flexible, I’m sure the dealership will be flexible as well.”

Step 4.

When your customer’s number comes up, for example $27,800, say: “I’ll see what I can do with this number, but I will need something to show me and my manager that you really want this vehicle today. Do you have a credit card, debit card, check or cash with you?”

We need to get some financial commitment from the customer. You do not need to ask for a deposit at this point, it is only given when we have agreed on a final selling price. At this point in the negotiation we have not agreed yet.

If your customer cannot provide any form of currency, they might just be shopping you. If you know they are not buying now, you have to handle the situation differently.

Ask the Customer: “If we agree on a price, can we use this money towards your deposit on the new vehicle?”

Step 5.

At this point in the negotiation, you will excuse yourself and take the worksheet, customer’s driver’s license and money to your manager and explain what is happening. The manager will give you a number to present to your customer. It should be a high number to build value in the MSRP.

For the purpose of this example, let’s say the sales manager’s number is $29,147. To get the customer to move up from their number, you will have to move down from your number slowly. Do not talk about the customer’s number. Keep focused on your number.

Again the customer is going to react.

Step 6.

Ask the Customer: “What if I could take off $47?” Pause for their reaction.

“I can try $100?” etc.

At this point you have to keep negotiating until they have given you another number to take to your manager. The sales manager will have the final talk with the customer to finish the negotiation.

Negotiating is about psychology and how the customer feels about the process, not how much the dealership profited. By having a professional negotiating process, you will see an increase in your sales and gross profit.

Darin George is the founder of the Automotive Sales College, est. 1996. For information on recruiting new sales staff and in dealership sales training, contact Darin by email at darin@visitasc.com. ASC company websites: www.visitasc.com and www.automotivesalescollege.net

Michael Bowen

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