The negotiation process of car buying is more complicated than what is commonly thought. Why is that? And the process of buying used cars is different than buying new cars.
We recently interviewed a potential salesperson at he store I work at, and his answer to my quesions set me back in my chair. First, me interview process starts with asking the interviewee what he thinks the car business is, and how it works. This way I know upfront what kind of deproggraming that needs to be if I hire the person.
A simple question was asked. “How is a car deal worked once you have found the perfect car for the customer, meaning what it the negotiation process?” His answer went something like this, “It’s easy you go out and show the car then when the customer says no, you drop $2000, and when he says no again, you just keep dropping until he says yes. Once he says yes you sold a car.”
Not a shocking answer. That is what most people think, and I can’t blame them. Their only experience might have bee that, or they learned so old school tips from Dad.
I followed up with, “two thousand dollars, and then you drop more, how much mark-up to you think a dealer has in one of his used cars?” Quickly he answered, “you go out and buy most of your cars at auction for around $2500, bring them back and sell them for whatever you can get the customer to yes to.”
Are you serious, does the general public really think this way, or did I just fall upon a wierd situation? I think this is where the negotiation process breaks down. Lack of knowledge. Is it his fault? No. Should I expect a different answer to my question? Probably not. After years of asking the same question, I get somewhat of a same answer. I think it is all common sense, because I deal with it every day. Sometimes you need to sit back, and realize why would they know anything about my business, I don’t know anything about theirs.
If you don’t have the correct knowledge, you do not know where to start in a negotiation, and that isn’t only for cars. How do you find the correct information? Ask the right person, someone you trust to guide you down the right path.
I tend to tread on those I know personally. I don’t know enough about buying/negociating a car deal so I leave it up to my husband/son and nephew.
Vicki http://www.bridal-threads.com
Wow, that lack of knowledge is shocking.
And is that how a car salesman really thinks? It sounds like the negotiation is vary in favor of the buyer. It will be a game to see how low he will go.
MissMentor
That is ridiculous. Of course it is more complicated than that. It’s interesting how many messed up perceptions people have. A cashier at a store I was buying stuff from the other day, mentioned that the national debt was meaningless because… the government can just print more money. I can’t believe there is adults that think that.
Bert (alter ego- Mister P)
MisterP.org/blog
I am terrible at negotiations. I would rather pay someone to do it.
Some people have crazy ideas about how things work. I was having a conversation about dominant and recessive genes with reguard to eye color with a group of people and one woman chimes in and says “I heard two browns make blue!” Ummmm ya……
Lisa McLellan
Child Care Expert,
Babysitting Services, Babysitting Tips, Babysitters, Nannies
I’m still looking for the win-win in all of this!
http://www.martin-wright.com
Well I certainly don’t think that way, but the ignorance doesn’t surprise me. Most people have very little knowledge of how buying, selling and negotiation really works.
Steve Chambers, Sale Trainer Speaker
Whether we’re talking cars or tickets to events, the customer has very little knowledge of the cost to the seller. If the customer thinks you paid nothing, then he’ll keep working you down . . . there is a distinct lack of appreciation for value creation.
Katie
Your man there comes from an unusual point of view.
If I’m about to purchase anything the first thing I do is suss out the market price. Then I know when I’m winning, and therefore when to enter agreement instead of wasting time.
Keri Eagan
Anything Alternative
Hi Car Buying Guy,
I think what he said is roughly what most of the public really does think especially with Used Cars. BTW, I also found his description hysterically funny in a drole sort of way. So direct it makes me smile.
Happy Dating and Relationships,
April Braswell
Single Baby Boomer Dating Success Expert
The client needs to be educated
Jose Escalante
http://www.joseescalante.com
We all need to be educated, that’s why we’re hanging with you Mr. Car Guy! Thanks for the clarity.
Kate
Never be surprised at the ignorance of people. They have inherited many of these ideas over many years from many people.
For me, negotiations break down in ONE SPECIFIC WAY and I tell every car salesman up front… If you lie to me once about anything I am out of here.
Seize the Day,
Rob
Emergency Preparedness For the 21st Century Family
I’ll have to say that until I read your posts I might just as well be one your were interviewing.
Martin O’Connor
http://smallbusinessdesigncenter.com
Thank you for arming us with such useful info!
Greg Dougall, Philanthropist-in-Training
I would have thought that you had come upon a weird situation — one where the interviewee was just a person that didn’t think about how a business was run — but you said that you’ve interviewed many people and come across similar answers often. Wow! That’s incredible!
Health, Fitness for Working People — Darryl Pace