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It's Always About The Price....Just Don't Get To Greedy



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When you and I shop for anything, we always look at price.

We can’t help ourselves.  It’s almost like we were born with a certain genetic make-up, passed down from generation-to-generation that forces us to do it.

It happens each and every day, for almost anything we buy.  And when it comes to a new automobile, van, truck or SUV, we really, really look at price.  We look at the cost of the various vehicles and ultimately, whether we can afford them or not - doesn’t make much sense to look at vehicles we can’t afford, right?

And when we narrow down the list of the vehicles we’re considering, we really, really, really start looking at price.  We start figuring out ways to get that new automobile, van, truck or SUV at an absolute rock-bottom price.

Heck, I did it the last time I leased a 4 door sedan.  And I know I’ll do it again.  So will you, whether you’re in the market now or sometime in the future. 

So let’s talk a little bit about pricing, the wonderful world of Automotive Retailing and how it will affect your automobile purchase.

Every Dealer, regardless of the manufacturer they represent, pays the exact same amount for their vehicles.  A Dealer on one side of town does not pay any more for a vehicle than a Dealer on the other side of town.

And for most vehicles sold in the U.S., the profit margin is anywhere from 8% to 18%.  For a mid-size, $30,000 SUV, that can be a profit of $5400 for the automobile Dealer - just on the sale of the SUV.  No wonder we focus so much on price! That’s a hefty profit on a single transaction.

So, what do we do?  We shop around.  We pick-up the phone and call numerous dealers that sell the vehicle we want.  Sometimes you get a price over the phone. Other times, the Sales Person won’t give a price and pushes you “to stop by”. 

Or, like many people, you drive all over town and spend a ridiculous amount of time getting prices from various dealers in an attempt to get the absolute best price you can on your automobile purchase

Neither of these options is lot of fun....it’s frustrating, time-consuming and the biggest reason most of us hate to buy new automobiles (In the next step of the New & Used automobile Purchase Pricing Guide, I’ll show you how to avoid the games that Dealers play regarding prices on an automobile Purchase).

Before I show you how to get the best price, the first time every time, let me offer a bit of advice....

At the end of all the fun-and-games, the Dealers you visit are usually going to be within $25 - $100 of each other on a final sale price.

Remember that.  Imprint that on your brain.  There usually is very little difference in the final sale price on any vehicle you’re looking at.....with one exception.

And that is when a Dealer has a whole “litter” of the particular vehicle you’re looking at.

In other words, a large number of automobiles or trucks sitting around collecting dust.  It might be that the automobile, van, truck or SUV you're considering is not selling very well....so you get a better sale price and save a little more on your automobile purchase.  That will be the only time you'll ever see a significantly better price.



How To Save Money and Get Great Service


So when it comes to pricing, and the pricing is real close, no matter whom you are talking to, do this....

Give your business to the individual that’s tried to help….they’ve probably earned it.

Let me tell you two quick stories……two things I did in the recent past that will show how important price is, how to shop for expensive retail items such as an automobile purchase, and why you should give your business to the person that helps you the most.

The first story centers on shopping for new Furniture – My wife wanted a new Dining Room Set and Living Room Furniture.  So....my lovely Bride dragged me out of the house to do some shopping.

We hadn’t shopped for furniture in years – WOW....was I shocked. I'd forgotten how expensive it was. We ended up buying from a super individual that works at a large, regional retail chain.  He answered all of our questions and even asked us a few questions that we hadn’t thought of.

And when it came down to actually getting ready to write the check, I asked for and got a significant discount on each piece.

Yep, that's right.  If you’re furniture shopping, ask for a discount.  If you’re spending a lot, you’ll get one.  How about that – I’m saving you money on other large, expensive purchases.

I didn’t beat-him-up on price.  He didn't play any games or waste my time.  We both got what we wanted and were pleased with the transaction.

After the Furniture was delivered, my wife noticed that one of the drawers on the China Cabinet didn’t close properly.  She called our Salesperson and the following day he had a Technician at our front door to repair it.  Their response was outstanding and best of all it, it didn’t cost a thing.

Now for the really fun part of this story – about a month or so after the furniture was delivered, Jasmine, our 6 month old Black Lab puppy, chewed a hole in the sofa fabric.  I'd left her alone in the Living Room for 5 minutes.....and she chewed a hole the size of a watermelon on the arm of the Sofa.  I thought the sofa was trashed and was ready to have a special, one-day only, “Jasmine Sale”.

My wife called our Salesperson.  He said a technician would be out in a couple of days to inspect the damage.  That huge hole in the Sofa arm?  It was repaired soon after and it's good as new.

And all I had to pay for was the service call - the Salesperson covered the cost of the materials.

This is some of the best service I’ve ever had….and the next time I need Furniture, he’s got my business.  And when I hear that a friend, neighbor or relative needs furniture....you can bet I send them his way.

I would consider this to be the perfect example of how a large retail transaction should be handled....I helped him by giving our business to him and he helped me by giving me the discount I wanted.

Now....here is an example of what not to do.



Payback is a....


Three summers ago, my wife and I decided to put a pool in – we got tired of listening to the kids complain so we just went ahead a did it.  I did a little research and began to price the pool that we liked.

I ended up speaking with two retailers.  One Salesperson answered all my questions, was very prompt when returning my calls and was a pleasure to talk to.

The other Sales Person was....well, let's just say he was extremely frustrating to deal with.  He had a habit of not directly answering my questions.  Imagine that - just like many New Car Sales People.

I had asked for, and received, a $1,700 discount on the pool from both of the retailers and was relatively happy.  How about that - you can get a discount on a pool purchase too - I’m saving you money again.

Everything was going smoothly and we were getting ready to make the purchase.  Then I had a major brain-cramp.....

I decided to be Greedy.

I began to play pricing games with the retailers.  You know how this works, right?  It goes something like this.

Store #1 will sell me the pool for $23,400.

What will you, Store #2, sell me the pool for?

I went back-and-forth with the two salespersons four times.  I eventually went with the Salesperson that I mentioned earlier - the one that had been so helpful.

And I saved another $200 to get a total discount of $1,900.  Yes! I showed him!

Wrong……he showed me.

You see, I forgot the golden rule of retailing - Especially on expensive items.  And that rule is....

Don’t punish the Salesperson.

If you try to squeeze the last dollar you can and beat-up the Salesperson on price, eventually you’ll end-up being "punished" and getting "paid-back".

It might not be today.  It might not be next month.  But you can bet the tiny amount you saved will never, ever have been worth it.

You see, that tiny amount you tried to squeeze out of the Salesperson was probably a large chunk of what he or she was going to make - so expect to be punished for taking it from them.

Here’s how I was punished.  My scheduled date for installation was pushed back three-weeks.  There was no reason given – just “scheduling problems."

And then, just two weeks after installation, the pump for the pool was not operating properly.  So, I made the call to the Service Department for an appointment and was told, "Sorry, the next available date was 13 days out."  Ouch!

I tried to get my salesperson to help – no luck there, though.  I couldn't get him to return my calls.

Have you ever seen pool water turn green?  Ever seen a 26,000 gallon water bill – twice - in less than 60 days?

And yes, two summer’s later, I was still getting smacked for full-retail price each-and-every time I needed chemicals.  What a shame.



The Moral of the Story....


The greatest advice I can give you is to "think twice" about playing the pricing game.

The few dollars you save upfront will end-up costing you a fortune in both dollars....and your time.

My Salesperson and I have called a truce – I apologized for what I did....and even flipped him tickets to a couple of special events I had access to.

And he's taken care of me ever since - he even gave me a huge discount on a recent Patio Set purchase and a few pool accessories.

All-in-all, this was a very expensive lesson and one that I hope you do not have to endure.

Since an Automobile Purchase is such a large Retail Purchase, remember the lessons I learned.  If you end up getting a really, really great price on that new car, truck, can or SUV you're considering....and then think about getting greedy and playing the pricing game on your next automobile purchase, take a step back and ask yourself this –

- Has the pricing you’ve been given fair?
- Have you been treated professionally?

If so, finish it up and make the car purchase.  If you do not, and decide to plat the pricing game, the entire purchase will be miserable.  Here's what's going to happen.

Welcome to your Payback!  It's called the Slow-Roll.

And it happens every day, in every type of retail operation (including New & Used Car Dealerships) regardless of what City or State you live in.

I’ve seen it done many, many times when a person plays the pricing game just to save $25 more.  So, don’t get slow-rolled for what amounts to “nickels and dimes” on your next $20,000 or $30,000 purchase.

Make no mistake.  Price is huge…….just remember you still have to complete the car purchase and someday.....you might need that Salesperson.  You want to make sure they’re ready and willing to help.




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