Negotiating on prices
May 3, 2009 at 10:11 am #2771WendySkeletonParticipant
Anyone have any tips, or any websites I could check out for some info on negotiating? I think I am an OKAY negotiator, I just don’t know what is considered a good price for a motorbike. Speaking strictly in AUD, I saw a bike that was $4,990, and I want to bring it down a couple hundred. Is that a good deduction?
The bike itself is quite new, a 2003 Yamaha Virago with about 10,000 kms on it. I checked it out today and it’s in great condition.
What do you guys think?May 3, 2009 at 12:37 pm #18143eternal05Participant
I used to work retail back in high school and college. Believe me: nothing gets you more negotiating experience than having pro negotiators working you over day in and day out. Here are some things to keep in mind. They’re not all essential and you can do fine without this stuff, but this is everything I know.
1) This is THE most important thing: be willing to walk away. If you are set on buying X from person Y, you’re already hosed. Your power as a consumer comes from the fact that the seller needs your business, but, in most cases, the product you want (or competitors’ products) is (are) available elsewhere. They should be in YOUR pocket, not vice versa.
2) At no point during your transaction should you show the slightest hint of excitement. Act neutrally, calmly, and logically. Be polite, but maintain an air of skepticism about any pitches, deals, etc. that a salesman throws at you. Grill the salesman on each and every potential flaw in the product. Make him/her struggle to convince you that the product is right for you, and never yield the impression that they’ve succeeded. The more unsure the salesman is that you want the product, the more he/she will do to get you out the door with it.
3) Strike a hard bargain, and be firm. Practice restraint, and like (1), be willing to leave (at least temporarily) if the salesman doesn’t like your offer, and doesn’t propose an acceptable alternative. I.e. “I’m sorry, but I don’t think I’m ready to spend X amount at this moment. I’ll have to go home and think about. Here’s my contact info if you change your mind.”
4) Your opening offer should be at the very bottom of the range you think is reasonable (or maybe even slightly below). This allows some room for negotiation without destroying your margin.
5) Salesmen like to close. Once you’re ready to buy, don’t waste time. Be assertive, and get an offer on the table. State your willingness to conclude the transaction immediately IF the deal is to your liking. I.e. “give me this price out the door and I’ll write you a check right now.”
6) If you can afford it, bring cash. Financing introduces all kinds of risks to the salesman and may yield a gargantuan waste of his time if your credit and financing options don’t align with what you want and what he/she’s willing to offer. You’ll find that MOST of the time (not always), being ready to pay cash will move things along much faster, and more in your favor.
7) Know the product you’re interested in backwards and forwards. Be able to correct the salesman if he lies to you or makes crap up. Put him on the spot. Ask about complex aspects he may not know about (especially if you genuinely are curious). This will contribute to the dealer treating you with respect and not trying to schmooze you. While this may seem douchey, keep in mind that you are not there to be a friend. You should be polite, but ultimately you are there to conduct a business transaction. No BS.
Know the value of the product you’re interested in. Find out what the wholesale cost on that item is, and figure out exactly how much margin the dealer has (i.e. mark-up). Then reduce that margin to a reasonable amount. In all but the most desperate sales, there must be a margin for the sale to help the dealership at all. There are many sites online that offer dealer invoices on new vehicles, as well as market value estimates for used vehicles. Google around. It’s very hard for anybody to make a blanket statement about a particular vehicle’s worth without knowing the specifics. To give you an idea, the following are some purchases I’ve made over the past decade:
2002 VW Jetta, listed ~$22,000 + tax/fees, paid $18,000 out the door (saved ~$7K)
2008 Ninja 250, listed $3,999, paid $5K+.
With the Ninja, there was a HUGE gap in supply/demand. Dealers were charging over MSRP for these suckers. You couldn’t negotiate if you wanted one because they were on back order for 4 months. If you didn’t buy, somebody else would. I was in THEIR pocket.
2006 Audi A4 (certified used, purchased last month), listed $29,900 + tax/fees, paid $21,000 OUT THE DOOR. Saving: ~$13,000
How did this work? I have two words for you: shit economy. You know, that and everything I wrote above
9) Your goal doesn’t have to be to get the lowest possible price (contradiction, right?). Your real goal is to be happy with what you paid for the product. When I can afford it, I try to leave room for the salesman to make a decent commission.
Last thing. I need to stress this. DO NOT BE A DOUCHEBAG! Be curt, know what you want, be firm, don’t take BS, but don’t ever be impolite or rude. I’ve been on the receiving end, and it’s just not nice.
Sorry for the long post. If anybody has any further advice I’d love to hear it!
Which Virago is it btw? 250cc? 535cc? I’m no expert, but definitely google around and see what the “market rate” is. Don’t pay more unless you’re looking to do a favor to the seller.May 3, 2009 at 1:46 pm #18144MunchParticipant
Other then above …. if the bike is sitting in the dealership, ask them to take it out into full sun light. A lot of times you can miss dings, and scratches do to lighting. Sun like has a way of casting shadows seeing how its a single point of light. Ask for maintenance records… history… what did they have to do to prep the bike for sale?May 5, 2009 at 12:36 am #18168WendySkeletonParticipant
Thanks for the comprehensive guide!
It’s the 250cc version of the Virago. I went to a dealership and it was give or take, $7,500 including on-road costs.
Also, what does “market price” mean?May 5, 2009 at 6:51 pm #18192BouncingRadicalParticipant
When I shopped around, I found bike dealers are not willing to play ball very much. They stop it short saying ‘this is what its selling for, take it or leave it’. So I left them. I dunno why most of them won’t haggle, only a few did, but once you find the ones you should be able to get a good deal. Also ask what the out the door price is, they like to forget to tell you they are gunna charge you an extra 100 bucks from when the put it together, 50 bucks for this, 42 for that, etc. You can sometimes get them to drop some of them cuz most of them are B.S. anyway.May 14, 2009 at 4:09 am #18487eternal05Participant
By “market price” I mean “fair market value” which itself is cryptic. An econ major would tell you that it’s “the price an asset would trade for in a competitive open market,” which really means “what it’s really worth, and what people should expect to pay.” For instance, Kelly Blue Book provides ROUGH estimates of “market value” for used vehicles. Here the suggested KBB retail price of a 2005 Virago 250:
Be careful though. KBB and similar sources won’t help you argue your case, as they are estimates based on a number of highly variable factors, and can be easily brushed aside by aggressive salespeople. It gives you a good idea of the ballpark you should be in, however, when you’re trying to come up with a number to throw out.May 24, 2010 at 4:32 am #26690MineSParticipant
Everyone of us has the potential to be a good negotiator. However, there are really certain tips that could help us negotiate prices. You will find really better times to visit a auto lot in an attempt to get a good deal, and good solutions to do it. So how can you buy a dealership car and get a fantastic discount? Essentially in short go to the auto lot on a weekday towards the end of the month with funding already lined up. On weekdays, car salesmen are a lot more likely to provide you with the attention and respect you should have than on busy weekends. Furthermore, everyone is pushing for that end of the month sale for making their commission. Also with funding in line, you already know what you are able to and can’t manage to obtain so you are more prepared to check out and negotiate prices.May 26, 2010 at 11:55 pm #26748kirkParticipant
Very good points from every one but I have found that buying a motorcycle is different from buying a car. I have purchased 3 new cars in my life. With all 3 autos I was able to negotiate successfully use some of the tips listed here. I was well informed and got some great deals.
With the 2 bikes I’ve purchased (Suzuki GS500F and Honda CBR) I have had no room to negotiate. The dealer in both cases said that the price was firm and they would not lower it. They wouldn’t even throw in a helmet or some freebie.
Keep in mind I was polite, well informed, wasn’t asking for a massive discount, didn’t appear desperate and I was not set on walking out of the dealership with the bike. As I said, with auto purchases I was able to negotiate, with bikes, no dice.
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