Saturday, December 4, 2010

Topic Seven: Haggle Versus No Haggle - How Much Do Dealers Make?

50% of America hates to negotiate but 50% likes it.  Go figure.  I can't stand it, so as a dealer at 9995 Motors, I decided to treat people the way I wanted to be treated - easy, quick process, transparency on questions, priced right from the get go, clean cars, and get me in the car fast so I can go back to my life ASAP. Who wants to spend the day at a dealers trailer anyway.

Lots of folks ask me about how much room there is on a vehicle to negotiate.

The answer is it depends.

It may seem like a lot of money to hear a dealer grosses $1500 on a sale yet that is the gross difference on that transaction between what they paid for the car and what they charged you.  Don't get me wrong, its hard to save $1500 but what consumers don't know is dealers end up netting only about $150 a car after their expenses from that $1500 when you put on a rent factor, overhead, etc.  That's why dealers want to be the low cost leader and the high volume leader. 

Unless you sell a bunch of cars, it's hard to eat off of $150.  If you think about all it takes to find a car, buy a car, prep a car, get it in your system, promote the car, sell the car, deliver the car, get plates for the car, $150 is a joke.  But...for folks who love the business, it's well worth it and if you can move thousands of vehicles, well then you are going to see them drive a nice car and sponsoring that little league team.

So ultimately little haggle is the way to go - saves time for you and them but you have to be ready.  Use the web to find out what kind of retail price is fair, offer them 10% off that and you may be able to drive the car away in under two hours or so.  As long as negotiation still exists, most cars transact close to 10% off anyway. Why not skip a step.  If they are willing to let you walk away they really can't sell you the car for what you offered. 

Our goal at 9995 Motors is to price the cars close to a no haggle price and have them delivery ready - they are all AS IS, all used (hence always something you want to have done to your new purchase) but have passed the safety inspection.  I can get you on the road in under two hours as I do not sell you extras, just cash deals or finance deals.  So if you want good clean cars at a good price then go to and take a look.