The salesperson should always start negotiation.

Start with a 2% discount at the most. In some cases, used cars for example, you can present the customer with no starting discount.

Unless the customer has come in for an advertised special sale, here is a 6-step word track for price negotiations.

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 say this, show the customer your worksheet with those numbers.

Step 2

If the customer overreacts, claiming the discount is not enough, tell them: “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?”

The customer says: “We only want to pay $27,000 and that's it.”

At this point, everything is verbal. Writing down the 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?”

Listen carefully to their response. The response will get to the point and tell you how they arrived at their number.

Step 3

In a counteroffer, slowly work down from your number, not up from the customer's. At this point, do not write your number 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?” 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. We are still x dollars apart on the price. If you can be a little more flexible, I'm sure the dealership will be flexible as well.”

Step 4

When your customer comes up to, say, $27,800, tell him or her: “I'll see what I can do, 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?”

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

Customers who balk might just be shopping your dealership. 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

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. It should be a high number to build value in the MSRP.

For the purpose of this example, let's say the manager's number is $29,147.

To get customers to move up from their number, move down from your number slowly. Do not talk about the customer's number. Keep focused on your number.

Step 6

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

“I can try $100?” etc.

Keep negotiating until given another number to take to your manager who will have the final talk to finish the negotiation.

Negotiating is about psychology and how the customer feels about the process, not how much the dealership profited. A negotiating process increases sales and gross profit.

Darin George heads the Automotive Sales College, www.visitasc.com. He wrote Sales Training — Automotive Edition, available at www.barnsandnoble.com. Contact him at darin@visitasc.com.

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