Heading out to buy your next pre-owned vehicle?
Join the club. Most of us need a set of wheels at some point.
The bad news? Haggling for the best price is no one’s idea of a good time.
The worse news? If you’re going to haggle, there’s a right way and a wrong way to do it.
The good news?
Research shows the right tactics produce excellent results.
Consumer Reports found 70% of used car buyers who haggled did so successfully 83% of the time. The average savings by buyers who negotiated? £900 off the initial sticker price.
The better news?
You don’t have to be a car sales expert to negotiate a better deal. It just takes a little knowledge of the right strategies.
Here’s what you’ll learn…
- Why Research is Your Best Tool
- Negotiation Tactics and Strategies That Work
- When to Buy and When to Walk Away
- Walk Away: The Secret Weapon
- How To Approach Negotiations
Why Research is Your Ideal Tool
Negotiation begins before you even set foot on a dealer’s lot.
Here’s the deal…
Negotiating for the best price on a used car is tough when you don’t have facts. That’s because the salesperson will have all the information and control the entire experience. Don’t let that happen.
Informed buyers come to dealerships armed with research. It gives them confidence and the facts to know when to push back on price. And dealerships know it.
Buyers who don’t have a clear sense of what the car is worth (based on multiple data points) give dealerships free reign to inflate pricing.
So what do you research?
- The vehicle’s market value
- Recent sales of identical or similar vehicles
- The car’s full history report
- Inventory levels at local dealerships
Buyers who do this work have a big advantage when the hard sell begins.
Fact is, whether you’re buying a Used Audi Kent or not, every negotiation begins with price discovery. And dealerships expect research savvy customers to negotiate price.
Negotiation Tactics and Strategies That Work
On to the fun part…
Research from CDK Global found that 68% of shoppers found negotiating the final price “easy.” Almost 85% spent less than 30 minutes haggling.
Yet so many people hate negotiating prices. Why?
Because they don’t have a plan or strategy.
These tactics work every single time.
Lead With Competing Offers
Shop around for multiple offers. Pick up the phone.
Contact various sellers and get offers in writing before making any commitments. Use those offers to create a competitive environment and anchor discussions around actual numbers.
“I’ve been offered X at this other place” has an immediate impact on the negotiation.
Focus on Total Price, Not Monthly Payment
A car salesperson’s favourite topic of discussion is monthly payments.
Don’t engage.
Focusing on monthly payment amounts distracts from the true cost of the vehicle. The dealership can adjust loan terms, interest rates, and the selling price all in service of a monthly payment target. Those other numbers just get buried.
Buyers should always focus on negotiating the out-the-door cost first. This includes the vehicle price, sales taxes, fees, and any optional products. That number is fixed before buyers commit to payment terms.
Start Below Your Target Price
The sticker price you see on a vehicle isn’t the price.
It’s the starting point of the negotiation. A seller who isn’t prepared to budge from their initial list price doesn’t know how to negotiate.
Asking a used car dealer for a 15% discount is a great way to never buy the vehicle.
Buyers make a first offer below market value. It’s as simple as that. If 10-15% off the sticker price is market value, that’s where the opening offer lands.
Negotiation is about giving room to wiggle.
By making an opening offer lower than your target price, you create negotiation space. When the dealership pushes back, real offers fall somewhere in between.
That’s where savings are found.
Timing is Important
Timing matters nearly as much as negotiating skill.
Buy used cars when the salesperson has a target to hit. The best times to buy (because that’s when the best prices will be available) are at…
- The end of the month when monthly quotas loom
- The end of a quarter when there’s more inventory moving
- Late December/January during sales slumps
- Weekday mornings when dealerships are quieter
Salespeople need to move inventory to hit targets. Salespeople who aren’t going to hit monthly targets become much more flexible about pricing.
Actively look for seasonal trends too…
Convertibles are a tougher sell in the winter. Trucks and SUVs move much quicker in inclement weather. Don’t buy what’s in season if that’s not the type of car you want. Dealerships are in business and have to move less desirable inventory.
Which leads us to the secret weapon…
Walk Away: The Secret Weapon
This is a game changer.
Buyers willing to walk away from the dealership radically shift the negotiation dynamics.
The moment a buyer demonstrates that they have limits and other options, a salesperson adjusts their approach. The used car needs to become a better deal if they want to keep that customer.
How?
Easy. Just ask for more off.
When negotiations get to a stalemate on price, the buyer says, “Thanks for your time, but this isn’t going to work for me. I’ll need to move on and look elsewhere.”
The dealer will then pull the pricing structure back and have the ability to drive a better price. A manager may even show up at that point. There’s a reason why successful salespeople stick to the core lot.
If they don’t budge?
Fine. They can’t be the only dealer in the country selling used cars.
Insist on Inspection
Inspection is part of the pre-negotiation process.
Buyers shouldn’t give a single pound on price without knowing the condition of the vehicle. Get the car inspected by a trusted, independent mechanic before finalising the purchase.
It costs about £50-£150 to do this, but you learn the health of the car. Plus, you’ll know if the odometer was swapped or anything like that.
Inspection can reveal mechanical issues worth thousands in repair. Buyers use those defects to demand price concessions.
Aging brakes, worn belts, cosmetic damage, and other issues are justification for paying less. Buyers who know the health of a vehicle before negotiating price are smart negotiators. Dealerships know it too.
Getting Pre-Approved Changes Everything
Car shopping with pre-approved financing is a massive leg up.
Buyers who have the bank or credit union with a loan before shopping can make the dealership’s financing a non-factor. Securing financing in advance also clarifies budget.
Benefits of getting pre-approved include…
- Knowing your budget
- Sharpened negotiation position
- No pressure from dealer financing
- Quicker buy
Dealer financing options are typically not as competitive as banks or credit unions. But having an alternative ready makes it so nobody can bully a buyer into an overpriced loan.
Summary: Tips for Negotiating Used Car Prices
Successful negotiation on a used car is about research, patience, and when to push.
Here are the best tips for buying a used car and negotiating price…
- Do your research
- Get competing offers
- Focus on total cost, not payments
- Wait for the right time to buy
- Don’t be afraid to walk away
Buyers who follow these steps pay less than buyers who don’t. Dealerships know that. Smart buyers also know that.
Go out and negotiate like a pro.
