Between financing and haggling over price, buying a new car can be a complicated and daunting process, but it doesn't have to be.
As with most major purchases, the keys to being a successful car buyer are to remove the mystery and become a strong advocate for yourself. For female buyers, the latter is incredibly important. Approximately 80 percent of women feel pressure when browsing for cars in showrooms -- and yet women play a critical role in nearly 60 percent of new vehicle purchases, according to Edmunds. So, what can you do to be a successful negotiator and make car buying less painful?
Are male and female customers treated differently during negotiations at car dealerships?
Unfortunately, the answer is often yes. According to Road and Travel Magazine, women typically pay up to $500, or 2 percent, more than men for the same vehicle. Additionally, many women have found that they are not treated as serious customers and may get comments like "Do you need to check with your husband first?" Given this environment, it is not surprising that 76 percent of women brought a man with them to the dealership because they felt intimidated, according to a 2005 study by Toyota.
What are some negotiation tips for purchasing a new car from a dealership?
The best way to go into negotiations is to be well-informed, and the Internet is a great resource of information. Before heading to the dealership, check out sites such as edmunds.com and cars.com, which provide you with both the MSRP and the invoice price of almost every make of car, as well as information on incentives. The MSRP is the manufacturer's suggested retail price, while the invoice price is a general tally of what the dealer pays for the car, excluding incentives.
The invoice price will be lower than the MSRP, but by knowing these two prices you can get a general sense of your room for negotiation. Additionally, Edmunds also offers the true market value of a car, which shows you the average amount other people in your area have paid for the same vehicle.
Where should you start your offer? Use the invoice price as the starting point for negotiating, but you should start by offering $500 less. It is a good idea to offer a price first, before the salesman does, to avoid being anchored in a price established by the dealer. Be sure to stand firm on what you are willing to spend, but be realistic -- on average, you should expect to pay 4 percent to 8 percent more than invoice price.
Do you have more bargaining power at certain times of the day, week or year?
Generally speaking, weekends tend to be busier times at car dealerships causing sales personnel to be more stringent with how much they are willing to knock off of the MSRP. So, it is best to head to the dealership on a weekday or late in the evening.
Ideally, you want to be the last customer of the evening for the salesperson. You should arrive with time to negotiate, but with little excess time to spare. Because it is unlikely that a customer will return to the showroom a second time, it is in the salesperson's best interest to get the deal done that day, so use the "time is ticking" to your advantage.
Typically, a car dealer and salesperson are most eager to make a deal during the end of the month or the end of a quarter, as they want to meet their quotas. Additionally, look to buy a car during a period of dealer incentives or when it is raining -- fewer people on the lot means a better chance to deal.