Being in the car sales follow up software business I get a lot of people who ask me advice. A big question is, "How do I hold gross?" Here are some tips.
- Don't talk about price until you have earned the right to talk about it. By earned the right, I mean built rapport, asked questions, landed them on a vehicle, demo drive, trial close, etc.
- If they are adamant about price, acknowledge it and then change the subject. "Oh--that car is around twenty-one. Speaking of that, were you wanting that car or one in a different color?"
- Hit them high when you give a price and negotiate down if you have to. You can always go down but it is very hard to go up.
- Don't be afraid to ask for it (gross)--you will never get it if you don't ask for it.
- Be confident when you ask for gross. Don't ask weakly. I used to work with a dude in Tennessee and here was how he presented his price. "Uh--the price is $22,000. We have to start somewhere." Wow! We have to start somewhere? He was basically telling the customer that the price was a starting price and that he was going to discount it.
- Close customers on payments instead of price. Odds are that if they like the payment, they won't ask the price.
- Convert customers to leasing so you can show them a lower payment and therefore hold gross. By the way--you can sell a car for over sticker and leasing makes it easier.
- If someone asks for a discount, pause for a second (so you don't fall into the discount trap) and justify the price. "Mr. Customer, these are the hottest cars around and we are selling out of them. As a matter of fact, we could probably sell them for a $1000 more but we don't want to gouge our customers like the gas companies are gouging us."
- If they make you an offer that is a great deal for you--don't hook up immediately. Try to bump them a little so they don't think they left money on the table. I once had a customer make an offer and I immediately accepted it and he frowned and said, "You're making too much money on me." That will never happen again, I promise you!
- Show rebates as a discount. "This car is $16500 and we have $3000 off so you can buy it for $13500."
- Close them with an either/or. Lets say sticker is $20,000 and the car has a $2000 rebate of 2.9% financing. Present it like this: "Mr. Customer, you can buy the car for $20,000 at 2.9% or for $18,000. Which would work better for you?"
- Work them for a lot of money down. Watch how fast price doesn't matter if they negotiate money down.