Sure, no one likes to haggle and it's a bummer to learn that the guy sitting next to you in the service department waiting room got a better deal on the same- model car you drove in.
But, the greatest turn-off in a car deal has little to do with price; it's about being taken for granted. Arrogance sours customers and a “one-price policy” is the ultimate upturned nose of dealership self-importance.
Everyone knows the balance of power in a car deal is tilted toward the dealer. What is seriously overstated is the presumption that a predetermined price, forced down a customer's throat, is friendlier than letting that customer make an offer.
Turning customers into fans requires taking them seriously. Nothing conveys that better than a well-orchestrated negotiation. Negotiation is not, “I want you to pay triple and you responded with half, and can we meet in the middle?” No better than that is: “Here's the price, take it or leave it.”
I've known successful “one-price” and traditional “price-negotiated” stores. I've even run a store that satisfied customers one way, then the other without any significant change in measurable customer-satisfaction levels.
A successful negotiation is a carefully choreographed dance; a series of satisfying gives and takes that impart many things beyond the price.
Happy customers appreciate the relationship that emerges from a buying experience that signals mutual respect. Suggestions that “haggle' and “hassle” are synonymous with “negotiation” are wrong.
Closing a deal is a matter of presentation skill and diplomacy, not one price vs. several.
The greatest fans of one-price policies always have been auto makers who hate dealing with dealers. Add to them every customer who hates negotiating but shops more than one store before committing to a price.
Shutting a customer down from making an offer on a car is asking someone to swallow a one-size fits all approach in hopes that they might exchange possible price embarrassment in your competitor's store for price intolerance in yours.
Good negotiation requires transparency; clear and honest communication in how price and value are presented.
Great negotiators tell customers that everything is negotiable and proceed to offer price options each spelled out to achieve a different deal. Satisfying negotiation creates a buyer with a confidence that the deal is the sum of both the care and the car.
Even a transient purchaser (one who will never return to the dealership) wants a warranty beyond the curb of the dealership.
Some believe that the elimination of price negotiation will kindle honor and integrity in the car business, and reestablish customers' lost trust in dealers.
I agree we need positive changes and welcome a new trust between dealers and customers. What I find repugnant is the assertion that the trust is broken at the line being drawn. The idea that price negotiation is the issue suggests the cure is solely in dealer's hands. That's preposterous, untrue and unfair.
That a dealer alone can set a fair price, high enough to sustain a quality sales effort yet low enough to hold in a competitive marketplace, is ridiculous.
I have lived that delusion and my competition shopped me and then had a field day undercutting my price in their ads and offers. My service department was filled with people who bought elsewhere only to return for the convenience of my shop.
Many of them praised us for the “integrity” they so appreciated, but failed to reward that with a vehicle purchase. They went on to report to my employees and customers within earshot that they bought for less elsewhere.
I want nothing more than to untangle the devilish complexity of the pricing schemes that bewilder employees and customers alike. Here's the hitch, it just ain't possible.
Auto makers feel little obligation to accommodate dealers' needs. Customers have no prohibition from making an offer. What results is the American way, negotiation and all, and no-stand alone dealer is going to take that away.
Peter Brandow is a veteran dealer in Pennsylvania and New Jersey.
