Dealing with unrealistic price expectations in auto sales

I am fairly new to auto sales and still learning every day. One thing that I found is that many customers have unrealistic price expectations on new vehicles and when you explain to them why you can't reach that price number they often get mad and upset and even get up and rudely walk out on you.

For example: Say you have a vehicle with a $259 monthly payment for 60 months and your customer says "that is too much, i really need to get to $200 a month with out putting any more money down." And after you explain to them that $59 X 60 = $3540 and that is an aweful lot of money to take of the price of a new vehicle, they get angry with you and many times get up and leave.

How do you handle a situation like this? Am I dealing with this in the right way?

I don't sell cars so I don't know how the system really works so I may be completely off base.

I have to do a lot of price negotiation and when someone makes a rediculous offer like that I sit them down and we write it up as a formal offer with a deposit check attached.

At this point it's one sided, but what you've done is to take their side in the deal and that will take the edge off. In most cases folks who do this are acting irrationally with no negotiating skills whatsoever.

What management comes back with is anyone's guess. It might be a counter offer to get the ball rolling or it could be that you could be fired on the spot for bringing the offer to them.

How do you think this might transpire?

Chuck

Quote:

Originally Posted by Sales Pro 1000

In most cases folks who do this are acting irrationally with no negotiating skills whatsoever.

I can't wait to find a way to deal successfully with this type of customer. I usually get very frustrated.

Quote:

Originally Posted by cozmo

I am fairly new to auto sales and still learning every day. One thing that I found is that many customers have unrealistic price expectations on new vehicles and when you explain to them why you can't reach that price number they often get mad and upset and even get up and rudely walk out on you.

For example: Say you have a vehicle with a $259 monthly payment for 60 months and your customer says "that is too much, i really need to get to $200 a month with out putting any more money down." And after you explain to them that $59 X 60 = $3540 and that is an aweful lot of money to take of the price of a new vehicle, they get angry with you and many times get up and leave.

How do you handle a situation like this? Am I dealing with this in the right way?

I am not to sure Cozmo,
The follwoing I have seen in the forum to be very good with sought of thing, try find them and see if their threads help:
SNOWMAN
SNOWBOY,
JACQUESWERTH,

Hello Cozmo,
In Australia we work a bit differently as far as talking about the buy price not the repayments, however I feel the process would be the same.

I would advise that you make sure that you are qualifying your clients well in advance of sitting them down to talk about the final deal. In saying that when you go through the sales presentation of the vehicle make sure you state the FULL PRICE of the vehicle. This way no matter what you would get some sort of a reaction - Whether it be that you are in New cars - it might be - I have it quoted cheaper then that (this way you know you have a chance at getting their business provided you beat the opposition) or if you are in used cars (theres one down the road with lower miles that's cheaper). You may then pose the question to the Clustomer "If I were able show you why this one might be a little more and be able to help you out with a package you would be happy, can I earn your business". Not confrontational and you letting the customer know upfront that this cars dollar value is high because of a reason - give the reasons of course and be sure th point them out to the customer using Features, Benifits and Involvment.

Feature - ABS
Benifit - Helps you to avoid traffic accidents with advanced braking technology
Involovment - "I am sure this will make you feel at ease Mr. Customer when your daughter is driving it hey?"

So in essence what you need to do is build VALUE in your customers mind.

"When the percieved value of the product exceeds the price, the customer will buy"

I do hope this helps.

All the best.

What works in this situation is to offer a vehicle in the payment range he is looking which gives him the payment he is looking for thereby creating AGREEMENT.

Script goes like this.

"Hey Steve, I understand you want to be at 200 per month. I have some choices for you. I have a brand new vehicle without the moonroof and the navigation system that would put your payments at 200. I also have a vehicle exactly like the one you are looking at with a couple thousand miles on it. In fact, it's a manager's demo that would put your payments around 200. Or you could spend the extra two dollars a day and get the car you really want.
Let's get this wrapped up so you can start enjoying your new car today! Conratulations!"

This shows your prospect he is really only 2 bucks a day away from getting the car he wants while understanding his initial payment "concerns". Always agree then show alternatives that work for you while giving prospect choices. Your prospect will see that he doesn't want to sacrifice equipment on the vehicle (OR BUY SOMETHING USED) to save a little money.
Enjoy!

Salespro

Quote:

Originally Posted by cozmo

One thing that I found is that many customers have unrealistic price expectations on new vehicles and when you explain to them why you can't reach that price number they often get mad and upset and even get up and rudely walk out on you.

...your customer says "that is too much, i really need to get to $200 a month with out putting any more money down." And after you explain to them that $3540 is an aweful lot of money to take off the price of a new vehicle, they get angry with you and many times get up and leave.

How do you handle a situation like this? Am I dealing with this in the right way?

Here's a suggestion, cozmo:

First, validate the prospect's "offer" of $200 per month by saying something like, "thank you for that offer - that's a good start. If I was shopping for a this car, I'd probably start at a number like that, too." Do this sincerely and with a smile and without a condescending tone of voice or body language.

Next, if you can't meet the prospect's number, tell him so, but then make it easy for the prospect to continue negotiating with you:

"Mr. prospect, I wish I could get you into this car for $200 a month, but I simply cannot. [slight pause] However, that doesn't mean you can't own this car. I'm going to ask you a question. Please just give me a simple yes or no answer. [dramatic pause]. Are you willing to increase your offer of $200 per month so we can continue talking about you owning this car - yes or no?"

Many of your prospects in this situation will answer "yes". That's a good thing, because you've closed the prospect on agreeing to negotiate with you. That buys you time and allows you to continue the selling dialogue.

I have found that this technique works great in all kinds of negotiating situations when the prospect is stuck on a specific number. Just getting the prospect to agree to raising their number can invigorate the sales process.

The best to you!

Oh boy Cozmo, I know what you mean. There are alot of great answers here. Let me see if I can add to it.

You first should not let this bother you so much. Believe it or not I actually grew to enjoy this part of a difficult sale when I was selling cars. I started enjoying it when I quit worrying about the sale (hard to do, but it can be done) and started looking at my job as helping others. When ever I dealt with this kind of customer I explained where the MSRP came from, how cars that have more options and higher price tags have more "wiggle room" and cars that less exspensive and have less option have hardly none. Then, I would explain to them that a car payment generally adds up to $20 per $1000 dollars, give or take. Tell them you are going to do your best but that you need a little help from them. Ask for more down even $300 helps.

Also, before you look at a car or while your looking with the customer ask

What are your payments now?
Are you looking to stay around the same payment or upgrade?
When they find one they seem to like (before the paperwork) think about that they said they wanted for a payment and what the payment will be on this car.

example 2007 corolla MSRP @15,699

They said they wanted a 300 payment almost perfect

now they have a trade in it's time to start asking questions about that trade... go from there

Dealing with unrealistic price expectations in auto sales

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