The most under-utilized word in the sales vocabulary

Again this is based upon my car sales experience.

I've found that the most dominating and seldomly used word in the sales consultants vocabulary is the word "No". Now it can not be used all the time, but there are a lot of instances where saying NO is probably the most powerful closing tool I have used. Alot of sales people still are under the impression "The customer is always right." What I've found is that a majority of the time they aren't. Sales people go out of their way to keep a customer happy, and a majority of time it costs a sales person his/her gross to do it. I have found that on the difficult closes, the ones that you end up negoting what seems like an eternity with, simply telling them no works best. Now of course this only works well if you have followed the sales process and have built value to your product. Usually telling a customer no works well with the fear of lose close. Below is an actual example that happened last week on a truck sale that I ended up grossing fairly on.

I had been negotiating with the customer for about 20 mins and the customer still at a ridiculus offer. We were at 675 monthly payments and the customer wanted no more than 600. I had tried about 4 other closes and to no avail. Finally I stood up shook the customers hand and told him "I'm sorry Mr. Customer I understand you are looking for a great deal, and I am giving you a great one, but unfortunately it's not the deal your looking for. I wish you the best of luck and give me a call if you need anything." My manager heard this from his office and was giving me a WTF are you doing look bcs we were still showing him the deal at Full Sticker price, and holding back 1000 on his trade. I started walking to my managers office and the customer was sitting there dumbfounded as well. He got up and started following me and said he would pay the 675 only if we got him 2000 more for his trade.
"Sir unfortunately we are currently $4000 dollars off on the deal and I don't have another $2000 for the trade." Again I started walking to the office and he stops me again and says if we throw in the leather seats we have a deal.
"Sir, adding leather to the vehicle costs us about $2750, and if I don't have $2000 more to give on the trade, how am I going to get $2750 to put the leather in? I'm sorry sir I can't, but I wish you the best of luck."
He stopped me AGAIN and says ok just give me free tint. "Mr. Customer, I really want to earn your business and if I had the money, believe me I wouldn't let $2000 dollars keep us from making a deal, but I don't have anything sir. This is the best I can do."
I started walking off and paused a moment, and turned around.
"Mr. Customer, I can tell you really want to buy this vehicle, and I really want you to have it... I'm not promising anything, but if I COULD get the payments to $650 with the vehicle as is, can we make a deal today?"
Of course he said yes, I went to the managers office told him to give him another 500 for the trade, leaving us holding back 500 and closed the customer at 660. The customer loves his vehicle and has sent me two referals so far.

I know this is an example of a fear of loss close, but it also shows the power of the word No. Again you can't use it in every situation but, you can use it quite a bit and it greatly helps your gross.

Just curious how many of you guys have ever tried to tell a customer no, and what the results were. -jrboyd

your lucky the client had no backbone.I would have walked. -rich34232

It is a tall order to "build value" when you are "still showing him the deal at Full Sticker price, and holding back 1000 on his trade."

How is that "value" when even your own sales manager was ready to give the customer a better deal--not to mention another dealer?

If you were at sticker price in an arena where discounts on most cars are the rule rather than exception, and you had a prospect who was that unsure of the value of the trade, it's obvious you saw a very naive prospect, and took advantage of him to line your own pocket.

You won the battle, but you know what they say about the war. -Ace Coldiron

Sorry for the confusion ace. The manufacturer rebates and discounts does NOT effect the gross. So when I said I closed them at full sticker it was minus the rebates. They were looking at a $45,000 vehicle that had $13,000 dollars in rebates so they were getting it for $32,000. -jrboyd

jr,
If you don't give them the rebates, i.e. sell the car at $45,000, do you get paid on the rebates because I do? In other words, if I don't tell them about an available rebate and they pay full price for the car, the rebate amount gets added to the gross. -wesbound

I'm with Rich. Not only would I have walked I would have told at least 12 other people about my awesome experience. -ccIowa

I think it's real easy to say "I would have walked." But I don't know if it was true.

Every human being on the planet has "over paid" for something (whatever "overpaid" means). You probably have, too. It would be easy for me to say "I would have never done that" but in fact I have.

Why do people do that? Because they want it. They want it now. And who are we to say they're wrong?

Most things bought and sold in the world are done so via negotiating a price. If a customer is willing to pay a price, shouldn't a salesperson be willing to take his money? (unless of course there are other issues such as the individual is not of sound mind).

As I see it, jrboyd called the customer's bluff. Is that wrong? -Skip Anderson

Something doesn't make sense. Please educate me.

How is a dealer able to divert a factory rebate available to a purchaser of an auto into its own pocket? Please explain the mechanics--AND--is it done with the factory's knowledge? In other words, is the paperwork falsified? -Ace Coldiron

Skip,
Far be it for me to question you; you are one of the most brilliant salesman in the world. Maybe even the very best. But, what do you mean that "Most things bought and sold in the world are done so via negotiating price."? Do you negotiate the price of your groceries, a pack of gum, the gas at the pump? I think very few of the things we ever buy do we negotiate the price. Even big ticket items like furniture and appliances, although you can negotiate price, I think most don't. Just houses and cars. Am I wrong? -wesbound

Still hoping someone will clarify how a car dealer can divert a factory rebate available to a purchaser into his own pocket.

Any answers--or are we going to let that just slide? -Ace Coldiron

1. Most products and services sold business-to-business are negotiated. Especially major purchases. And compensation paid to employees.

2. Price is able to be negotiated on most things sold in consumers' homes in the U.S. (windows, room additions, sunrooms, knives, kids' books, satellite dishes, hardwood flooring, carpet, window treatments, vacuum cleaners, security services, etc.).

3. If your definition of "world" is "United States", you'll miss the myriad items and services sold throughout the entire world's population that are done so by negotiating a final price.

4. When I buy a suit at my favorite men's clothier, I ask, "Can you do any better on price?" And they say, "I can give you 20% off." Some retailer's will negotiate with you if you ask.

5. At times, the following items and more can sometimes or all the time be purchased via negotiating: Boats, RVs, the neighborhood kid mowing the lawn, car rental, jewelry, snow removal, rent, musicians, fine art, credit card interest rates, mortgages, nannies, tree trimming, golf lessons, guitars, wedding cakes, portrait photography, massage services, selling a business, hotel rates, appliances, roofing, catering, IT services, home repairs, etc. -Skip Anderson

I used to be a staunch chevy fan and have had nothing but chevy's since 1970... till I asked the chevy dealer, a friend of mine, for the best deal he can offer me.

Had I been negotiated anything, I'd be driving a new chevy truck today... instead, my wife and I drive two NEW Subaru's and I still have my old chevy truck... running like a top.

If I ask someone for the best deal I can get, and they expect me to be a part of the negotiations, they lose. If an insurance company quotes a renewal premium and a competitor comes in lower, and the original insurance company then comes back to match the competitor, I quit using them. If they could have done that up front, they should have.

Aloha... :cool: ;bg -rattus58

The money comes straight to the dealership. That's it. Whether or not it is used to reduce the selling price of the automobile may or may not be known to the manufacturer. -wesbound

Skip, maybe I'm wrong, but when I think of "most" things that are purchased, I'm thinking of consumables, things that are purchased every day by a person. People don't buy RVs and suits every day, but they tend to go grocery shopping once a week, or so. Here the prices are fixed. I guess you could ask for the manager and tell him you don't feel the mountain dew is worth $1.50 for a 20 ounce bottle, but you would gladly pay $0.85 for it. Maybe he'll change the price. I doubt it though. -wesbound

Rattus,
I've met a lot, I mean a lot, of people who say the same thing you do. Just give me your best price. So, my manager and I put together a very fair presentation. What do they ALWAYS say? "Surely you can do better on the price." I've just shown them a proposal for an automobile with an MSRP of $21,000 with savings of nearly four grad with discounts and rebates and they want MORE. No matter how much you discount the vehicle off the top, the customer always wants more, and more, and more. That, my friend, is why we start the negotiating at sticker. -wesbound

Today is the day that the country's largest auto manufacturer is starting bankruptcy proceedings. I am sure that there are many mistakes and high levels of incompetency from the top down which have contributed to the failing state of several manufacturers.

If what you say is correct, you've certainly contributed food for thought. When a manufacturer devises an incentive in the form of a cash rebate for new buyers, and establishes so little control over the disbursement of those funds to the point where they can end up in the dealers' and salesforce's pockets, today's headlines do not surprise me.

Somewhere along the line the auto industries' training schools forgot to teach that integrity is a weapon--perhaps because they didn't know it themselves.

I have many friends in the auto industry, at manufacturer and sales level, and among OEMs. My comments are not a reflection on them. In a way, they too are the victims. -Ace Coldiron

Hi Westbound,

If you had said to me, Tom we have a gross of $4000 in this car and the factory has $2200 in rebates. We can give you $2,000 (or whatever it is) off the gross since you don't have a trade in and $2200 in factory rebate and you would have a check in your hand within 5 minutes. I bought my chevy truck sight unseen over the phone.

Both Subarus were bought essentially after walking in and talking to a salesperson who had been sending my wife birthday and christmas cards for 18 years and now worked for subaru again.

I have insurance companies that don't give us the best that they can till some competition enters in... That only happens once with me.

Aloha... shds; ;bg -rattus58

You are right about one thing, rebates have had a detrimental impact on automobiles. They serve only to cheapen the vehicle and reduce the equity one has in his vehicle come trade-in time. -wesbound

I won't reveal which brand of automobile I sell, other than to say I sell imports. I wish we had $4,000 markup. Even our high-end models are only marked-up about two grand and the people buying those are not exactly price-conscious.
It's funny, when you mention Chevy, you only mention price. However, when you mention the Subaru, you don't say a word about the price. Obviously, regardless of the price, you feel you got a good "deal" because of what you get for you money, the intangibles, the service, the fact that the guy has kept in contact with you for years. That transcends price. -wesbound

Actually I didn't mention price on any of them... I bought my chevy truck, which I still have 14 years later, sight unseen. However you're exactly right about service and attention. I flew for the chevy dealer for 30 years and it was sold to a guy who I flew around alot and from whom I'd bought a half a dozen chevy's. I guess too, what goes around comes around... they got dumped by GM and now 45 employees are out of work... I felt a little disrespected by this guy and walked away.

Service and Attention... You're absolutely right... transcends ALL for me anyway and I believe, most over the long haul.

Much Aloha.... Tom shds; ;bg -rattus58

Equity? If someone stick a gun in my ribs and demands my wallet, I'd say I've lost some equity in that case too. Call it what you want. If I buy a new car and there is a factory rebate INTENDED FOR ME THE BUYER, and somebody on the selling end decides he's going to stick it in HIS pocket, I'd say we have more than an equity issue here. I'm in business and I deal with equity issues on my balance sheet. I deal with dishonest people in a different manner. What has been described here about diverting a customer's rebate is extremely dishonest.

Some of the most professional and successful people in sales make their living selling cars. Fortunately, the majority of these successful people care about their customers enough to never engage in glomming people's rebates. -Ace Coldiron

People's rebates? INTENDED FOR ME THE BUYER? Where is it written that we HAVE to pass this savings on to the customer? The rebates are not guaranteed money in the customer's pocket. They CAN be used in the negotiation process to lower the price. -wesbound

Where is it WRITTEN?

How about in just about every single advertisement announcing a factory authorized rebate to buyers?

I think you are hugely mistaken perhaps because you are not familiar enough yet with the discounts off MSRP, the dealer holdbacks, the rebates, and various incentives, that would effect the final outlay from a buyer purchasing a car. You profile yourself as a novice, and it's understandable that your knowledge hasn't caught up yet.


Another place it would be written would be on the buy order that I would sign or I'm hitting another dealer on the way home. -Ace Coldiron

I am very familiar with discounts off MSRP. Holdback? Very few dealers give up their holdback. Why? Because it's not set in stone what it's going to be, so it's difficult to know how much you can dip into it. Moreover, many times that's the only money the dealer may get on a car. I may be a novice, but I can tell you don't work in my business where 99% of the cars I sell I get a nice, big, fat $100 mini. Do you have any idea how many cars one has to sell like that to pay his bills? -wesbound

Westbound, that is me too. I don't work in your business. But I do understand the $100 commission, because I make those all day long. I strive to make one sale a day, every day, and sometimes I make 5, somedays none, but some days I gross $20,000 a week and make $5000 for my efforts, but I've made clients with each sale.

I've learned from a guy named John Savage, also an insurance guy, that you have to have a rabbit before you can have the stew. Each of your $100's and many times my $75 commissions makes both of us owners of a client... it's what we do with that client that makes us different. These are the most important people there are for me, even at a dime, for they may continue to buy from me if I treat them right.

Yes, you need big numbers, but Joe Girad, a car guy, made a living on numbers that was next to phenomenal. If I was you, I'd be lovin the numbers, shows that you'd be on the right track in my OPINION.

Aloha... shds; ;bg -rattus58

Can't sell cars to the tumbleweed on the lot......and my previous customers do not seem to be bringing me anyone either..... -wesbound

Ok there is a big misunderstanding here. FACTORY Rebates can not be held by the dealer regardless. Dealer Cash is a different story. Now as far as rebates de-evaluating the trade that is completely true, but a different story. Well say Manufacture X has 10K knocked off his vehicles 8 out of the 12 months. Now let's say you are looking at a one year old vehicle. Now brand new the vehicle is 30,000 dollars. But you know there is usually a 10,000 dollar rebate. Would you feel comfortable buying the one year old vehicle for $20,000, knowing you could get a brand new one for $20,000? SO rebates do de-evaluate quite a bit. -jrboyd

Wes.. You are confusing, dealer cash with rebates. By law rebates have to be given to the customer. Dealer Cash is used at dealer's discretion. Holdbacks are written in stone as to how much they are. As far as you recieving mini's, maybe I can help you with your process to keep that from happening. Honestly I say about 80% of car salesmen are in your shoes. I however, Rarely get a mini deal. This last month I didn't focus much on sales due to event coordinations, but I sold 5 units, and grossed 3500 dollars. Not my best month, but I am averaging around 700 com per car. And no they weren't all used cars either. In fact the biggest grossing car I have had was a new vehicle, and I made close to 1500 comission off that one car. I have a guide to help you with the process that has been working really well for the guys that choose to follow it. My newest guy started it, and on a deal he had to split, his half of the commission was $579. He has been doing it for 2 months now, and before was consistantly getting mini's. Now he actually makes some money. -jrboyd

That is correct. -Ace Coldiron

We have customer cash, which is on the manufacturer's website, and dealer cash. If possible, we'll hold back both. Jr, I'll email you my phone number and we'll discuss the mini thing if you wish, because I know you're one hell of a car salesman. -wesbound

See Consumer Cash and rebates are two different things as well. You can actually hold consumer cash back or instead of using it on the price of the new vehicle, it can be added to the trade to help offset the negative equity. -jrboyd

Not that I understand anything about buying a car other than gap insurance, which makes your car whole to a bank if you get creamed with negative Bluebook to payment balance, but buying a car for me is not at all like it is for my wife. A car for me is wheels, for my wife it's a work vehicle. For me I have to have room to carry my office. I put a minimum of 15,000 miles a year and with my new car have amassed 67,000 miles in a little over 3 years so far, so comfort and to a degree economy.. but more importantly, AC and a 6 cd player are most important.... sn;

What turns me off buying anything is lack of service/attention when I'm looking for something and when I bought MY SUBARU as compared to my wife, and the salesman who sold me my suby made two astute observations before he met with me. One, I'd been driving a truck and they sold Mazda Trucks and SUV's and when my wife called him to ask him if they had anything available, they indicated that they had what I had asked for.. a king cab and a CD player.

The salesman asked why a truck and my wife said that I didn't fit in her Baja comfortably. My wife said that a kingcab was necessary because of all the stuff I haul around in the back of my truck in a rubbermaid tub. Enter the WRX hatchback.

When we showed up for my truck, he had both side by side, the B4000 and the WRX. I jumped in the truck... comfy... Ok... lets do it... salesman.... Tom... before we sign anything... I would like to take you for a ride in the WRX. For one thing, look at the rear trunk space.... and opened the hatchback.... Wow... Ok... that's better than the truck even in the rear of the cab. But, I aint gonna fit mon.... Well lets try it out.... (The suby has a multi-adjustable seat that he had cranked down to the bottom and gave me beacoup headroom....) Jumped in went for a ride... once we got down the road a bit he said.... do a freeway merge there Tommy... and I sayed... what's that... Ok... put it in third and step on it.... WHEEEEEEEEEEEEEEEEEEEE..... Wifey in corner holding her head in hand mumbling... Oh good grief.... me.... Where do I sign..... and bonus.... 6 cd player great AC and a great big "wheeeeeeee" factor...

Guy paid attention to my wife and waylaid me in ambush....

Good job.....

Aloha.... shds; ;bg -rattus58

I've often said NO to customers and get away with it just fine. They want a discount and I can't see any reason to give them one I just say "we offer discounts on volume purchases but not when you buy just one" to make them feel better I tell them that we are the most competitive in the niche market we're in. Our nearest competitor is still double than us. I tell them that we keep our prices low so that is why we don't negotiate on price. They accept that.

One other time I made a deal on some "seconds". Stuff that could have been sent to the garbage but I had one client who loved to buy that stuff. I talked to our accountant and he gave me a list on what the costs were on our books. With that I came up with a selling price and the customer agreed to pay for it. Somewhere along the way I managed to goof and sent him my costs list by mistake. He thought he could pull a fast one and he wanted to buy them at my cost. I said NO because without any margin I had no incentive to even bother with the sale. I just said that if he was not willing to pay our previously agreed price then it was ok. We wouldn't have a deal. He stood to lose more than I so he relented and went back to our agreed price (which was already a good deal for him anyway).

Generally I reserve "no" when a customer tries to abuse the process. Other than that I try to cooperate and help the customer as much as I can without affecting our bottom line. A sale where one makes no money is just no fun. -Andrea

First off, I thought women are born with a "NO" switch, weren't they? sn;

Although the examples that you JR have provided are easy to understand, I'm still a little clueless, and I know there will be a rush to confirm this, as to why it is the most "under" utilized word in our vocabulary?

I don't normally see myself using it. I can understand the strategic example of using no or maybe more likely "Hey John, you don't want to do that!" ... and John.. "Why not?" "John, cuz by owning that life insurance policy, when you die, Obama and company are going to add it up as being in their estate. You don't want it in their estate... and they think anything you own, they own, so don't own it! Would you like to look at ways to take it or keep it away from Sheriff?"

What are some other examples you see of using NO effectively in sales?

Much Aloha, :cool: -rattus58

ummmmm NO comment.....

I don't know how one can possibly know that it is the most under utilized unless one spent time with every sales rep alive....

JR used NO in negotiation. And what he did in his example is called posturing. Lots of people do that. I don't see that as novel. I see that as a tactic or gimmick and personally that is not my style. No wonder people have such an aversion to car salesmen... you can't trust those guys!! -Andrea

Whoa! Whatever happened to "no comment". If I sold cars, I'd cry foul. -Ace Coldiron

I "knew it....;bg "

They're not too crazy about insurance salesmen either..... sn;

Aloha... shds; ;bg -rattus58

Actually come to think of it... in general most people aren't too crazy about sales reps no matter what industry they are in... I have a lot of nurses that hate it when sales reps come a knocking!! Which is why if you make yourself useful to them they will be happy to take your calls... that's how I feel anyway. -Andrea

I'd hate to think how you to make yerself useful to them nurses.... msnwnk;

Aloha... :cool: -rattus58