Real Stories From Life at a Dealership

People are the experience

It Should be as Easy as Buying a Gallon of Milk

Sierra Motors        “One Low Price, Plain and Simple…ALWAYS !”


 CALL TODAY  @800.571.0275 


It can be said that buying a car is the last great frontier of negotiation left in the retail buying market in today’s world. A store checker from Albertsons can walk into a Dealership and demand a lower price off the sticker price that the Federal Government has stamped with their seal of approval should be the retail price point.


Conversely, walk into Albertsons and try to get fifty cents off a off that gallon of milk from that same store clerk…not going to happen…And we know we pay too much for milk.


Here is a typical element in a car deal, “THE DOWN PAYMENT”.


Marcus (the car buyer) and Joel (the salesman) are going to negotiate the amount of money that Marcus is going to put down on the new vehicle that he purchasing. Joel is an old school, well-trained, salesman; Marcus is going to take several different paths through the sale. Marcus has settled on a $30,000 car.VOLT


Marcus has bought several cars the last one from Joel. Marcus has a good credit history and a well paying job with money in the bank.


Joel has been trained that down payment is good. Early training told him that banks finance the cost of any car, plus tax and license. Cost being represented by new car invoice or wholesale Kelley Blue Book. What the Bank won’t finance is profit. The lesson Joel has learned: the amount of profit can be determined by the amount of down payment.


Joel is also taught that down payment cures almost everything. If there are any credit problems a large down payment will overcome most of the associated problems. If the trade-in has negative equity (upside down) down payment solves that also. If there is a monthly payment issue, the down payment is a huge factor. When the interest rate is important positive equity in the form of a down payment is going to affect the rate available from Banks. If Joel wants to be able to take the car in trade from Marcus in the future, down payment will eliminate negative equity. Down payment is good.


Marcus and Joel are sitting at a table in the dealership. Joel is writing on a worksheet. Now we cut to the dialogue:



              Let me explain the cheapest way to buy anything; finance the smallest

              Amount for the shortest period of time, wouldn’t you agree?






              To accomplish this most people will put about one-third down.

              In your case that would be about $10,000, were you thinking that

              much or a little bit more?



            That’s more than I was planning on.



           Would $8,000 be more what you were looking at?



           Still too much.



          Then $7,000 would probably be fine…



          If it’s going to take that much I don’t know…



         Only $6,500 down.



        No way!



        $6,250 total down payment.



        No, too much



       $6,100, only $6,100 okay?



       I can’t !




(Marcus stands up)



      How much less are you thinking?



(Setting back down)


      I was planning on putting $2,000 down



     That’s not even enough to cover tax and license. If my own Mother

     were buying a car, I would tell her to put enough down to cover that.

     You don’t want to pay interest on Government fees, do you Marcus?



     No, I don’t. How much do I need to cover all of that?



     $4,000. That’s a lot less than most people put down Marcus, but let me ask you:

     If we can get it done with only $4,000 down can we earn your business today?

    There is a long protracted silence. Joel has been taught that after offering a

    Closing question to just sit tight and to remember; the first one to speak loses.



     Okay, I can put $4,000 down!!!CASH


This is Sales 101. Some of the techniques employed are:

  1. Telling Marcus a story
  2. Getting Marcus to say yes
  3. Establishing an amount
  4. Step selling
  5. The decreasing amounts are cut in half every time
  6. Making $50 sound like the end of the world
  7. Pushing Marcus until he stands up
  8. Sitting Marcus back down
  9. Getting an agreement through a down payment
  10. Using his Mom
  11. The “if I could would you?” close
  12. Knowing that the first one to speak loses
  13. Making Marcus feel as if he has won the negotiation


If the idea of negotiating a down payment like this sounds absurd, you are not alone.


We at Sierra Motors are dedicated to changing the way you purchase your next car. You do not have to commit to purchase to find out how much a car will cost. After all…at the end of the day…I’m your friend in the car business.




June 16, 2009 - Posted by | close, down payment, eric prothro, friend, mom, negotiate | , , , ,

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