Negotiating with Nissan: Pay What You Want for the Car of Your Dreams
By Katie Phillips...Re-posted from our blog at ForbesWoman.
It’s an all-too-familiar situation. Coffee in hand, you climb into your beloved 1997 Corolla as you mentally prepare for another grueling day at the bottom of the office food chain. Drowsily, you put the key in the ignition and discover that where there once was a solid, comforting engine hum, now there’s a not-so-wonderful thud-and-clunk combination. You’re thinking “why me?” and it’s only 8:30 AM.
After momentarily cursing the universe and Toyota (NYSE:TM), you mentally assess your options. Since you bought the car used, you don’t have a service plan or warranty. That means repairs might run up a hefty bill.
You could trade this car in for another used car, but what’s to say you won’t run into the same problem five months down the road? You don’t want to pay more in service charges than you did for the car itself.
You stew briefly before you dare to think: what about a new car? You’re cruising in a new ride wearing your Ray-Bans. Reality sets in as you recall last night’s dinner: Easy Mac and $3.99 Chardonnay from CVS (NYSE:CVS).
You don’t need a sugar daddy, a trust fund, or a corner office.
You remember your embarrassing financial portfolio (the monthly MasterCard (NYSE:MA) bill) get discouraged, and stop dreaming. But why settle for another repair-generating jalopy when you could negotiate for something you really want?
Here at She Negotiates, we define negotiation as a conversation leading to agreement. Negotiation is not: men in suits and ties wearing Bluetooth headsets, sitting at a long table, yelling at each other. We get that notion from movies and SportsCenter where the guys talk ad nauseum about athletes’ salary negotiations.
If negotiation is a conversation leading to agreement, that conversation requires two people. Meaning that you (yeah, you!) with your dead Toyota actually have a voice and something to say to Mr. Pointy-Shoes at the car dealership.
Before laughing at or trembling before that guy, enter his point of view for a moment. How is he going to try to work with you as a customer? He wants to maximize the dealership’s profit because he makes a living by skimming a small part of that profit off of the deal as a commission.
You need something from him, but he also needs something from you. You’ve got the money, which is always a good negotiation position to be in. Remember the “golden rule?”
He who has the gold makes the rules.
Let me suggest two ways in which this transaction may transpire.
YOU: How much is that 2011 Nissan (NSANY:NISSAN MTRS) Versa?
MR. POINTY-SHOES: Oh, that’s $16,000.
YOU: (Shoulders slumped in defeat) Oh. Okay. How can I finance that?
Ding, ding, ding. Mr. Pointy-Shoes wins.
Here’s the alternative.
YOU: I’m willing to pay $12,000 for this beautiful 2011 Nissan Versa.
MR. POINTY-SHOES: I’m sorry, that car costs $16,000.
YOU: I’m a poor, recent college grad. I’ve got this Toyota I can trade in. I understand car salesmen work on commission, so if I pay $12,000 for the car, everybody does, in fact, win.
MR. POINTY-SHOES: Let me discuss it with my manager.
What’s wrong with Door Number 1? You assume a subordinate position, giving the salesman control of the negotiation range by allowing him to set the price. Then you accept his first offer instead of engaging him in a conversation about your ability or willingness to pay. There’s always room for discussion, especially when you’re the one with the money.
What’s good about Door Number 2? By starting the conversation with what you’re willing or able to pay, you are anchoring the negotiation. You’re setting the terms. It’s no longer Mr. Pointy-Shoes walking all over you demanding the sticker price. Being honest with him about your financial circumstances isn’t a position of weakness. It’s a position of strength. By reiterating the benefit he can gain from the transaction, his interest has been piqued. He’s going to want to see what he can do to make that sale.
Dealing with rejection.
I know what you’re thinking: what if he says “no?”
You’ve got to be prepared to hear “no,” and it shouldn’t be a monumental defeat or a total collapse. If he says “no,” you say, “okay,” and walk away. You’re not willing to pay $16,000, remember? Chances are, he’ll want to grab you before you head off the lot and talk about a price you can pay.
You pay the price you want to pay for the car that you wanted to begin with. You drive the new car off the lot wearing your Ray-Bans and feeling great. Mr. Pointy-Shoes makes the sale and can put food on the table for himself and his family. Car Company makes money. Everybody’s happy. Everybody wins.
There’s a lot of discussion these days about how to market to Gen-Y and why we’re not buying cars. Take that as victory. They really need us. We’re not just the runts in the office who are scuttling back and forth with coffee cups. We’re a market segment. We have money to spend. It’s not a lot of money. But it’s enough. Otherwise, those modern-day Don Drapers wouldn’t be spending so much time talking and doing research about us and developing new marketing strategies to attract us to their products. They’d be busy drinking martinis and sexually harassing Joan on an office couch.
We have power. It’s our responsibility to learn how to wield it.
By Katie Phillips, our assistant and negotiation protégé!