Thank Goodness for Bad Sales Managers

I don't buy cars often, but when I do I buy new and keep them a long time. I did my homework, test drove a couple of top candidates and decided which one to pursue. Our local dealer treated us well, but dropped the ball and ultimately missed out on a sale exceeding $30,000. Here's why.


I checked around at a couple of other dealerships about 75 miles away and they had slightly lower prices, but not enough for me to abandon the local dealer, especially since the salesperson is a friend of mine.

My friend offered to take the print-out quote from the other out-of-town dealer for the exact same vehicle and see if his manager would come down a bit more, even if he couldn't match the $500 lower price.

I had a check in my pocket, and was ready to just buy the car if he came down a bit more or offered us discounted extra features or something.

"No, he won't go any lower," my friend informed me after a few minutes. I was surprised by the manager's blunt reaction and didn't feel especially valued as a customer so I was in no hurry to buy at that moment. If the price was so set, I could buy it any time. Still, I thought it odd that such a high-end product would not have any wiggle room on the price. I've experienced this on two previous auto purchases, where I saved thousands by driving 90 minutes to the east.

When I returned home, my past auto buying experience was on my mind and I felt more motivated to see what other offers might be out there. Ah-ha! After a quick Google search, I discovered that there was a dealer I hadn't approached. I found the model I was interested in, and sent the email. Within a few minutes I had my quote. It was more than $2,300 lower than the local price that was set in concrete!

At first I thought it might be an error or they just wanted to unload this white car that was languishing on the lot. Since I preferred another color, I asked if she had the same vehicle in blue. The Internet manager found the version I wanted and came up with essentially the same price! I bought it the next day over the phone with my credit card down payment.

I did try to negotiate that price lower, but to no avail. The dealership was already selling it under cost. They do that sometimes because they'll miss out on the manufacturer's bonus if their dealership doesn't move enough cars that month. I learned this from an episode of This American Life, which explained how crucial it is to make that bonus each month. One manager interviewed for the show bought a car himself to reach his target number. His dealership could not lose that bonus!

In any case, thank goodness the sales manager at our local dealer didn't have the sense to at least come out from his office and meet me, explain how his margins are tight, but that he'd really appreciate my business. Had he done any of that, I would have cut the check and been done with it. This car is highly rated, his price was fair according to and the prices I had seen were all very similar. Besides, I already decided I wanted this car.

The lesson for sales novices and pros is that even if you have a hot commodity, you're wise to show that buyer you'd appreciate his or her business. And at minimum, step out of your office and say hello.

Posted on February 15, 2014 .