Why You Should Use the Invoice Price to Leverage a Deal

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Canadian Car Cost Reports – Free!
Whether you’re financing, leasing or paying cash, a new car is bound to cost you a lot of money. You want to pay the absolute best price, and learning the dealer invoice cost is the best place to start in order to get the best new car deal you can in Canada. Get a free report here.

Why You Should Use the Dealer Invoice Report

The invoice price is what the dealership was charged for by the manufacturer, and the number the dealership doesn’t want you to know. They want you to pay as close to the MSRP (the sticker price) as possible. The room for negotiation is between these two numbers, the invoice cost to the dealer, and the MSRP, roughly 8.7 per cent per vehicle. So a new car costing $50,000 will have a profit margin of just under $5000. The invoice price is the crucial component in making sure you start the negotiation on the right foot, making sure not to cut too deeply into the dealer’s profit, and turning down a good deal.

What if the Information is Different at the Dealership?

You may have seen dealers selling at invoice price and thought: they must’ve paid less than the invoice price and are claiming to have paid more, falsely. What actually ends up happening is that in autumn, near the end of the year, when manufacturers are introducing the upcoming year’s models, they want their dealers to clear out older cars to make room for the new models. Dealers get significant financial incentives from the manufacturer to sell at invoice price. These incentives are called dealer cash and dealer holdback. Dealer cash usually a small amount, under $1000, given after a sale and dealer holdback is the amount manufacturers commonly inflate the invoice price by, and later give back to the dealers. Allowing the dealership to sell at the invoice price and still make a profit when the holdback comes in. Vehicles being sold at invoice price, near Autumn, are likely at the lowest price they’ll be, so don’t be shocked when the dealer refuses to go below invoice price, even considering dealer cash and holdbacks. The first step to take is to get the invoice price from our free report here, and then request quotes from a dealer. Equipped with the invoice price, you’ll know exactly where to start your negotiation.

Negotiation tips

To start the negotiation at a reasonable price, by add a percentage to invoice price (between 3 and 7 percent). Don’t go as low as the invoice price itself, as dealers still need to make a profit and aren’t likely to sell for that low. Most dealers just want you to walk away as a happy customer. That said, don’t stand bad customer service. Walk away if you think a salesperson is being too aggressive or unreasonable. Keep the negotiation within range, do your research, keep your expectations realistic, and you’ll drive out of the lot with absolutely nothing to regret.

To get the best deals on new cars, get a free dealer invoice report today. Call 1 866 453 6995 for more information.

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