Negotiation for Highlander Essay

Plan A
Before Michelle visits the dealer, she should go over some helpful websites like or Kelley Blue Book. There, she can find out the manufacturer’s suggested retail price (MSRP) and the dealer’s cost for any vehicle (CNN, 2017). As a result, she gets to know that the dealer’s price is $27,929. She can also identify customer or dealer rebates, subsidized lease deals, or other special deals that can cut the costs.

Michelle should try to negotiate the price of Highlander, remembering the dealer’s cost found earlier. For the Highlander, 2% above the dealer’s invoice price is a reasonably good deal as the car was released in 2013, which is $ 28,488. (CNN,2017) Hence, she should start negotiating keeping in mind $27,929. Salespeople usually try to negotiate based on the MSRP. Michelle must try to focus on how much she intends to bid over the dealer’s invoice cost rather than the listed price. The salesperson appointed may know less than her since traditional dealer training focuses mainly on the list price, and many dealers do not share the invoice prices with their sales teams.

She must start the bidding low enough, but not so low that she seems like an uninformed buyer, thereby causing the dealer and salesperson to lose interest (CNN, 2017). Even with a target of 2% above invoice, she might need to compromise a little. As suggested by certain journals she must try to act as uninterested and unenthusiastic as possible. Even after the test-drive, she should put up an ambivalent expression so that the dealer tries to convince her to buy car rather the other way round.

Michelle must agree on the price when she reaches closest to her target price. Now is the time for Michelle to talk about a trade-in as usually dealers charge a higher price when the customer has a trade in. She would already know the trade in worth from checking local ads and looking up her model on sites like and Kelley Blue Book. She should finalise the trade in case she receives an amount equal to higher than that offered by used car dealerships, otherwise she can simply sell her car there, thereby leading to a higher profit. (CNN,2017)

In the next step, the dealer will offer her a number of deals that cost some money and seem very lucrative. The best option here is to decline them as they will hardly be profitable to her; however, there may be some exceptions. Add-ons such as security etching and extended warranty are not worth the extra charges.

Plan B
In line with plan A, if the dealer refuses to settle for a lower price, Michelle can also state that other dealers are offering her a lower price. This will further lead to the dealer lowering the prices. However, once the dealer realises that she has done her research and can also opt for other dealers, the prices will be the lowest possible (EBSCOhost, 2011).

It would also be great option for Michelle to check the prices at other dealership stores while adding on the transportation and travelling costs.

Additional Tactics
Michelle should visit the dealer at a time when the store is not very busy. If she visits on Monday, a sales person may be more motivated to cut a deal because business will be slow for the next few days till the weekend (Leamy, 2017).

Michelle should shop at the times when the dealers try to push sales. Car dealers often get monthly bonuses if they are able to sell above a certain threshold. If she shows up on the 30th and the salesperson is two cars short of a bonus, he or she may reduce the price as low as permissible.

She must carefully read all the documents before signing them to ensure that no additional charges have been levied (Welsh, 2008).
Weight the different payment options with the dealer to zero in the one, which gives the best deal. Usually dealers settle for a lower price when it comes to cash dealings (Leamy, 2017).

Michelle should counter with a small increments as opposed to large ones to demonstrate her mental toughness to the sales staff, thereby make the increments of her counteroffers smaller than theirs.

If she is close but can not quite get the price she needs, instead of trying to pay less for the car, she must try to extract the most out of her money (Gorzelany, 2014). She can ask for extras, better tires or an advanced lighting system, opting only for the things that she would anyhow include rather than add-ons that she does not need.

Rather than talking about the monthly payment, her focus should be on the price. Auto loans can take many years thereby leading to increasing effective costs. As loans stretch over six to seven years, she might end up paying more that what the car is worth, given that car prices depreciate (Welsh, 2008).

Free essay samples and research paper examples available online are plagiarized. They cannot be used as your own paper, even a part of it. You can order a high-quality custom essay on your topic from expert writers:

Get Custom Essay on Any Topic is a professional essay writing service committed to writing non-plagiarized custom essays, research papers, dissertations, and other assignments of top quality. All academic papers are written from scratch by highly qualified essay writers. Just proceed with your order, and we will find the best academic writer for you!

Leamy Elizabeth (2017). 12 ways to haggle a lower car price. Wall Street Journal.
Welsh Jonathan (2008). Does paying cash get you a better deal on a car? Wall Street Journal.
Gorzelany Jim (2014). How to get the best deal on a new car without being taken for a ride. Forbes.
Scott Morton, Fiona; Silva-Risso, Jorge; Zettelmeyer, Florian. What matters in a price negotiation: Evidence from the U.S. auto retailing industry. EBSCOhost
Buying a car: Things to know (2017). CNN.