How Knowing MSRP & Invoice Price Can Help You Negotiate at the Dealership
What is MSRP? The manufacturer’s suggested retail price, or MSRP, is the number the public is exposed to when searching for a new car. It’s the number displayed in the car’s window, on the lot and the number advertised online.MSRP is basically the price that the dealership hopes you will pay for the car.
The MSRP is more important to the manufacturer than anyone else. It’s a value Honda or Ford thinks you might be willing to pay. It’s also a marketing tool. A number is easy to compare to another number. A Ford Focus’s MSRP is easy to compare to the MSRP of a Honda Civic. Use MSRP for shopping, not for purchasing. Read on to find out why.
Now let’s talk about invoice price. There are a few things to know.
What is invoice price?
The invoice price is the price the dealer paid for the car, which is the price on the car manufacturer’s invoice bill to the dealership for the car.The price your dealer paid is the invoice minus about approximately 1% – 2.5% of the vehicle’s MSRP. The % discount is called the holdback and it normally comes in the form of a rebate after the car is sold.
Dealers don’t want you to see the invoice price. Knowing the invoice price of the car you want can give you the upper hand in the negotiations at the dealership. By knowing the invoice price, you know how low the dealership can go on negotiating price, and if you’re actually getting a good deal.Know the invoice price and decide on a goal price. Then, find out if the dealership will agree to it.
When looking for a new car, it pays to be informed. At Buyingadvice.com, we can provide you with the dealer invoice price on any new car you want, so you can get the best deal possible at the dealership.
Simply request a free quote today – it’s fast and easy, and there’s never any obligation.
