“Do your homework first.”
That’s what you always hear when you’re planning to buy a car.
Shopping at the right time of the year, researching the value of your trade-in, and comparing prices even after you’ve negotiated an “unbeatable” offer pays off, according to the U.S. News & World Report.
Even just by finding out what the dealer paid for the car, and visiting more than one dealership, you can save an average of $US230, Eric Barker writes on Barking Up the Wrong Tree.
But for economist Steven D. Levitt, being unprepared turned out to be an advantage.
In “When to Rob a Bank,” his latest book in the popular Freakonomics series with co-author Stephen J. Dubner, Levitt describes asking a dealer to fax him a quote, only to forget it at home and arrive at the dealership without it.
“I fought hard for that price: threatening repeatedly to leave, back and forth and back and forth, and finally I got the dealer within a few hundred dollars of the price I remembered,” he writes.
But when he got home, he looked at the fax again and realised that he’d been wrong.
The price that he’d been quoted was actually $US2,000 higher than the one that he’d just bargained.
What seemed like a simple mistake ended up getting him a better deal.
He writes, “Leaving that fax at home was worth thousands of dollars.”
Obviously, this isn’t the recommended approach. But Levitt’s story shows that when shopping for a car, aggressive negotiating can pay off, and — after you’ve done your research — you shouldn’t be afraid to ask for the price that you think you deserve.