Price negotiation

**HenryDorsetCase** · 5th July 2012, 17:40

Originally Posted by onearmedbandit

It's been said here before that most if not all new dealers rely on service and parts to keep the businesses open. Selling the bike/car is just the vehicle to getting paid for servicing/repairs/parts.

Same as electrical goods (from a salespersons perspective). A new TV/Fridge/Washing machine will have 22-24% in it. Almost every weekend there is a '20%' off sale. Salesperson gets paid 5% of profit. So on a $1000 TV with 20% off you could expect that TV will earn the salesperson a few dollars commission. Where they make their money is in the extras, warranties, cables, cleaning cloths (I kid you not). These products have up to 70% (and in some instances much more - 'Monster' brand HDMI cables for $400??) profit in them.

Thats why Hardly NOrmal hate me: I haggle them down then buy all the other stuff elsewhere. And then giggle like a schoolgirl when they try and sell me an extended warranty: that is THE biggest margin in the shop, because it does nothing, yet costs plenty....

**Quasievil** · 5th July 2012, 17:41

**baffa** · 5th July 2012, 17:53

Originally Posted by onearmedbandit

I'm in car sales. We already lose when selling for cash, in other words we get a commission from the finance company for putting the finance through them. So when someone wants a discount for cash it's a very unlikable situation for us.

Yup, finance makes car sales a good chunk of money, so you'd be much more likely to get a deal if you were on finance. And the Finance manager pockets a good amount of it too.

In saying that, if you do finance a vehicle, I would fight for a better finance rate.
When I was on a car yard, the finance companies would offer a base finance rate for the customer, of say 11%, then if the car yard increased to rate to 18%, they would pocket the 7% difference, so if this is still the case, there may be room to move on finance.

It is always worth trying to haggle though. I've saved money buying all sorts of wierd things, including a bottle of whiskey, and im not even that good at it.

**Robert Taylor** · 5th July 2012, 18:22

Originally Posted by Coneamahfone

So guys when buying a "new" bike, how much do you think is appropriate negotiate off the price. Do you think there is a standard 15% off for cash etc when;

1) Buying New from a dealer
2) Buying Used from a dealer
3) Buying from a private seller

I read an article one time (about buying a cage) that used dealers expect you to negociate up to 15% off the sticker price.

what have your experences been. I had $2k knocked of the hornet when I bought that from a dealer used.

Many motorcycles have LESS than 10% margin in them, and thats before predelivery costs. They cannot be a charity when margins in bikes are below the level of sensibility

**ckai** · 5th July 2012, 18:39

So the moral of story is:

You can haggle as much as you want if you think the seller is making money but if you think the seller isn't making any money then don't haggle

or...there is no rule of thumb and just do what the hell you want

**Drew** · 5th July 2012, 18:49

Originally Posted by ckai

So the moral of story is:

You can haggle as much as you want if you think the seller is making money but if you think the seller isn't making any money then don't haggle

or...there is no rule of thumb and just do what the hell you want

There's no harm in asking, so long as you don't mind being told no sometimes.

Also, just about all retail vehical sellers MAKE more money on finance deals. So, if you start waving cash around and want bigger discount, you're less likely to get it.

**nzspokes** · 5th July 2012, 18:51

Real question here is why dont Motorcycle retailers open Sundays........

**Ocean1** · 5th July 2012, 18:54

Originally Posted by Drew

Also, just about all retail vehical sellers MAKE more money on finance deals. So, if you start waving cash around and want bigger discount, you're less likely to get it.

Before the recent economic... realignment HD supposedly grossed more from finance than they did from making motorcycles.

**placidfemme** · 5th July 2012, 19:06

Originally Posted by nzspokes

Real question here is why dont Motorcycle retailers open Sundays........

Because you also expect them to be open Mon-Sat, and working 7 days is shitter... plus it is not as busy as you think, I have worked at 3 shops that have given it a go, and it was a massive fail in all cases, not as many people as you think go on Sundays.

In regards to the OP and the others who seem to think bike shops make a killing in new bike sales have no idea what they are talking about, look at the responses from those in the industry, 10% is lucky, and as also mentioned a lot of robbing from margins between departments goes on to get a balance, but the sales department really doesn't make as much as you think. Also in regards to the comment on parts being a "minimum" 30% margin is also not totally accurate as normally it is a "maximum" 30% margin, most suppliers advertise everywhere, so you'd be pressed to find a dealer up-marking to 30+ because it's too easy to be caught out. Some of you general public really have no idea

**Robert Taylor** · 5th July 2012, 19:33

Originally Posted by placidfemme

Because you also expect them to be open Mon-Sat, and working 7 days is shitter... plus it is not as busy as you think, I have worked at 3 shops that have given it a go, and it was a massive fail in all cases, not as many people as you think go on Sundays.

In regards to the OP and the others who seem to think bike shops make a killing in new bike sales have no idea what they are talking about, look at the responses from those in the industry, 10% is lucky, and as also mentioned a lot of robbing from margins between departments goes on to get a balance, but the sales department really doesn't make as much as you think. Also in regards to the comment on parts being a "minimum" 30% margin is also not totally accurate as normally it is a "maximum" 30% margin, most suppliers advertise everywhere, so you'd be pressed to find a dealer up-marking to 30+ because it's too easy to be caught out. Some of you general public really have no idea

Well said, there are plenty who have been blissfully unaware of whats involved who have gone on to open motorcycle shops, ''the current shops are not doing it properly and I'll show them!'' And then theres a good dose of reality of actually how hard it is to make a complex business run smoothly and turn a profit. Manufacturers abysmal warranty reimbursement rates being a real eye opener for one.... After turning a small fortune into a tiny one the doors are then closed. The reality also is that we have way way too many motorcycle shops for such a small population.
When I owned a shop the margin on a popular 2 wheel farmbike was about 20%, now on that same model its 9% BEFORE UNCRATING AND PREDELIVERY. That is madness and unsustainable.
Part of the problem here is that where you have big box retailers such as Briscoes advertising 50% off sales then too many people ( who dont own businesses ) blissfully think that everyone makes huge margins on all products....

**p.dath** · 6th July 2012, 09:24

Originally Posted by Coneamahfone

So guys when buying a "new" bike, how much do you think is appropriate negotiate off the price. Do you think there is a standard 15% off for cash etc when;

1) Buying New from a dealer
2) Buying Used from a dealer
3) Buying from a private seller

I read an article one time (about buying a cage) that used dealers expect you to negociate up to 15% off the sticker price.

what have your experences been. I had $2k knocked of the hornet when I bought that from a dealer used.

The last bike I bought [second hand] from a dealer was already being advertised at what I considered to be a fair price - which I told the dealer, and I didn't try and knock him down. I appreciate that he needs to make a profit to stay in business - and I don't want any more bike dealers dissappearing.

HOWEVER, the tyres on the bike were close to being completely worn out, so I did negotiate a deal on a set of replacement tyres. Also the next service for the bike was one of those "hell expensive" ones, so I negotiated to have that done as well. Basically I wanted to ride away and know I didn't have anything big that was going to need doing.

**Coneamahfone** · 6th July 2012, 09:49

its funny to see how people who sell things for a living differ in their views from people who buy things for a living.
I guess the take away here is, take what the seller says is their margins, and the buyer 'thinks' is the margins and pick a number between the two.
I can understand a fairly low margin in new bikes, and bikes traded with in the first few years. But i guess the margin gets better the older the bike gets?
But like you 'mostly' said, its only worth what someone will pay and a 5 year old bike with low k's is a great draw card for buyers and people are less willing to move the price on a perceived easy seller.