[podcast flashvars=”transparentpagebg: ‘yes’, titles: ‘Competitive Pricing'”]https://growwithcars.com/da/wp-content/uploads/2009/06/DAJunePodcast.mp3[/podcast]As a salesperson, you know the important role price plays in the sales process. So why leave it to chance? While some dealers use intuition or wishful thinking to price their cars, others rely on sophisticated internet-based tools. To calculate the price, these tools take several key factors into account: local supply and demand; the vehicle’s condition and actual prices. Regularly consulting this information ensures that your prices are both current and competitive. 

At the same time, you also want to be familiar with the sources your customers trust. What they see online shapes their perception of how much they should pay. While you don’t need to be the lowest priced, you do want to be competitively priced. In some instances, you may find you even have room to raise your price. 

For used cars, we suggest three steps that will keep you in line with the market and your shoppers. 

  1. Know the Blue Book value: As part of their homework, many shoppers consult Kelley Blue Book to learn a car’s suggested sticker. Your price doesn’t have to match, but you should be familiar with the guide’s advice and the basis for it. That way, you can defend your position. Perhaps your car offers features not found in the one the shopper evaluated. Maybe it’s in better condition or is painted in a more desirable color.
  2. Shop the competition: Like in-market shoppers, you also should check out what your competitors have to offer. Browsing their listings allows you to understand their inventory and pricing strategy and fine-tune yours as needed.
  3. View the market-average price: Automotive shopping sites such as Cars.com provide tools that give you an at-a-glance view of how similarly equipped models are priced in your area. You can use this information to both set the initial asking price and monitor aging inventory. As a car begins to linger on the lot, you’ll want to you re-evaluate your asking price. A price adjustment may be just the ticket to a timely turnover.  

Using market-based tools to set competitive prices creates a win-win situation. Should prospects question the price, you can confidently hold your ground and let them see for themselves that they’re getting a fair deal. 

For more Cars.com Podcast tips, please click on the “Podcast” archives link on the DealerADvantage newsletter.