11 May WHAT WERE DARREL’S STRENGTHS & WEAKNESSES AS A NEGOTIATOR?
How much can you spend per month on your car?”
“Under $350.”
“Well, we can stretch the payments out to four years and that makes it only, let’s see , .. $337 a month. What do you say?” As Darrel leaned over his desk awaiting her response, Marcia began to reconsider buying a new car, especially without shopping around first. She got up to make her escape and to thank Darrel for his time when he blurted out, “Are you a first-time new car buyer?”
“Why . . . yes,” Marcia answered .
“I almost forgot,” Darrel announced, “I can offer you $300 off invoke just to get your business and begin what I’m sure will be a long-term relationship with this dealership. Even if we don’t make anything on this car, we’re in it for the long haul. This will bring the payments down to $329. You can’t beat that; the car you want at your price, But we have to make the deal today. There has been a lot of interest in that particular Zirconia and I’m not sure how long it will be around.” That was just enough to halt her exit; besides, at this point, Darrel was really trying to help her out. Marcia took the deal.
“Just let me clear this with my sales manager,” Darrel explained as he left the room. When he returned, he was solemn. “He didn’t go for it. He got after me for getting carried away, especially with the new buyer discount. Bottom line, he says you can’t have the new car buyer discount and the options at cost.” Marcia was angry with the sales manager, but empathized with Darrel’s predicament and agreed to his suggested solution of giving up the magnesium wheels. After a quick check, Darrel indicated with evident relief that the sales manager had accepted .
Now it was time for the paperwork. Darrel began by filling in the sales discount. Marcia noticed an $80 processing fee, but she did not mention it because it was printed on the form and therefore must have been a standard charge. Darrel filled in the proper price, $15,750, and the $1,000 factory rebate, but then wrote in a mysterious $105 charge . “What’s that?” Marcia inquired .
“Oh, I forgot about that. That’s the paint sealant we put on all our cars to protect our customer’s investment,’ Darrel replied.
The next line was the trade-in value for which Darrel had to check with his “trade-in specialist.” Darrel left the room and returned with the specialist who stated that the 1980 Cavalier was in worse shape than Darrel had thought and the dealer could only offer $500 for it and would probably lose money even at that price. Marcia thought back to the morning. Five hundred dollars was close to what her mechanic said it was worth, so she had to agree.
Darrel said that he felt terrible. “I thought that we could get more for it, but he’s the expert.” Darrel added, “You know, with a new car like that, you really should have an extended warranty. I have a 6-year/60,000-mile warranty available on the Zirconia. We usually sell it for $750, but since I was wrong on the trade-in, you can have it for $500.” Knowing that she would have the car for a long time (the payments alone would last four years), she took him up on the offer.
“Now just take this over to the finance department and I’ll meet you out front with your new car. It’s been a pleasure.” With that, Darrel smiled and led Marcia to the finance window.
The finance manager looked over her papers and asked Marcia to sign on the dotted line. A last check of the forms revealed a $230 life insurance fee, which would pay off her auto loan if she died before she could . Angered by this late addition, Marcia thought back over her three-hour ordeal and, not feeling too well, reasoned that life insurance might not be such a bad investment after all. So with a sigh of relief, she signed the papers not knowing how much she really paid for the car or whether or not she got a good deal.
1. Was it a good deal for Marcia? Why or why not? Give reasons.
2. Would you call it a win- win negotiation/deal or not? Give reasons.
3. What were Darrel’s strengths & weaknesses as a negotiator?
4. If you were in place of Marcia, how would you have proceeded with the negotiations (assuming that you did want to buy the Zirconia GT). Give your answer quoting specific instances from the case.
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