Buying Advice How to negotiate

Tractor Seabee · Apr 7, 2018

Back to Tractors! A lot depends on what you are buying. The fast moving SCUTS and CUTS will not have much to play with. There are 3 guys around the corner and one will buy it. Dealer margin is lower on the movers and higher on the slow movers. In 2011 when I bought my BX they would not bargain. Same price cash or Kubota financing. They claimed the asking price was already $3K below the completion. The K financing required you buy at least 3 implements to get that price. Lo and behold it was after checking around. That was 10% +/-. Deal made. If you get 10% that is about all you can do, services and accessories probably easier. Since the best I have done on implements again is 10%. They call that there "good ole boy discount".

Ron

audsp98 · Apr 9, 2018

Which part of the country you're in and the model of tractor you're looking at will make these numbers vary but here's what I found from going around to the local dealers (Kubota, JD, LS, Mahindra).

Mahindra was the most off MSRP at about 30%
JD was about 20%
LS was about 25%
Kubota was 13-20% depending on the model

I chose Mahindra, not only because they gave me the most money off, but also because they gave me the most tractor for my money. LS was a close 2nd.

DavesTractor · Apr 10, 2018

TomIre said:
I like the service one. Doesn't really cost them much and the service manager was begging for my business when I stopped in. Will be paying cash.
How much less do you think I could get them off the quote? Was thinking start at 20% (won't hurt to try!) and be looking for 10%.
I'm also guessing implements have higher margins but only a guess.

How much less you offer, if any, depends on how the dealer prices his tractors to start with. If the dealer is at MSRP, then for sure he has plenty of room. But as for us at our dealership, years ago we quit the MSRP game. We know what we pay for our tractors, plus freight, plus PDI, plus margin to keep the doors open, plus a little for "free delivery in the local area" and we have our price. The goal for you I think is to get the tractor at a fair price, to not over pay. It is not how much you saved off their asking price, instead it is what you actually paid.

Some thoughts from a dealer's perspective. We can't compete with "no sales tax", and legally in most states you owe the tax even though the out of state dealer had no obligation to charge you for it. In California, if you buy out of state, you clearly owe the tax still. I hate taxes, and I pay more taxes than most people. But just know that there is a difference in avoiding taxes and evading taxes. Avoiding is awesome, evading - not so much.

There is value buying local. You support your local businesses and they support you. I just bought my wife a new pickup. I priced it at the out of state volume dealers, then went to my local dealer. I told him the price I had found and asked him to come as close as he could to that price, but to stay at a price for which he was still happy he sold to me. I think he was $800 higher on a $50k truck and I was more than happy to stay local...and I did.

Teachu2 · Apr 10, 2018

My local Kioti dealer is family-owned, been in the tractor business about 80 years, and has an outstanding reputation - even a competitor told me what a great dealer they are. They offered to let me demo both models I was considering on my property for the weekend, at no charge, no strings attached. Told me if I scratched them up, they'd just put them in their rental fleet. The salesman/owner's son made me a smoking deal on a rental return (they had six of the model I chose out on rental to local farmers and contractors) and when he found that all six rentals were planning to buy them out, he found me a new one that he could get on dealer trade - at the same price! He sold me a box blade that had sat out in the sun at his actual cost. Four days later, he personally delivered it to my home, 35 miles away.

I'm new to tractors, so I had the dealer do my 50hr service. Very thorough and reasonable on the price. When I had a hydraulic leak, I trailered it down to the shop and the service manager came out to look at it. He ran back in the shop for a wrench, some spray brake cleaner and a rag, and crawled under the tractor on the trailer. Had it fixed in five minutes, shook my hand, and sent me on my way. No charge. They treat me like I'm a million dollar customer there, even though I'm a drop in a large bucket. In the three years I've owned the tractor, I've sent them five more sales.

I got a great deal all the way around.

TomIre · Apr 10, 2018

That's a great story Teach. You just know right away when you are getting outstanding service.

TomIre · Apr 10, 2018

Dave, thanks for your response and thanks for not being "anonymous"! I don't disagree with a thing you've said.
I suppose I didn't give my OP the best title. I want the dealer to make a profit on the deal. In part so he'll continue to be there when I need him.
I guess my real question is, How can I know if I'm getting a good deal? Pretty sure the dealer is not going to sell at a loss anyway

!
BTW, after I shopped for my truck, I bought from the nearest Chevy dealer to where I live and I still take it there for service. But, I also know I got a good deal by doing my homework.
And, that's in part what I'm struggling with - how to do the homework.

DavesTractor · Apr 11, 2018

TomIre said:
Dave, thanks for your response and thanks for not being "anonymous"! I don't disagree with a thing you've said.
I suppose I didn't give my OP the best title. I want the dealer to make a profit on the deal. In part so he'll continue to be there when I need him.
I guess my real question is, How can I know if I'm getting a good deal? Pretty sure the dealer is not going to sell at a loss anyway!
BTW, after I shopped for my truck, I bought from the nearest Chevy dealer to where I live and I still take it there for service. But, I also know I got a good deal by doing my homework.
And, that's in part what I'm struggling with - how to do the homework.

Probably if you double check your local price against any of the larger volume dealers and it is pretty close, you will know you got a decent deal. Just like on your Chevy. I can't take the time to do this for everyone, but more than once I've had someone email me from across the country asking if a price quote they got is a fair deal. Many dealers will do that. Basically a friendly helpful dealer that has no skin in the game, that is way too far away to sell you a tractor can spend 5 minutes and check your quote and let you know how it compares to their prices.

TractorNH · Apr 11, 2018

I just bought my new Mahindra and had been shopping around with five Mahindra dealers. Two of them were really close and had an attractive price and 3 others were a couple thousand higher. I shopped at the dealer I wanted to buy from and asked him if he could match my low price and he did. Absolutely shop around for price and then negotiate. I feel like I got a great deal because of it.

California · Apr 12, 2018

Here's a dealer offering $7,700 off MSRP of $39,300. Is this typical?

38 Horsepower Mahindra Tractor 1538 HST, Tractor Loader and Backhoe - farm & garden - by dealer - sale

He's in Ridgecrest, 'Gateway to Death Valley National Park', kinda remote. So I expect any warranty would would have to be done closer to the buyer's home. Maybe that's a cost savings to him?

DavesTractor · Apr 12, 2018

California said:
Here's a dealer offering $7,700 off MSRP of $39,300. Is this typical?

38 Horsepower Mahindra Tractor 1538 HST, Tractor Loader and Backhoe - farm & garden - by dealer - sale

He's in Ridgecrest, 'Gateway to Death Valley National Park', kinda remote. So I expect any warranty would would have to be done closer to the buyer's home. Maybe that's a cost savings to him?

Let's do the math. MSRP per the ad is $39,339. Let's take a 15% reduction off of that to get to a more normal price. 39,339 - 15% ($5901)= $33,438. Then you take the cash-in-lieu discount this month for that model which is $2000, and you are at $31,438. All of the sudden you are at $7901 off list price. He is at $7700 off of list, so his reduction off MSRP is actually less than 15%. His prices are fairly typical and that is a fair price, but advertising it as $xxxx off of MSRP makes it sound more awesome than it is.

Complete Turf Care · Apr 12, 2018

DavesTractor said:
How much less you offer, if any, depends on how the dealer prices his tractors to start with. If the dealer is at MSRP, then for sure he has plenty of room. But as for us at our dealership, years ago we quit the MSRP game. We know what we pay for our tractors, plus freight, plus PDI, plus margin to keep the doors open, plus a little for "free delivery in the local area" and we have our price. The goal for you I think is to get the tractor at a fair price, to not over pay. It is not how much you saved off their asking price, instead it is what you actually paid.

Some thoughts from a dealer's perspective. We can't compete with "no sales tax", and legally in most states you owe the tax even though the out of state dealer had no obligation to charge you for it. In California, if you buy out of state, you clearly owe the tax still. I hate taxes, and I pay more taxes than most people. But just know that there is a difference in avoiding taxes and evading taxes. Avoiding is awesome, evading - not so much.

There is value buying local. You support your local businesses and they support you. I just bought my wife a new pickup. I priced it at the out of state volume dealers, then went to my local dealer. I told him the price I had found and asked him to come as close as he could to that price, but to stay at a price for which he was still happy he sold to me. I think he was $800 higher on a $50k truck and I was more than happy to stay local...and I did.

I like this reply. I always try to buy, or sell, anything at a 'fair' price. And a fair price is much easier to determine these days with the internet.

Mike Gibson · Apr 14, 2018

Plus one for Dave's post. When price is close the difference is dealer service and reputation for me.

dickfoster · Apr 15, 2018

Mike Gibson said:
Plus one for Dave's post. When price is close the difference is dealer service and reputation for me.

I say price doesn't even have to be that close. Basically the warranty is only as good as the dealer servicing it. How much is the warranty worth?

IndianHeadFarms · Aug 16, 2018

Best thing i did was shop around for the same tractor at different dealers. Especially when your ready to buy. I went to one dealer that said he was giving me a great deal on the tractor and couldn't go any lower, and a friend of mine recommended another. I was glad he did. Saved me 5k of the tractor and attachments.

TheFarmerInAdell · Sep 10, 2018

I just bought 2 used tractors off a very good local dealer. Family run business that is very friendly. They didn't deal much on the prices of the tractors (maybe $1000 off asking price total), but I wanted attachments and they had used ones there they were able to knock some $$$ off. They also gave me (at my request) some free shear pins for the blower (don't want to be without those during a snow storm...). I also got them to sell me a new Stihl chainsaw I had been eyeing up at $100 discount. All in all I think I did decent, considering it is very hard to find a used version of what I really wanted (40+HP, under 60" width).

After I loaded my tractors on my trailer, one of them started leaking fluid. I didn't catch it, but the sales manager did. He brought the tech out and they said they were going to order the part. I just need to bring it back in when the part shows up, they'll take care of it.

darmstrong2319 · Sep 10, 2018

Sounds like your happy with the deal and that’s what matters. It also sounds like a good dealer so best of luck to you.

arrow · Sep 17, 2018

The value of anything you buy has more to do than just price. Personally i couldn't care less what anyone pays for anything whether it's a dealer, buyer or a relative. I simply assign a "value" to it that includes price, quality and dealer rep, what I need and how the thing fits me. Have I ever 'overpaid' for anything? Not once if I stick to my own comparisons.
Examples: 5 years ago was looking at Kubota 3000 something. I assigned a price to the tractor based on my criteria that was $2400 less than the dealer wanted. He let me walk which was fine because its value did not come up to my criteria.
2 years ago I purchased a 2006 Durango Hemi Limited that I know the dealer paid $7800 because I saw his purchase price . I paid $10,600 and was pleased to do so. Why? Because the comparable Tahoe was $11,000 more and the Durango had only 76,000 miles on it which is low for a 10 year old car. The thing looked brand new and it would have been a haul to find another like it. The "value" of the thing surpassed the price for me.