20 October 2014

Do any of your customers really enjoy haggling over prices? There’s long been plenty out there to suggest that they don’t. But lately evidence for the case against has been mounting.

Take Dacia. One of the success stories of modern car retailing, sales that have more than doubled year-on-year have been built around fixed prices.

Likewise, Suzuki retailers have seen Swifts and Altos flying out of the doors because of widely advertised price reductions that mean customers can buy a base-level new car for just £5999. While this is a discount, it’s open and there for the taking: no haggling is involved.

Higher up the scale, ‘want’ cars such as BMW’s i8 and the coming UK-spec Ford Mustang will change hands at the published price, thanks simply to demand out-pacing supply.

Turning to used vehicles, more and more retailers now (wisely) benchmark prices against the local competition and price their stock to match or undercut them. My local Peugeot retailer takes this approach. And, though they don’t advertise the fact, their prices are then, effectively, ‘fixed’. If they’ve researched the local market correctly, there’s no need for them to reduce them further to secure a deal.

What’s more, everything we know about shifts in the approach taken by shoppers, whether looking for new or used, indicates that they spend longer and longer online researching their intended purchase before coming anywhere near a showroom. More and more of them will only visit having first assembled online a print-out detailing the car they want and the finance package they require. Provided that the sales person can match their figures, the deal is easy and conflict-free.

Of course, there will all be a minority of buyers who feel they must taste the scent of battle and browbeat the sales person down to an unheralded price, available only to the few capable of such steely-eyed haggling. For them, the charades can be played out, to suit.

I wonder, though. Isn’t the time coming when retailer groups, or even more car brands, declare a formal end to haggling. When price-bargaining seems as it does to be in retreat, would it make sense to hasten its demise by advertising your prices as ‘fixed, no-haggle’?

Doing this would take the pressure off buyer and seller – and that can’t be bad.

Ray Castle

Tags: Dacia, fixed prices, haggling, Suzuki