BEST NEGOTIATING TIP 1013: Bluffing when buying a car
A pack of wolves smelling your fear is likely to call your bluff when you are trapped in the open without your gun. Don't leave home without it.
A negotiator's 'gun' is preparation. Using bluffing as a tactic is a strategic mistake if you cannot accept being called on it. When you are shopping for a car or other expensive item you are well served to have thorough reviewed two things before discussing price with the salesperson:
1. Establish what a fair asking price is. Make sure you know what other dealers are asking for a comparably equipped car. Check online pricing. Ask friends who have a similar car what they paid compared to the asking price. This is not the price you intend to pay. It is only a barometer of how the respective dealers are pricing the cars.
2. Establish what you can afford to pay for the car. It is best to understand the most you can pay even though you hope to get the car for less. The reason for this is that you may be able to get the dealer down a bit but not to your price. If you haven't established where your 'walk-away' price point is, you may be tempted to chase the deal beyond what you can afford to pay.
When do you bluff?
Assuming you have prepared properly and that you have been negotiating in good faith but have not gotten the price down below your 'walk-away' price you can consider a bluff provided you are prepared to give up if your bluff is called. Having established a firm 'not to exceed' price is key in being able to deploy bluffing as a negotiating tactic. The salesperson or sales manager will seek to test your sincerity and their perception of your reaction will determine if your offer is accepted or rejected.
Beware! Once a bluff is made you really can't retract the position without impairing your credibility. A bluff is a venture into the unknown because you are gambling the other person has the ability to agree to your offer. If they counter and you were bluffing, you will have a serious problem. If you continue to negotiate having been caught bluffing, the other side will tend to assume you are always bluffing.
Being caught in a bluff is not unlike being caught in a lie. Repetitive bluffing will impair your reputation and, in personal or professional relationships, endanger the relationship itself.
It is safest to bluff when you have nothing to lose; such as when you are buying a car or other commodity and know you can go elsewhere to make a deal. Alternative sources for the same commodity give you options and options give you power in a negotiation.