NADA Value vs. Dealer Asking Prices

[Xelaw]

I'm looking at some used boats around 2-3 years old (mainly at dealers). My plan was to try to offer NADA low retail value for a few boats and see if somebody will accept my offer. Is that a reasonable offer to make? I've been told by several people you can steal used boats right now because dealers are taking 3-4 months to sell them. I'm wondering how reasonable offering low NADA value is though, I'm seeing boats listed for like 18k that have a NADA low retail value of like 12k. Am I going to low by offering 6k under asking price or will I get a good deal by doing this?

 

[Xelaw]

Re: NADA Value vs. Dealer Asking Prices

Ever had any experience with making a low offer at a dealer? I know they list for a high price but you know I'm sure they bought those boats for 25% of the list price. I'm trying to get something for 15-17k out the door for boat and trailer. Financing is already approved so that'll give me a slight advantage.

I would like to hear stories from anybody who tried making offers under NADA average value and either succeeded or failed.

 

[ufm82]

Re: NADA Value vs. Dealer Asking Prices

"Expensive" boats happen everywhere. Ever go look at a "great boat" that some individual has? It looks good, runs good in the driveway, seems ok. You pay the guy, take your new treasure out for a first run and the engine blows up? Or the electrical system is defunct or some other major problem, that "great boat" just got real expensive. At least through a dealer you may get a short term warranty or at least some very short term protection through consumer law.
That all being said, I see boats listed at dealers way over NADA and that is due to a list of reasons. Profit margins, overhead, expenses on work done to make the boat sellable, covering a consigment fee, etc. Just figure that is the boat is on the dealer's lot, the cost is about 50%-65% of the asking price. Figure your offer price off that number and work from there. I.E. Asking price of $10K, offer $7.5K. Work from there. That gives him some margin, you get a break off asking price and hopefully you can buy the boat.

UFM82

Never pays asking price...

 

[Thad]

Re: NADA Value vs. Dealer Asking Prices

I bought my Rinker for several thousands under what they were asking. I had the cash, they had the boat. I figure I don't need to beg someone to take my money. Sooner or later, when they feel that they WILL miss a sale, they (sometimes) become a little more reasonable.

When we bought our current boat (new) I had it narrowed down to two boats. Made the same offer to both dealers. One laughed at me and thought I was pulling his leg, the other said to show him the money. Two days later, we pulled her right out of the show room doors.

So, at least from my two experiences, you can get what you want for pretty darn close to what you want to pay. You DO have to compromise some.

 

[BoatNoobie]

Re: NADA Value vs. Dealer Asking Prices

if you check closing on NADA, their list prices are a little wack. They list low prices as non-working boats with major repair. Average prices as need minor work. And they state expect to pay higher for good/excellent condition boats.

Use NADA just as a general guide, not the all it to be.

 

[ufm82]

Re: NADA Value vs. Dealer Asking Prices

Xelaw- I was typing when you reposted.
This was 3 years ago- my buddy was looking for a boat and found one at a local "on-the-lake" dealer. This dealer was known for being high as they are right on the lake and make hay with the location. They offer free test rides and wil finance for you, making the deal "easy".
They had a Lund there with a 150 on the back. It was in fair condition and needed a little work- carpet was stained, etc. Mechanically sound. Test ride was fine. They had the boat listed at $12,500. NADA listed it in "good condition" at $9,800. My buddy offered $9K due to the cosmetic condition. After two hours of negotiations he bought the boat for $9,500 even. The sales guy whined about losing money but obviously he wasn't because he sold the boat. He may have lost money had someone dropped $12,500 on the table but he still made some on the deal. We even asked for a full tank of fuel on delivery and the guy agreed. LOL

UFM82

 

[dingbat]

Re: NADA Value vs. Dealer Asking Prices

As strange as it may sound you will never get their best price with cash in hand. You may think cash is king but it is not to him. He is losing 10-20% profit by taking cash over a financed deal.

I always negotiated a financed deal. You will get your absolute best price that way. Then turn around and pay off the loan the next month.

 

[qmrichardson]

Re: NADA Value vs. Dealer Asking Prices

Just be patient and don't pay over blue book value. Your best bet is to keep watching all the surrounding cities on craigs list until something pops up that the seller is willing to sell at bluebook value. that's what I did and didn't have to pay sales tax which was nice. Kansas has no sales tax on sales between individuals. Sooner or later you'll find one if you are patient. Summer is winding down and people will start selling more...

 

[109jb]

Re: NADA Value vs. Dealer Asking Prices

I have never put much stock in NADA values. Boat prices depend on many factors, none of which NADA takes into account. For example location is not even asked.

As for used boats, they are the ones selling right now. The boat dealer near me had lots of used boats a few years ago because everyone had money and bought new boats and traded in. I was in there last week to get some stuff and they had 2 used boats for sale. I even asked the salesman what was up and he told me quite frankly that the used boats are the ones selling and that's what people are looking for. With high demand for used boats like that the haggle room diminishes. Good luck though.

 

[Brewman61]

Re: NADA Value vs. Dealer Asking Prices

That seems to be the case around here as well. Used boats are selling quite wll, new ones, not so much. Boat dealers know what they have, and what's moving.
But there is really no pat answer. Do a little homework- has the boat on the dealers's lot been there for a couple weeks or 9 months? The longer inventory sits around, the more it costs them, and the more likely they'll be to discount. Dicker around on price and don't be afraid to low ball. Believe me they won't take it personally. In general, dealers often ask about double of what they pay on used items like cars, boats, motorcycles, etc.....
You can also ask for things like services or merchandise be thrown in- that may move them more then large price discounts. But it never hurts to try, and don't be afraid to walk away if you can't agree on a fair price. You never know, they could suddenly have a "sale" the next day and call you back.

 

[BTMCB]

Re: NADA Value vs. Dealer Asking Prices

Personally, I have no problem with making a low ball offer at the start, whether it be for a boat or a car at a dealership. When they react offended and say it is a ridiculous offer, I simply say my offer was as ridiculous as them starting out at 100.00 below MSRP! If you walk away with the boat or the car at the end of the negotiations, they still made money (regardless of what they might say) as they are NOT in the business of giving things away. However, if the sales manager isn't smiling and his eye is twitching, I usually feel I did the best I could.

 

[JimJam]

Re: NADA Value vs. Dealer Asking Prices

As strange as it may sound you will never get their best price with cash in hand. You may think cash is king but it is not to him. He is losing 10-20% profit by taking cash over a financed deal.

DB could you elaborate on this? Thanks.

 

[Chaparralboater]

Re: NADA Value vs. Dealer Asking Prices

I am a mobile detailer...I just detailed a brand new 2010 sea ray 2450. Price tag was 100k...the guy bought it brand new for 50 k..he said he walked in and made a retarded offer and said take it or leave it. They took it.. Don't be afraid. There's always more of them out there. Make an offer, if they take it awesome if not awesome walk away find another one..

 

[The Famous Grouse]

Re: NADA Value vs. Dealer Asking Prices

NADA is irrevant and the dealer's know it. Don't even mention it because you'll just look like a newbie.

Be cool and personable, but firm. Something about negotiating turns some guys into slick talking used car salesmen that can't stop talking and trying to impress the sales staff with how much they know.

It shold go without saying that you need to be in a position to sign on the dotted line TODAY if you want to have real negotiating power. That means you have the cash or you have the pre-approved finance package right now.

Make your offer straight up and justify it only by saying you really can't offer any more based on the current economy. Don't be drawn into a discussion of what that means, just say you really can't offer any more for that boat, but you hope you'll consider it.

I just bought a Wellcraft from a yacht brokerage for well under what similar boats have gone for recently in this area. I saw the boat, I told the broker I was a cash buyer and by cash I literally mean a large stack of $100 bills. Here's my offer, take it to the owner. No further discussion.

As I later found out, the owner had already bought a new boat and was getting very tired and nervous about sale prospects after the 4th of July which is considered to be the middle of the season here in MN. He was very motivated to deal because payments were due on both boats every month. I saw the boat on Tuesday and the broker was counting $100 bills 24 hours later.

Grouse

 

[Brewman61]

Re: NADA Value vs. Dealer Asking Prices

DB could you elaborate on this? Thanks.

I'm not DB, and I can't back up the specific percentages he quotes, but in general, dealers make a profit on financing. The dealer has arrangments with various lending sources based on credit scores, and gets money for arranging the financing. As long as the customer qualifies for some sort of dealer provided loan, the dealer makes profit above what the boat brings.
Really, dealers make a relatively low profit on the sale of the boat, but they can make out like a bandit selling add on's like extended warranties, service contracts, financing, insurance, etc........
That's why you often get turned over to the F&I (Finance and Insurance) guy after the initial sale. They F&I guy's job is to push the add on's and that's where the real profit is.
Cash would only be "king" in the situation where a customer simply won't or can't finance.
Lenders get the money to the sellers very quickly, so it's not like the dealer is out a dime by not accepting cash from the buyer.

 

[dingbat]

Re: NADA Value vs. Dealer Asking Prices

DB could you elaborate on this? Thanks.

If you financed the boat for 5 years @ 6%, the dealer would have ended up making $23,199 with interest. That is 16% more than if you had paid cash.

 

[asm_]

Re: NADA Value vs. Dealer Asking Prices

If you financed the boat for 5 years @ 6%, the dealer would have ended up making $23,199 with interest. That is 16% more than if you had paid cash.

Math is correct, but that's not really how it happen. I doubt any dealer actually do their own financing. So, bank takes the interest minus the kick back to dealership as profit.

B

 

[Brewman61]

Re: NADA Value vs. Dealer Asking Prices

I'd be really surprised if any dealers did actual financing themselves. That would be a very risky proposition, not to mention they need the lump of cash from the boat sale to pay the factory for the boat, and the commission to the salesperson, etc......
What they do is place loans on behalf of lenders, and they get a fee for that. I suppose it's possible that a seller may hold their own financing, but I'd be very surprised if that were many doing that.

 

[edwardh1]

Re: NADA Value vs. Dealer Asking Prices

Sometimes the dealers are trying you out or maybe think you really want a specific boat.

Right before 4th of July Local dealer had a 2003 17.5 Scout D. Console just taken in on a trade with 2003 bimini and 2003 trailer and a 2003 90 white johnson. 7 on a scale of 1-10 in my opinion.
I asked how much with a 90 4s Yamaha - he said no problem in changing motors and would allow $2000 for the old Johnson.
He wanted $21,300 for the 2003 Scout with a 90 4s Yamaha. I think he thought we had to have the boat.

 

[dingbat]

Re: NADA Value vs. Dealer Asking Prices

Math is correct, but that's not really how it happen. I doubt any dealer actually do their own financing. So, bank takes the interest minus the kick back to dealership as profit.

B

Agree, but I?ll guarantee that there are some pretty hefty incentives for a dealer to get a customer to finance the product. Especially, if the builder is self financing or has agreements in place with large financial groups to supply consumer loans for their products.

Brunswick and BRP both have large consumer loan companies on the "payroll".