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What Is Car Dealer Invoice Price?
With so many names for the same thing, it can get confusing for consumers, which is fine with the car dealers because they want to make sure they get the most money for the vehicle. However, in very simple terms, the car dealer invoice price (regardless of what name it is called by) is the wholesale price of the vehicle. The wholesale price is the cost to the individual car dealer company, and represents their absolute bottom line for what the car costs them. However, other price issues will affect what price you as a consumer are charged over the car dealer invoice prices.
What Factors Affect New Car Dealer Invoice Prices?
All car dealers will pay the exact same wholesale cost to purchase the vehicle you are interested in from the manufacturer. So, why does the car cost more at one location than another? This is because each dealer is an independent small business. They purchase vehicles wholesale from the manufacturer, but have other expenses that factor into the car dealer invoice price published for consumer viewing.
In addition to the actual car dealer invoice prices that the independent small business owner pays to the manufacturer, the car dealer incurs other costs to sell that car. Often, these are marketing costs for the vehicle itself, or the dealership.
Advertising Costs
The dealer car prices may go up from the new car dealer invoice price because of advertising expenses. Car dealerships have a lot of competition and will often invest in national and regional advertising. Fees for these advertising opportunities are paid to television stations, radio stations, and newspapers and will add to the cost of purchasing your new car.
Floorplanning
Floorplanning is interest on loans that your car dealer has to pay when the small business uses loans to purchase stock. Their stock are the cars they purchased at the actual car dealer invoice prices, but your cost will go up because the longer that car is on the lot, unsold, the more it costs your car dealer in loan fees. The manufacturer has sold the vehicle to the car dealer who now owns it and is paying for it until you come along and buy it off the lot. Just like with your own car loans, interest can grow and is paid regularly on unpaid loans.
Basic Business Costs
The basic costs of running a small business are also factored into car dealer invoice prices. To maintain the dealership, the small business owner has to rent or own their lot and office space. They also have to pay for heating and utilities, as well as small business taxes. In addition to general overhead costs, and the costs of the cars on the lot, the dealer also has to pay salaries and benefits to employees at the dealership. All these factors can increase the published invoice price that you see at a car dealership in comparison to the actual car dealer invoice prices. To survive as a small business, the car dealership has to meet these costs through car sales, which means that cost is passed on to the consumer during the car sale.
Find Actual Dealer Invoice Prices Online
There are several websites where you can find the true, published car dealer invoice price. This is the wholesale price of the vehicle you are interested in, and the cost to each dealer who purchases the vehicle from the manufacturer. By knowing this information, you can work toward getting the best deal on your new car as you bargain the published invoice price down. Two of the most popular online resources for finding actual dealer invoice prices are Kelley Blue Book and Edmunds.com.
Kelley Blue Book
If you’ve ever owned a car or been around a savvy car buyer, you may have heard of the Kelley Blue Book, which is often just called The Blue Book. Some consider this resource as the ultimate in finding out about true costs of vehicles, as well as the value of the vehicle when you go to sell it. As such, this is also one of the most popular websites for finding out car dealer invoice prices.
At http://www.kbb.com/, you can search out pricing by beginning with the type of vehicle you are interested in (Sedan, Crossover, Wagon, Pickup, etc.), and then entering more specifics about the vehicle make and model to arrive at the specifications for your vehicle. You can also just skip to selecting the make and model of the vehicle you are price researching to find car dealer invoice pricing. Kelley Blue Book can help you find the lowest cost on the vehicle you want, and they ask you to enter a zip code so you’re certain the information your search returns will apply to vehicles in your geographical area. Kelley Blue Book also has a hand comparison feature where you can select up to four different vehicles for side-by-side review of pricing, specifications, and consumer ratings to give you a good overview of what you’re getting for the money.
Edmunds.com
At http://www.edmunds.com/, anyone can enter information to find unbiased actual car invoice dealer prices. You have many choices for how you come to the information. For example, you can browse by the type of vehicle you are interested in (SUV, hybrid, sedan, truck, minivan, etc.), or you can surf the information by actual make of the vehicle (Acura, Honda, Ford, Toyota, etc.). Edmunds.com also offers search options for the vehicles that are consumer favorites, and those with the lowest true cost to own. You can search out information on new or used vehicles to find fair market pricing so you have information to use as a bargaining tool at the dealership.
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