Before purchasing a vehicle, getting a quote on a price point to start negotiating from may be on your to-do list. Between a dealer invoice and a report from Car Cost Canada, it may sound like the same information given in different mediums. The truth is, they provide different perspectives on pricing and one is significantly more beneficial for buyers.
Dealer invoices come from the car dealerships where they look for areas to rank up the price, add additional but unnecessary components to your vehicle or package, and hide hidden fees. The reports from Car Cost Canada showcase attributes that are important to your decision-making such as, incentives and rebates that you qualify for as well as actual dealer costs.
Keep reading to learn the difference between the two and the benefits associated with each:
A dealer invoice shows the invoice that the manufacturer of the car sends to the dealership when the dealership receives the car from the factory. This should be the at cost pricing, allowing dealers to adjust their sales markup and work from there.
However, the prices on their dealer invoices are no longer a true reflection of the amount dealers pay to the manufacturer. Discounts that are applicable to dealerships such as the dealer holdback and dealer cash incentives, which are based on their sales volume, help decrease the amount the dealer ends up paying back.
Invoice prices also exclude the rebates, charges, and licensing/registration fees that a consumer would have to pay when purchasing their vehicle. Thus, the dealer invoicing gives a very unrealistic estimate for a consumer to predict the markup a dealer is getting.
Dealer holdback is the amount that the manufacturer pays to the dealer upon the sale of each car. Being that this is paid after closing a sale, it is essentially a significant profit margin for the dealer as there is no carryover to the customer in terms of reduced invoice prices.
The concept of dealer holdbacks comes from dealerships that have inventory on hand, holding back more than necessary to allowing convenience when it comes to consumer browsing. Since this is the case, manufacturers often inflate dealer invoice prices by a predetermined amount but after it has been sold, that inflation amount is reimbursed. The manufacturer holds the funds back and releases it after the vehicle is invoiced to the dealer.
This is the reason that a dealer’s invoice will not reflect the true amount that they have to pay back. The incentives and agreements in place are not taken into consideration, providing a false estimate of what the at cost value truly is.
Car Cost Canada Reports
The invoice price reports from Car Cost Canada more or less provide the same type of information but in a way that is tailored towards the buying consumer. For example, it assists in all the basic information about the vehicle you are interested in, from the vehicle specifications itself to the retail and invoice prices associated. The report even builds in potential add-ons you may consider.
Beyond the vehicle make, the report includes incentive programs that are applicable to you from the specific brands as well as financial incentives from financial institutions. Given these rebates, you are able to make the best decision going forward.
Benefits of Car Cost Canada
The difference between the two invoice reports is the disclosure of incentives and hidden fees. You are able to make a decision that is in your best interests after understanding all components associated with your purchase.
Be cautious when consulting websites that claim to provide realistic and unbiased dealer invoices for a fee. These may not be accurate and in many cases, are actually lead generators for dealerships. When you invest in reports provide by untrustworthy websites, it is possible that this information is being passed on to dealers who, knowing you’re interested in their product and willing to pay for information about it, provide inflated invoice figures and pass it along to you through the website. In these cases, the dealer is paying the website for access to your information in order to target new customers and rack up their sales. Bearing this in mind, it is always advisable to exert caution when approaching a website for invoice reports.
Although they both provide car pricing and an estimated cost of the purchase price, dealer invoices are in favour of the dealership and Car Cost Canada invoice reports are in the perspective of a buyer. Thus, a Car Cost Canada report will benefit a consumer much more. You will be able to save more money by utilizing this free resource.
Next time you’re looking to purchase a new vehicle, talk to our team about getting a free invoice report to make your best decision going forward.