Q: What is a Car Dealership?

December 17, 2013 12:53 PM

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A car dealership is often the place you go when you're looking to buy a new or used car. Dealerships let you get behind the wheel and test drive a new vehicle, along with providing you with key information to help you make an informed purchase. Choosing the right dealership can make a big difference in the options that are available for financing and how clearly you'll understand your options before making the purchase.

Brick-and-mortar retail dealerships, unlike online car venues, give you a chance to examine the car from all angles and get a real feel for what driving the vehicle is like. This lets you ensure that the car has the roominess, style and features you need for your family or business. In addition to outright sales, most new-car dealerships also offer auto lease deals and incentives through the manufacturer or an external financing agency.

Dealerships are run by salespeople. Salespeople at car dealerships often work on commission. That means it is in their best interest to convince you to purchase a vehicle from them at the highest price you'll accept. The more you pay, the more the salesperson and the dealership will benefit. Thus, negotiation and being informed are major steps in purchasing a car.

New-car dealers often have manufacturer incentives to help you get the price into your range and might offer a discount if you choose to finance through one of their preferred providers. You should try to negotiate the best price possible and take the cost of financing into account along with the price.

Leasing options are also more common at new-car dealerships. A lease allows you to drive the car for a predetermined period of time, generally about three years, usually at a lower cost than you might if purchase the vehicle. At the end of the lease period, you can return the vehicle to the dealership, choose to purchase it at a discount, or end the lease. Most leases have yearly mileage limits and other considerations, so take care to ensure you understand the fine print before entering such agreements.

The quality of the staff and managers of a car dealership can dramatically affect your car-buying experience. Knowing what to look for and expect from salespeople can help you stay one step ahead in the negotiation process and ensure that you leave the car dealership with the right car to suit the needs of your lifestyle and family.

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