Assuming you are buying your cars at auction like most dealers, there are about a hundred different ways to price a car for retail. Likewise, every dealer has his own opinion on how to price their inventory. However, I will now share with you my approach to pricing on the Internet that worked well for me over the years. I will break these down very plainly for you.
First, if you do not put a price on the Internet, you have no car period! If you are arrogant enough to think that you have the only one, or that you are going to trick a consumer to call for a price you might as well close your dealership or at the very least not waste your time and money putting inventory on the Internet. New Car Dealers, I am talking to you, you are the absolute worst at not pricing your inventory on the Internet. NO PRICE ON THE INTERNET EQUALS NO SALE ON THE INTERNET!
Secondly, to be successful on the Internet you must mark your car $2000-$2500 over on day one. If you mark the car $4000 over your cost on the Internet you are not likely going to sell it on the Internet. Of course you can find exceptions to this rule, but I am talking about the norm.
The first 30 days you own a car represents the best time to sell it for the most profit. The second part to this is to print your Window Sticker at $3000-$4000 over, this shows the Internet Customer that you have already lowered the price and that they are already receiving the Special Discounted Internet Price. This approach helps you do three things. First, you are now making sales on the Internet and increasing inventory turn. Secondly, you are holding gross on the Internet deals by having the Window Sticker show the customer that they are already receiving the discounted Internet Price. Thirdly, you give yourself a chance to hit a home run with a Floor Up by having the Window Sticker $3000-$4000 over.
In summary, selling cars is like selling Milk! You need to operate your car dealership like a grocer sells his Milk and use the First In, First Out method. If you still have the car on day 60 mark to $1000 over and blow it out because you now have only 30 days until it has to come off your floor plan. This method keeps Inventory fresh and keeps Customers and Sales People engaged and interested.