SOUTH EASTON, Mass. -

A little more than a decade ago, the move that Bourne’s Auto Center made from a smaller location to its current facility on Belmont Street in South Easton, Mass., also came with a shift in strategy.

The independent dealership decided to go with no-haggle, fixed pricing. This strategy change and several other factors have helped push the dealership from being a roughly 40-car lot with five or so employees in 2003 to the 64-employee, 400-car lot that it is today.

And something funny happened along the way: people became more and more accepting of the no-haggle approach as time went on.

“Every month, every week, every day that goes by, I have less and less people even ask to negotiate on the price,” general manager Michael Kelley told Auto Remarketing. “And I don’t know why that is, because obviously that’s the way they’ve purchased cars for so many years.

“I don’t know if it’s because of the amount of research that they’re doing online and that we’re so forward that that’s the way we do it, but I rarely even get a salesperson that will come to me and be like, ‘This customer just won’t pay the price; they want to talk to a manager,’” he continued. “It is maybe one or two times a month, and given the volume that we’re doing, that’s pretty incredible.

 “I think the consumers are ready for it,” Kelley added. “I think you’re going to see manufacturers go that way over the next couple of years. There’s going to be a manufacturer that’s going to tell their dealers that they have to be fixed price, i.e. the way Saturn was.”

He said more and more franchised dealers are turning to no-haggle pricing, including those in the dealership group realm launching stand-alone pre-owned stores with fixed pricing.

As industry studies can attest — including a recent one from Edmunds.com that shows only a fifth of shoppers will take as many time as possible to get the lowest price — consumers certainly see the benefits of taking at least some of the haggling out of the equation.

But what’s in it for dealers like Bourne Auto Center?

“The benefit for us is, the customer is spending so much of their time online that they can conduct just about everything that they want to do online. So they can really measure our car versus the competition,” Kelley said. “So, that’s one thing, because they know exactly what they’re going to pay, whereas they might go (look at) another dealer’s car and say, ‘I don’t really know what I’m going to pay.’

“So they’re going to know exactly what they’re going to pay, with all the fees and everything right up front; frankly, without even contacting us,” he continued. “They can get that information all online.”

He added: “That’s great from the consumer’s standpoint. From the dealer’s side, it’s great because it’s going to speed up the transaction. You’re going to empower your salespeople to make decisions, and they know exactly what it is. So, they’re not spending time going back and forth to a manager to try to negotiate a price or anything like that. They know the price, so they’re going to be able to deal with more customers in the day … It just makes the whole transaction from the salesperson’s standpoint and the consumer’s standpoint a lot quicker.

“And that was one of the big hot topics at NADA … time, time time,” he continued. 

That’s where fixed pricing can help: it reduces the time used up by both the salesperson and the consumer.

Other Strategies Pay Off, Too

The focus on fixed pricing isn’t the only area that has spurred growth for the dealership. Bourne’s Auto Center has also benefited from shifting its ad dollars from traditional avenues to third-party lead providers, and decided to hone in on turn instead of volume.

In 2013, the dealership sold an average of 194 retail used cars each month, moving 2,280 units for the full year. (It also wholesaled 1,120 vehicles)

This year, though, the dealership is on pace to hit 2,584 retail sales, which shakes out to about 215 sales per month. (Its wholesale sales are tracking at 96 sales per month)

“What’s really interesting about that is, we’ve taken what we stock on a daily basis for retail units and we’ve actually lowered it. And we’ve seen our sales go up,” he said. “We were averaging last year stocking somewhere in the high 300s, and this year so far we’re averaging stocking around 312.

“What we’ve done is, we’ve increased our turn by about 12 percent so far this year,” he said. “It’s pretty incredible.”

Kelley would go on to explain the thinking behind this approach and how the dealership has managed to make it work.

“Obviously, our service department reaches a capacity. So, the biggest and the most important thing is that we get the vehicle to the front line.  And when I say to the front line, I mean detailed, photographed with 40 some odd photos on our website and then mechanically serviced and also taking care of any sort of body shop issues, any sort of wear-and-tear on the outside, things that we would want to do to make a good product,” he noted.

“By having less inventory, we’re able to get the cars to the front line faster, which means that when the customer comes to look at the car, it’s pretty much ready to go. Very rarely are they asking for anything additional to be done. Their age-old question is, ‘When can I take the car?’ Our answer is, ‘Right now.’”

And as the dealership has found with its no-haggle approach, for many consumers, time is of the essence.