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Topic: Set up fees....what a load of *&^%  (Read 4808 times)

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xsrider
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« on: March 11, 2012, 12:26:58 AM »

My 2003 Kawasaki ZR-7S is getting old, so I'm looking to buy a new bike.  A local dealer was advertising a 2011 Suzuki GSX1250fa for $9899.  I went over ready to buy.  But the dealer wanted a $960 set up and handling fee.  I didn't even bother to counter his offer, instead I walked out.  It's bait and switch advertising as far as I'm concerned.  I will not pay a high set up fee.  Heck, the bike on the sales floor was already set up.   Am I just being too picky?

I'll keep looking.  
« Last Edit: March 11, 2012, 12:37:47 AM by xsrider » Logged

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« Reply #1 on: March 11, 2012, 12:51:32 AM »

I agree with you on the setup fee.  Esp if you aren't paying cash in full, they'll be making it up in finance anyway.  Find the bike you like, and the KBB price.  Say you'll take it today at that price out the door.  Maybe haggle for them to throw in some free service (oil change, tire mounting, etc?).  See how hungry they are....
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« Reply #2 on: March 11, 2012, 01:01:04 AM »

Don't worry about the set up fees. You should be able to buy any new bike (except the exotics) in the SF Bay Area for MSRP out the door or very close. Every dealer will mention set-up and freight. There is some cost but its only about 10% of what you were quoted. Buying a bike is a negotiation. Always make a counter offer.
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« Reply #3 on: March 11, 2012, 01:05:16 AM »

You're in the bay area.  Shop around and you'll be able to get a 1250fa otd for under $10k.  If you are buying cash, let them know that is what you are willing to spend that day.  When I was recently shopping for my next new bike the sales guys on the phone/floor varied by as much as $1k otd.  After talking to the owners/managers the difference was within $200 at the same shops.  Money talks when you are talking to the guy who pays the bills.
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« Reply #4 on: March 11, 2012, 01:10:54 AM »

Yup.  Set up fees are BS fees.

I would NEVER pay it.  The bike comes out of a box.  They wipe it down, clean it up, properly inflate the tires, make sure the battery is charged, and it's ready to go.  Dealers who charge set up fees are price gougers.

I have never paid for any set up fees.  I had this one dealer try to talk me into it and explain to me why they want to charge me a whopping 1,200 for set up fees.  I walked out.  A day later they called me up and they gave up their set up fee BS.  
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« Reply #5 on: March 11, 2012, 01:48:07 AM »

I hate the "document fee".    Thumbsdown   Car dealerships try to fleece you with this one.

I mean, the secretary is sitting in the office all day anyhow, and she gets paid the same whether or not she moves my papers from pile "A" to pile "B" or not.

I see that as being the dealership's problem as to how they will pay her. It's not like they called her in from home especially to fill out my documents.   Twofinger
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« Reply #6 on: March 11, 2012, 03:09:50 AM »

The setup fees are paid by the idiot sheep of people.

You know you need the ZX-10R anyway.

I reviewed the 2005, and it has much gotten better in sequential years.

http://www.motorcyclenews.com/MCN/News/newsresults/First-rides-tests/2010/May/may2810-Guest-road-test-Shervin-reviews-the-Kawasaki-ZX-10R-/
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« Reply #7 on: March 11, 2012, 04:52:12 AM »

Give some thought to finding a late model used bike in like new condition. I read a article on the new Honda VFR. If you buy it loaded it runs $21K. After you drive it home, it is worth 11K I can't justify that kind of loss.
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« Reply #8 on: March 11, 2012, 11:15:17 AM »

Take all the stress out of it.

Know what you are willing to pay out the door and tell them, "I'm willing to buy this bike today for $X out the door, yes or no?"

If they say no, don't get mad, just say thanks and leave.

I know this second part is going to raise some hackles around here, but unless the bike is primary transportation, this should be a cash deal.  Do not finance toys, save until you have the cash.
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« Reply #9 on: March 11, 2012, 01:24:50 PM »

Not too picky at all.  If more people walked out when they do this, maybe the dealers would think twice before attempting to add fees to a negotiated price...
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« Reply #10 on: March 11, 2012, 03:47:47 PM »

All what matters is the out of the door price . I`ve  always used that as a base for the negotiation . I was never interested what they put on the stupid bill , final price is what matters .

Poor accountants had to do the bill of sale backwards . LOL .  
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« Reply #11 on: March 11, 2012, 07:37:11 PM »


Take all the stress out of it.

Know what you are willing to pay out the door and tell them, "I'm willing to buy this bike today for $X out the door, yes or no?"

If they say no, don't get mad, just say thanks and leave.

I know this second part is going to raise some hackles around here, but unless the bike is primary transportation, this should be a cash deal.  Do not finance toys, save until you have the cash.



+1 on all counts (including the cash part).  As far as negotiating with dealers, when they try to add a fee you can always counter.  Nothing wrong with that, and it doesn't have to be emotional.  It's all business.  But if you're one who doesn't like negotiations (and there are many people who do not), there is nothing wrong with walking out if you feel the salesperson isn't going to at least entertain your reasonable offer.  And after you've purchased the bike from another dealer, you owe it to yourself to ride to the first place, park your brand new bike in their lot and let them see the deal they missed just because they wanted to stick you with a bloated setup fee.    Razz
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« Reply #12 on: March 11, 2012, 09:01:45 PM »

What pisses me off when dealers charge set up fees is that it is nothing more than a scam.  

The MSRP is an agreed upon price "suggested" by the manufacturer to give them a profit margin that is sustainable for the dealership business.  If a dealership feels that margin is not good enough, then they should not be selling bikes.  Period.

Do NOT ever pay for set up fees.  The moment a dealership tries to justify this charge to you, shut them down.  
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« Reply #13 on: March 11, 2012, 09:07:19 PM »


What pisses me off when dealers charge set up fees is that it is nothing more than a scam.  

The MSRP is an agreed upon price "suggested" by the manufacturer to give them a profit margin that is sustainable for the dealership business.  If a dealership feels that margin is not good enough, then they should not be selling bikes.  Period.

Do NOT ever pay for set up fees.  The moment a dealership tries to justify this charge to you, shut them down.  


Agreed upon with who? Do you think motorcycle dealerships have any input on MSRP?
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« Reply #14 on: March 11, 2012, 10:13:21 PM »

What are you trying to say?  MSRP is NOT enough?

Dealers also get hold back.  So on top of the maybe, $500 (depends on bike) or more margin built into the MSRP, plus the hold back, dealers should get more?  

If dealers had any say on price, they would say get the highest price possible.  That is what those set up fees are for.  It's adding more money on top of the MSRP.  So yes, many dealers have spoken very clearly.  To me that is dishonesty and it's what creates the distrust between buyers and dealers.
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« Reply #15 on: March 11, 2012, 10:24:14 PM »

Although I'm not defending outrageous set up fees, I know every new  bike I've purchased from my Triumph dealer has never had the problems others on Triumph forums allude to.  In the case of my  05 Sprint the off-road tune was put in with the stock can as the mechanic knew the factory tune was too lean as supplied by Triumph.  I've seen my bikes come out of the crate and the front wheels were not attached, bags and hardware for same needed some assembly, TPS checked and reset, throttle cables adjusted...

17-20% gross profit doesn't leave much net.

A guy on Triumphrat.net was bitchin about a $600 first service on his new Speed Triple and compared it to the fact that the first oil change on his new Audi RS8 was free.....  right.
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« Reply #16 on: March 12, 2012, 12:38:11 AM »


What are you trying to say?  MSRP is NOT enough?

Dealers also get hold back.  So on top of the maybe, $500 (depends on bike) or more margin built into the MSRP, plus the hold back, dealers should get more?  

If dealers had any say on price, they would say get the highest price possible.  That is what those set up fees are for.  It's adding more money on top of the MSRP.  So yes, many dealers have spoken very clearly.  To me that is dishonesty and it's what creates the distrust between buyers and dealers.


Quit projecting. I didn't say or imply any of that.

I'm just trying to find out what you mean by "agreed upon" and who you think is involved in agreeing upon the figure represented by MSRP.
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« Reply #17 on: March 12, 2012, 12:53:31 AM »

Tell the dealer you want to negotiate an out the door price.  However they want to justify that price, tax, license, freight, setup, whatever, you don't pay a penny more than the price you and the dealer agree on.  Generally this means you'll be paying right at MSRP out the door unless you manage to swing a special deal somehow.  
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« Reply #18 on: March 12, 2012, 12:54:08 AM »


All what matters is the out of the door price . I`ve  always used that as a base for the negotiation . I was never interested what they put on the stupid bill , final price is what matters .

Poor accountants had to do the bill of sale backwards . LOL .  


This.

They tried to explain to me when I bought my Ninja why the bill of sale read like it did. I told them I knew why, I just didn't care. The OTD price worked for me and that's all I cared about.

If you have a trade though suggesting some juggling to them may help you and not hurt them. For instance, the more you get for your trade the less tax you pay on the purchase. That saves you $ and costs them nothing.
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« Reply #19 on: March 12, 2012, 01:25:34 AM »

This has all been interesting reading for me.  I haven't bought a new motorcycle since 1984.  I've bought used bikes ever since.  I am one of those guys that doesn't like to hassle with dealers.  I'm OK dealing with guys on craigslist.  I'm still on the fence regarding the GSX1250 I mentioned in my OP.  I'm now thinking of getting a pre-owned BMW.  (Aren't fancy bikes like BMW's and Guzzi's pre-owned, rather than used like the old Kawasaki I own.)
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« Reply #20 on: March 12, 2012, 01:27:19 AM »


The setup fees are paid by the idiot sheep of people.

You know you need the ZX-10R anyway.

I reviewed the 2005, and it has much gotten better in sequential years.

http://www.motorcyclenews.com/MCN/News/newsresults/First-rides-tests/2010/May/may2810-Guest-road-test-Shervin-reviews-the-Kawasaki-ZX-10R-/



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« Reply #21 on: March 12, 2012, 08:15:33 AM »

My dealership told me to never pay a setup fee. In most cases the dealer is compensated by the manufacturer anyway to bolt the bike together.
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« Reply #22 on: March 12, 2012, 02:07:32 PM »

The "setup fees" around here drove the price of the Ninja 250 over $5000 at one point and people were jumping on it.  EEK! Its amazing how many used Ninja 250s there are on craigslist with asking prices much higher than MSRP.
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« Reply #23 on: March 12, 2012, 04:02:59 PM »

Dealers are in business to make money, if they don't make money they go out of business and you have nowhere to buy your shiny new bike. Buyers are interested in paying the lowest possible price for their new bike in a way that is least painful. Both perspectives are equally legitimate. Sales tax and DMV fee's are set by the state and aren't negotiable. That just leaves the bike itself and I personally don't care how they break the price out and label it, they can charge $0.01 for the bike and $9,999.99 for the set up. I'm only paying what I'm willing to pay and they're only selling for what they're willing to make. If we agree then it's a deal and we're both happy and if not then no harm no foul, we each move on. That's how I buy my bikes and it's always worked well. I have experience on both sides of the desk, and being right up front makes life better for all involved.

I wouldn't expect any honest legitimate dealer to negotiate a sales price over the phone, either or both parties could be lying their asses off and it's just verbal masturbation until you're face to face with one party holding a checkbook or credit card and the other party holding a set of keys. Cash holds no special significance to the dealer as they are going to have to get paid by someone before the bike leaves the property, and it doesn't matter to them if it's you or the bank. They can make money off the financing depending on their relationship with the institution doing the funding.

There will always be greedy, idiotic sellers and buyers. I don't waste time with either.  


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« Reply #24 on: March 12, 2012, 05:24:54 PM »


Dealers are in business to make money, if they don't make money they go out of business and you have nowhere to buy your shiny new bike. Buyers are interested in paying the lowest possible price for their new bike in a way that is least painful. Both perspectives are equally legitimate. Sales tax and DMV fee's are set by the state and aren't negotiable. That just leaves the bike itself and I personally don't care how they break the price out and label it, they can charge $0.01 for the bike and $9,999.99 for the set up. I'm only paying what I'm willing to pay and they're only selling for what they're willing to make. If we agree then it's a deal and we're both happy and if not then no harm no foul, we each move on. That's how I buy my bikes and it's always worked well. I have experience on both sides of the desk, and being right up front makes life better for all involved.

I wouldn't expect any honest legitimate dealer to negotiate a sales price over the phone, either or both parties could be lying their asses off and it's just verbal masturbation until you're face to face with one party holding a checkbook or credit card and the other party holding a set of keys. Cash holds no special significance to the dealer as they are going to have to get paid by someone before the bike leaves the property, and it doesn't matter to them if it's you or the bank. They can make money off the financing depending on their relationship with the institution doing the funding.

There will always be greedy, idiotic sellers and buyers. I don't waste time with either.  





Excellent post.

Every motorcycle I have owned has been used from a private seller.

With cars I have always bought from a dealer with maybe 1 or 2 exceptions.  New we always go back to the same guy because he has always been straight up and fair with us.  I have walked out on other sales people when they have pulled lame attempts to change the deal at the time of signing.
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« Reply #25 on: March 12, 2012, 11:56:46 PM »

Being up front and honest always wins the day.

I just bought a car from a good, honest dealer.  I was ready to pay MSRP because I liked the salesman.  When we sat down to "work the numbers", the salesman simply gave us the Invoice Price + $100, 3% APR (which was what GM had for the car at the time).  Done deal!   Thumbsup  I never had to haggle over anything.  That's how easy it should be.

When dealers tack on $500 or $700 or more on top of MSRP, then the buyer has no idea what is fair.  So immediately there is distrust between buyer and seller.  

I sold cars for a living for a year in 2003.  Been on both sides of the table and seen the Finance schemes.  I realized how dishonest dealers can really be if they wanted to.
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« Reply #26 on: March 14, 2012, 08:03:52 AM »

I just purchased a new bike and paid MSRP but not a penny more.  The dealer said we do not charge set up fees, delivery charges or any other hidden fees.  It made the deal very easy and stress free.  I had no problem paying the MSRP since I did a little research and found that was the norm for the bike I wanted.  Besides the manufacturer had a significant price drop in the 2012 model year anyway.  
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« Reply #27 on: March 16, 2012, 09:26:17 PM »

Hey Frank!

I'm +1 on the total price out the door. OTOH, I've seen some nice bikes on CL lately.


Looking forward to finding out what you get.  Thumbsup

Elseanno
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« Reply #28 on: March 16, 2012, 11:03:29 PM »

I really miss the OTD Cyclesports network of dealers here in California.   A few years ago they had several shops throughout the state but now they're down to one dealer in Los Angeles.   They always had the bottom line best OTD price period.  Zero haggling, zero sales bs, nothing.   Personally never used their service dept or parts dept because they generally sucked like most shops but if you knew exactly which bike you wanted there was no better way to buy a bike.   Now that the OTD network dealers are out of Nor Cal I've noticed most shops are charging stupid set up fees.      
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« Reply #29 on: March 17, 2012, 11:42:17 AM »

Do you think OTD closed the stores because they made too much money?
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« Reply #30 on: March 17, 2012, 02:17:36 PM »


Do you think OTD closed the stores because they made too much money?


I spoke with the local store manager at one of the OTD stores (Yamaha dealer) as they were having a going out of business sale. The owners had overextended their credit and with bike sales falling the only choice was to close all nonprofitable stores.

  While having the TPS switched out under warranty (FJR) I got to watch a young kid (18-20) unbox and set up a quad. total time about 20 min. Seems kind of steep for shops to charge what they do for set up after seeing it done.
  Several years back I watched a flat bed truck pull up to a Kawasaki dealer and unload new set up bikes. I asked the counter help about it, turns out they paid a flat fee to have the bikes unboxed and set up before delivery. In doing this they were also passing on the liability of something going wrong (brakes failed ; see the company that did the set up "Not Me".) most likely saved some $ on insurance for the bike shop. I am betting they added some to the set up charge and passed it on to the buyer.

Maybe some day I will buy a new bike and have to deal with this, until then I will just buy used.  Some good deals out there now, just have to look around
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« Reply #31 on: March 17, 2012, 02:59:44 PM »


My dealership told me to never pay a setup fee. In most cases the dealer is compensated by the manufacturer anyway to bolt the bike together.


The first bike I bought new I was told the same thing by my salesman.  In California, auto sales/lease doc fees are capped by state law.
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« Reply #32 on: March 17, 2012, 03:09:03 PM »

I'm not defending disreputable or greedy dealers, but the fact remains that no mfg.'s bikes arrive here fully assembled and ready to ride off. Some form of prep and adjustment has to be done to be road ready, regardless of who does it or how it's paid for. Revenue must exceed expenses or you're gone, regardless of the type of business. Personally, I'd rather do business with a dealer who has an honest, skilled, and ethical sales, parts, and service department and form a good relationship with them. They give me a fair price, excellent work and service, and due consideration on any issues. In turn I give them my business and recommend to friends. While this doesn't necessarily translate into the very cheapest OTD price, I believe I come out ahead in the long run. I've been mostly successful with this practice in the past, and this is the dealer relationship I have now.
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« Reply #33 on: March 17, 2012, 04:18:13 PM »


I'm not defending disreputable or greedy dealers, but the fact remains that no mfg.'s bikes arrive here fully assembled and ready to ride off. Some form of prep and adjustment has to be done to be road ready, regardless of who does it or how it's paid for. Revenue must exceed expenses or you're gone, regardless of the type of business. Personally, I'd rather do business with a dealer who has an honest, skilled, and ethical sales, parts, and service department and form a good relationship with them. They give me a fair price, excellent work and service, and due consideration on any issues. In turn I give them my business and recommend to friends. While this doesn't necessarily translate into the very cheapest OTD price, I believe I come out ahead in the long run. I've been mostly successful with this practice in the past, and this is the dealer relationship I have now.


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« Reply #34 on: March 17, 2012, 05:31:01 PM »

Having done setup, I can tell you for certian that you are not correct.  This does not justify the "prep or set up" fee some dealers charge, but depending on the bike it can take a few hours. Hours during which the service person IS NOT generating $$ at the shops hourly rate. Even scooter such as the lil 50cc jobs from take some bit of set up.  The last time I did set up on a Goldwing (been a few years), it took better than an hour just to get it properly uncrated.



 The bike comes out of a box.  They wipe it down, clean it up, properly inflate the tires, make sure the battery is charged, and it's ready to go.  Dealers who charge set up fees are price gougers.

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« Reply #35 on: March 17, 2012, 06:26:28 PM »

I had an ex-coworker who now operates a dealership.  He's been in business for over seven years now and has quietly survived the downturn of '08-'09.

The time it takes to prep a bike is built into the price+ margin.  Dealers should not charge $500-$1000 for set up/prep fees.  Period.

Each bike has a different margin depending on its MSRP, market segment, and yes, the time it takes to get it off the box and ready to display.  If they sell the bike at MSRP they make a nice healthy profit because they get the margin plus hold back, plus whatever financing scheme they can put together.  Even if they sell the bike at cost, they still make a profit from hold back and financing.  I've never haggled a dealer down to cost because I understand the business model.  If I like the dealer I give them MSRP to give them and the salesman the $$ they deserve.  
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« Reply #36 on: March 21, 2012, 04:59:08 PM »

i don't agree with back-end fees (doc fee, vehicle setup, etc).  Manufacturers & dealerships should have all of this built into the price of the vehicle.  So why do they do it?  because they find that they make more money by sticking it to you after negotiation for the price of the vehicle.

The only way to combat this is to negotiate the "out the door" price from the beginning, including any extras you want (extended warranty comes to mind) and don't be afaraid to walk.  As long as you are respectful to them, you can always come back.  Time is on your side, and they hate it when you leave.  

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« Reply #37 on: March 21, 2012, 05:08:39 PM »


The only way to combat this is to negotiate the "out the door" price from the beginning, including any extras you want (extended warranty comes to mind) and don't be afaraid to walk.  As long as you are respectful to them, you can always come back.  Time is on your side, and they hate it when you leave.  




This only works if you are dealing with a bike that is either:
a/ in plentiful supply
2/ overstocked
iii/ not in great demand

If you want a bike that is in demand w/ a bunch of people waiting in line behind you, and only a handful are coming, then you either pay the set up or don't get it.

I was ok to pay that for my Guzzi Griso SE because in SoCal they are in high demand with a waiting list, and if I tried to get it out of state any savings would be used up with shipping /travel costs etc.

If you want a Japanese bike in CA, then yeah you can work all sorts of deals.
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« Reply #38 on: March 21, 2012, 09:22:16 PM »

You blew it!   It's SoCal man, wait 5 minutes and the cafe racer pudding bowl goggle wearing trendy thing will go away.    
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« Reply #39 on: March 21, 2012, 11:54:54 PM »


You blew it!   It's SoCal man, wait 5 minutes and the cafe racer pudding bowl goggle wearing trendy thing will go away.    


Yah, I didn't get a Thruxton...
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« Reply #40 on: March 22, 2012, 11:26:01 AM »

The only time I would pay a set up fee is if I got the bike at the dealer's cost.  I did it with an ATV once (dealer cost) and paid $150.  And yes, I confirmed what dealer cost was.  I am not sure if there is hold back on ATVs, but I would guess not.
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