What Is Sticker Price and How Does It Relate to MSRP?

Understanding Sticker Price and Its Relation to MSRP

What is Sticker Price?

When you walk into a car dealership, you may notice that every car has a price tag or sticker displayed on the window. This price, known as the sticker price, is the amount of money the dealership is asking for the car before any negotiations or discounts.

Think of the sticker price as the starting point for the negotiation process. It’s like when you go to a store and see the original price of an item before it goes on sale. The sticker price represents the initial value of the car set by the dealership.

How does Sticker Price relate to MSRP?

The term MSRP stands for Manufacturer’s Suggested Retail Price, and it is the price suggested by the car manufacturer, not the dealership. Think of MSRP as a recommendation from the manufacturer about how much the car should be sold for.

You might wonder, why is there a difference between the sticker price and the MSRP? Well, the dealership has the freedom to set its own price on the car. This means that the sticker price can be higher or lower than the MSRP.

Sometimes dealerships might decide to sell the car for less than the MSRP. They could do this to attract more customers or compete with other dealerships. On the other hand, some dealerships may choose to sell the car for more than the MSRP. This could be because they have added extra features or accessories to the car or because they want to make a higher profit.

Why is it important to understand Sticker Price and MSRP?

Understanding sticker price and MSRP is crucial when buying a car. By knowing the difference between the two, you can have a better idea of how much you should expect to pay for the car. It also gives you more confidence when negotiating with the dealership.

Knowing the MSRP can help you determine if the dealership is offering you a fair price for the car. If the sticker price is much higher than the MSRP, it might be a sign that the dealership is trying to make a larger profit. On the other hand, if the sticker price is lower than the MSRP, you might be getting a good deal.

Additionally, understanding these terms can help you compare prices between different dealerships. You can use the MSRP as a reference point to see if the sticker price is similar or significantly different from one dealership to another.


In conclusion, the sticker price is the amount of money a dealership is asking for a car, while the MSRP is the recommended price set by the car manufacturer. Understanding the difference between these two terms is essential when buying a car, as it helps you negotiate a fair price and make informed decisions. So, the next time you visit a car dealership, remember to consider both the sticker price and the MSRP before making your final purchase.

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