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MSRP vs. Invoice Price

Knowing the difference between the MSRP and the invoice price may help you save money on a new vehicle. The quick explanation is that MSRP is for consumers, and the invoice price is for dealers. In this guide, we will go through both and share some best practices that may help you ultimately pay less money for a new vehicle.

To help visualize this MSRP vs. invoice price concept, think in terms of higher and lower and easy and not so easy. This is important because it impacts a dealer’s profit margin and the final cost of a new car. Let’s start by quickly defining each.
What Is MSRP"

MSRP is the acronym for Manufacturer’s Suggested Retail Price. Sometimes referred to as the “retail price” or “sticker price,” the MSRP is the purchase price as suggested by the automaker. The MSRP is easy to find. It will be readily available on the vehicle’s window sticker (maybe even boxed and highlighted), on a dealer’s website, or listed in almost every car review.

Despite being easy to find, the sticker price is one of the high...