Undercover Car sales

[Rollin]

Here's a good article from a well known information site. They sent a journalist to a few auto dealerships to work as a undercover Salesman.
Informative and very interesting reading, check it out.

Click for article

 

[WakkoSS]

Excellent reading...thanks for the link.

 

[commiepunk]

I read it when i was at work, very interesting stuff.

 

[DKREDT]

I thought that was an awesome read and quite informative.

The only part that made me go was when the guy described feeling bad about making a 16% profit for the dealership on a sale. I am NOT saying or approving bending people over or being shady is ok. Just picking on the fact that there should even be consideration of what is too much profit etc.

I am sure there are lot's of businesses out there and even represented here on this board that have a better profit margin on thier products.

Maybe we should have a government mandated profit margin for everthing produced and sold in the usa... how about 2%.

Alright.. back under my rock.

Joel

 

[KEVINS]

Coming from a marketing company, our standard is a 300% markup over cost. The extra markup is what pays for the companies insurance, payroll, retirement, health insurance, etc, so not nearly all of that 300% is company profit..

 

[John Larkin]

The manufacturer drives the dealer to operate in this way since quotas are paramount: sell what we are producing because we have to make a bunch of money too. The article doesn't dig quite deep enough. If there is perceived quality, then the price is of no object, within reason. That is why Honda, Toyota, and Mercedes sell virtually for sticker (or above). No one minds having it broken off in them if they are getting a car that will do 200K miles with not alot of problems. The profit at sticker is quite good without even considering the trade-in; there's the "pounder". Domestic manufacturers are working hard to close this gap but it will be awhile.

Eventually I see dealers becoming fewer in numbers and multi-franchised at every location. There will still be crazy ads and some negotiating but as customers become more savvy, we will move to a true "one-price" sales outlet.

 

[Lee_Burough]

The Internet is going to change EVERYTHING about how cars are sold

Did you notice the one customer in the service dept waiting room who had purchased his car via the Internet? That, my friends, is the wave of the future.

A case in point: http://www.markrobertsmotors.com/?redir=1 You can buy a new Dodge or Chrysler product AT INVOICE COST!! He's been in business for 8 years I know of....

I was buying a early Dodge Dakota in 1997. I mentioned _Mark Roberts Motors_ to the Dodge sales manager here locally, and the price went down to invoice....Instantly. I drove the truck for 15 months and 22k miles for a cost, after resale, of $1,800.