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re: What do you feel is a reasonable profit for a dealership to make
Posted on 1/30/17 at 3:53 pm to Kafkas father
Posted on 1/30/17 at 3:53 pm to Kafkas father
i thought they lost money on every deal?
1
Posted on 1/30/17 at 3:54 pm to DownshiftAndFloorIt
quote:
frick that. That's one-off engineered product margins.
Posted on 1/30/17 at 3:55 pm to NYCAuburn
quote:
I'd expect a business to make at least 25% gross profit on an inventory item
Found the car salesman.
In reality, for a new car, you're looking at 3-5% on the deal as a reasonable profit. The dealership as a whole is going to make additional profit beyond the initial sale from things like a cut of the financing (if they get it), through the used car lot on the trade-in, and through the service/body center as additional ongoing revenue for some of the new vehicles they sell.
EDIT: Basically, think of the new car lot as the portion of a car dealership that makes the manufacturer money. The dealer's real reward for moving Detroit's product is in repairing it and reselling it.
This post was edited on 1/30/17 at 4:06 pm
Posted on 1/30/17 at 3:56 pm to Boudreaux35
My dad had dealerships all throughout my youth. The dealerships profit is built in. No matter how awesome you think you are at negotiation, you will never affect a dealerships profit.
The money you are getting off the car, is out the salesmans commission. Sounds stupid but dealerships absolutely frick their salesmen over with that.
New vehicles are normally set at a certain amount per vehicle garuntee for the dealership but as far as used, the dealership is absolutely ripping your head off in profit. A dealership most likely is making $3,000-$4000+ on every single vehicle sold when it comes to a used vehicle .
The money you are getting off the car, is out the salesmans commission. Sounds stupid but dealerships absolutely frick their salesmen over with that.
New vehicles are normally set at a certain amount per vehicle garuntee for the dealership but as far as used, the dealership is absolutely ripping your head off in profit. A dealership most likely is making $3,000-$4000+ on every single vehicle sold when it comes to a used vehicle .
Posted on 1/30/17 at 3:56 pm to dbeck
whatever, two new cars, no new car note, I had to justify the new set of truck nuts and Yeti that I just bought anyhow
Posted on 1/30/17 at 3:56 pm to Chad504boy
New car sales are the lowest profit margins at a dealership. They can operate just fine at 3-5% because the Parts, Service and Body shop have huge profit margins.
Posted on 1/30/17 at 4:14 pm to TigerstuckinMS
quote:
Found the car salesman.
found the business owner
quote:
In reality, for a new car, you're looking at 3-5% on the deal as a reasonable profit.
in reality they make much than this, you just think that is their margin.
quote:
The dealership as a whole is going to make additional profit beyond the initial sale from things like a cut of the financing (if they get it),
I'd considered this part of the gross profit from the initial sale
quote:
through the used car lot on the trade-in
This is another sale, sure if they can even out their margins a bit it helps, but still a separate sale
quote:
through the service/body center as additional ongoing revenue for some of the new vehicles they sell
not much money in a new car from the service parts dept
Posted on 1/30/17 at 4:16 pm to NYCAuburn
Shitttttttttttt
Service dept makes bank
Service dept makes bank
Posted on 1/30/17 at 4:18 pm to DownshiftAndFloorIt
Not from new cars
Posted on 1/30/17 at 4:32 pm to Fat and Happy
quote:
A dealership most likely is making $3,000-$4000+ on every single vehicle sold when it comes to a used vehicle .
Used salesman here. The above is absolutely correct for the new car side of my dealership, for the Silverados anyway. We're a non-negotiating store as well, so to me it seems like a pretty foolproof business model: try to price everything right up front lower than anyone else in Montana/eastern Idaho/northern Wyoming, then sell more cars than any dealership in MT and count the stacks.
Volume-driven store so we very(very) rarely make more than $4k on the front end of anything, new or used, but when we're selling 450+ cars a month, we don't need to.
This post was edited on 1/30/17 at 4:34 pm
Posted on 1/30/17 at 4:36 pm to TigerDeacon
quote:
As much as they can. It's not their fault if you don't care enough to be informed as to you buying decision. If you don't talk to several dealerships, you are a fool
This is what gets me about the small business capitalist owning a used car place
Their entire business premise is to rip off the person they buy from as much as they can and then to rip off the person they sell to as much as possible
Not to mention the part where their "trade" doesnt even exist if it weren't for government regulations
This post was edited on 1/30/17 at 4:37 pm
Posted on 1/30/17 at 4:38 pm to mouton
500 on the front, 1000 on the back.
Anymore than that, the buyer was lazy.
When I did it, I considered any deal where I didn't make 2000 in profit for every 10k sold a complete waste of my time.
Anymore than that, the buyer was lazy.
When I did it, I considered any deal where I didn't make 2000 in profit for every 10k sold a complete waste of my time.
This post was edited on 1/30/17 at 4:42 pm
Posted on 1/30/17 at 4:48 pm to NYCAuburn
quote:
Not from new cars
The service department at the dealership I bought my last car at sure didn't act that way. There was scheduled maintenance they'd remind me about every couple of thousand miles. Seems like they thought it was plenty lucrative to service my car four or five times in the first year.
Posted on 1/30/17 at 8:58 pm to mouton
Ne awâw ; skin their arse alive my starting point would be msrp- rebates- $500 they still making money on the rate and a salesman will clear 10k a month on bonuses alone if he can push 20 out a month just dont waste their time ill takeca mini kg I can do it in son hour and dont talk to more then one rep go in ready to buy right no
Used: just give up too many variables
Used: just give up too many variables
Posted on 1/30/17 at 9:21 pm to vengeanceofrain
quote:
Ne awâw ; skin their arse alive my starting point would be msrp- rebates- $500 they still making money on the rate and a salesman will clear 10k a month on bonuses alone if he can push 20 out a month just dont waste their time ill takeca mini kg I can do it in son hour and dont talk to more then one rep go in ready to buy right no
Serious question
Are you drunk?
Posted on 1/30/17 at 9:22 pm to yellowfin
I think he's plugging vodka tampons
Posted on 1/30/17 at 9:25 pm to AUCE05
quote:
Grading contractors will operate at 0% at times.
Governmental bids can get real tight.
Posted on 1/30/17 at 9:28 pm to mouton
Well I've never seen a poor owner and I really don't care what they make.
They don't care what I make either, its just business.
They don't care what I make either, its just business.
Posted on 1/30/17 at 9:29 pm to DownshiftAndFloorIt
quote:
Shitttttttttttt
Service dept makes bank
Every dealership should want a well run service department but no dealer owner as ever said we want to make our money via service tickets.
Posted on 1/30/17 at 11:15 pm to DownshiftAndFloorIt
quote:
Good. We can get rid of the greasy salesmen
I'm sure you work for a company that charges only bare minimum to make ends meet and make payroll and nothing more. You probably make too much and I should go sit with your bosses and negotiate your pay lower so that I can pay less for the product/service you provide.
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