While this is certainly one of the big red flags I always point out on the forum, I don't actually hold it against the dealer themselves. It's based on state law. If you're trying to sell cars down the street from another dealer, and one dealer follows the state law and excludes destination, and another dealer doesn't, which one is going to get internet traffic to come in? Pennsylvania requires we include the destination cost in our advertised price, but I still lose business to Maryland and Va to this, and we're 60 miles from the boarder. Both MD and VA have higher doc fees than PA as well. These are things that are state law driven more than dealer driven, but again, it's the customers who refuse to believe these difference are real, and they give their business to the "cheaper" place, take business from local, and then complain that no one wants to give them great service for the car we aren't making money on.

A sales persons dream would to be make a fair profit and then spoil the customer every time they come in. Not try to sell them a car on every service, but spend time with them. If we made more per transaction you'd get better service. The demand for lower prices has to equate to lower services. Folks want loaner cars, longer warranties, free service, and folks who can drop everything to take care of their simple needs. Buy local, be loyal. If they make money on you sometimes, and once in a while you pull out a killer deal, and you like how you're treated, everyone is winning. That's how the market should work! The internet is really ruining the quality of service in the name of better prices. While there is a good mark-up on the expensive trucks we often talk about on this forum, that's not the dealers bread and butter. We sell 20 nice Escapes for every nice super duty. Even an expensive Escape at sticker isn't a home run. On one in stock MSRP is $40185. There is $1772 to get to invoice, and then $1179 in HB.... And guess what, most folks buying fully loaded vehicles are not the folks paying full sticker.... People who pay full sticker normally are called "get me done" customers. Their credit sucks, so they are just happy to get in a new car. Often we have to pay a fee to the bank to get the deal... so assuming the loan is actually paid off, it's the banks that make the most money here because full sticker on a base focus isn't anything to pay rent with when the commission check hits!

 

Sorry man, I just find it difficult to believe that dealers routinely sell new cars at an actual loss. Maybe happens occasionally on a unit that has been sitting for months and months. I know dealers take inventory they probably don't want. My wife drove one of the the VW TDI's and was bought back by VW. She liked it so much, she wanted another Golf, but only in red. Dealer is just down street from me and was able to find one and was so happy because the other dealer took a black Beetle off his hands in trade....he said he can't give a black Beetle away.......so I'm sure it does happen.

 

Let's not sugar coat what is nothing more than crooked business practices by saying there are "different strategies for how to market in today's world"

 

Oh my goodness no, we don't typically sell things for a loss. But the OP asked a question about a gross screen of an accounting software. I don't think I've done this for a single person ever! I have shown my commission slip once or twice to a customer. OP wanted to know what the screen meant, and there are times a vehicle is sold at a true loss. It could well be it was an old unit and they used advertising dollars or push pull to cover it, but a loss is a loss, and it sounds like this one is one. We don't have all the details to analyse, and without them, more often than not, the dealer is being upfront.

Eh, as I said, much if it is based on various state laws, which are consumer driven at the polls. The marketing practices are consumer driven. Someone comes up with a better sale and you, the customer base as a whole, respond favorable to it compared to upfront deals. There are hardly ever sales. It's a matter of different times of years warrant different incentives to move inventory to counter the deprecation that occurs though the year. I make the same amount on the stuff I sell from Jan 1st to December 31st, on leftovers and brand new inventory. Calling market strategies crooked business practice is pretty ignorant. That's all marketing is for any industry. The customer chooses to respond to low lease payments and low sales price figures. Same with printers, some companies marketed cheap printers and then had expensive cartridges, others went the other way around. Smart shoppers could get the cheap printer and buy 3rd party cartridges. Smart shoppers can pay cash at the places that assume they'll get huge mark ups in the warranty or something. Most shoppers aren't paying cash, and want a one stop local shop. IMO i'd rather deal with fair pricing on everything rather than weighted prices on one thing vs another, but the public doesn't respond well. You can't judge an industry that simply responds to public demand for marketing strategies. And I'll stand by the idea that anyone, anywhere in the country, can get below $1k profit for a dealer within 5 minutes of online research. If you need to win a little more, you can go a few hundred bucks. It's really about the most transparent industry there is, but most people don't bother to research and we do make money where we can. It is very insulting when well educated folks refuse to accept the information that's available to them, call folks liars, and then see them get hosed down the street because the lies were better and the customer assumes all lies are equal. The customer lies to us in the process under the pretense that they'll get a better deal by holding out. That does nothing but take more time. I used to go right to invoice for walk in retail deals too, and it was really burning me. I wasn't able to let customers feel they won, because I came out right away with a great deal. They wanted to see thousands of dollars in discount and because I wasn't spelling out the discount and rebate they ignored that and treated my sale price as MSRP. I really don't want to sell stuff at MSRP, I want folks that come back for great easy deals, but i was losing too many initial sales to strangers because they didn't trust my offer was good. They actually respond far better to a crap offer that works down to the offer I wanted to show upfront. It's stupid, but that IS the avg customer and it's how the industry is forced to work.

Sorry for the rant! But yeah, the car industry isn't crooked, we're trying to make money. It's the best side of capitalism, and works to the customers greatest advantage. If you work in the public sector, your job is based on the money I make. If you work private, I work hard to get you equipment for very fair pricing, that not only is a good deal, but the right truck for your task. If you just want to drive something nicer than a Yugo, I help make sure you get something with the features you want and know how to use them. If my service department drops the ball, I'm the one you can complain to that has the general managers ear and can make things happen, because I NEED you to be loyal to me in order to make a living. I think most sales folks deserve every cent they earn, and if we make too much one one person it helps justify losing some on the next. If someone comes in and doesn't object to paying full sticker am I going to stop them? Nope. But that's not crooked, it's being pretty upfront. Price is on the truck! We have those stickers by law to keep us on the straight and narrow. Other industries don't have that. I was at the Carlisle Chevy show this weekend (I know I know), there were some straps I wanted, but for 4 it was $30 bucks. On Amazon I could get them for $23. I offered the vendor $25, and he declined. He wasn't trying to rip me off, he just has different margins than the folks online. But I don't need them today, so I'm good waiting a few days to even bother to order them. The consumers advantage to be able to pay pretty much what we pay and have a MSRP listed that the banks use to value the car is hard to say it's crooked without being completely ignorant. There is good money in used cars, but that's a gamble too because not every car you sell to us is everything you've promised, by intent or by ignorance. I sold one car OVER MSRP. It was when I first started, $800 over on a Focus. It was a honest mistake but again, we don't expect people to say yes to the first numbers we show them. You're supposed to say no, and give us a counter offer. This guy didn't. I've made it up to him over the years, with several other vehicles to him, friends, and family once I got a little more flexibility in writing my own deals. He, and every single person who every paid full sticker, has always given us top marks in surveys. I get bad surveys from folks we make $500 off off and less. I will get grouchy with folks who start driving too hard because you quickly get to a point where the bad survey is worse than making the sale. 4/5 is a bad survey FYI... So come in like I'm a liar and I'll punt your business down the street and let them make no money and get a bad survey. I end up on top not selling to folks like that.

Okay, sorry for rant X2... done for now... got to go take care of some business here, working till 8:30 tonight (-=

 

Just reminded me of the survey. The finance manager basically told me to give all high marks on the Survey or it would be like a failure. He also told me that the survey only affects my salesman. I would like to know if both those statements are 100% accurate for when I get the chance to fill out my survey

 

Yes, my salesman said the survey affects him directly. I had no issues with him or the dealership so I gave them all 5 stars. I would think the survey affects the dealership as a whole and not just 1 person......but maybe it does.

 

The truth: Car dealers (all of them, in fact all businesses) aren't charities. They are there to make money. Period. Anything else, like being your friend, is just part of making money.

It behooves all parties to be civilized and try to be good to each other so neither party feels berated.

 

Sticker price....LOL. No reasonable person would pay $50K+ for a F150 XLT with cloth seats. The only reason dealers can advertise "$10K OFF MSRP" is because the MSRP stickers are so highly inflated to begin with. It is an advertising gimmick just like the fake keys and scratch-offs you get in the mail. It makes people feel better to buy a truck for $38K that has a $52K sticker than $38K for a truck with a $42K sticker.......

 

So here we go with the personal attacks an

 

Personal attack? Ignorant isn't an attack, it's a statement of fact. If you don't know how something works, that's the definition of ignorant.

Yes, as I said, folks like to feel like they are winning. And yep, I've sold every vehicle in Fords lineup at sticker (except the Flex, I don't think I've sold a single Flex). On guy took 6 months to make up his mind on the truck he wanted, he get interested on one of the $10k off trucks, by the time he said yes, he agreed to sticker minus rebates on effectively the same truck. I also had to work about 10 deals with the guy to get there and I'd be better off having sold ten mini deals to ten people, but hey, that's how it works sometimes.

 

I paid X-plan on my pickup and didn't ask for anything else, other than the factory rebates. I like having a healthy dealership in my area. I like them making money. And frankly, I paid $69k for a truck I would have easily paid $100k for, so I feel like I'm stealing from Ford on this purchase. And where we are at, they absolutely do not sell 20 escapes to 1 Super Duty. They sell far more F150's than Super Duty's, but their bread and butter is the pickup market for sure. Right the local dealership in my area is moving lots of Super Duty's, and our economy is in big trouble due to low oil prices.

 

So here we go with the personal attacks and name calling when someone disagrees with you.... So me saying that some dealerships crooked business practices isn't just " strategic marketing" now I'm ignorant.... ignorant to what your train of thought.... sugar-coating what is obviously underhanded business practices and then you want to blame the consumer for dealer's bad behavior as you have done in the past.... .........
Laws are in place to protect the consumers from the underhanded "strategic marketing" of some dealerships... those laws weren't enacted because of bad behavior by the consumer it was to curtail " strategic marketing practices" as you like to call it....................
Could that be the reason "Salesmen hate consumers ".... Now that statement isn't very wise by a guy trying to make a living off the consumer..... Humm.... and I'm the idiot!!

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I wise man once told me, when I was complaining about something at work, "if you don't like your job, just quit".

 

Amen to that!

 

See now "idiot" would be a personal attack because you know I'm not and you're using it as slander. But it's okay.

It's not a matter of disagreeing.. It's a matter of how things are. If you disagree with facts, you're ignorant, or worse. I figured ignorant was the most complementary.

All industries have consumer protection laws. The auto industry is one of the most heavily regulated industries in the country. All our information is online and commonly discussed, though rarely believed.

The OP wanted to know what the gross screen really meant. As I said, it's the value of that deal to the overall business. The initial responses all attacked my industry and called us liars, with nothing but their emotions to back it up. Sorry, that is ignorance, not disagreement.

A wise man pays my bills, not you. A wise man knows the truth when he sees it, those are my customers. The ones I hate, I shouldn't really call customers, I should call them "people I let other folks deal with"