Topic: Re: Etching and Nitrogen Fees

[Noto]

not conducive to a good experience... as you say john... the whole structure isn't great... or good...

I guess that's what I'm alluding to, but the reality of which is to diminish tens of thousands of jobs (including yours, tooscoops - which I don't intend to do).

I want a car to be purchaseABLE  online and avoid the dealer experience.  If I am getting value-added from the dealership, I don't mind paying for it (albeit a reasonable price).

I just think the system could be revamped to be more efficient for all involved.

[tooscoops]

not like many people would find this as interesting as i do, but if anyone is bored, http://digitalcommons.law.yale.edu/cgi/viewcontent.cgi?article=3732&context=fss_papers

here is an article over 50 years old talking about the issues with automotive franchises.... because of my background, i've always seen the other side of this where the dealer was the scapegoat and whipping boy of the manufacturer... and in being so, put itself in a position where it was also the model to avoid by the purchasing public.

I just think the system could be revamped to be more efficient for all involved.

the only way it can happen is to remove a huge portion of the workforce, break billions of dollars worth of contracts and pass that final bill on to the final consumer. so while it would be nice if it could just change, it's unfortunately, just not possible. it would take decades of small changes i think to make it truly get better.  i try to do little changes constantly, but i see no light at the end of a tunnel.

[toolatecrew]

don't mean to rag on lawyers noto. but as always, thanks for any clarifications on my assumptions!

as for the pdi, they actually differ manufacturer to manufacturer. like a diesel 1500 truck right now? pdi does not cover def fluid or gas. the articles that state that gas is a part of pdi is misleading.. it hasn't been included across the board for over 5 years now. so while you are not wrong to hope that all that is included, it is in fact, incorrect. sure they *should*, but that means little these days...


the way the customer is treated seems to be the big issue in the end.

i find a big problem is that there are a few different views.. the customer sees themselves as paying 40 grand or so... the manufacturer sees themselves making 3000... the dealer sees themselves making 2000... the salesperson see themselves making 250...

so the customer wants to be treated like they spent 40 g's.... but the other parties actually involved in the deal make so little that they have to do all they can to up their piece of the pie, so they scramble to get more.

not conducive to a good experience... as you say john... the whole structure isn't great... or good...

The problem as you say is the system.

The sales person makes "only 250". Problem is I the consumer am paying that 250 but don't get anywhere close to 250 in value. In my recent purchase I'd be surprised if I spent even 1 hour in total with the sales person face to face or on the phone. 1\2 of that time was on the test drive where he brought 0 value. It was a Ford at a Chev dealer and I knew much more about the car than he did. They did not have a car proof so not only did I pay for my own but I KNEW more about the history of the car than he did. When we negotiated I was probly the only customer in the dealer. The sales manager wasn't busy so really no need for him to run back and forth.

So really I got little to no return for the extra 250 I in effect paid for my car. I will pay for service but only if I get value in return.Now I am sure the argument will be made that other customer take a lot more time or some take lots of time an don't buy. I don't care. I should not subside other customers. If I get 1 hour of service I should pay for 1 hour. I shouldn't have to pay for the equivalent of say 5 hours service simply because the sales person is going to sit around for the rest of the day with no customers or that the next customer to come along knows little and need 10 hours worth of attention.

I really wish they could have a two tier system- If you know what you want/need and just want to buy the car go to line 1 and get a xxx discount for self serve. Need help go to line 2 and pay extra for the service.

Just like gas stations that have self serve and full serve. You'll notice few have full serve anymore because people simply don't realize the value from full serve. Car sales is the same. But they won't change...not because  sales people help them provide better/equal service to competition but because they feel its integral to the profit building process.  We may be stuck with the dealer model due to legalities but there are no such legalities that require the deal to have sales people. Its perfectly legal for a ddealer as far as I know to have self serve kiosks like at the movie theatre.

[blotter]

I want a car to be purchaseABLE  online and avoid the dealer experience.

see I want a car to be purchaseABLE but get a proper dealer experience.
the industry needs to change and be streamlined, however
1) the industry is insanely competitive
2) we'll most likely never see everyone come together in agreement
3) we need cars, so they sell them how they see fit.

I would much prefer to walk into a dealership and talk to someone in person.
I'm not one to deal with issues over the phone, if I can go somewhere and talk face to face, that's important to me.   

[johngenx]

The only killer John, is that if times are slow you will have to lay off your in-house sales staff off. With agents that you pay 2% on a house or even a flat fee you just have to do jack squat.

That's why builders sub-trade out. It's a boom and bust industry and overhead sinks builders.

I have no idea of what his long range plan is, but he tells me he has a plan to deal with that.  He's one of the smartest guys I've ever known, so I'll be curious to see what he has in store for the firm should the housing industry here stagnate.  One thing I have noticed is that there are rarely agents attending open houses.  There are part-time staff that give tours, hand out brochures, etc.  Licensed agents deal with buyers.  The open-house staff are trained in sales techniques and customer assessment, but do not hold a real estate license.  He has a surprisingly small staff level of agent considering the volume of homes and condos that he sells.

[tooscoops]

toolate... i don't speak for all salespeople, but i can tell you i am not paid enough.

(hopefully this doesn't relate to any here) many customers who come in and give me the arrogant, "i'm probably your dream customer" bull about how easy they are because of how much they know, are generally the kind of people i don't want to deal with. they assume knowing what they want (which they are usually not right) is all that matters. even though i don't have the car on my lot (and it possibly just does not exist) and the price they are willing to pay is a 2 grand loss for me... oh thank you so much! then they'll throw a trade that they expect a grand over high blackbook for.

in the end, i'd say a strong 80% of customers NEED a salesperson. and almost all of those who say that don't (and are actually correct) should just order a car and not deal with a car on any lot. simple.

while an admin fee is *possibly* just a cost of doing business, having an employee is 100% a cost of business... so just thinking you are overpaying by 250 is just ludicrous.

[toolatecrew]

toolate... i don't speak for all salespeople, but i can tell you i am not paid enough.

(hopefully this doesn't relate to any here) many customers who come in and give me the arrogant, "i'm probably your dream customer" bull about how easy they are because of how much they know, are generally the kind of people i don't want to deal with. they assume knowing what they want (which they are usually not right) is all that matters. even though i don't have the car on my lot (and it possibly just does not exist) and the price they are willing to pay is a 2 grand loss for me... oh thank you so much! then they'll throw a trade that they expect a grand over high blackbook for.

in the end, i'd say a strong 80% of customers NEED a salesperson. and almost all of those who say that don't (and are actually correct) should just order a car and not deal with a car on any lot. simple.

while an admin fee is *possibly* just a cost of doing business, having an employee is 100% a cost of business... so just thinking you are overpaying by 250 is just ludicrous.

Nope not ridiculous at all.

Having employees is a cost of doing business. Having sales people as I said is not. I do not require the services a sales person provided. I already outlined it. They essentially did NOTHINg for me. It was a used car. i found it myself. I ran the carproof myself. Having that person run my offer to the manger was something i could have done myself had the manger bothered to walk next door and sit down at the desk across from me.

I am not disputing that car sales people put in a lot of "unpaid" hours. that they put up with a lot of crap from both customers and internal management for thre $ they do earn. But as I've said before I've sold cars and MANY other things. I deal as an internal consultant in our company on million dollar plus sales.

Car sales people are not necessary to the process. If you eliminated them all you are not going to see consumer satisfaction with auto purchases plummet because people are "picking the wrong cars".

Sales people (who keep their jobs) don't put customers in the "right car for them". they put them in a car you can sell them. If you work for a Ford dealer and what the customer really needs is a compact inexpensive AWD CAR because of what they can afford you don't send them down the road to Subaru. An Impreza is the right car for their needs. you try to convince them that a Focus with snow tires is what they need because that's what you sell. You try to dazzle them with low long term payments on an Escape because it has AWD even though it truly is more total $ than they should be spending.

Don't take it as a personal attack. Its not that you are not a useful person. What you do in your role is no value to me. NONE. I would rather have an extra $250 in my pocket..heck maybe I spend that $250 in accessories or service at the dealer. But I don't want to pay for your services. Let the people who WANT your services pay for them..not me.

I've sold cars..I know the manger sent me back in 4 times simply to bump the offer an extra $100. I was doing NOTHINg to the customer benefit..NOTHING with my actions.

Once again its not personal. I'm sure that there are some customers who appreciate your help in explaining option packages or the difference between your car and a competitor..because they can't or won't go look it up themselves. Just like some people pay extra because they can't or won't pump their own gas or wash their own windshield. BUT if I c an pump my own gas (and many people can) then I don't want to pay for you to pump it and listen to you try to persuade me I need a can oif $10 fuel injector cleaner I don't need or could buy for $2 at Canadian tire.

[Ex-airbalancer]

Then you should only buy private for sale cars

No one is forcing you to buy a used car from the dealership

[toolatecrew]

Then you should only buy private for sale cars

No one is forcing you to buy a used car from the dealership

Actually I was. Used cars are unique. I could not buy that identical used car any other than that dealer. That still does not require the services of a sales person for me.

New cars are only sold through dealers and then you are once again forced to pay for a sales person.

If someone adds value I will pay. I have bought much of my audio video through local specialty stores. I paid more than the big box stores because the sales person provided value. They looked at sketches of my room for example and gave suggestions. Yes they wanted to make a profit also. That is OK. My experience before and after was enhanced by what they provide.

Car sales does no such thing for me thus I have no desire to pay for it.

[Noto]

not like many people would find this as interesting as i do, but if anyone is bored, http://digitalcommons.law.yale.edu/cgi/viewcontent.cgi?article=3732&context=fss_papers

I just think the system could be revamped to be more efficient for all involved.

the only way it can happen is to remove a huge portion of the workforce, break billions of dollars worth of contracts and pass that final bill on to the final consumer. so while it would be nice if it could just change, it's unfortunately, just not possible. it would take decades of small changes i think to make it truly get better.  i try to do little changes constantly, but i see no light at the end of a tunnel.

re the article - really neat that you were able to pull that up!  I don't have time to read it now, but I did go through the abstract and intro and find it very interesting!!

re the revamp, I agree with you (and said so before - I don't want to kill our economy by shattering jobs just so we can have stable prices for vehicles).  I want there to be some efficiency gains, but not at the expense of people's livelihoods.  I thank you for making little changes

The sales person makes "only 250". Problem is I the consumer am paying that 250 but don't get anywhere close to 250 in value.

I disagree, respectfully.  While I do agree in theory that the value-added may not approach $250, there is no requirement for linearity.  $250 may be the minimum amount that a dealership can charge to stay afloat.  Vehicle sales are typically slow - you're not moving hundreds of cars per day.  Tooscoops may be better able to shed some light on typical sale numbers, but if 1,000 vehicles are moved per month (which I bet it's a lower #), then that's $250,000 earned per month - seems like a lot of money, no?  ...except rent itself will be in the $30-40,000 range per month, salaries are more, building maintenance, etc.  ...and that all assumes that $250 is pure profit, net of all expenses involved in the transaction.  I would think more realistically, <200 vehicles are moved per month (~6 per day, on average), and only $100 of the admin fees are profits, so maybe $20,000 per month?  At that rate, dealerships would be operating at a huge loss (assuming profits come solely from admin fees - which they don't).

Any way, it's all to say that business is business.  Economies of scale must be realized and fairness is not even remotely part of the equation.

I do wish, however, that many salespersons could be educated as to what "lost hours of work" are.  In particular, I can provide the experience we had with buying our Corolla in a very summarized way:
*walks into dealership*
Hi, we're looking at a Corolla.  We've test driven all the competitor's we're interested in, and have decided on the 2010 Corolla CE with Enhanced Convenience Package.  We're here to make a purchase today, if the price is right.

the response?  MSRP is $19,500.  Then you add tire tax, etc.

...and what kind of discount can you offer?

"MSRP is $19,500.  So, the price would be $19,500, plus tire tax, etc."

...we want $600 off MSRP.

"MSRP is $19,500.  So the price would be $19,500, plus..."

Moral of the story?  We got up and walked out, went to a dealership further from our house, found Phillip, the most magnificent of all sales persons I've ever dealt with (save and except for tooscoops, of course ), and banged out a deal in 20 mins ($450 off, plus a trunk liner thrown in, plus all the other sh!t about the ECP and rustproofing I dare not discuss again here).

The sad part is, the conversation I refer to herein happened at 3 different dealerships before we found Phillip.  3.  Not one bad salesperson, but 3.  Idiots like that are the reason why people hate car dealerships.

[blotter]

like anything other job in life, there are GOOD sales people and CRAPPY sales people.

I've dealt with both.   Sadly more often, I've done enough research to know more than the sales person but that's certainly not always the case.   We shouldn't paint every sales person with the same brush.

When they're good at what they do, they certainly add lots of value.


Although it's unlikely I'll end up with a full size truck, we're going to give them a try.
The D3 sites aren't that great.   I've got specific needs and wants.   I plan to spend a day walking into each dealership for advice.   Telling them what I want and need and asking which bloody truck they'd recommend.   It'll make for an interesting experiment.

[blotter]

^^^

I'm planning to do this in September or October and hope to post up a "review" of it all
 

[toolatecrew]

The sales person makes "only 250". Problem is I the consumer am paying that 250 but don't get anywhere close to 250 in value.

I disagree, respectfully.  While I do agree in theory that the value-added may not approach $250, there is no requirement for linearity.  $250 may be the minimum amount that a dealership can charge to stay afloat.  Vehicle sales are typically slow - you're not moving hundreds of cars per day.  Tooscoops may be better able to shed some light on typical sale numbers, but if 1,000 vehicles are moved per month (which I bet it's a lower #), then that's $250,000 earned per month - seems like a lot of money, no?  ...except rent itself will be in the $30-40,000 range per month, salaries are more, building maintenance, etc.  ...and that all assumes that $250 is pure profit, net of all expenses involved in the transaction.  I would think more realistically, <200 vehicles are moved per month (~6 per day, on average), and only $100 of the admin fees are profits, so maybe $20,000 per month?  At that rate, dealerships would be operating at a huge loss (assuming profits come solely from admin fees - which they don't).

Any way, it's all to say that business is business.  Economies of scale must be realized and fairness is not even remotely part of the equation.

The $250 in my example was not the dealer profit..it was the sales person's commission. It could be a fault $250 or it could be 25% of the 1000 gross profit the dealer made.

Regardless that $250 is a cost passed directly back tothe customer regardless of if they need the services of a sales person or not.

Actually, yes, it does require a sales rep.  Dealerships need a point of contact whose specific job will vary in accordance with the needs of each customer.  In your case, that probably meant facilitating a test drive, answering some very basic questions about vehicle history and presenting your offer.  In other cases, the role might be more extensive.  But sales environments (auto and otherwise) require sales associates. 

once again that does not require the services of a "Sales rep"

You could have an hourly employee photocopy a license and hand out keys.
He knew less about the vehicle history than I did. A paper with vehicle history and carproof will answer any questions the sales person could have (after all where else would he get the information)
In terms of presenting an offer he picked up a paper walked less than 10 feet and then came back with it. Once again I could have done it via email. The sales manager could have walked out his door walked 10 feet and accepted my offer.

None of these things require a SALES person. A person that is paid a commission based on the gross profit of the car.

The point I am trying to make is that sales people and what they provide are not necessary to consumers. These things can be provided by minimum wage employees or non human methods.  Sales people don't make $250 or $100 or $500 in commission because its in any way related to the value they give to the consumer. They make it because of the profit they bring to the dealer. The value sales people bring is to the DEALER not the consumer.

A sales person was not required for my sale. Maybe I needed a gopher. Someone to take the paper from one desk 10 feet to the manager desk and back. i could have brought my 10 year old along to do that fro free.

[Noto]

NoTo, the dealership's position as to pricing is not necessarily the fault of the sales rep.  If the sales manager will not discount from MSRP on certain models, what's the sales rep supposed to do?

It's one thing to have a policy of not discounting cars, but then state that.  I'll get up that much sooner

...these idiots were robotic.  The same answer to different questions asked.  I wasn't be facetious when I re-typed the same response - that ACTUALLY happened.  At 3 separate dealerships!

...if that is, in fact, the policy of Toyota's regional dealerships, then I'll revoke all GM and Chryfi hatred and push the full brunt of it on GTA Toyota.  ...but since I was able to secure 'something' of a discount, I don't think it is the regional policy - I think it was a bunch of idiots trying to push me to buying a car at full MSRP.  Toolboxes.

[blotter]

NoTo, the dealership's position as to pricing is not necessarily the fault of the sales rep.  If the sales manager will not discount from MSRP on certain models, what's the sales rep supposed to do?

It's one thing to have a policy of not discounting cars, but then state that.  I'll get up that much sooner

...these idiots were robotic.  The same answer to different questions asked.  I wasn't be facetious when I re-typed the same response - that ACTUALLY happened.  At 3 separate dealerships!

...if that is, in fact, the policy of Toyota's regional dealerships, then I'll revoke all GM and Chryfi hatred and push the full brunt of it on GTA Toyota.  ...but since I was able to secure 'something' of a discount, I don't think it is the regional policy - I think it was a bunch of idiots trying to push me to buying a car at full MSRP.  Toolboxes.

Interesting because our local Toyota dealership had a reputation of ZERO price negotiation from the previous owners.   It was family run and they couldn't give a turd.   I remember two specific dealings with them.  My dad trying to negotiate a discount on a mini van and storming out!   My wife first purchase was actually attempted through another Toyota dealership but our "local" dealer was the only one with a black Toyota Echo at the time.   They refused to move it, forcing us to go and purchase through them.

The owners have since retired.   New people have built a new store a few years ago and it's become a pretty good place.  (they still have some duds, but over pretty good).


I think aside from an available manufacturer rebate... dealerships can wheel and deal how they please.

[Noto]

Interesting.  I don't want to name the sh!thole dealershits that tried to hose me, but suffice it to say that they were not 'ma and pa' establishments...they're probably the largest (by volume of sales) in the GTA.

[tooscoops]

too late... please don't take any offense to what i say, because i'm more using your ideas here and exaggerating them to suit my needs.

did you find the car online?... i put my cars online. did you call to make sure the car was still there?.. i answer the phone. did you e-mail the sales department?... i respond to the e-mails. was the car cleaned?... i arrange the clean-up on and off site. were you able to find the keys?... i stock and tag every used car that comes in. was the car safetied?... i arrange and approve those fixes. was the car e-tested? i tend to be the sucker who has to go drop it off for that.

just stating that people don't know what goes into it. you say you sold cars... i'm sure you are a good guy, so you must have just worked in a place where the sales staff are the useless guys you are speaking of... (not saying you are useless!)... as others have said, the dealership designates a lot of how useful a salesperson is. i know few go above and beyond in this business, but every store usually has one or two because without them, the place falls apart. trick is to find em.

every trade in, i can tell you if they were the first owner... if they ever did anything to increase the value (or decrease)... if it was local... what we did on the safety... whether it was from an auction, leased... etc. so even once you came in, i'm sure i could help out... even someone who knows cars and knows what they want.

ales people (who keep their jobs) don't put customers in the "right car for them". they put them in a car you can sell them. If you work for a Ford dealer and what the customer really needs is a compact inexpensive AWD CAR because of what they can afford you don't send them down the road to Subaru. An Impreza is the right car for their needs. you try to convince them that a Focus with snow tires is what they need because that's what you sell.

i do send people down the road... just did it this morning in fact for a subaru like you said! wanted an awd sedan, but the 200 seemed too long and pricey for him. why waste my time with a guy who won't be happy? cut my losses and move on. i sell 20 a month, i don't have time to persuade someone to buy something they don't want. that's 1970's sales. and i don't think i'll be getting let go anytime soon.

[tooscoops]

$250 may be the minimum amount that a dealership can charge to stay afloat.  Vehicle sales are typically slow - you're not moving hundreds of cars per day.  Tooscoops may be better able to shed some light on typical sale numbers, but if 1,000 vehicles are moved per month (which I bet it's a lower #), then that's $250,000 earned per month - seems like a lot of money, no?  ...except rent itself will be in the $30-40,000 range per month, salaries are more, building maintenance, etc.  ...and that all assumes that $250 is pure profit, net of all expenses involved in the transaction.  I would think more realistically, <200 vehicles are moved per month (~6 per day, on average), and only $100 of the admin fees are profits, so maybe $20,000 per month?  At that rate, dealerships would be operating at a huge loss (assuming profits come solely from admin fees - which they don't).

just to "shed light"... our dealership is small... in fact AP, you have seen it, so i'll let you judge its size. it's not a tiny country lot

we sell roughly 40 cars a month new, and maybe 20 used during good months. usually 40-70 in total avg. assume a 1200 profit on each... because yes.. we do lose on some.. both new and used. but we also get 3000 on some.  (that's total profit on the car including admins, etc.)

1.5 million in sales to make under a hundred grand. before costs/overhead.

[toolatecrew]

too late... please don't take any offense to what i say, because i'm more using your ideas here and exaggerating them to suit my needs.

did you find the car online?... i put my cars online. did you call to make sure the car was still there?.. i answer the phone. did you e-mail the sales department?... i respond to the e-mails. was the car cleaned?... i arrange the clean-up on and off site. were you able to find the keys?... i stock and tag every used car that comes in. was the car safetied?... i arrange and approve those fixes. was the car e-tested? i tend to be the sucker who has to go drop it off for that.

just stating that people don't know what goes into it. you say you sold cars... i'm sure you are a good guy, so you must have just worked in a place where the sales staff are the useless guys you are speaking of... (not saying you are useless!)... as others have said, the dealership designates a lot of how useful a salesperson is. i know few go above and beyond in this business, but every store usually has one or two because without them, the place falls apart. trick is to find em.

every trade in, i can tell you if they were the first owner... if they ever did anything to increase the value (or decrease)... if it was local... what we did on the safety... whether it was from an auction, leased... etc. so even once you came in, i'm sure i could help out... even someone who knows cars and knows what they want.

ales people (who keep their jobs) don't put customers in the "right car for them". they put them in a car you can sell them. If you work for a Ford dealer and what the customer really needs is a compact inexpensive AWD CAR because of what they can afford you don't send them down the road to Subaru. An Impreza is the right car for their needs. you try to convince them that a Focus with snow tires is what they need because that's what you sell.

i do send people down the road... just did it this morning in fact for a subaru like you said! wanted an awd sedan, but the 200 seemed too long and pricey for him. why waste my time with a guy who won't be happy? cut my losses and move on. i sell 20 a month, i don't have time to persuade someone to buy something they don't want. that's 1970's sales. and i don't think i'll be getting let go anytime soon.

there are exceptions to every rule I'm sure. You may be one. Congrats.

Thius is just curiosity but are you able to write your own deals to any extent?

Many of those things you speak of putting cars online, answering emails, knowing the trade history are things I often see done by the manage/used car manager or other "senior" person. Regular floor sales people don't do that stuff.  Once again that's all administrative stuff. The fact that a commissioned salesperson needs to do those admin tasks when they are essentially paid nothing for doing them stinks.

I remember when they used to look for someone to move some cars around all the sales people would scatter. You don't get to take ups while you are moving cars and you don't make sales and get paid.

[toolatecrew]

Look, if you buy from a dealership, you pay for the costs of running the dealership.  If dealerships need sales reps, then, yes, you pay for that cost too. 

Next time you buy a pair of shoes, tell the shoe store you are uniquely enabled to see in the dark and would prefer not to pay that portion of the sale price attributable to hydro.  Are you bald?  If so, then complain to your next hotel that you refuse to pay for the "complimentary" shampoo.  What's that?  You don't like air conditioning.  Then you can also complain to the hotel about that portion of your nightly room charge that goes to air conditioning the common areas.   

What matters is the cost of running a business and not whether each consumer benefits equally from all those costs.   

As AB said, it's simple: You don't want to pay for sales staff, then buy privately.  Obviously, you did benefit from this dealership b/c someone there - i.e., a paid employee - found an example of the particular model that you wanted. 

The car was a trade in. The sales staff did not "find it".

Some of your examples are interesting. For example the shoe sales.
You know what..if I don't need the services of a shoe sales person, don't need the lights in the store..guess what. Youi can log onto a website order the shoes without ever speaking to a person or using any shoe store lights. The shoes will show up on my doorstep.

Shoes are really no different than cars. they are both commodities. A new pair of Nike's from Nike.com are identical to the ones sold at Foot Locker.
A new Focus with package 1A at Dealer a is identical to dealer B.  Me paying 21,000 for the car at A rather than 20 K at dealer B does not make that car one bit better when i drive it.

People buy all kinds of commodity goods without the assistance or intervention of sales people every day.