Quote:
Originally Posted by Jimmy Krack Korn
^^^Jeez I hate car salesmen. You just confirmed why.
In any customer based business, Customers are how you exist. Pretty simple. You do anything other than satisfy your customers? You lose.
I pay cash for my cars and I don't put up with any BS. You give me the "I have to check with my boss (finance manager etc)" line? Guess what? You just lost a sale.
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Customer satisfaction and price are not mutually exclusive. I could pull up a gazillion studies of our industry that show otherwise. And the difference nowadays between a good deal, and a great deal with the access to information on the internet is usually a couple hundred bucks. On a 30k purchase I am more than willing to spend a couple hundred dollars to deal with someone I trust.
Unfortunately, most dealers are set up that the sales guy has no choice to get permission from his boss to discount a car. If you let the sales guy have full reign over what he can discount a car, unfortunately, they would sell everything at minimum profit levels, and nobody would make anything. It has been tried in a lot of stores over the years, and it always fails at big dealers. Small volume it can work because the sales guys usually have to manage themselves to a degree, but in a giant modern day mega dealer the profit margins and competition is so tight you have to micro manage it. Customers end up getting great deals.... sure, but the dealerships are turning zero profit. And it still is a business has to shows return.
The government of Canada, makes more on the GST on the sale of a vehicle, than 90% of dealers do, there is such a small margin to mind now. In the business model you need someone to mind the big picture for the guy who fronted 25 million dollars to open a dealership. And a 22 year old kid, with zero business experience, and no access to the general ledger, can't be trusted with that decision. It is not smoke and mirrors all the time. Somehow it has been construed that profit is a dirty word in the car industry, and I have never understood that. Cars are not a right, they are a luxury. And as a guy with access to the general ledger, I have no idea why anyone would want to open a car dealership anymore. The return on investment is a joke nowadays.
I understand customers are how we exist, but just like there are good and bad businesses, there are good and bad customers too.
I haven't worked on the sales floor in 5 years, and I still sell half a dozen cars a month to people I have provided exceptional service to over the last 12 years. And they know they might be paying a little more for that service. But they still get a fair deal. If I was, I wouldn't be there to help them on the next one.
Personally, I am more than willing to pay a little more for good service. I get there are a lot of scabby dudes in car dealerships. But there are also some guys that have been around for a long, long time that treat their customers like gold, and never have to take a lead through the front door. They are 100% loyalty, and referral based. And contrary to what you may think, those are the guys that always have the best Gross profit numbers in the store. It is because they can be trusted, and because they provide exceptional service. Not because they blow everything out at cost.