jim beam

SMS wrote:
> jim beam wrote:
>
>>> Offer $500 over dealer cost, if you can figure out dealer cost.
>>
>> $500 over cost doesn't cover overheads, commissions, anything.
>> there's no way they'd sell for that.
>
> Yet they do that all the time. Of course they're not selling every
> vehicle on the lot for $500 over cost, you're correct that this would
> not cover their overhead. You have to look at the big picture like the
> dealer does. A dealer views a $500 (or less) over cost sale in several
> ways:
>
> 1. As pure upside revenue that they would otherwise not have, because
> the potential customer will leave.
>
> 2. As an opportunity to sell financing, an extended warranty, paint
> protectant, fabric guard, glass etching, Lo-Jack, and a long list of
> other very high-margin dealer installed, mostly worthless, options.
>
> 3. As future potential revenue for the service department.
>
> Of course they're not going to sell a vehicle that is in short-supply
> and high-demand for $500 over dealer cost, or even $500 over invoice,
> but there are very few vehicles that fall into that category. The Honda
> Odyssey used to be in that category, now the Prius and Civic hybrids are
> probably in that category now. If you have to have the hot car of the
> moment, you'll pay more (have patience, supply will catch up with
> demand), but you can easily buy high-volume vehicles like the Camry and
> Accord for $500 over dealer cost (or less), depending on the time of year.
>
> I.e., the last Camry we purchased had an MSRP of $20,728, and invoice of
> $18,551 (including destination), a factory to dealer incentive of $1000,
> factory kickbacks (holdback plus advertising subsidy, plus WFR) to the
> dealer of 5% of the base invoice ($928) (Toyota bases this on invoice,
> not MSRP like most manufacturers). The dealer cost was $16,623. The
> price they were selling them at was $16,988, and this wasn't a
> negotiated price, it was "all model 2532 in stock at this price."

no, you're getting suckered by this "dealer cost" crap. that's an
entirely fictional number that [apparently successfully] helps you feel
better.




>
> Of course it wasn't as simple as walking in and plonking down the money.
> When it became clear that we weren't buying a warranty, or financing, or
> digital floor mats, the vehicle suddenly became "unavailable," with a
> bizarre excuse about how it had been damaged on the lot and then
> repaired, and how it needed to be "cleared" by Toyota before it could be
> sold. However returning the next day, we worked around the dealer's
> shenanigans by financing the vehicle then paying off the loan a week later.
>
> In my experience, the best deals are found during, and right after the
> XMAS season (when many people have no money to spend, and the excitement
> of the new model year has worn off) and in the summer before the next
> year's models come out. National sales figures show December and January
> as the slowest months, and it's been that way for a long time.
>
> To me, the most amusing thing is when perfectly mediocre vehicles like
> the PT Cruiser are hyped beyond belief and dealers are able to charge
> thousands over MSRP to dumb people.

car rental agencies buy vehicles direct from manufacturers at abut 50%
of sticker. that implies that dealers do also. that means the "$500
over dealer cost" translates to about $10k for your toyota. thus the
fancy real estate and the gold chains.

looking at it from another perspective, 100% markup over cost, or more,
is absolutely the norm for low volume, high cost retailers. the idea
that car dealers should somehow be different, and that their spectacular
overhead should be paid for out of these so-called incredibly skinny
margins, is naive in the extreme.

Siskuwihane

On Aug 22, 8:48 am, jim beam <spamvor...@bad.example.net> wrote:
> Siskuwihane wrote:
> > On Aug 22, 12:10 am, jim beam <spamvor...@bad.example.net> wrote:
> >> SMS wrote:
> >>> Robert11 wrote:
> >>>> Hello,
> >>>> Real amateur when it comes to negotiating for a new car.
> >>>> In my 70's now, not that sharp with negotiating, and would appreciate
> >>>> any opinions on this:
> >>>> I see in the various Forums and newsgroups that an "appropriate" first
> >>>> offer
> >>>> on a new car would be perhaps 500 max. over the Dealers Invoice.
> >>>> Seems to
> >>>> be a magic number.
> >>> Not magic at all. The dealer doesn't pay the manufacturer the "invoice
> >>> price," and you routinely see dealers advertise "under invoice." The
> >>> last two cars I purchased we paid well under invoice. Clearly the dealer
> >>> wasn't selling these vehicles at a loss. Between holdback, factory to
> >>> dealer incentives, and other kickbacks, selling at invoice is very very
> >>> profitable for the dealer.
> >>> You want to go up from dealer cost, not up or down from invoice or MSRP.
> >>> Unfortunately determining dealer cost is very difficult. You need to
> >>> know all the incentives for a specific vehicle in a specific region of
> >>> the country.
> >>> Offer $500 over dealer cost, if you can figure out dealer cost.
> >> $500 over cost doesn't cover overheads, commissions, anything. there's
> >> no way they'd sell for that.- Hide quoted text -
>
> > If profit (or not) made on the front end won't cover it, profit made
> > on the back end would. Some dealers make more on financing and/or
> > service than sales.
>
> don't believe it. all that fancy real estate, and all those sales dudes
> with all their gold jewelry getting fat on $500? no way. and there's
> no way the sales dudes get a share of selling you a $900 timing belt
> replacement.

I don't believe it was stated anywhere that every vehicle was sold at
that price. Not everyone who walks into the dealership knows what they
are doing so vehicles get sold at many different price points. The
fact is cars do get sold at $500 or less over invoice all the time.


> bottom line, the myths about minimal margins in car sales have to be a
> complete crock - otherwise car sales would be mail order or from some
> dirt lot three hours out of town. basic math.- Hide quoted text -

And they would be serviced in that same dirt lot or by mail? Financed
from that same dirt lot or by mail?

Siskuwihane

On Aug 22, 9:34 am, jim beam <spamvor...@bad.example.net> wrote:
> SMS wrote:
> > jim beam wrote:
>
> >>> Offer $500 over dealer cost, if you can figure out dealer cost.
>
> >> $500 over cost doesn't cover overheads, commissions, anything.
> >> there's no way they'd sell for that.
>
> > Yet they do that all the time. Of course they're not selling every
> > vehicle on the lot for $500 over cost, you're correct that this would
> > not cover their overhead. You have to look at the big picture like the
> > dealer does. A dealer views a $500 (or less) over cost sale in several
> > ways:
>
> > 1. As pure upside revenue that they would otherwise not have, because
> > the potential customer will leave.
>
> > 2. As an opportunity to sell financing, an extended warranty, paint
> > protectant, fabric guard, glass etching, Lo-Jack, and a long list of
> > other very high-margin dealer installed, mostly worthless, options.
>
> > 3. As future potential revenue for the service department.
>
> > Of course they're not going to sell a vehicle that is in short-supply
> > and high-demand for $500 over dealer cost, or even $500 over invoice,
> > but there are very few vehicles that fall into that category. The Honda
> > Odyssey used to be in that category, now the Prius and Civic hybrids are
> > probably in that category now. If you have to have the hot car of the
> > moment, you'll pay more (have patience, supply will catch up with
> > demand), but you can easily buy high-volume vehicles like the Camry and
> > Accord for $500 over dealer cost (or less), depending on the time of year.
>
> > I.e., the last Camry we purchased had an MSRP of $20,728, and invoice of
> > $18,551 (including destination), a factory to dealer incentive of $1000,
> > factory kickbacks (holdback plus advertising subsidy, plus WFR) to the
> > dealer of 5% of the base invoice ($928) (Toyota bases this on invoice,
> > not MSRP like most manufacturers). The dealer cost was $16,623. The
> > price they were selling them at was $16,988, and this wasn't a
> > negotiated price, it was "all model 2532 in stock at this price."
>
> no, you're getting suckered by this "dealer cost" crap. that's an
> entirely fictional number that [apparently successfully] helps you feel
> better.
>
>
>
>
>
>
>
> > Of course it wasn't as simple as walking in and plonking down the money..
> > When it became clear that we weren't buying a warranty, or financing, or
> > digital floor mats, the vehicle suddenly became "unavailable," with a
> > bizarre excuse about how it had been damaged on the lot and then
> > repaired, and how it needed to be "cleared" by Toyota before it could be
> > sold. However returning the next day, we worked around the dealer's
> > shenanigans by financing the vehicle then paying off the loan a week later.
>
> > In my experience, the best deals are found during, and right after the
> > XMAS season (when many people have no money to spend, and the excitement
> > of the new model year has worn off) and in the summer before the next
> > year's models come out. National sales figures show December and January
> > as the slowest months, and it's been that way for a long time.
>
> > To me, the most amusing thing is when perfectly mediocre vehicles like
> > the PT Cruiser are hyped beyond belief and dealers are able to charge
> > thousands over MSRP to dumb people.
>
> car rental agencies buy vehicles direct from manufacturers at abut 50%
> of sticker. that implies that dealers do also. that means the "$500
> over dealer cost" translates to about $10k for your toyota. thus the
> fancy real estate and the gold chains.
-

Having worked for a Hertz Licensee, our vehicles were sold to us
through a dealer and never for 50% of sticker, if it worked that way
(not saying it doesn't for corporate owned locations but 50% sounds a
little steep) the employees would have been buying them too.

SMS

Siskuwihane wrote:

> I don't believe it was stated anywhere that every vehicle was sold at
> that price. Not everyone who walks into the dealership knows what they
> are doing so vehicles get sold at many different price points. The
> fact is cars do get sold at $500 or less over invoice all the time.

That's the key point the Jim doesn't understand. BTW, don't get suckered
by "$500 over invoice." the last car we purchased had an invoice price
of $18,551, and a dealer cost of nearly $2000 below invoice. There's a
_huge_ difference between dealer cost and invoice, they really bear
little relation to each other. In fact invoices has become the defacto
retail price for many vehicles, with dealers thrilled to be able to sell
as many vehicles as possible at invoice.

The last Accord I helped someone buy (Autowest Honda in Fremont) was
about $1200 under "invoice." I don't remember the dealer cost. This was
a "six at this price" sale, and indeed they did have them on the lot but
they were all black (black doesn't sell well in my area). They wanted
$750 more for a different color, and settled for $250. Naturally there
was the high pressure for extended warranties and other crapola, but
it's not hard to resist.

Invoice is just a bogus concept these days. Don't think buying at
invoice is some sort of spectacular achievement, it isn't. You see
people that paid too much insisting that it's just not possible for a
dealer to sell at $500 over cost, but what they really mean is that it's
not possible for the dealer to sell every vehicle at $500 over cost.

Now OTOH, one sister-in-law went into a Honda dealer for a repair on her
Accord and walked out with a new CR-V at significantly over invoice,
complete with a non-Honda extended warranty and 100% financing by the
dealer. Now she wants to let them repossess it because the payments are
so high, but it's not that simple as they'll come after her for the
difference between the wholesale value of the vehicle, and the balance
of the loan amount. I guess it's just morally wrong to allow a sucker to
keep their money.

SMS

Siskuwihane wrote:

> Having worked for a Hertz Licensee, our vehicles were sold to us
> through a dealer and never for 50% of sticker, if it worked that way
> (not saying it doesn't for corporate owned locations but 50% sounds a
> little steep) the employees would have been buying them too.

It was about 80% of MSRP, and it's gone up. Plus the rental agencies
tend to buy the stripped down vehicles, as well as the vehicles that no
one else wants to buy. Sometimes there are vehicles manufactured solely
for rental car fleets.

The problem appears to be that Jim got ripped off by a dealer at some
time in the recent past, and he actually believed what the car
salesperson told him!

Larry in AZ

Waiving the right to remain silent, SMS <scharf.steven@geemail.com> said:

> You want to go up from dealer cost, not up or down from invoice or MSRP.
> Unfortunately determining dealer cost is very difficult. You need to
> know all the incentives for a specific vehicle in a specific region of
> the country.

You need to know even more than that. Aside from the published programs, a
dealer may have additional price breaks based on volume, etc.

As I said before, you'd need to ask the dealership's accountant, and it isn't
very likely you'll get the information from them, unless they want to lose
their job...

--
Larry J. - Remove spamtrap in ALLCAPS to e-mail

"A lack of common sense is now considered a disability,
with all the privileges that this entails."

SMS

Larry in AZ wrote:
> Waiving the right to remain silent, SMS <scharf.steven@geemail.com> said:
>
>> You want to go up from dealer cost, not up or down from invoice or MSRP.
>> Unfortunately determining dealer cost is very difficult. You need to
>> know all the incentives for a specific vehicle in a specific region of
>> the country.
>
> You need to know even more than that. Aside from the published programs, a
> dealer may have additional price breaks based on volume, etc.
>
> As I said before, you'd need to ask the dealership's accountant, and it isn't
> very likely you'll get the information from them, unless they want to lose
> their job...

Yes, it's true that knowing the real dealer cost is damn near impossible.

However, you can come pretty close by finding out the invoice price, all
the factory to dealer incentives that are in place, and all the known
kickbacks that the factory or region is giving the dealers. I know that
in my area, the Toyota dealer is getting 2% holdback, 2% in advertising
subsidy, and 1% called WFR (which is ostensibly to finance their
inventory with their bank).

The key thing to remember is that "invoice" can easily be $1000 more
than the dealer cost. The dealer isn't losing money when they sell some
vehicles at $500 over their cost.

jim beam

SMS wrote:
> Larry in AZ wrote:
>> Waiving the right to remain silent, SMS <scharf.steven@geemail.com> said:
>>
>>> You want to go up from dealer cost, not up or down from invoice or
>>> MSRP. Unfortunately determining dealer cost is very difficult. You
>>> need to know all the incentives for a specific vehicle in a specific
>>> region of the country.
>>
>> You need to know even more than that. Aside from the published
>> programs, a dealer may have additional price breaks based on volume, etc.
>>
>> As I said before, you'd need to ask the dealership's accountant, and
>> it isn't very likely you'll get the information from them, unless they
>> want to lose their job...
>
> Yes, it's true that knowing the real dealer cost is damn near impossible.
>
> However, you can come pretty close by finding out the invoice price, all
> the factory to dealer incentives that are in place, and all the known
> kickbacks that the factory or region is giving the dealers. I know that
> in my area, the Toyota dealer is getting 2% holdback, 2% in advertising
> subsidy, and 1% called WFR (which is ostensibly to finance their
> inventory with their bank).
>
> The key thing to remember is that "invoice" can easily be $1000 more
> than the dealer cost. The dealer isn't losing money when they sell some
> vehicles at $500 over their cost.


dude, again, the "invoice" is fictional. no money has changed hands
with that number on it.

jim beam

SMS wrote:
> Siskuwihane wrote:
>
>> Having worked for a Hertz Licensee, our vehicles were sold to us
>> through a dealer and never for 50% of sticker, if it worked that way
>> (not saying it doesn't for corporate owned locations but 50% sounds a
>> little steep) the employees would have been buying them too.
>
> It was about 80% of MSRP, and it's gone up. Plus the rental agencies
> tend to buy the stripped down vehicles, as well as the vehicles that no
> one else wants to buy. Sometimes there are vehicles manufactured solely
> for rental car fleets.

bullshit.


>
> The problem appears to be that Jim got ripped off by a dealer at some
> time in the recent past, and he actually believed what the car
> salesperson told him!

why are you making up stories? that's not even vaguely true.

you don't understand is that i actually have no problem with a dealer
covering their overheads, commissions, advertising, etc., i simply
object to this bullshit charade about "dealer invoice" because it's a
crock designed to deceive. and evidently successfully so in your case.

jim beam

Siskuwihane wrote:
> On Aug 22, 8:48�am, jim beam <spamvor...@bad.example.net> wrote:
>> Siskuwihane wrote:
>>> On Aug 22, 12:10 am, jim beam <spamvor...@bad.example.net> wrote:
>>>> SMS wrote:
>>>>> Robert11 wrote:
>>>>>> Hello,
>>>>>> Real amateur when it comes to negotiating for a new car.
>>>>>> In my 70's now, not that sharp with negotiating, and would appreciate
>>>>>> any opinions on this:
>>>>>> I see in the various Forums and newsgroups that an "appropriate" first
>>>>>> offer
>>>>>> on a new car would be perhaps 500 max. over the Dealers Invoice.
>>>>>> Seems to
>>>>>> be a magic number.
>>>>> Not magic at all. The dealer doesn't pay the manufacturer the "invoice
>>>>> price," and you routinely see dealers advertise "under invoice." The
>>>>> last two cars I purchased we paid well under invoice. Clearly the dealer
>>>>> wasn't selling these vehicles at a loss. Between holdback, factory to
>>>>> dealer incentives, and other kickbacks, selling at invoice is very very
>>>>> profitable for the dealer.
>>>>> You want to go up from dealer cost, not up or down from invoice or MSRP.
>>>>> Unfortunately determining dealer cost is very difficult. You need to
>>>>> know all the incentives for a specific vehicle in a specific region of
>>>>> the country.
>>>>> Offer $500 over dealer cost, if you can figure out dealer cost.
>>>> $500 over cost doesn't cover overheads, commissions, anything. there's
>>>> no way they'd sell for that.- Hide quoted text -
>>> If profit (or not) made on the front end won't cover it, profit made
>>> on the back end would. Some dealers make more on financing and/or
>>> service than sales.
>> don't believe it. �all that fancy real estate, and all those sales dudes
>> with all their gold jewelry getting fat on $500? �no way. �and there's
>> no way the sales dudes get a share of selling you a $900 timing belt
>> replacement.
>
> I don't believe it was stated anywhere that every vehicle was sold at
> that price. Not everyone who walks into the dealership knows what they
> are doing so vehicles get sold at many different price points. The
> fact is cars do get sold at $500 or less over invoice all the time.

you don't understand - "invoice" is fictional. even if it sells at
"under" invoice, the dealer still has a profit because the /actual/ cost
is way lower.


>
>
>> bottom line, the myths about minimal margins in car sales have to be a
>> complete crock - otherwise car sales would be mail order or from some
>> dirt lot three hours out of town. �basic math.- Hide quoted text -
>
> And they would be serviced in that same dirt lot or by mail? Financed
> from that same dirt lot or by mail?

do you believe that the dudes on the sales floor with the gold chains
and bad teeth get cross-subsidized by the service department???

Siskuwihane

On Aug 22, 10:26 pm, jim beam <spamvor...@bad.example.net> wrote:
> Siskuwihane wrote:
> > On Aug 22, 8:48 am, jim beam <spamvor...@bad.example.net> wrote:
> >> Siskuwihane wrote:
> >>> On Aug 22, 12:10 am, jim beam <spamvor...@bad.example.net> wrote:
> >>>> SMS wrote:
> >>>>> Robert11 wrote:
> >>>>>> Hello,
> >>>>>> Real amateur when it comes to negotiating for a new car.
> >>>>>> In my 70's now, not that sharp with negotiating, and would appreciate
> >>>>>> any opinions on this:
> >>>>>> I see in the various Forums and newsgroups that an "appropriate" first
> >>>>>> offer
> >>>>>> on a new car would be perhaps 500 max. over the Dealers Invoice.
> >>>>>> Seems to
> >>>>>> be a magic number.
> >>>>> Not magic at all. The dealer doesn't pay the manufacturer the "invoice
> >>>>> price," and you routinely see dealers advertise "under invoice." The
> >>>>> last two cars I purchased we paid well under invoice. Clearly the dealer
> >>>>> wasn't selling these vehicles at a loss. Between holdback, factory to
> >>>>> dealer incentives, and other kickbacks, selling at invoice is very very
> >>>>> profitable for the dealer.
> >>>>> You want to go up from dealer cost, not up or down from invoice or MSRP.
> >>>>> Unfortunately determining dealer cost is very difficult. You need to
> >>>>> know all the incentives for a specific vehicle in a specific regionof
> >>>>> the country.
> >>>>> Offer $500 over dealer cost, if you can figure out dealer cost.
> >>>> $500 over cost doesn't cover overheads, commissions, anything. there's
> >>>> no way they'd sell for that.- Hide quoted text -
> >>> If profit (or not) made on the front end won't cover it, profit made
> >>> on the back end would. Some dealers make more on financing and/or
> >>> service than sales.
> >> don't believe it. all that fancy real estate, and all those sales dudes
> >> with all their gold jewelry getting fat on $500? no way. and there's
> >> no way the sales dudes get a share of selling you a $900 timing belt
> >> replacement.
>
> > I don't believe it was stated anywhere that every vehicle was sold at
> > that price. Not everyone who walks into the dealership knows what they
> > are doing so vehicles get sold at many different price points. The
> > fact is cars do get sold at $500 or less over invoice all the time.
>
> you don't understand - "invoice" is fictional. even if it sells at
> "under" invoice, the dealer still has a profit because the /actual/ cost
> is way lower.
>
>
>
> >> bottom line, the myths about minimal margins in car sales have to be a
> >> complete crock - otherwise car sales would be mail order or from some
> >> dirt lot three hours out of town. basic math.- Hide quoted text -
>
> > And they would be serviced in that same dirt lot or by mail? Financed
> > from that same dirt lot or by mail?
>
> do you believe that the dudes on the sales floor with the gold chains
> and bad teeth get cross-subsidized by the service department???- Hide quoted text -


No one made that claim. Sales people are paid for sales. It's much
better to go home with $100 in your pocket from a $500 over deal than
to go home after working 10 hours with nothing. While these deals do
not support the dealership, the back end can and does as has already
been explained. As was also stated it doesn't happen everyday, but
when it comes to making a sale-vs-no sale, it will happen, especially
during slow times.

SMS

Siskuwihane wrote:

> No one made that claim. Sales people are paid for sales. It's much
> better to go home with $100 in your pocket from a $500 over deal than
> to go home after working 10 hours with nothing. While these deals do
> not support the dealership, the back end can and does as has already
> been explained. As was also stated it doesn't happen everyday, but
> when it comes to making a sale-vs-no sale, it will happen, especially
> during slow times.

Also remember that the dealer can't tell the factory, "send me only
large shipments of the hottest models." They have to take a product mix.
When gas was cheap the Odyssey and Pilot were hot they'd have loved to
get no Civics and fewer Accords. Now they'd love to get a lot more
Civics. But it doesn't work that way. They have to sell the complete
line, and if that means moving the dogs off the lot by selling them at
very little over what they pay for them, so be it. Eventually supply
catches up with demand, so the patient customer doesn't overpay, while
the one that simply must buy the hot model as soon as it comes out will
subsidize other customers.

jim beam

Siskuwihane wrote:
> On Aug 22, 10:26�pm, jim beam <spamvor...@bad.example.net> wrote:
>> Siskuwihane wrote:
>>> On Aug 22, 8:48 am, jim beam <spamvor...@bad.example.net> wrote:
>>>> Siskuwihane wrote:
>>>>> On Aug 22, 12:10 am, jim beam <spamvor...@bad.example.net> wrote:
>>>>>> SMS wrote:
>>>>>>> Robert11 wrote:
>>>>>>>> Hello,
>>>>>>>> Real amateur when it comes to negotiating for a new car.
>>>>>>>> In my 70's now, not that sharp with negotiating, and would appreciate
>>>>>>>> any opinions on this:
>>>>>>>> I see in the various Forums and newsgroups that an "appropriate" first
>>>>>>>> offer
>>>>>>>> on a new car would be perhaps 500 max. over the Dealers Invoice.
>>>>>>>> Seems to
>>>>>>>> be a magic number.
>>>>>>> Not magic at all. The dealer doesn't pay the manufacturer the "invoice
>>>>>>> price," and you routinely see dealers advertise "under invoice." The
>>>>>>> last two cars I purchased we paid well under invoice. Clearly the dealer
>>>>>>> wasn't selling these vehicles at a loss. Between holdback, factory to
>>>>>>> dealer incentives, and other kickbacks, selling at invoice is very very
>>>>>>> profitable for the dealer.
>>>>>>> You want to go up from dealer cost, not up or down from invoice or MSRP.
>>>>>>> Unfortunately determining dealer cost is very difficult. You need to
>>>>>>> know all the incentives for a specific vehicle in a specific region of
>>>>>>> the country.
>>>>>>> Offer $500 over dealer cost, if you can figure out dealer cost.
>>>>>> $500 over cost doesn't cover overheads, commissions, anything. there's
>>>>>> no way they'd sell for that.- Hide quoted text -
>>>>> If profit (or not) made on the front end won't cover it, profit made
>>>>> on the back end would. Some dealers make more on financing and/or
>>>>> service than sales.
>>>> don't believe it. all that fancy real estate, and all those sales dudes
>>>> with all their gold jewelry getting fat on $500? no way. and there's
>>>> no way the sales dudes get a share of selling you a $900 timing belt
>>>> replacement.
>>> I don't believe it was stated anywhere that every vehicle was sold at
>>> that price. Not everyone who walks into the dealership knows what they
>>> are doing so vehicles get sold at many different price points. The
>>> fact is cars do get sold at $500 or less over invoice all the time.
>> you don't understand - "invoice" is fictional. �even if it sells at
>> "under" invoice, the dealer still has a profit because the /actual/ cost
>> is way lower.
>>
>>
>>
>>>> bottom line, the myths about minimal margins in car sales have to be a
>>>> complete crock - otherwise car sales would be mail order or from some
>>>> dirt lot three hours out of town. basic math.- Hide quoted text -
>>> And they would be serviced in that same dirt lot or by mail? Financed
>>> from that same dirt lot or by mail?
>> do you believe that the dudes on the sales floor with the gold chains
>> and bad teeth get cross-subsidized by the service department???- Hide quoted text -
>
>
> No one made that claim. Sales people are paid for sales. It's much
> better to go home with $100 in your pocket from a $500 over deal than
> to go home after working 10 hours with nothing. While these deals do
> not support the dealership, the back end can and does as has already
> been explained.

but it doesn't support the sales people on commission. what incentive
do /they/ have to sell for only $100???



> As was also stated it doesn't happen everyday, but
> when it comes to making a sale-vs-no sale, it will happen, especially
> during slow times.
>

there's no way you're going to let $20k of inventory go for only $100.
that's 0.5% profit. even high volume retailers like a supermarket can't
live on margins that skinny.

Siskuwihane

On Aug 23, 10:09 am, jim beam <spamvor...@bad.example.net> wrote:
> Siskuwihane wrote:
> > On Aug 22, 10:26 pm, jim beam <spamvor...@bad.example.net> wrote:
> >> Siskuwihane wrote:
> >>> On Aug 22, 8:48 am, jim beam <spamvor...@bad.example.net> wrote:
> >>>> Siskuwihane wrote:
> >>>>> On Aug 22, 12:10 am, jim beam <spamvor...@bad.example.net> wrote:
> >>>>>> SMS wrote:
> >>>>>>> Robert11 wrote:
> >>>>>>>> Hello,
> >>>>>>>> Real amateur when it comes to negotiating for a new car.
> >>>>>>>> In my 70's now, not that sharp with negotiating, and would appreciate
> >>>>>>>> any opinions on this:
> >>>>>>>> I see in the various Forums and newsgroups that an "appropriate"first
> >>>>>>>> offer
> >>>>>>>> on a new car would be perhaps 500 max. over the Dealers Invoice.
> >>>>>>>> Seems to
> >>>>>>>> be a magic number.
> >>>>>>> Not magic at all. The dealer doesn't pay the manufacturer the "invoice
> >>>>>>> price," and you routinely see dealers advertise "under invoice." The
> >>>>>>> last two cars I purchased we paid well under invoice. Clearly thedealer
> >>>>>>> wasn't selling these vehicles at a loss. Between holdback, factory to
> >>>>>>> dealer incentives, and other kickbacks, selling at invoice is very very
> >>>>>>> profitable for the dealer.
> >>>>>>> You want to go up from dealer cost, not up or down from invoice or MSRP.
> >>>>>>> Unfortunately determining dealer cost is very difficult. You needto
> >>>>>>> know all the incentives for a specific vehicle in a specific region of
> >>>>>>> the country.
> >>>>>>> Offer $500 over dealer cost, if you can figure out dealer cost.
> >>>>>> $500 over cost doesn't cover overheads, commissions, anything. there's
> >>>>>> no way they'd sell for that.- Hide quoted text -
> >>>>> If profit (or not) made on the front end won't cover it, profit made
> >>>>> on the back end would. Some dealers make more on financing and/or
> >>>>> service than sales.
> >>>> don't believe it. all that fancy real estate, and all those sales dudes
> >>>> with all their gold jewelry getting fat on $500? no way. and there's
> >>>> no way the sales dudes get a share of selling you a $900 timing belt
> >>>> replacement.
> >>> I don't believe it was stated anywhere that every vehicle was sold at
> >>> that price. Not everyone who walks into the dealership knows what they
> >>> are doing so vehicles get sold at many different price points. The
> >>> fact is cars do get sold at $500 or less over invoice all the time.
> >> you don't understand - "invoice" is fictional. even if it sells at
> >> "under" invoice, the dealer still has a profit because the /actual/ cost
> >> is way lower.
>
> >>>> bottom line, the myths about minimal margins in car sales have to bea
> >>>> complete crock - otherwise car sales would be mail order or from some
> >>>> dirt lot three hours out of town. basic math.- Hide quoted text -
> >>> And they would be serviced in that same dirt lot or by mail? Financed
> >>> from that same dirt lot or by mail?
> >> do you believe that the dudes on the sales floor with the gold chains
> >> and bad teeth get cross-subsidized by the service department???- Hide quoted text -
>
> > No one made that claim. Sales people are paid for sales. It's much
> > better to go home with $100 in your pocket from a $500 over deal than
> > to go home after working 10 hours with nothing. While these deals do
> > not support the dealership, the back end can and does as has already
> > been explained.
>
> but it doesn't support the sales people on commission.

Once again, no one made that claim. It's been explained already.

>what incentive do /they/ have to sell for only $100???

Are you just looking to argue? No one is saying that ALL sales result
in a $100 commission, but when it's SLOW, it's better to have made
$100 than go home after working all day empty handed. There are days
you'll make a lot of profit on a car and the commission that goes with
it and days you won't, it's stated in what you quoted below.

> > As was also stated it doesn't happen everyday, but
> > when it comes to making a sale-vs-no sale, it will happen, especially
> > during slow times.
>
> there's no way you're going to let $20k of inventory go for only $100.
> that's 0.5% profit. even high volume retailers like a supermarket can't
> live on margins that skinny.

Last time, profit is also made on the back end (lose out front, gain
it on the back end) and in service,
and the small profit sale deals do not happen every day. The end.

jim beam

Siskuwihane wrote:
> On Aug 23, 10:09�am, jim beam <spamvor...@bad.example.net> wrote:
>> Siskuwihane wrote:
>>> On Aug 22, 10:26 pm, jim beam <spamvor...@bad.example.net> wrote:
>>>> Siskuwihane wrote:
>>>>> On Aug 22, 8:48 am, jim beam <spamvor...@bad.example.net> wrote:
>>>>>> Siskuwihane wrote:
>>>>>>> On Aug 22, 12:10 am, jim beam <spamvor...@bad.example.net> wrote:
>>>>>>>> SMS wrote:
>>>>>>>>> Robert11 wrote:
>>>>>>>>>> Hello,
>>>>>>>>>> Real amateur when it comes to negotiating for a new car.
>>>>>>>>>> In my 70's now, not that sharp with negotiating, and would appreciate
>>>>>>>>>> any opinions on this:
>>>>>>>>>> I see in the various Forums and newsgroups that an "appropriate" first
>>>>>>>>>> offer
>>>>>>>>>> on a new car would be perhaps 500 max. over the Dealers Invoice.
>>>>>>>>>> Seems to
>>>>>>>>>> be a magic number.
>>>>>>>>> Not magic at all. The dealer doesn't pay the manufacturer the "invoice
>>>>>>>>> price," and you routinely see dealers advertise "under invoice." The
>>>>>>>>> last two cars I purchased we paid well under invoice. Clearly the dealer
>>>>>>>>> wasn't selling these vehicles at a loss. Between holdback, factory to
>>>>>>>>> dealer incentives, and other kickbacks, selling at invoice is very very
>>>>>>>>> profitable for the dealer.
>>>>>>>>> You want to go up from dealer cost, not up or down from invoice or MSRP.
>>>>>>>>> Unfortunately determining dealer cost is very difficult. You need to
>>>>>>>>> know all the incentives for a specific vehicle in a specific region of
>>>>>>>>> the country.
>>>>>>>>> Offer $500 over dealer cost, if you can figure out dealer cost.
>>>>>>>> $500 over cost doesn't cover overheads, commissions, anything. there's
>>>>>>>> no way they'd sell for that.- Hide quoted text -
>>>>>>> If profit (or not) made on the front end won't cover it, profit made
>>>>>>> on the back end would. Some dealers make more on financing and/or
>>>>>>> service than sales.
>>>>>> don't believe it. all that fancy real estate, and all those sales dudes
>>>>>> with all their gold jewelry getting fat on $500? no way. and there's
>>>>>> no way the sales dudes get a share of selling you a $900 timing belt
>>>>>> replacement.
>>>>> I don't believe it was stated anywhere that every vehicle was sold at
>>>>> that price. Not everyone who walks into the dealership knows what they
>>>>> are doing so vehicles get sold at many different price points. The
>>>>> fact is cars do get sold at $500 or less over invoice all the time.
>>>> you don't understand - "invoice" is fictional. even if it sells at
>>>> "under" invoice, the dealer still has a profit because the /actual/ cost
>>>> is way lower.
>>>>>> bottom line, the myths about minimal margins in car sales have to be a
>>>>>> complete crock - otherwise car sales would be mail order or from some
>>>>>> dirt lot three hours out of town. basic math.- Hide quoted text -
>>>>> And they would be serviced in that same dirt lot or by mail? Financed
>>>>> from that same dirt lot or by mail?
>>>> do you believe that the dudes on the sales floor with the gold chains
>>>> and bad teeth get cross-subsidized by the service department???- Hide quoted text -
>>> No one made that claim. Sales people are paid for sales. It's much
>>> better to go home with $100 in your pocket from a $500 over deal than
>>> to go home after working 10 hours with nothing. While these deals do
>>> not support the dealership, the back end can and does as has already
>>> been explained.
>> but it doesn't support the sales people on commission. �
>
> Once again, no one made that claim. It's been explained already.
>
>> what incentive do /they/ have to sell for only $100???
>
> Are you just looking to argue?

no, i just want to inject some commercial reality into what is clearly
the very non-commercial world in which you live.


> No one is saying that ALL sales result
> in a $100 commission, but when it's SLOW, it's better to have made
> $100 than go home after working all day empty handed. There are days
> you'll make a lot of profit on a car and the commission that goes with
> it and days you won't, it's stated in what you quoted below.

dude, when there's $20k worth of car sitting on the lot, with all those
real estate, advertising, insurance, tax, admin staff, phone bills and
commission overheads biting your ***, there's absolutely no freakin' way
you're going to let that thing go for only $100. absolutely no way.



>
>>> As was also stated it doesn't happen everyday, but
>>> when it comes to making a sale-vs-no sale, it will happen, especially
>>> during slow times.
>> there's no way you're going to let $20k of inventory go for only $100.
>> that's 0.5% profit. �even high volume retailers like a supermarket can't
>> live on margins that skinny.
>
> Last time, profit is also made on the back end (lose out front, gain
> it on the back end) and in service,
> and the small profit sale deals do not happen every day. The end.

you don't understand. the dealer makes profit on sales. not $100
profit. big multi-thousand dollar profit. every time. that's where
all huge-*** sales real estate gets paid. all the multi-page
advertising in your local paper gets paid. all the tv ads get paid.

again, i have no problem with that, but i do object to the deception
about "dealer invoice". and right now, i strongly object to the poor
fool[s] that grimly cling to this deception as their way of dealing with
reality.