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IYKYK

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in reply to Vee

Burnt Veggies
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Burnt Veggies
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I believe most dealerships make more money from service than they do from sales. At least that's how it was at the dealerships I worked at. Sales in the red every month. Service in the black every month. And yet in service, we were treated like unwanted children while the sales staff were put on a pedestal for monthly sales (that still didn't break even 🙄).
This entry was edited (4 months ago)
in reply to Vee

Burnt Veggies
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Burnt Veggies
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I haven't worked in the field in over 15 years now, but when I worked in the field, there was a really tight profit margin for new cars. Slightly larger for used cars. My understanding is they would be lucky to make $500 to $1000 on a new car sale. Meanwhile in service, we were over $100,000 a month in the black and that was at a small dealer.
in reply to Vee

Burnt Veggies
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Burnt Veggies
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yeah, if I remember correctly, if sales sold 30-40 cars in a month that was about average. In a bad month 15, a good month 50 (rare). Multiply that by 1,000 at the high end and they still didn't come close to service. In a good month, we might do $150k or more in profit margin. Of course there were liabilities, the occasional tech screwing up or wrecking a car. 😂
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Reg Braithwaite 🍓
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Reg Braithwaite 🍓
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👆🏽

It's amazing how much more the cash price is when they can't hide how much you're paying with financing. But get them to commit to a number while leaving the question of financing open.

If you tell them you plan to pay cash up front, they'll try to get rid of you with "we don't haggle" before investing time in selling you. Let them invest that time first. Then the sunk cost fallacy will compel them to haggle so they haven't wasted their time.

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