Now let’s move to advertising portion for future deal advertisements:
Tagged you all since you mentioned advertising and transparency.
First off, we did not charge his friend extra $300. His friend paid exactly what was agreed to.
Lastly, let me explain why we take our dealer fees upfront and how pricing with dealers work. Please help me provide a more transparent experience because after I explain this, I will show you what the advertisement could look like and how convoluted it would look. This includes you too @adomspam. Provide me a better alternative and I will change our ways.
- Now let me explain to everyone else why we like to take our dealer fees upfront when dealers allow us. I already explained this to the OP previously.
When we have our dealer fee rolled into the deal where the dealer has to pay us directly, it can, depending on the dealer, take up to 200 days before receiving a check for any given deal. (3-4 months on average) We even have some deals that we are still trying to collect from almost 2 years ago from dealers. So we decided to cut out the accounts receivables turn around time and collect it directly from the client (the deal is the same for the client either way). Most dealers prefer this way, because their business office does not have to deal with it on their end either,
It actually is even more transparent because when brokers roll their dealer fee into the deal, the client will never know what the dealer is paying the broker. At least this way you know how the money is being allocated, but again, the money you are paying out of pocket in total is the same either way. And as I already have proven, clients are NOT required to pay the dealer fee upfront, if they would rather the dealer pay us directly we would have just bitten the peverbial accounts receivable nightmare of a “bullet” and roll it into the deal. If @adomspam would have brought this point up when his friend asked about it before paying it, we would have provided that option. Doing it not only after payment has been made, but even worse AFTER the contract has already been signed and car picked up is unreasonable. More so, not accepting the re-contracting when it was offered again and again is finally ridiculous.
- All deals are pre-negotiated by the time we post them, but every dealer has different pricing varying to some degree by anywhere between $100-$2000. Or even higher on rare models.
For example (Hypothetical) let’s continue with Ioniq 5:
Hyundai Dealer A Ioniq 5 broker pricing: $3000 off sticker
Hyundai Dealer B Ioniq 5 broker pricing: $2500 off sticker
Hyundai Dealer C Ioniq 5 broker pricing: $2000 off sticker
Based on market trends and researched deals, advertising deals at 2k off sticker is the sweet spot that beats pricing from most brokers and dealers.
Obviously we would prefer to have all our deals go through Dealer A because we make the most money with them, but Dealer A already has 19 of our deals and they are not able to keep up the efficiency so we divert some new deals to Dealer B. Yes, we are losing $250 on our profit, but now we are better able to keep up the efficiency to ensure customers receive their cars as promptly as possible and are satisfied. BUT WAIT, as brokers, we know that Dealer A and B are not always going to be the top two best priced and dealers can be whiny babies if they don’t at least get a few deals each month or every other month. Let’s make sure to give Dealer C, D, E, and F some deals because they could be better priced next month or the month after. Again, cuts into our profit margin, but from a decade of doing business, we know this will work out for us in the long term.
(I will reiterate the example above is just an example to help you understand)
Let’s apply this to our November Ioniq 5 advertisement:
For ease, let’s work this based on the 7.75% tax rate deal.
1485+799=2284 total out of pocket
Now, let’s look at what it could be:
- 13/10k ONE PAY(Conquest ): 2284 (7.75% tax, fees, and Customer Broker/Dealer Broker fee included)
Hmmm well that can’t work because broker fee is not actually listed so this would really be against advertising guidelines. Also, other brokers that keep their customer fee outside of the deal advertised are showing a lower payment in their thread title so our thread will not get clicked on as much even though our deal is actually cheaper
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- 13/10k ONE PAY(Conquest ): 485-1485 paid to dealer (7.75% tax and fees included) 1799-799 paid to Broker. No matter what, your deal is equating to 2284 all in and will depend on which dealer we send your deal to.
Hmmm well that can’t work either because a final broker fee is not actually listed so this would also be against advertising guidelines. Then Imagine seeing that ad on a thread title, most people would be like WTF??
More over, you will have those clients that will be like:
Potential client: “I want the 485 paid to dealer and $799 paid to broker deal.”
Omega: “No sir, as it states on the post, your total no matter what is 2284. What you will pay to the dealer and us will depend on which dealer we send it to.”
Potential client: “Well it could be read as though we could choose which amount we want to pay to both dealer and broker.”
Omega: “No sir, again as it states on the post, your total no matter what is 2284. What you will pay to the dealer and us will depend on which dealer we send it to.”
Potential client: “Ugh, that is so misleading. There is a huge discrepancy here. Let me bring this to LH”
Omega: “No sir, please check out the post Caution: Omegaautogroup Broker Fee Discrepancies - #126 by tmx2001.
This is what the community decided on as the most transparent way of advertising deals.”Potential client: “I am still going to post this on LH”
Ugh ok, let me spend half the night screenshotting text messages, blacking out names for privacy reasons, and come up with other arguments against this clients facts so I am not needlessly roasted once again.
- We simplified the version of what we have on our credit app disclosure.
Is this acceptable to the community as a whole?
If any of you have an alternative that you think will work, please post it.
Thank you. It is now 5am. I am going to sleep.
Note: I did not have the energy to proof read this entire reply. If something does not make sense, post it and I will respond once I wake up.
Have a great night (or morning now)