Spend time at the dealerships much?

I have worked at over 45 dealers in the past 20 years, these days im an auto broker.

I just found a photo of this sign that has been posted at every single dealership i ever worked at. Makes you think!

Wow. Just 13 extra minutes increase your closing rate five-fold? How smart LOL

Does it mean

to drag the buyer round and round for as long as possible until they give up and sign?
or
to spend time answering all the question the buyer has?

Many times it feels like it’s the former rather then the latter.

means, do whatever it takes to keep the buyer in the seat and wear them down!

That’s their #1 goal because the law of averages will let them make more deals that way

So how does this auto broker thing work? Do you work with dealers national wide?

I’m currently looking to lease QX60 in NJ. Wonder if you got any good deal?

That sign above infuriates me.

The opposite has been true in my experience. The longer I wait, the more likely I just leave.

I agree and time saved, is money saved!!!

The purpose of the sign isn’t so much about waiting at the car dealership

in the world of sales, its about building rapport with clients, showing the value propositions. The sales process is mostly just conversational .

The more time they can spend chatting with a customer, the more opportunity they have for you to put your guard down and feel good about the deal

And heres the thing, the reason why not one website has been successful in completing the lease process on a new car from A to Z. Whereas to “replace the salesman” in putting the entire process online, from searching the car, running credit, approval, quoting an accurate payment and down pay to printing contracts for you to bring in signed contracts to the dealer and pick up a car.

That scenario / model has always 100% failed. WHY?

Because people have questions and people need people to walk them thru and navigate the process.

Thats exactly why this forum is so successful, its the closest thing to automation in the car buying / leasing world driven by peer to peer help by way of their own interactions & experience with car salesmen.

Thats exactly why i’m here…I work with general sales managers and dealer principals day in day out almost 365 days a year constantly shopping deals. I know the market inside & out on most brands. I Charge a flat fee, 99% of the time the savings is MUCH greater than our fee. and it only takes 10 minutes to Iron out the deal.

So while most people try and piece together bits of information gained on the forums and try and Forest Gump their way thru the process and still spend hours if not days shopping and shopping in most cases wind up spending more money in time spent ( Lets say your time is worth $75/hr & average forum shopper spends an hour or two a day x week or more) than what they actually saved in the first place.

Seriously, how long have you been on the forum cruising for a deal to save $1000 or $2000? When you could have been driving a brand new car for over a month now.

My customers save on average $1800 including our flat fee. Process takes literally minutes to work up the numbers and maybe an hour answering their questions.

Hope this helps, hope you find the new car of your dreams! FYI we’re well into the end of the model year as there are already 439,000 2017 Vehicles in stock at dealerships!!!

Anthony @ DSRLeasing.com

It’s so bizarre, I’ve been to dealership maybe two dozen times where I’ve actually sat down and talked numbers…I’ve certainly had my butt in the seat 100+ mins many times, but to have the salesman sit with me? Never…At most 5mins of try-hard chit chat, 5mins of him taking my info and entering it, then everything else is 30-60 second of them running their the numbers back and forth through their sales manager…Usually I’m by myself for 5-20mins between offers…

So true, did you have line of sight to the new car you were discussing most of the time???

My favorite moment was when I was waiting for the sales manager to counter my offer and two sales people walked by loudly talking about how popular the Jetta is and how they have been setting up test drives with potential customers for later that day now that they finally have some in stock… I had to try to keep myself from laughing out loud. I’d been watching inventories for a while and they had a consistent 55+ Jettas on the lot for the past month.

3 Likes

Hi Anthony,

I have a couple issues with your “sales pitch”. Firstly, you’re acting as a middleman to the middlemen. Another mouth to feed. Second, you have no loyalty to anyone. You get a flat fee so there is no incentive for you to get a better deal for the buyer. I’m sure you would also like to keep your relationships with car dealerships so you would have little incentive to squeeze them as hard.

On the other hand, I am always looking out for el numero uno. For some people the little bit that can be saved by not paying you and squeezing the dealer for a little bit more could go a long way, not matter what cost of time spent is (for a lot people that’s zero if it’s free time and they don’t mind it).

Personally, I hate the whole car buying process. It’s antiquated and serves no purpose. Two people can buy the exact same car and pay vastly different prices. Why should we have to fight with dealers to get a better deal? Honestly I’d rather pay a predetermined price directly to the manufacturer even if it’s more than what I would have paid a dealer if I didn’t have to go through the whole process and have to cut a deal with a con-artist. Tesla has the right idea and dealerships are running scared. Dealerships are completely unnecessary and in time they will be eradicated.

1 Like

Kudos!

And without people like myself here to educate people on this forum the world would be a darker place.

Most people don’t know that in the 1960’s manufactures decided to not sell direct to the public but however franchise the brands to independent dealerships.

Thats the reason why 2 people pay two separate prices. My intention is to close that gap.

Not many people realize how salesman make their commissions. Its normally 25% of the overall gross commission.
If a car salesman wants to earn $500 for a sale ( Most of these guys work 65+ hours a week ) that means the store needs to earn a gross profit of $2000. The average dealer profit on a lease nationwide is $2350 per vehicle.

Or they make a flat $250 per vehicle if the store considers the transaction a “mini deal” where the store is cheap selling it. and still the store needs to earn enough to " keep the lights on" as any business would.

bottom line, with my involvement, the dealers average profit drops to about $450 and the difference is savings.

Middleman? yes absolutely…necessary ? yes 100%

Tesla does have a good model. But ask any one of those reps in the mall’s selling the product. $0 commission and they make a little above minimum wage. Good for the consumer, not so good for the working middle class. All the while Elon Musk controls everything from supplier to manufacturing to retail & distribution and reaps 100% of the profit and isn’t putting it back into the middle class. green for the environment not for the middle class though which makes up 98% of all the dealership professionals working in the automotive field.

Yes, in fact I can’t ever remember a time where I went to a dealer and drove two different models; but I have test driven multiple trims of the same model…

I’m gonna go ahead and disagree with you on the necessary part of your statement about middlemen. Yes, they are blue collar American workers and make more money than the showroom workers at Tesla. But who’s paying for it? Me, that’s who and the rest of the American public who are forced to buy a car through a dealership. Car sales should be driven by supply, demand and competition, not who can withstand the salesman’s haggling the longest to not get swindled. There is no transparency. You cannot give me one credible reason why independent car dealerships should exist.

1 Like

Interesting conversation. In my view, the current dealership model works very well for savvy shoppers who live in a competitive market. Every dealer sets its price differently, and I save money accordingly.

If there was no price discrimination and everybody paid MSRP, like with Tesla’s model, there’s no doubt I’d be driving a lesser car. I probably wouldn’t lease; I’d buy a Model 3 and drive it into the ground.

It’s a combination of factors – overproduction/overcapacity, volume targets/incentives to dealers, cheap credit – that allow for these cheap deals. $300/month and minimal drive-off for a nice luxury car would have been unheard of 10 years ago and impossible anywhere else in the world. Gross margins on car sales and car manufacturing are slim compared to other industries, so it’s no wonder that Ford, BMW, Tesla, and others are looking into becoming “mobility providers” rather than simply manufacturers.

1 Like

I completely agree with you Michael. Things are much better than they were even ten years ago, but people that frequent this website I’d venture to guess are less than 1/10 of 1% of the car buying public. We, thanks to you and others who run the site, are able to take advantage of these situations. Websites like TrueCar and purchasing through Costco has made it easier for the consumer to get a decent deal.

All that being said, I still read and hear about the sorry sap who walked out of a dealer having lost his shirt. There is very little if any transparency and the deck is stacked heavily in the dealers favor. Most people probably don’t even know how poor of a deal they got and all the extra money goes to one place, to the dealer, the middleman. I see no purpose for them. It is an obsolete system.

Here’s where I see the picture differently than you do. If manufacturers sold the cars themselves they would still have “loser” cars that they just can’t get rid of, last years model that nobody really wants. They’ll have to incentivize them and reduce the prices until they can get rid of them, just as they do now. Even break even or lose money until they are all gone. Supply and demand takes care of that and there’s enough competition to keep prices in check (unless there is price fixing of course).

At the end end of the day, I love this site and have saved thousands using the info and techniques. I just don’t like that we have to work so hard to work a system that I feel shouldn’t even be there in the first place.

2 Likes

I have to say that while I understand what you’re going for here, Anthony, I think the LH forum is the wrong audience. The folks here are the ones who are digging in and learning about residuals, mf’s, etc. in an effort to save those extra $1k or $2k. If the person is the type who wants to dig into the numbers and squeeze every last bit of savings out of it, they will. I have family members who are very highly educated and accomplished and every once in a while they will come around and ask me to help them negotiate a deal. So I do a bit of legwork and give them a clear path to follow (hell, I even offer to go along and go with them sometimes), but there are mostly ever two outcomes: 1) they come back spewing whatever bs lines they were fed at the dealer about their credit, the deal not being available, etc. and feeling like they got an awesome deal on that lexus IS at $800 month (this really happened), or 2) they give up within a day and tell me thanks but they decided to just get it overwith and bought whatever they were after at a dealer-dictated price without cross-shopping. IMO, this is your target audience, and they’re not here on these forums. I can understand what skildner is saying because to those of us here who have the desire to learn about this, your post does come off like a sales pitch. For example, I went over your site and my first thought after looking at half the numbers was that if I could get access to the incentives, mf and residuals I could likely negotiate much stronger deals with a bit of cross-shopping and correct timing (end of month). So yeah, I’ll “forrest gump” my way through it, as you put it, without so much as a second thought.

I’ve also never fully agreed with the whole “your time is worth $75/hr so why spend it doing X when you could be making money,” because it’s not like anybody is taking time off of work and giving up that $ in an effort to lease their car. You will sacrifice some off time (nights/weekends) to make it happen, but by no means did I lose $500-$1k from my paycheck when I went after the Cruze deal from December. And ultimately it was 100% worth it because I’m sitting here paying $70/mo with only a couple hundred due at signing while there were folks over in the edmunds forums, for example, asking if their $1200 drive off $160/mo lease was a good deal—plus I’m sure we both earned full paychecks that month.

Having spent some time working in car sales for some high-end brands I’ve not stopped thinking about the fight that Tesla is having with the dealer lobbies, and while I don’t really have a definitive position yet I will say that with time I think what Amazon did to brick & mortar retailers will play out in some form as it relates to car sales. This seems to be the way Tesla is heading, and I have to say I agree with skildner; while I would miss not being able to haggle, if I knew that nobody out there was getting a deal and it was a breeze of a process instead of the usual car-buying dance I wouldn’t have a problem with it at all. There are a few brands out there that protect their prices by limiting any promotions on them and I buy them happily without ever wondering if/when they will go on sale or walking into the store and using google shopping to cross-check every other retailer out there. It’s the new economy, either fortunately or unfortunately (whatever your viewpoint is), and everyone from the salespeople to the Tesla demo workers to the customers will need to learn how to adapt because at the end of the day what skildner said is right; it’s all about numero uno, because if you’re not looking out for yourself neither is Musk and neither is Joe Blow Manager at BendOver Nissan.

Edited to add: the argument about displacing the middle-class workers at dealers can always be countered, as there will always be other jobs that are either created by the new economy or which one can become educated for. Personally I ended up leaving sales after scoring a couple of deals where I made massive gross (5 figures, and the pay plan at the dealer was insane so I saw a good portion of that) but felt like complete crap that those folks thought they were getting a good deal and I ultimately compromised my morals because I wanted to maximize my paycheck. Everyone is different, but that sealed the deal for me and I was gone (voluntarily) within a month for a completely different field. Car sales have always mostly been transitional jobs anyway for something like 75% of the sales staff (service will always be needed, the office staff will go be office staff somewhere else for the same $), and the traditional dealer model going away would do nothing more than place those folks in a different position at some other corporation. So yeah, if they’re ok with settling for minimum wage at a Tesla showroom then ultimately they will dictate their future, but if they want to earn more $ it’s not like there aren’t already a multitude of other ways they can do that. Heck, what you’re saying Tesla will “do” to salespeople is somewhat similar to what CarMax has been doing to salespeople for years and that seems to be going swell for them since there is literally no shortage of folks willing to do that job.

3 Likes

45 dealerships in 20 years?! Sales is about building rapport with customers. A big part of building rapport is not just closing an individual sale, it’s about building a relationship that leads to repeat business and referrals. I cannot see how you were successful without establishing minimum levels of longevity. Every few months you moved on…? Not trying to be difficult, just saying.

It’s disingenuous to suggest alternative or web-based business models have failed or are always doomed to fail for intrinsic reasons. There are legal hurdles on a state-by-state basis that are probably insurmountable for any web startup to overcome, and will be fought tooth and nail by an entrenched dealership lobby.

Even Tesla, with huge financial resources (i.e. the ability to lobby, change state legislation, and fight litigation) has found the going very difficult.

If the following link is up to date, they can operate legally in roughly half the country, after fighting state-by-state legislative and litigation battles for a while now:

And they’ve been explicitly banned in some states such as Michigan (hmmm, I wonder what the powerful lobbies and vested interests in that state might be?)

1 Like