Real life pricing
#61
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or by a forced close along the lines of "this is our last offer" (which, Chris knows, it really never is).
You are absolutely right, it's hard to predict a specific amount because the actual sales volume will determine the extent to which the dealership can spread its fixed and operating costs, but PAG/PCNA does offer its dealers a nice gross profit margin to play with, at least compared to other higher-end brands such as BMW or Mercedes and alike.
You are absolutely right, it's hard to predict a specific amount because the actual sales volume will determine the extent to which the dealership can spread its fixed and operating costs, but PAG/PCNA does offer its dealers a nice gross profit margin to play with, at least compared to other higher-end brands such as BMW or Mercedes and alike.
Typically I find myself not having to say such things because my clients trust me. I sell 100% honestly and have no issues with saying I need to make a profit. There are instances where if I've had a car for a LOOOOOOOOOOOOOOOOOOOOOOOOONG time, for example the 2006 Cayenne Turbo that I just sold-
end of the day that car was a $7860 LOSS. Meaning, I owned (trade in + floor plan + work and CPO) it for $7860 MORE then I sold it.
I had to get it off my lot. So that's what I had to do.
But back to the original point; I do have situations where Im forced to say something like that.
Hey listen, I'm in this business for my Career and make a living. Thankfully MOST of my clientel don't put me or themselves into situations of conflict where ultimatims need to be spoken.
The 20/80 rule applies here as well. 80% of my clients I have good to great if not really good friendship relationships with. 20% are the absolute grinders.
They're mostly miserable or if not miserable- they're nice but they lie to your face no matter how much you break your ***** trying to sell them a car.
But listen; it's just like any business. You'll have that.
#62
Nordschleife Master
Is the floor plan and service work considered a sunk (fixed) cost of doing business whether or not you sell the car?
Keep up the good work!
#63
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Interest paid for a vehicle (floor plan) is not a fixed cost. It depends on the car and it's seasoning on the lot.
real $$.
Service department charges the sales department full retail on their services.
real $$.
Money- that comes from actual profit- is taken and put on the older unit in stock; that's called a 'write down'.
For example. (not this car, just an example of a real world scenario)
Trade in ACV (ACTUAL CASH VALUE)
$60,000
Service RO+CPO
$4,280
Floor Plan
$1800
Write Down
$5,000
Let's play it out.
I own the car for (within the first 60 days)
$60000+$4280
So I'd have to retail that car for about $72,995 for example.
Car doesn't sell in it's allotted time, thus incurring the $1800 finance charge.
Moves the $64280 cost of the car to $ 66080.
Car still does not sell.
I take $5000 from the previous months profit and place it on this car,
Effectively lowering it's real cost to $61080.
HOWEVER (this is the part most don't catch or understand- basic business 101)
So If I sell that car for $63,500 let's say.
Is it a LOSS or a PROFIT?
Let's see what you guys think.
#64
Chris-
Here is my vote:
This would be considered to be a profit from the perspective that you had already taken the $5000 write down in a previous time period. Otherwise you would be double dipping on the loss.
-Ryan
Here is my vote:
This would be considered to be a profit from the perspective that you had already taken the $5000 write down in a previous time period. Otherwise you would be double dipping on the loss.
-Ryan
#65
Instructor
The price you pay is determined by supply/demand/market conditions. Porsche sales are down 25% for the year. Read that last sentence again. Right now is not simply a "buyers market" it's a buyer's DREAM COME TRUE. Dealers have no leverage. None. The typical base 2009 Carerra has at least $ 12K of pure profit built into the MSRP. That profit rises (sometimes dramatically) with each and every option.)
However, we're talking about purchasing consumables--Porsches. You save 10% on MSRP, but the car drops 10% a year afterwards. It's only a great time to buy a car, if you're able to or needing to buy one. If not, I'd stay away. I'd be nuts to trade my car for a "cheap" 911S, given the lack of demand for a used low-mi 997 911.
Consider instead "investing" in Star Wars LEGO or distressed buys of Leica film bodies and lenses.
J
#67
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You guys who guessed LOSS are correct.
Those who think otherwise; check business 101 and get back to me!
(not picking on your Ryan!)
Sales are month to month, quarter to quarter, semi annual and annual.
Bonuses are paid based on monthly performance. It's how you get the MOST out of a sales environment such as this.
So literally and figuratively- I have no real motivation to extend the same % discount on the 1st of the month from the deal I offered you on the 30th.
And if it's pertaining to MB or someother heavily leased and incentivized car or truck- It's out of my hands when the Mercedes Benz Finance or BMW fianance or Lexus financial take the incentives and cash back away.
You snooze. You lose.
Those who think otherwise; check business 101 and get back to me!
(not picking on your Ryan!)
Sales are month to month, quarter to quarter, semi annual and annual.
Bonuses are paid based on monthly performance. It's how you get the MOST out of a sales environment such as this.
So literally and figuratively- I have no real motivation to extend the same % discount on the 1st of the month from the deal I offered you on the 30th.
And if it's pertaining to MB or someother heavily leased and incentivized car or truck- It's out of my hands when the Mercedes Benz Finance or BMW fianance or Lexus financial take the incentives and cash back away.
You snooze. You lose.
#68
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**** anything is possible.
I'm seeing some Porsche dealership's do REAAAAALLLY stupid things.
To bad by the time the car comes in, the dealership will have been bought by a bigger, stronger dealership and null and void the deal.
12% off an ordered Porsche?
REEEE TARRRRRRRDEEEDD!!
LOL @ that.
#69
Hey guys,
I'm really in for a 2009 c2 but this dealership has just called me and offering me this new 2008 black c2 with MSRP of $80,000 for $65,000. Is this an excellent deal?
I'm really in for a 2009 c2 but this dealership has just called me and offering me this new 2008 black c2 with MSRP of $80,000 for $65,000. Is this an excellent deal?
#70
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Do you like that car? Have you driven it? Have you driven the new DFI car? Do you care about the boost in HP, Xenons new self adjusting clutch, different wheels, larger brakes??
How long are you going to keep the car? Finance? Cash? Were you considering to Lease?
Would you consider an 08 blk/blk with 8000 miles Certified for 6 years/100k?
Inquiring minds want to know!
*see, it ain't as easy as saying 'IS THIS A GOOD DEAL'.
THOSE are just a few of the questions that you should be asking yourself rather then asking if it's a good deal.
YOU not anyone else- decide what's a good/great/stupid deal FOR you. based on your needs/wants ect ect.
#75
Many "Dealers" are about to pay big time for "ripping" their best customers when they thought they had the upper hand!