One possible solution to this IMO, is to set up an appointment-system at dealerships where potential customers who are serious could reserve a set time with a sales-rep for whatever the customer needs.....to order a new vehicle from the factory, to purchase a new or used one, or to just get some info from the salespeople on what is available, not available, for what will be available at any given time. Anyone who does not have a scheduled appointment will be assumed to be there just to browse around, check out the inventory on their own, check out a new vehicle, or maybe do a test-drive.....and dealer-reps won't have to drop what they are doing to accommodate them.

Granted, that's not a perfect solution, since, when making appointments, it's like being at the Doctor's or Dentist's office......one never knows exactly how much time any appointment ahead of you could take, or if you will be delayed. But, although not perfect, IMO it's at least a start.

 

ArmyofOne, please send me a copy of your thesis when completed. It's a great topic.

In summary, the auto industry is pure capitalism at play. Knowledge is power. No effort no gain. Ignorance leaves you at a disadvantage. Scammers and tricks abound. While I hate going into a new car dealership because of the tricks and scams, I take pride in getting a good price if I did my research.

n the end, the consumers will drive the manufacturer and dealership relationship. Smart business will always make happy customers and money, and smart customers will always get a better deal than others. You will have many varieties. Dealerships will not go away. They will just change for a better consumer experience.

 

Dealers already try and encourage this but the bottom line is its a retail business, and people more often than not just show up and walk in off the street. There are a lot of consumers, most of them actually, who do just walk in and ultimately buy a car like they do anything else, furniture, clothes, electronics, etc.

 

This is true. Everyone is different. A good, well established dealer likely will have experienced and tenured product staff. Luxury dealers should have the best of the best..I can’t imagine Lexus or Mercedes hiring anyone without any experience The best will determine exactly how the customer wants to be treated. Some don’t like to be bothered, some want to be treated like a queen, some want “snooty” banter….

I think Lexus had a corporate policy when they first arrived in the scene in 1990 that guests will ONLY be approached by the receptionist at the front, this is part of the experience and the reason why a Lexus costs more money than a regular Toyota.

 

Car dealers are not doctors. I would not want a system where I am contemplating such a significant purchase, and I'm treated like a lower tiered customer because I didn't make an appointment. What if I really think I want a Camry, but I don't really like it, and there's a Honda dealer next door and I decide just to drop in? I will grant you that anyone with an appointment gets priority over walk-ins. Dealers already size up customers and make assumptions about them when the walk in the door; giving them some type of system to "assume" you aren't a serious buyer is not something I want any part of.

 

Oh, imagine it! They absolutely hire people with no experience, no previous sales or car experience...the issue is that you really cant make any money selling cars, so people who are very good experienced salespeople move on to other fields where they can make more money.

Consider, the absolute top, best car salesperson maybe you can make $200k, we're talking high end brand, lots of volume, huge rolodex of past customers, really top of the industry. Most car salespeople make $30-40k, if they are able to put a living together at all. In my business, top people can make well over $1M a year. There are all kinds of types of outside industrial sales and other commodity sales where you can make mid, high 6 figures over 7 figures. If you are a really talented, hard working salesperson why would you sell cars?

So, its hard to attract people like that to car sales. Thats where my concept of well paid sales managers comes from, you can pay $150k+ bonuses to good people who aren't able or willing to put consistent success together in outside sales and attract good talent.

Thats common in most luxury dealers

 

On the topic of sales and marketing, you don't need a formal education to be really good at it. You either wok hard at it (self educate) and/or are naturally good at sales/marketing. The Internet is allowing more consumers to be educated about the car buying process, and the more they know, the more they will not like the current condition of the car sales industry. Hence, you are seeing an evolutionary change and thesis like this one getting more attraction.

Buying cars is still a big ticket item for consumers. You may not need a broker or agent like RE, but you do need to be educated from time to time when shopping. Those that are ignorant of it will lose out.

When I walk into a dealership, it's like walking into a flea market. Haggle, low ***** but no personal insults because none is taken or given. That's how the rest of the world does business in case some of you who do not get out of the USA much. The moment a buyer or seller takes something personal, deals are harder to make.

 

This is absolutely true. My dad never graduated from high school and he made $400k a year in the 90s (which is a lot now but it was a LOT then) in industrial sales. I know a ton of hugely successful people in my business with no college degrees

Before my Dad retired he had gone on to head his division and he used to clash with his company all the time when they didnt want to hire great salespeople because they didnt have college degrees. His argument always was "You wouldn't have hired me?!"

There is actually a growing market for vehicle brokerage services where you do represent a buyer and negotiate their deal for them for a fee, I do it for friends for free. I talked to a few of them when shopping for my S Class. A lot of them in the BMW world.

 

i think it was a brand policy. I believe it was printed in all their literature. But I can’t find it

 

I'm sure it was, it was already in their market.

 

How about this “gem”. Getting my second “free” oil change at the CDJR dealer I bought my TourX from. Presenting the mighty Wrangler Rubicon 392. $3500+ worth of blinker fluid + $10k market adjustment.

 

ArmyofOne, you may also want to looking the changing business of the banking industry (consumer facing) particularly how some banks are going retail in lieu traditional corner lot standalone buildings, and even just drive thru banking, and online loans and services. Research on Chase, Region Banks, and a few others who are changing strategies. They are synonymous with the sales side of the car industry.

Then investigate the changing strategies of healthcare (the consumer side) regarding appointments, walk-ins emergency facilities versus hospital and emergency hospitals, and telemedicine and remote sensors/diagnostic tools. That's where the service side of the auto industry will be heading too.

 

Also very good suggestions, especially the consumer facing side of banking.

 

Unbelievable...

I mean, at least call it all a market adjustment!

 

But that would be inaccurate…. See, they’ve always had thousands of $$$ of fluff added to the sticker price - on both new and used cars. The ADM, however, is reserved for the special cars.