no discount for cash
Discussion
E30M3SE said:
So they offered discount if you took their finance but not if you did not??
Don't think that is quite 'right'.
Take them up on their finance deal, and the discount, and then settle in full within the first 7 days.
Correct,i would imagine there will be a early settlement fee somewhere in the small print.Don't think that is quite 'right'.
Take them up on their finance deal, and the discount, and then settle in full within the first 7 days.
Raverbaby said:
EK993 said:
I really struggle to understand why people think that paying cash should mean a discount - what benfit does the dealer get from doing a cash deal for a car versus them getting additional commission for selling a finance deal?
If one has cash for a car then surely hes not going to enter into a finance deal.So if theres no discount up for grabs then customer will move on to somewhere that will offer a discount, this would mean the dealer still has cars on his forecourt and wont turn metal into money, which is surely what his aim is.
Its only natural to want a bit off for cash bruv
It's my understanding that main dealers purchase their cars from the manufacturer at a set price, try and sell the car for a RRP and have a minimum amount that they will accept for the car to keep their profit margins intact. The salesman will then add his commision onto the base dealer's base price and he will have a figure between the RRP and his base price to work with. So....
Would it be possible to walk into a main dealer, say to the manager "I don't want to deal with a salesman, but I'll give you the bottom price you can go to while still meeting your profit margins for the car I know I want and I'll pay by debit card right now" and actually get a deal done?
Salesmen, is my understanding correct? eg Ford's price = X, dealer's price = X+10%, list price = X+20%, sales commission is 10% and therefor bargaining amount is whatever part of that last 10% the salesman is willing to let go? (figures and %'s used for ease)
Happy to be told how it really works, if anyone will be totally honest!
Would it be possible to walk into a main dealer, say to the manager "I don't want to deal with a salesman, but I'll give you the bottom price you can go to while still meeting your profit margins for the car I know I want and I'll pay by debit card right now" and actually get a deal done?
Salesmen, is my understanding correct? eg Ford's price = X, dealer's price = X+10%, list price = X+20%, sales commission is 10% and therefor bargaining amount is whatever part of that last 10% the salesman is willing to let go? (figures and %'s used for ease)
Happy to be told how it really works, if anyone will be totally honest!
irodger said:
It's my understanding that main dealers purchase their cars from the manufacturer at a set price, try and sell the car for a RRP and have a minimum amount that they will accept for the car to keep their profit margins intact. The salesman will then add his commision onto the base dealer's base price and he will have a figure between the RRP and his base price to work with. So....
Would it be possible to walk into a main dealer, say to the manager "I don't want to deal with a salesman, but I'll give you the bottom price you can go to while still meeting your profit margins for the car I know I want and I'll pay by debit card right now" and actually get a deal done?
Salesmen, is my understanding correct? eg Ford's price = X, dealer's price = X+10%, list price = X+20%, sales commission is 10% and therefor bargaining amount is whatever part of that last 10% the salesman is willing to let go? (figures and %'s used for ease)
Happy to be told how it really works, if anyone will be totally honest!
No. the salesman wont get the last 10% of the deal as 'commission'.Would it be possible to walk into a main dealer, say to the manager "I don't want to deal with a salesman, but I'll give you the bottom price you can go to while still meeting your profit margins for the car I know I want and I'll pay by debit card right now" and actually get a deal done?
Salesmen, is my understanding correct? eg Ford's price = X, dealer's price = X+10%, list price = X+20%, sales commission is 10% and therefor bargaining amount is whatever part of that last 10% the salesman is willing to let go? (figures and %'s used for ease)
Happy to be told how it really works, if anyone will be totally honest!
irodger said:
daemon said:
No. the salesman wont get the last 10% of the deal as 'commission'.
Thanks for the reply 
How does it work then? Does the salesman get a % of the final sale figure?
bananaman1 said:
E30M3SE said:
So they offered discount if you took their finance but not if you did not??
Don't think that is quite 'right'.
Take them up on their finance deal, and the discount, and then settle in full within the first 7 days.
Correct,i would imagine there will be a early settlement fee somewhere in the small print.Don't think that is quite 'right'.
Take them up on their finance deal, and the discount, and then settle in full within the first 7 days.
E30M3SE said:
bananaman1 said:
E30M3SE said:
So they offered discount if you took their finance but not if you did not??
Don't think that is quite 'right'.
Take them up on their finance deal, and the discount, and then settle in full within the first 7 days.
Correct,i would imagine there will be a early settlement fee somewhere in the small print.Don't think that is quite 'right'.
Take them up on their finance deal, and the discount, and then settle in full within the first 7 days.
daemon said:
Typically they will get a percentage of the profit in a deal. OR they may get a flat rate per car sold. The controlling influence will be the sales manager. It will be up to him to set sales targets, agree bonuses, etc, NOT the salesman otherwise you could end up in a scenario whereby a salesman only sells one car a month for list price but gets one huge bonus.
Cool, thanks for the info Irodger, salesmen are paid on a number of different structures, though I don't know of one anything like how you described. Usually its a percentage of the total profit made by the chassis, any associated insurance products and finance commission. This percentage escalates in certain bandings dependent on the number of cars sold.
If not this, then a flat rate per car, with the flat rate again depending on units sold. I get paid in this way, though the commission per car also incorporates a Finance and Insurance profit per unit element. For example, if I sell between 1 and 11 cars over the course of a month, I'm paid a meagre £25 for the unit. I then have the amount of profit I have made through finance and insurance divided over the number of units to give me a F&I PPU. If this fails to achieve a certain amount, I don't get paid a bean extra.
Ie, if I sell no finance or insurance, I get paid a crap flat rate for the car and that's my lot. Hence no discount for cash.
If not this, then a flat rate per car, with the flat rate again depending on units sold. I get paid in this way, though the commission per car also incorporates a Finance and Insurance profit per unit element. For example, if I sell between 1 and 11 cars over the course of a month, I'm paid a meagre £25 for the unit. I then have the amount of profit I have made through finance and insurance divided over the number of units to give me a F&I PPU. If this fails to achieve a certain amount, I don't get paid a bean extra.
Ie, if I sell no finance or insurance, I get paid a crap flat rate for the car and that's my lot. Hence no discount for cash.
robsco said:
Irodger, salesmen are paid on a number of different structures, though I don't know of one anything like how you described. Usually its a percentage of the total profit made by the chassis, any associated insurance products and finance commission. This percentage escalates in certain bandings dependent on the number of cars sold.
If not this, then a flat rate per car, with the flat rate again depending on units sold. I get paid in this way, though the commission per car also incorporates a Finance and Insurance profit per unit element. For example, if I sell between 1 and 11 cars over the course of a month, I'm paid a meagre £25 for the unit. I then have the amount of profit I have made through finance and insurance divided over the number of units to give me a F&I PPU. If this fails to achieve a certain amount, I don't get paid a bean extra.
Ie, if I sell no finance or insurance, I get paid a crap flat rate for the car and that's my lot. Hence no discount for cash.
Thanks for clearing that up If not this, then a flat rate per car, with the flat rate again depending on units sold. I get paid in this way, though the commission per car also incorporates a Finance and Insurance profit per unit element. For example, if I sell between 1 and 11 cars over the course of a month, I'm paid a meagre £25 for the unit. I then have the amount of profit I have made through finance and insurance divided over the number of units to give me a F&I PPU. If this fails to achieve a certain amount, I don't get paid a bean extra.
Ie, if I sell no finance or insurance, I get paid a crap flat rate for the car and that's my lot. Hence no discount for cash.
Who provides the commission from the finance and insurance? Is it direct from the finance company? And do they have set targets with the dealer who in turn pass on the finance co's targets to the sales team?
Would you ask a customer how they are paying first and then work out a price for the car based on that? If a customer asked got a price based on finance and then said "ooooh, that's cheap, I'll take that but I'd like to pay by debit card tight now", would you have to renege on the deal?
Sorry for all the questions. I've often considered a career in car sales, but no one has ever been helpful in letting me understand how it works. Most salesmen seem to treat you as a threat as soon as you mention how it all works. Internet searches tend to throw up people who think they know how it works yet have no experience of it at all. As such I never get by the 'mildly interested' stage!
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