Last post on Dec 10, 2007 at 1:52 PM
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What is this discussion about?
#423 of 462 Re: Determining holdback [dash5]
Nov 27, 2007 (12:36 pm)
All of those things are interesting to know but every car has a market value. If what you offer makes sense, you'll have a deal. If not, they will walk you.
The finance profit, if any, won't be considered by the sales dept and they can't assume you'll ever use thier service dept.
It sounds like you are trying to be fair and you will probably drive out with a new car.
#424 of 462 Re: Determining holdback [isellhondas]
Nov 28, 2007 (5:33 am)
Rather than saying "I want to pay $X because I know the invoice is $Y and holdback is $Z and I know there is a dealer incentive of $W and...", just say "I will pay $X for this car".
#425 of 462 Re: Determining holdback [isellhondas]
Nov 28, 2007 (6:42 pm)
Besides flooring, the overhead to run a store is a lot higher that most people would imagine
Truer words have never been spoken. Check this out.
I read your post earlier and it got me thinking so here is what I did. I took the average number of new cars and trucks that we sell a year and multiplied it by the average hold back.
Then I multiplied our average monthly expenses here including floor plan times 12 to get a figure for the year.
A years worth of hold back is equal to 3 months worth of expenses in our store, and we have our expenses under control here and have a slim advertising budget.
#426 of 462 Re: Determining holdback [joel0622]
by kyfdx@Edmunds HOST
Nov 28, 2007 (7:28 pm)
I'd think an extra revenue stream that covers 25% of your expenses is substantial... Not sure what argument you are trying to make here...
Not too hard to figure out how cars sell for under invoice..
#427 of 462 Re: Determining holdback [kyfdx]
Nov 29, 2007 (6:28 am)
No argument, just an observation. Isell just got my wheels turning and got me thinking about it.
Besides its not an extra revenue stream its just the way the business is structured. If the manufacture did not offer hold back our dealer invoice would just be that much lower. They try to make you think it is something they are doing for the dealer but it is just another way to distribute $$ that are ours in the first place.
Also every one know that you are not in the new car business to make big money, it is just gives you the ability to sit under a Manufactures sign and sell used cars and new trucks.
#428 of 462 Re: Determining holdback [joel0622]
Nov 29, 2007 (6:30 am)
Are you saying that the holdback alone covers 25% of all the expenses in your store, including the used car and service departments and all the salaries? If thatís true, it is simply amazing! I bet that the 300% markup in your service dept. pays the rest of the bills and then some. Not to mention the profits on the used cars.
#429 of 462 Re: Determining holdback [exb0]
Nov 29, 2007 (7:26 am)
My god, you people are like Hyenas on a dead Zebra. My statement was painted with a broad brush as a generalization, thinking out loud more then anything.
I always tell myself to stay away from the holdback forum.
#430 of 462 Re: Determining holdback [joel0622]
Nov 29, 2007 (8:32 am)
My apologies, Dead Zebra. But I really appreciate your post. Lifts a little guilt of my shoulders when I beat a SM down to $1K under invoice while heís whining to me and wants to know if Iíll pay his mortgage.
#431 of 462 Re: Determining holdback [exb0]
Nov 29, 2007 (9:12 am)
The ONLY thing holdback even remotely cover is the flooring expense on a new car.
Depending how long the car sits on the lot, it may not even cover all of that.
All other expenses are covered out of the profit generated by the dealership,just like any other business.
#432 of 462 Re: Determining holdback [exb0]
Nov 29, 2007 (9:46 am)
Yeah, this is a good forum for me to stay out of and I know this.
Now service has a 300% markup ??