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Any car dealers on here?


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Long story short I was allowing people to display cars for sale on my lot as a courtesy and occasionally I would sell one of my own that I had owned for years (so they were a loss no matter what), the combination of cars displayed put me solidly in "Retail Dealer" territory so I became one at the suggestion of my DMV guy. So now that I'm a legitimate car dealer with dealer plates, insurance, paperwork, and auction access I'm not having too good luck making money off that segment of my business. I could use some help in this department otherwise I'm going to cease selling cars after my licence expires. Here's the problems I'm encountering:

 

1. Cars at the auction sell for more than I anticipated and cost me at least 1 day of work.

2. Craigslist buying takes up infinite time on the weekend.

3. All the cars have some kind of hidden problem.

4. Customers want to get a perfect 4 year old lease car with 40,000 miles for $5,000, and ironically

5. Customers want a 200k mile $500 car with no problems

6. Reconditioning used cars to a safe and reliable condition without any used car sleaziness removes all the profit plus some of my own money if I want to sell it the way I would want to put my wife and kids in it.

7. "Green light", "Front-line ready", and "Just Serviced" are all lies at the auction.

8. Selling a vehicle and actually getting the money takes way longer and is much more difficult than I anticipated.

.

I know there's a learning curve I just need some help with it. Here are a few questions:

 

What cars sell the best on your lot? (miles, price, condition, age?)

What is a reasonable time frame to sell a vehicle?

What is a reasonable net profit to make on a vehicle?

How long do you wait before wholesaling a dud or taking a loss?

How do you determine the price of a car you are buying and expect to sell it for?

How many cars a month do you need to sell to remain profitable?

How do you advertise a constantly changing inventory like cars on the lot?

 

I'm in NY so all cars must be inspected. Thanks for the help. At the rate I'm going I might as well go to the casino, I might have better results. The only benefit so far is it keeps the mechanics busy during down time and I get lucky occasionally with a car that needs very little and sells quickly. Luck is not a viable business plan.

 

Note: the irony is I can't let people sell their beaters on my lot anymore because I have to "consign" them as a dealer. ugh.

 

I have been using Manheims MMR as a buying guide and KBB clean retail as a selling guide.

Edited by alfredauto
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  • Have you checked out Joe's Latest Blog?

         5 comments
      I recently spoke with a friend of mine who owns a large general repair shop in the Midwest. His father founded the business in 1975. He was telling me that although he’s busy, he’s also very frustrated. When I probed him more about his frustrations, he said that it’s hard to find qualified technicians. My friend employs four technicians and is looking to hire two more. I then asked him, “How long does a technician last working for you.” He looked puzzled and replied, “I never really thought about that, but I can tell that except for one tech, most technicians don’t last working for me longer than a few years.”
      Judging from personal experience as a shop owner and from what I know about the auto repair industry, I can tell you that other than a few exceptions, the turnover rate for technicians in our industry is too high. This makes me think, do we have a technician shortage or a retention problem? Have we done the best we can over the decades to provide great pay plans, benefits packages, great work environments, and the right culture to ensure that the techs we have stay with us?
      Finding and hiring qualified automotive technicians is not a new phenomenon. This problem has been around for as long as I can remember. While we do need to attract people to our industry and provide the necessary training and mentorship, we also need to focus on retention. Having a revolving door and needing to hire techs every few years or so costs your company money. Big money! And that revolving door may be a sign of an even bigger issue: poor leadership, and poor employee management skills.
      Here’s one more thing to consider, for the most part, technicians don’t leave one job to start a new career, they leave one shop as a technician to become a technician at another shop. The reasons why they leave can be debated, but there is one fact that we cannot deny, people don’t quit the company they work for, they usually leave because of the boss or manager they work for.
      Put yourselves in the shoes of your employees. Do you have a workplace that communicates, “We appreciate you and want you to stay!”
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