Talonz Posted January 5, 2012 Share Posted January 5, 2012 Just thought I would share my recent experience SELLING CARS .... OK, my kids are getting older ( teenagers now - DAMN ) and working in I.T., at least in WNY, doesn't pay very well...I held two different tech coordinator/network admin jobs in the past decade at two different large private schools. The second school only lasted about a year and a half - it is a very well known school that shockingly paid TERRIBLY... My salary wasn't bad - 40k and change to start, but the family health insurance was $13000.00 a freaking year!!!! So I was really only making 27k w/family health insurance... Sure no one twisted my arm to work there and I failed to negotiate for a salary like I should have and in addition I didn't find out how much the insurance was until I started ..... I know I know...VERY DUMB on my part..... I really didn't like working there ...The hours were great since we got a ton of off time, but that was about the only bright spot! Anyways, so as contract time was coming up I bucked for a large raise, but not insane - I said I needed AT LEAST another 7K a year... About a week later I was terminated. Shown the door. Thrown out like rotten fish. Never happened to me in my entire life!!! ACK Oh I could go on about that joint but that isn't what I wanted to discuss - Just wanted to give background info ... So after some soul searching I said " why don't I try what my Dad did for 20+ years ??? " ... My Dad was good. Very good at selling cars. He wasn't a slimeball and he treated people with respect. Problem is he retired 15 years ago and my oh my has the car business changed. My reasoning was there was no way I was going to make less than I did in I.T. NO WAY... HA HA HA !! Boy was I wrong. I will tell you this much about selling cars. Let me shout it to the hilltops : DON'T DO IT! Getting hired was not very hard. I worked for three different dealerships in about seven months time! Let me explain why: First dealership: Old domestic lot - decent sized - started out with a few other "green peas". After training I hit the floor for a few weeks and started to realize quickly that it just wasn't going to work. You want to know why? --- Guess how much a car salesmen makes on your average *NEW* car? $100.00 Yup. $100.00 Now don't get me wrong - there are new cars that pay more, but I'd say 2/3'rds are going to be what they call a "flat" - $100.00 . I've sold cars/trucks that were $45,000.00 and made..Yup..you guess it $100.00 . You can make good money on used - $200-400 is the norm, but the used inventory at the first dealership SUCKED so there wasn't much hope of doing much used business there... So I jumped to a foreign dealership - It's a dealership that advertises ALL THE FREAKING TIME ( if you live in WNY you'll know ) ... Oh boy was this a mistake...hahah OK, if you are still reading I appreciate it and will take time to explain the draw -- How much does a car salesman make? Well here is how it works at most dealerships ( at least the three I was at ) - You are on a draw. What is a draw you may ask? Well it's a loan. A loan? HUH? Yup. OK - this is how it worked at my second dealership, which really SUCKED - ( the other two "forgave" the drawn each month ). You have to clock in and out on your scheduled days on. All told you work about 45-48 hours on the clock a week. Take minimum wage the multiply it by 40 + whatever overtime... Let's say your check is for $350.00 a week. Ok so the dealership is "loaning" you the $350.00 a week - you don't actually "earn" it. If you don't sell anything that week you are -$350.00 in the drawn. Don't sell anything the next week = $700.00 in the drawn... Ok, so week three comes and you sell a car that pays $150.00 . You only sell that one car. You then take $1050.00 and subtract the $150.00 and you still owe the dealership $900.00 ! This can go on for months. There were guys there before me that left owing $4000.00+ !! Once you leave obviously you don't pay them back - You may think selling one car in three weeks must mean I sucked? Nope... There are days and sometimes SEVERAL days working at a car lot that you will not talk to anyone or anyone even close to buying a car. At the second dealership I worked at there were only a few salesmen. Often there were only one or two of us working on a shift, so it wasn't like I was slow, etc.. It's just how it goes. The secret to making "decent" money is that you must sell 10 cars a month. Period. End of story. No debate. 10 is the magic number. Hit 9? Tough. You get ZERO. Hit 10 and you make a nice bonus. Not great, but nice. Again 10 cars in a month doesn't sound like much at all, but please trust me IT IS. Also car manufacturers offer "spins" on cars - The first domestic dealership I worked for had a decent manufacturers bonus program ( like $75.00 a car if I remember right, but you had to complete six months of service, so I didn't make it ). The second dealership which sold a foreign line had really good "spins" actually - At the end of each week they would load $$ onto a debit card... But again if you ain't sell volume, you ain't making much here either The third dealership I worked at was another domestic brand that had really crappy "spins" from the manufacturer - almost a non-factor which is shocking... Anyways, back to the second dealership - After working there about 3 1/2 months and never really making much more than minimum wage + a little $$ loaded on my debit weekly, I left. I feel as far as $2000.00 or so in the draw, managed to work my way out, only to fall back in... I couldn't take it and promptly left --- I jumped to a third dealership...This only lasted about five weeks... Let me tell you something rather obvious. SELLING CARS IN WNY DURING THE WINTER SUCKS. This dealership had 15-16 salesmen and very few were on pace to bonus for Decemeber, and let me tell you this December wasn't bad in the weather dept. I can only imagine Jan + Feb. OMG... No thanks... So I resigned... I just didn't have it in me to do it any longer. If I would have worked at Mighty Taco for the seven or so months I sold cars I would have made more.. Oh and let me tell you some things I learned - The advertising a dealership does reflects pretty closely how they treat a customer. Those dealerships that advertise a 1000 times a day with obnoxious commercials treat their customers accordingly .... hahah Want to cut out all the BS when looking for a car? Just tell them you went to their closest competitor and they offered the same car or similar car at invoice. Just about every dealership will still sell you the car at "invoice", which is suppose to be the "cost" to the dealership..... Of course manufacturers give dealerships incentive to sell volume that you don't see in the invoice, so most of the time invoice is a easy/quick way of getting the best price you'll get...I never saw a car sell for under invoice... Take this as gospel and a golden nugget of knowledge if you don't know this already : New or used car shopping? Not in a huge hurry? WAIT UNTIL THE LAST DAY OR TWO OF THE MONTH!!! If you time it right go to a dealership a the beginning of the day on the last day of the month...Make sure you are there early so you can work out any kinks by the end of the business day. Dealerships ALWAYS give you the best deals in this timeframe -- Remember the last 1-3 days of the month !!!! Some other random things : Folks if you are going car shopping please be ready to purchase. Don't have six months left on a lease and are thinking about switching to another car brand so you want to test those... Car salesmen far and wide *HATE* this. You are waisting their time and your time. Remember the essay above about pay? Don't go waste someones time for an hour or two if you have no intentions on buying. On the fence? Fine...Let someone "sell" you a car. There to kill some time while wife shops? Please don't. You are taking the opportunity away from that guy/gal from making any money. I'd say from what I've seen even the best salesmen who have been doing it for 20+ years will only get about 1 in 7-8 people to come back if they don't buy then and there. For less polished guys like me it was closer to 1 in 10-12.. The average car sale takes about four hours total. Car salesmen are responsible for obtaining new insurance, getting the vehcile clean , gas in the tank, oh selling the car ( haha - that comes first and takes 1-2 hours alone most of the time ), getting paperwork signed, approved, deliverying the car and explain its features.... Yea four hours is about right. Sometimes longer...Not often shorter.. Most dealerships give car salesmen very little training, if any. One out of three of mine had a week long training. The other two? Nope. Every manufacturer makes you get certified in a certain amount of time, but learning the vehicles and all the features is only a small portion on what you need to know.. Yup you pretty much get thrown in to the shark tank right away.. HOPEFULLY some of the other guys help you learn the system, but most of the time it's flying blind. Your sales manager can be your best friend and your worst enemy. Sales managers determine how much your paycheck will be... They are the ones that decide to take a deal or not. There is no real line there.... Well I hope that was a little entertaining and informative. Don't get me wrong - there are guys/gals that make bank selling cars. I worked with guys who make 80-90-100k a year. Of course you have to be good to last in the business so making that type of money means you've been in the business for 10+ years. When you are new you have ZERO customers. It takes AT LEAST three years to build up your book of business and to get a decent amount of repeat customers. It's actually closer to five before you really start to see it... So would I have made more if I stuck with it? Probably. But I'm not working on minimum wage or thereabouts for the first one, two, or three years... So I moved on. Left the car business last week never to return. Thanks again for reading if you did make it all the way through. I had more to add but I thought I would save the novel version for a later date hahah . I can answer any questions if you have them about buying a car - leasing vs buying, how to negotiate, etc. Link to comment Share on other sites More sharing options...
The Poojer Posted January 5, 2012 Share Posted January 5, 2012 I tip my hat to salespeople...its one of the many traits I have a serious deficiency of. I hate rejection, which you'd think I'd have plenty of experience with, nor do I have that aggressive closer aptitude.... Link to comment Share on other sites More sharing options...
Phlegm Alley Posted January 5, 2012 Share Posted January 5, 2012 I can relate to a certain extent. I've done radio/media sales for the home radio station of the Philadelphia Phillies where you worked off of a draw, which is a difficult concept to grasp, but you've explained it fairly well. In my industry, you had to cover your draw, which meant you had to bill at least enough on a monthly basis to cover it. Any additional money you billed on top of your draw, you would make commission on. However, you had a make or a miss rate of commission, which were several boxes you had to check off. If you check them all off (certain things like make your digital budget, make your auto sales budget, make your one day sale budget, etc), you would make your make. If you failed to sell a certain initiative, you would make your miss, which was a smaller percentage of commission. I was being paid an annual salary of $30k, but the commission rates were pretty good (26% for new business), where the average sale was about $5,000/month. The reason why it is tough to make a lot of money is because of the attrition. If you had 3 clients that were annual contracts, you would do well, but the annual deals were few and far between, so it is difficult to get that "base billing" that comes with several years experience in order to make a lot of money. Radio sales were a 24 hour a day job, requiring regular attending of networking events, often requiring you to shell out your own cash for drinks/dinner with clients, parking (when in a major city can run you $7-$11 per hour) and it can all add up. Not to mention the wear and tear you put on your car because you are in outside sales. I became frustrated at not being able to bank on making a certain amount of money every month. Certain months in the industry can be very dry and not a lot of people make money, which is difficult to deal with. The last few months have been tough and I started seeking new opportunities. I jam happy to say I just handed in my letter of resignation last Tuesday after getting recruited to do inside sales for a growing technology software company that recently got voted as being one of the top companies to work for in Philadelphia. I get a 30% increase in base salary ($40k/year) and I don't have a draw. Straight commission on anything I sell, which to start is 17.5% commission, which can increase to 25% commission if I hit accelerators. Plus, I get as much vacation time as I need, and the benefits are great. Sales is tough for sure, but car sales and radio/media sales are some of the tougher industries to sell for. I am sure you could find another sales opportunity and your experience selling cars would have prepared you well for it. Link to comment Share on other sites More sharing options...
Just Jack Posted January 5, 2012 Share Posted January 5, 2012 So I jumped to a foreign dealership - It's a dealership that advertises ALL THE FREAKING TIME ( if you live in WNY you'll know ) ... Oh boy was this a mistake...hahah ... Fuccillo? You have to clock in and out on your scheduled days on. All told you work about 45-48 hours on the clock a week. Take minimum wage the multiply it by 40 + whatever overtime... Let's say your check is for $350.00 a week. Ok so the dealership is "loaning" you the $350.00 a week - you don't actually "earn" it. If you don't sell anything that week you are -$350.00 in the drawn. Don't sell anything the next week = $700.00 in the drawn... I worked at an electronics store in a mall here in Syracuse (Silo) one Christmas as temp help about 20 years ago. Being temp, I was paid minimum plus commission. The regular sales people were all on the draw via commissions. Eventually I figured I'd be the nice guy and if someone came in wanting to buy, and one of the regulars wasn't busy, I'd hand them off. It was there that I figured I was not good at hard sales so I've avoided those type of jobs since. I do remember the scale, 3% for electronics, 4% for clearance, and 5% for accessories. Link to comment Share on other sites More sharing options...
erynthered Posted January 5, 2012 Share Posted January 5, 2012 Talonz, your post brought back a ton of memmory's. I've been out of the car Biz for about 11 years, but spent over 25 years in the car business. Its not what it used to be, that for sure. I made a **** load of money back many years ago in the car biz. Most of my time was spent in Mngt, so we DID make more than the "green Peas" One of the things that changed, and a reason I got out was that the single point franchises were getting gobbled up by mega dealers. And so one of the first thing dealers cut is commisions. I remember one place I worked commish was; 25% 30% 35% plus 10% back end money, with a demo. Cha Ching!! After being bought out that all got cut to 20%, thats it. And the dealer pack went up too. Hell, I could go on and on. Link to comment Share on other sites More sharing options...
SageAgainstTheMachine Posted January 5, 2012 Share Posted January 5, 2012 Link to comment Share on other sites More sharing options...
BuffaloBill Posted January 5, 2012 Share Posted January 5, 2012 Interesting because my wife and I need to go out and buy a replacement car for the one that was wrecked. My sales guy in Dallas is willing to deal - to the point where I can put the car on a truck and have it shipped here for less than what the local dealer wants to sell. I'm getting "not exactly the same car ...blah blah." My response to the local guy has been then sell me the same car for the same price (btw they are the same make and model). It's my understanding that dealerships really make their money on parts and service. I get the idea that sales is treated as a necessary evil by everyone involved. The whole process is screwed up. Link to comment Share on other sites More sharing options...
erynthered Posted January 5, 2012 Share Posted January 5, 2012 Interesting because my wife and I need to go out and buy a replacement car for the one that was wrecked. My sales guy in Dallas is willing to deal - to the point where I can put the car on a truck and have it shipped here for less than what the local dealer wants to sell. I'm getting "not exactly the same car ...blah blah." My response to the local guy has benn then sell me the same car for the same price (btw they are the same make and model). It's my understanding that dealerships really make their money on parts and service. I get the idea that sales is treated as a necessary evil by everyone involved. The whole process is screwed up. There are 5 profit centers in a dealership. Parts and service is one of them. Most of the money dealership service depts make is off warrenty claims. Link to comment Share on other sites More sharing options...
Richmond_Bills Posted January 5, 2012 Share Posted January 5, 2012 My one and only job that involved sales was absolutely brutal. Background - I had worked as an area controller/accounting manager for a large company in the area for 8+ and they shut the doors - not the same company as Pooj (Circuit City), but this was in the same time frame. In my previous role I worked hard, but had a ton of autonomy, boss was in FL, had my own office, etc. Well, I get laid off so I go to a local big name staffing company. I was totally looking for their assistance in finding me something, full time, contractor, etc. So I'm going through the routine and I met with a large number of people from their company. So after about 2 hours, the original guy that I met with comes in and says "how would you like to come work for us? your personality is great and i think you'd do great". I honestly had always wanted to get into sales and I agreed that I'd be a fit. Also, this is the very next day after getting laid off and knowing that there was going to be a flood of supply due to my company and CC closing the doors - I had to take it right? So we went through the negotiations and I took the job. I was selling senior level accounting and finance "temps" - staff accountant to CFO. Well wow. There are so many things that were working against me. The ONLY good part about the job was that they gave me a $60k base with a 9 month rampup to less base/more commission (or I could change over any time i wanted if i was successful). All of the negative stuff. I'm 4th person on a 4 person team - I was warned very early - don't call on any of these companies (given a list of basically all of the major employers in Richmond). I started the week of Thanksgiving - the slowest time in staffing is between Thanksgiving and New Years. The call quotas were absolutely ridiculous - I had to have 125 "connects" per week - this means I had to actually speak to 125 people - realize this required making about 800 calls because of voicemail, hangups, etc. I also had to get 10 "site visits" per week - so I had to have 10 people agree to let me come out and talk to them per week. For the record in my time there, I never hit any of those previous goals. Other negative things - we had to do all kinds of meetings, conference calls and role playing scenarios - on top of the 800 phone calls that needed to be made. If you walked in the office after 7:30 or left before 6:30 it was BAD NEWS. Oh and I almost forgot - I was in a cubicle not more than 3 feet from my boss who would listen to and critque every single call. Oh yeah and it was a suit every day - regardless if you were meeting a client or not. Long story even longer, after about 2 months I was desperate for another job. Anything. I would get home from work and immediately apply to about 15-20 jobs. The job market sucked (both as a candidate and as a staffing person). All total I lasted just over 3 months. My bosses boss scheduled a meeting to come in to town to review my Professional Development Plan - part of which I would have to do a ton of work researching, etc. I didn't do it. I had an intuition of what the meeting was really about - and I was right. Me and 2 others were canned that day. In all - during the 3 months on the team - not one job order was filled by anyone on my team. Oh and of the 17 people at the office when I started, only 7 were left after my wave of being canned. Never, ever, ever, ever would I wish that job on my worst enemy....... Link to comment Share on other sites More sharing options...
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