From digest.v6.n788 Thu Jun 19 16:10:06 1997
From: BMW_at_comet.net (Phil Marx)
Date: Thu, 19 Jun 1997 11:38:06 -0500
Subject: Re: BMW sales job (sore point)
Mike Biles responded:
> I think you aren't looking at BMW dealers and salesmen realistically
>(that goes for the others in the group that have complained about them).
> We BMW owners are BMW owners because we love the cars, and I think
>there is a tendency to look at BMW dealers and salesmen as having the same
>attitude about the cars as us. The problem is that they are not BMW dealers
>and salesmen but auto dealers and salesmen that happen to sell BMWs. They
>don't see that M3 as a beautiful piece of German art/engineering but they
>see it as an expensive car that they will make more money off of than
>selling a chevy.
> We as BMW lovers need to forgive those poor fools who can't
>appreciate the real value of the cars they sell (or the devotion of their
>owners). And we need to find those few dealers and salesmen that are true
>BMW dealers and salesmen not just salesmen who sell BMWs.
>just my .02
>BTW the same goes for Porsche dealers and salesmen too.
First off, I should be offended by these remarks but then, I worked for a dealer for 20 years, but don't anymore, so I guess that leaves me out. Of course you graciously allowed for the existence of a "few" good ones. However your assessment of what's important to "the group" (Digest members) when they are looking to buy a car slams into the reality of what we really often ask in this forum which is:
"I'm looking at (X model) BMW and my local "stealer" has "offered" it to me for $xxxxxx, which is $xxxx over what Edmund's site tells me the dealer invoice is. Where can I save another $50? Any help?"
I'll stick my neck out and say that the pitiful state of BMW sales professionalism is a direct result of consumer demand. Its the old WalMart analogy. (Or Carmax, to keep it automotive) If you're not willing to pay for professionalism and price is your primary concern, that's all you're going to get and quit the bitching. Sure there are exceptions and those salespeople have a following of repeat business and referrals that can/may support them. But rebates, invoice cost services and over dealerization without regard to quality have given us that about which you now complain. Its incredible to me that professionals earning over $100,000/year (customers) would spend days driving, faxing, phoning to save $500 on a $60,000 purchase. Is it worth it? Or is it an addiction caused by the current consumer environment? The expectation on the part of the consumer for the treatment he deserves in such a major purchase is of near-inverse proportion to the profit made on the deal, simply because the product is a BMW and costs a lot of money.
For the sake of illustration, assume the average gross profit to the dealership on any BMW model is about $2500. That's probably not far-fetched and may be high for some markets, certainly if you factor out the hot new models. And, of course, this is based on vehicle sales with an average sticker of maybe, what, $45,000? using the 528i Premium Pkg as a middle-ground. At the average dealership, the salesperson does not participate in the dealer hold-back paid by the manufacturer, some dealerships do not pay on factory incentive monies, which are considered part of that $2500 gross. Most dealerships assess "lot fees" or other forms of "pack" on cars, some percentage based, many well in excess of $500 per unit. Most salespeople don't participate in the finance income, which for most domestic stores is greater than vehicle sales profit by a factor of 2 or 3. It is quite conceivable, and even generous, to say that on the average BMW sale, the average BMW sales person is paid a commission on an effective gross profit of less than $2000, sometimes, way less, and remember this is an average. Of that, often the commission schedule calculates either a percentage or a volume-based compensation which means, for our purposes, maybe 15%, or maybe $300/BMW sale. Ok, so double that amount if you feel better, what does the salesperson actually bring home for his professional treatment of you over the average 90-120 day contact period during purchase consideration? If you ordered $600 in merchandise from Land's End, Sharper Image or LLBean, they've made more from your phone call than your BMW salesman will realize from 10 hours spent with you, and 20 hours following up on your happiness for the next 4 years of ownership. If you purchased a $500 watch from a local jeweler, their profit exceeded what your BMW salesman made selling you that $45,000 car. You don't go into Sears and negotiate that new appliance purchase. Where else does a salesperson have to endure what happens in the car arena? Everyone knows his/her cost. No one expects to pay near the retail price. But, they all want exemplary treatment and consideration. Where else is the profit margin on a major purchase 3%? Consider also that the Salesperson costs the dealership nothing and that to most dealers, adding more salepeople can increase sales with no additional cost. If they don't sell, they don't pay them. If 5 people can sell 25 cars/month, maybe 10 can sell 50, or maybe not, doesn't matter. The actuality is those 10 may still fight over the same 25 sales. The actual dollar cost to the Dealer is the same. You can figure the true cost in terms of moral, customer satisfaction, etc. Normally in such situations the gross profit drops as well, the salespeople are starving and scared. This is the real world.
What's the point? Well, I guess just don't overestimate what you're paying for the service you are provided by those you actually come in contact with while purchasing a BMW. Of course, when you do find that rare guy or gal who really knows their stuff, treat them with respect, support them and count yourself lucky. The cards are definitely stacked against them. (And remember, if you tipped them $25 for each $100 discount they gave you, they'd be better off.)
BTW: yourself. I also sold Porsche for 20 years. And remember their idea of doing away with the dealers and operating regional distribution centers which didn't fly years ago? Ford's playing with the concept today. You may not have the salesperson to kick around much longer anyway.
I'd be interested in hearing BMW's response to all this slamming of salespeople, but we won't. I know the Training Department of BMW is dedicated to turning out professional BMW salespeople and their emphasis has always been on customer treatment, product knowledge and listening to the customers needs, never on gross profit. They provide the tools, the people and spend a lot of money to help the dealerships solve the problems you find. It is the dealers who control what is done with this support.
Right Barbara N.?
BMW salesperson enthusiasm test:
Ask them "what is an Isetta". (This will suprise DC area afficionados who think their used BMW resellers are gods)
Ask if they are familiar with the 2000 series BMW, see if they know how many doors these had (answer is usually "2", of course you know......)
See if they call the M52 engine a V6.
(You guys in Baltimore have already had fun with this one!)
Do they still refer to BMW radios as Blaupunkts? (They've been incompetent for way too long.)
Ask them to explain the "integral link". (We've gone far enough)