How many vehicle salesmen does it take to change a light bulb?
May 19th, 2010
I’m going to work this out on my calculator, and I think you’ll be pleasantly surprised…
The dealer vs. your pocketbook…
Just recently I got somehow involved in a lively discussion about the cost of doing business with a local dealer and how outrageous the dealers prices were compared to doing the work yourself. The conversation also focused on finding a product at another store or on the Internet versus getting it from someone local. It seemed that the general consensus was that the dealer overcharges everyone on just about every service type and/or part in their inventory.
Guess what? It’s a fact of life and it’s one I happen to agree with.
Look, a dealer has to make a living. In order to make a living they have to make a profit. To make a profit they have to price services or product according to the guidelines established by their respective manufacturers requirements coupled with a desire to make their enterprise profitable, pay the rent, keep the lights on and provide the simple little “snacks” that you consume when you visit. I cannot begrudge them in trying to keep the doors open.
Let’s look at this dealer relationship in another way.
Does the dealer mind if you find a product or service somewhere else? Sure he does. Any dealer would like to have your business and view the prospect of you going somewhere else as an issue. Dealerships try to make the idea of visiting their establishment a positive one. They try and maintain an inventory that will appeal to ninety percent of the foot traffic that walks through the doors. Sometimes, they will provide little niceties that keep you cool, keep your children entertained while your vehicle is being worked on or allow you to watch your favorite TV programs as you shop or wait for service. If you really stand back a bit from your disgust at what you just got charged, you would see that you are really angry at yourself, not at the dealer.
Case in point: I needed a cable for a helmet COM system. I could have hit the Internet, spent a few minutes looking for the part, and had it shipped to my home. Case closed. However, I need the cable in two days and if I paid for overnight delivery, the cable would have cost more than what I paid for it by going to my local dealer. And then I got angry at the final cost. But my anger was at myself, not the dealer. Had I been thinking, I would have started this whole cable scenario a week earlier. But I didn’t. The dealer had the part and made an upcoming trip that much better.
How about another case in point: You know that you need to get the oil changed in your car. If you do the work, it costs about sixty bucks and you can complete the task in two hours. What’s your time worth? Ten dollars per hour? Twenty? Fifty? Not counting the tools you may or may not have, lift, clean-up, sophisticated equipment… If you have all of that, plus the time to do the job, then do it. However a dealer offers you an oil change service and the ancillary headaches are something you do not have to put up with. Remember, the word service does not mean just something one does to a vehicle, it means taking that vehicle in, performing the work, and returning it to you in a timely manner… so that you don’t have to do it or think about it. Having the dealer do the work means you won’t spill the old oil all over the floor of your garage, pinch a finger, slice open your hand on a sharp edge and let the neighbors know that you can swear like a sailor.
Dealerships also need to move services and products in and out quickly. Products that sit in storage bins provide no profit. Therefore dealers will not have every single item you might need in a size you can use. If they did, they would be mind readers anticipating your desires before you walk into their store. They also don’t get paid to have your vehicle sit on a lift while a technician wire brushes a small spot of “Double Bubble” off of a front rim during a tire change. Technicians are told to move them in and move them out. The more work done during a day, the more product a dealer sells during the day, is more money that the dealership can make to stay in business a little bit longer. Also, a technician is trained to perform the service work and to recognize issues that may be developing on your vehicle. That training is costly. It’s also part of the job description. Sales personnel are required to make products look their best, and they have to have the knowledge of what it is and what it does. That knowledge is costly.
Hey, I like to wrench. For me, it’s a way to get in touch with my machine and it helps me gain more and more knowledge about how things work. I will work on my vehicles if time is available and knowledge can be imparted to do a complete job. I also know that I am not trained to identify possible future issues and I accept that as part of doing the work myself. In the tire scenario above, a dealership can ill afford doing a tire change the way that I perform a tire change. But there are times when a dealer may fit the bill in either service work, parts or supplies.
Profit is the only way a dealer can stay in business. Anyone with any kind of business acumen will tell you that. However, when you think a dealer is charging an outrageous amount of money for a product or service, remember that the dealer is trying to keep his doors open and people employed so that you can keep driving your car or motorcycle. And do not think that the money spent is just about the owner and/or the technicians. It’s also about the folks that answer your calls when you phone, the accountants that keep the books, the people that keep the dealership clean and well maintained and the management staff that keeps everyone in their respective departments doing their jobs. It also includes the inventory people that make sure that you have the right part when you need it and the advertising that tells you when something is available that you might want to look at. A dealership has to make money to stay open and keep people gainfully employed.
Let’s say that a business owner has a 16,000 square foot, eight bedroom, seven bath house on twenty-two acres with a full 600 hundred sensor electronic security system, ten live-in nannies / maid’s / kitchen support, personal security contingent and a motor pool. Would you want to use their product or service? I mean it’s obvious that they have to “over charge” for their product just to maintain that life style, right? Well, you are quite possibly helping them pay for that lifestyle by reading this on your Microsoft operating system. And you pay those high prices for this software with a smile on your face… because you can’t build an operating system, don’t have the time to build an operating system or you don’t want to use any other type of operating system that’s free of charge. Why is that?
I like my local dealers. I like to visit them and say “Hi, how are you?” And there will be times when I need the dealer to be ready to service my vehicle because I haven’t the time nor the expertise. There are some things on my vehicle that I will service myself. Some things I will ask the dealer to do. But I will not grouse about the cost of doing business with my dealer. Yeah, it can be expensive. But if you really look at things from their point of view, keeping the business open and able to service anyones needs, not just yours, may be paramount in their minds.
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Until next time…




