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  March 29, 2011 8:45 p.m. BoneYard_Racing Reader

  As a consumer I have a problem with the dealership making a killing and the salesperson getting nothing ie Carmax. We dont have the carmax franchise up here but I work on the same street as two no-haggle high volume stores, they still make money on finance and products.

  Being screwed is a perception most of the time. If someone pays 30k for a 20k car okay they got screwed very very rarely at least from what Ive seen does anything like that happen.

  I sell Buicks and one thing about older people is they dont stop shopping after they buy their car, say we do a deal at invoice with no rate held no products basically a looser all the way around the customer will take the buyers order AFTER taking delivery to the dealer of a different make and ask them to look it over. The other dealer will ofcourse make up a number and put it on some official looking paperwork and of course they come back to us and complain. I agree the industry is broken and its what leads to all this crap on all sides how to fix it is a mystery to me.

  Again I sell buicks so I dont really have to worry about the too fast killing people thing. I sold a used G8 GXP and paid for the owner to do an auto-x with our local club he loved it and got to drive the car somewhere safe.

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  March 29, 2011 9:56 p.m. KATYB New Reader

  probs with selling hyundais is out commission was always just a 100 dollar mini or 99% of the time. alot of thier cars are only 600 to 1200 over invoice at sticker... then ofcourse 500 to 750 holdback which sales dont get paid on and 300 to 1000 dealer cash. then you have tiered incentive money from hyundai. if you sold 17 cars youd get around 4400 for the month. nothing to really get all that excited about. i preferred to focus on used cars. we avged 3200 gross on used cars and at 25% made it nice to sell them.

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  March 30, 2011 7:21 p.m. FlightService HalfDork

  I know Carmax's sales structure, in the end the salesman's gets 15 to 25% of what the total profit is.

  If you are a non club member you get $150 for car $100 for warranty Directors club $200 and $125 President's Club $250 and $150 (then president's club goes up from there, but that takes a good amount of time.)

  On my 3 years as a part timer (14 days a month) I averaged 8.5 cars a month with 4.5 warranties. I was either President's or Director's club for all but 7 months of my time there.

  We had 6 really good career salesman that were making in the 80-100 range. Just like a regular dealership. You get the BS out of the way you can sell more cars. The salesman looked at the volume too. We liked it.

  Carmax's goal was $1000 to $1200 profit on every unit. Some more some less. But that is the company goal for an average. Now mind you they had numbers for everything, so the only thing not accounted for in that profit was Uncle Sam. They are a very well done dealership. They are trying to make it the Wal-Mart of cars.

  That statement alone should get me flamed! LOL

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  March 30, 2011 11:33 p.m. integraguy Dork

  "They are trying to make it the Wal-Mart of cars."

  I've visited the CarMax in Memphis, and visit their website at least a few times a week. I wouldn't set foot in a Wal-Mart. Wal-Mart wants to control the market for anything and everything, I never had that feeling at CarMax.
  Wal-Mart seeks to wring THE lowest possible price out of it's suppliers so it can (supposedly?) pass the savings on to it's customers. To be honest, I don't know what CM does to it's "suppliers", but it doesn't look like they are following Wal-Mart's "credo".

  When comparing 2 car that to me look the same (for example 2 Toyota Corollas) I am amazed at why they can be priced so differently by CarMax. Similarly, CarMax doesn't seem to take into account the fact that some cars have ..."less brand, cache?" than others. A Corolla will be priced about the same as an Elantra or Spectra.

  While I realize CarMax is PRIMARILY a used car network, one of the things I DO appreciate about them is that there are no goofy fees that seem to have been made up as an excuse to further fleece buyers.

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  March 31, 2011 9:04 a.m. Datsun1500 Dork

  integraguy wrote:

  While I realize CarMax is PRIMARILY a used car network, one of the things I DO appreciate about them is that there are no goofy fees that seem to have been made up as an excuse to further fleece buyers.

  Here in MD they have a $99 Dealer Processing Charge...

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  March 31, 2011 9:15 a.m. Otto Maddox HalfDork

  In reply to FlightService:

  I am surprised their profit would be that low. I've always figured I can find what CarMax has at a normal dealer for at least $1K less.

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  March 31, 2011 9:16 a.m. Otto Maddox HalfDork

  In reply to Datsun1500:

  I've bought two cars from the local Lexus dealer that has a $489.50 processing fee. I hate the idea of it, but I just figure it into my calculations.

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  March 31, 2011 9:50 a.m. FlightService HalfDork

  Carmax lost a lawsuit in SC about the doc prep fees, even though they put it in the price they still lost it, so they are now starting to phase it out in areas of vagueness.

  Remember I said a $1000k after EVERYTHING (they know how much electricity that it will cost them to run the building, commission rates for consultants, property and facility depreciation, I meant EVERYTHING). Carmax is one of the best managed stores in the market.

  As for the Wal-Mart reference, it was an inference to the ability to walk in find 90% of what is in the market and walk out quickly. Not an implecation to the lack of service or professionalism that Wal-Mart shows.

  Carmax "beats" up their suppliers as well, that is why a good condition car will only get an offer of fair condition value. They also are LOVED at auctions, they know they have money and will slam the gavel quick for them. They tend to get a car a little cheaper than a traditional dealership because of it.

  It is a good system. I haven't found a price at Carmax I couldn't beat but it takes work to do it.

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