Wednesday, August 19, 2009

Observations on the Car Sales World

I've bought cars from dealers, and now I'm selling them at a dealer. My friend Doug was curious about what it's like selling cars. Here's what I've learned.

People pay a little more for cars than I think they might have to. Strong negotiators can win, though. We salespeople want to sell you the car NOW, because we know that if you go away to think about the deal there is only a small likelihood you will return later and purchase the vehicle, so if you push back on price we will try to lower it, to a point. Remember, it has to be advantageous for both sides of any deal, so there is level below which a dealer won't go and will let you walk away.

It's like being in combat being a car salesman. Long periods of boredom punctuated by moments of terror. It isn't terror though, it's the occasional customer, or "up" as we call them. You go out and wait on them, try to learn who they are and what they want or need. In the software development world, it's analogous to the Initial Requirements Discovery and Specification phase of that process, only it's about a car instead of business processes and software.

People will lay down on price. We salespeople are good at convincing them that the price is right. At my dealership, the prices actually are about right. I had no idea, and this was the most surprising thing I've seen.

Your credit score matters. How you look matters. Sales guys look at you carefully, and they look at whether you drive up in a shitbox or not. Successful salespeople won't take "ups", or at least not ones that look like they have crappy credit. Look bad, get bad or no service or be relegated to a newbie salesperson like me - I take any and everybody.

The simple sales process they taught me is just a guy trying to get you to like and trust him, believe that the dealership will treat him well, and lastly buy into the vehicle. The really good salespeople go way beyond that and make a plan for you (and they do it quick) that synthesizes who you seem to be with different specific transitional selling techniques they have, like moving you from looking at a new car to a late model used car to pump you up on price. And they are very good at it. More power to them.

At the end of the day, cars get sold at reasonable prices, at least in my experience at my dealership. It's a lot fairer than I thought.

That's what I know about the car business so far.

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