With increasing pressure on new/used car profit margins, the business managers are now perhaps the most important employee in the dealership when it comes to generating profit, indeed whereas maybe 2 yrs ago a sales manager would be targeted to sell 400 used cars per year at £1000 per unit profit, today’s market is very different.
A typical car may generate up to £500 from the ‘metal’ or in the case of a new car considerably less. The profits are now generated from many other insurance
based products being offered to market as shown in the graphic. (click to enlarge)
The car is now, literally and metaphorically, a vehicle used to help generate extra income, creating the impression that massive discounts are available on new/used cars but the dealer still needs to make a profit, therefore you will be offered a whole range of add-ons rendering the old war cry ‘do I get a discount for cash’? well and truly consigned to history!