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What Is A Car Salesperson's Job? 


Photo Credit: pexels.com Brett Jordan

Car Shopping > Salesperson's Job >

A car dealership employs a number of people in range of titles.
This web page will focus on the roles of people that you either interact with or that are in the chain of command of the people that you interact with.

People Involved In The Car Buying Process

Ups

Customers are ups.
Singular is up as in "an up", plural is ups.
Regardless of singular or plural, pronounced as a word, not the letters U.P. or U.P.S.

Be Back

A be back is an up who has left the dealership without purchasing a vehicle.
In industry jargon the term be back is intended to ironically indicate that just like your father who never returned from that last time going out to buy cigarettes, neither will a be back.

Business Development Center

You may have interacted with a car dealership's business development center but did not know the name.
The role of a car dealership's business development center is to take incoming phone calls and internet leads from "ups" and convince the "ups" to make appointments with car salespeople.
If an "up" shows up for an appointment then the business development employee may receive a payment from the dealership in addition to his or her hourly rate.
In theory a business development center employee might be hired under the premise that if he or she is successful he or she will be promoted to internet sales or sales on the dealership's floor.
In reality, if a business development center employee is successful in getting potential customers to show up for appointments then the dealership may view the employee as being too valuable in his or her role to promote.
A given dealership may or may not have a business development center.

Internet Sales Team

In some cases, the role of the internet team could be to go from initial intake as a lead through signing the paperwork for a given car.
In a great many other cases, despite the title their job is really business development center.
In that case their job is to funnel you to the actual sales team.

Salesperson

During the car buying process, a salesperson will be the intermediary between the customer and a sales manager.
A car salesperson may use phrases such as "What price do you need in order for you to buy today?"
From the perspective of the customer, the discussion must NOT revolve around payments.
The more prepared you are, the easier it will be for you to either get to competitive pricing or determine that a given dealership does not offer competitive pricing.

Finance Manager

Often abbreviated as F&I for Finance and Insurance.
At any given dealership, the role of the finance manager can range anywhere from:
Go over the terms of the deal you had discussed with the sales person and upsell you on additional products and services such as warranties.
Ignore whatever terms that you and the salesperson discussed by presenting you with completely different paperwork.

Sales Manager

A sales manager dictates the pricing at which a salesperson can sell a vehicle.
A large dealership might have several sales managers.

General Manager

The various department heads report to the dealership's general manager.
The general manager is paid on the overall profitability of the dealership.

Car Buying Exercise

Exercise 1: Defining The Relationship

What is a car salesperson's job?

Below is my solution.

  • 33 ⅓: While working under the supervision of a sales manager,
  • 33 ⅓: sell cars to ups,
  • 33 ⅓: at the highest possible gross profit.

Add up your points.
Your score is the total number of points you answered correctly on a scale of zero to one hundred.
Is there any chance of grading the exercise on a curve?
NO.
If anything, the exercise is far too lenient as is.
Consider that the typical customer only engages in a real life exercise once every few years but dealership staff get to practice every working day.
Please Google the phrase "statistics minimum sample size".
When I tried doing so, the first values that came up were 30 and 100.
A salesperson for a mass-market brand in a populated market should expect to target 100 or more ups in a year.
A typical consumer should not expect to enter into 30 car purchase negotiations in a lifetime.
In the automotive sales industry, selling a vehicle at the highest possible gross profit is called holding the gross.
I have no issue with a salesperson's need to hold the gross, but I would prefer that they do it with someone else.


Exercise 2: Salesperson's Techniques

What are some techniques that a car salesperson might use to accomplish what was stated in the solution for exercise 1?

The customer may want to feel like he or she has "won" something in the negotiation.
The salesperson - sales manager team may try to "give in" to make a customer feel like he or she is "winning" while actually conceding nothing.

  • Payment
    If the customer is concerned with payments, the customer may be presented with a loan that finances the vehicle over the longest time possible.
    I can already hear some customers siding with the dealership by saying "as long as the payments are what I want I do not care about the price."
    I am not completely sure how to respond to that. If you have enough to pay for a vehicle with cash, you should care about the price. If you need to finance a vehicle, you should care more about the price, not less.
  • Trade-in
    If the customer is fixated on the value of his or her trade-in, the dealer may add to the value of the trade-in while also adding to the price of the vehicle to be purchased.
  • New Car Price
    If the customer seems primarily concerned with the price of the new car, the dealership may make a low offer for the trade-in while offering a discount on the new car.

Exercise 3: Customer's Responsibilities To Him Or Herself

What should you the customer do to prepare for what was stated in the solution to exercise 3?

You the customer should perform the following BEFORE talking to a new car dealership:

  • Financing
    See what pre-approval opportunities your bank or credit union has.
  • Trade-in
    Get estimates from places such as Carmax for what they would pay for your car.
  • New Car Price
    Search the internet for pricing on new vehicles.

Without that information, you are at the mercy of the dealership.
Spoiler Alert
Car dealerships are NOT known for having mercy.

Takeaway

The Covid-19 lockdown may have been extremely lucrative for many car dealerships.

In contrast, many of us customers are still rebuilding our finances after furloughs and layoffs.
For those of us that fail to prepare, that rebuilding will be that much harder.