Anyone in the field or worked in the field before? I am kinda curious because I just got back with my aunt to pick up a new MBZ E320. We got treated so well. They did just about everything for us except shinning our shoes.. well, that could be had too for a couple of bux. No really, they have a person right there shinning your shoes for you for a couple of bux. So, how much commission are they getting from selling us the one car to give them that much incentive?
how much commission do car salesman get?
- Thread starter kt
- Start date
db
Lifer
- Dec 6, 1999
- 10,575
- 292
- 126
They get plenty. Guy I work with said the first time he sold a Corvette he was converted from the "principal" of fairness, to seeing how much sunshine he could blow up someone's ass in order to get them to buy, b/c he made so much $.
And lots of people don't know how to bargain, or even that they *can* bargain. Sad.
And lots of people don't know how to bargain, or even that they *can* bargain. Sad.
The place that I worked at a LOOONG time ago (Lincoln/Mercury dealership) (I wasn't a salesman, I worked in the office -- that's why I don't know this scheme very well 
) had a scheme whereby they made, I think, 1% on the first 10 cars a month, then 2% for the next 10 cars, and so on.... with a $100 minimum since there are used cars that cost less than $10,000. Good salesmen who had been there for years and had an established customer base averaged 20-30 sales a month. Merely decent salesmen got like 10-15. Not all of sales were for new cars, of course. Again, this was a while ago and I could be wrong on the exact percentages, but I think I'm in the ballpark.
) had a scheme whereby they made, I think, 1% on the first 10 cars a month, then 2% for the next 10 cars, and so on.... with a $100 minimum since there are used cars that cost less than $10,000. Good salesmen who had been there for years and had an established customer base averaged 20-30 sales a month. Merely decent salesmen got like 10-15. Not all of sales were for new cars, of course. Again, this was a while ago and I could be wrong on the exact percentages, but I think I'm in the ballpark.Interesting...so avg. of $20k for a new car * 10 to 30 cars/month @ 1% commission = $2k to $6k a month
<< Interesting...so avg. of $20k for a new car * 10 to 30 cars/month @ 1% commission = $2k to $6k a month >>
hmmm.. that's some good commission. Is it commission only or do they have a base salary?
When I sold cars in 1993-1995 the basic break down was like this
You got paid on a percenage of FRONT end Profit..
You sell a new car for 20K and invoice is 18K
You get a percentage of the two grand.
Usually it was 20% (although I did work at a place that was 30% if you sold 15 cars)
Usually there is a pact between 300-500 dollars that is taken ou of the profit BEFORE commisions are paid
Any there is almost always a "MINI" of 50-100 bucks. The minimum you will make.
so A typical deal would go like this
20,000 sale price
18,500 invoice
1,500 profit
<500> pact
1000 Payable
* 20%
200 dollars
Some dealers pay a flat per car commision that escalates with each sale.
100 per car for the first 4 then 200, 300, 400 and so on
For you that think that car salesman make MAD BANK while some do many make less than 40K and work 60 hours a week.
You got paid on a percenage of FRONT end Profit..
You sell a new car for 20K and invoice is 18K
You get a percentage of the two grand.
Usually it was 20% (although I did work at a place that was 30% if you sold 15 cars)
Usually there is a pact between 300-500 dollars that is taken ou of the profit BEFORE commisions are paid
Any there is almost always a "MINI" of 50-100 bucks. The minimum you will make.
so A typical deal would go like this
20,000 sale price
18,500 invoice
1,500 profit
<500> pact
1000 Payable
* 20%
200 dollars
Some dealers pay a flat per car commision that escalates with each sale.
100 per car for the first 4 then 200, 300, 400 and so on
For you that think that car salesman make MAD BANK while some do many make less than 40K and work 60 hours a week.
<<
<< Interesting...so avg. of $20k for a new car * 10 to 30 cars/month @ 1% commission = $2k to $6k a month >>
hmmm.. that's some good commission. Is it commission only or do they have a base salary? >>
By law they should get at least minumum wage however if you get an HOURS CHECK it usually is your last check from that dealership.
I know dealerships hate me.
I've haggled the price down on every vehicle I've ever bought. My mirage I got $3K of off sticker. That was a cheap car to begin with. My current truck I paid $12.5K, sticker was $16k.
My motorcycle I got $1000 off. And right now I'm looking at a 2002 Dodge Ram. Sticker is $18k plus the add-ons and frieght and other BS. I've gotten the dealer down to $16k for a decked out V8 regular cab.
I've learned that always buy towards the end of the month. This is when they are willing to make deals to make their quotas. And most importantly, don't look desperate or act like you really really love the vehicle your looking at. Doing so signifies to the dealer that you are more likely to accept a small discount to get the car immediatly.
I've been talking to the Dodge guy for a week, and purposely ignore his calls, then call him back saying "I should be able to make it buy this weekend." This entices them more to make better deals to get you back.
Most importantly is to get quotes from other dealers and online.
The guy I'm talking with told me straight up that he makes about $3k a month to $6k(a good month).
I've haggled the price down on every vehicle I've ever bought. My mirage I got $3K of off sticker. That was a cheap car to begin with. My current truck I paid $12.5K, sticker was $16k.
My motorcycle I got $1000 off. And right now I'm looking at a 2002 Dodge Ram. Sticker is $18k plus the add-ons and frieght and other BS. I've gotten the dealer down to $16k for a decked out V8 regular cab.
I've learned that always buy towards the end of the month. This is when they are willing to make deals to make their quotas. And most importantly, don't look desperate or act like you really really love the vehicle your looking at. Doing so signifies to the dealer that you are more likely to accept a small discount to get the car immediatly.
I've been talking to the Dodge guy for a week, and purposely ignore his calls, then call him back saying "I should be able to make it buy this weekend." This entices them more to make better deals to get you back.
Most importantly is to get quotes from other dealers and online.
The guy I'm talking with told me straight up that he makes about $3k a month to $6k(a good month).
Again, my numbers may be off... I just worked in the office and didn't pay much attention to the salesmen's commissions! Maybe it was .75%. I don't know. And also, I don't know about where the commision came from. What tm37 says sounds more reasonable. And now that I think more about it, I'm pretty sure that it was tied in with the *profit* on each sale, not with just the sale price.
But I'd say $2k-$6k per month is not unreasonable. Although even the best salesman in the dealership I think only ended up with around $60k a year. Obviously you can't sell 30 cars a month every month. Maybe I was just there during a good time -- I know that the managers kept saying that we had a relatively low inventory the whole time I was there, meaning we were selling more cars than usual. Also the guys who sold the most cars every month tended to sell more used than new, so their average selling price wasn't as high, but their profits could be much higher. Man it makes me mad that I can't remember all of this stuff.
Anyway, don't pay any attention to me. I'm going on incomplete memories from long ago. But again as tm37 said, the hours are VERY long, like 10 hours a day 6 days a week (most of which is wasted sitting around and waiting and smoking, but that's still pretty bad) and I'd also agree that the typical earnings would be under 40K a year.
But I'd say $2k-$6k per month is not unreasonable. Although even the best salesman in the dealership I think only ended up with around $60k a year. Obviously you can't sell 30 cars a month every month. Maybe I was just there during a good time -- I know that the managers kept saying that we had a relatively low inventory the whole time I was there, meaning we were selling more cars than usual. Also the guys who sold the most cars every month tended to sell more used than new, so their average selling price wasn't as high, but their profits could be much higher. Man it makes me mad that I can't remember all of this stuff.
Anyway, don't pay any attention to me.
I'm going on incomplete memories from long ago. But again as tm37 said, the hours are VERY long, like 10 hours a day 6 days a week (most of which is wasted sitting around and waiting and smoking, but that's still pretty bad) and I'd also agree that the typical earnings would be under 40K a year.Actually, so far this month I've sold 10 units and grossed about $26,000 profit for the dealership.
20-35% is the commission range, depending on how many units you move. (That's 20-35% of the amount you make the store, not the selling price of the vehicle)
Takes 20 units sold in my store to get 35% retro back to the first sale of the month. Yes, the money can be very good......as long as you are making sales.
The other bennies we get are called spiffs, which are cash in hand bonuses for selling vehicles they want sold, such as old age inventory and previous model year, etc.
20-35% is the commission range, depending on how many units you move. (That's 20-35% of the amount you make the store, not the selling price of the vehicle)
Takes 20 units sold in my store to get 35% retro back to the first sale of the month. Yes, the money can be very good......as long as you are making sales.
The other bennies we get are called spiffs, which are cash in hand bonuses for selling vehicles they want sold, such as old age inventory and previous model year, etc.
Every dealership has different commission rates, so it's hard to say but my father's been in the business for 25 years and I'll tell you how much the sales people at his dealership make.
He said his worst salesman makes about $50k a year, and that's how much they can make starting out. His best sales person will make about $130k per year. He does sell higher end cars (Cadillac dealership) but he's also on the used end of it.
I spoke with a gentleman recently who sold Mercedes-Benz's and they paid a flat commission of $550, no matter if you sold a $130,000 car or a used car for $10,000.
Conversely, if someone works a deal on my father's lot, the least they can make is $150, but you can make $2,100+ on a Cadillac at sticker.
dm
He said his worst salesman makes about $50k a year, and that's how much they can make starting out. His best sales person will make about $130k per year. He does sell higher end cars (Cadillac dealership) but he's also on the used end of it.
I spoke with a gentleman recently who sold Mercedes-Benz's and they paid a flat commission of $550, no matter if you sold a $130,000 car or a used car for $10,000.
Conversely, if someone works a deal on my father's lot, the least they can make is $150, but you can make $2,100+ on a Cadillac at sticker.
dm
waggy
No Lifer
- Dec 14, 2000
- 68,143
- 10
- 81
My father has been in the car business for the last ohh 23 years.
he used to own a few dealerships but got tired of how much work he had to do so he retired. heh that didnt last long before he got bored.
Now he works for a local honda dealership as used car manager. From what he says working in used will get you more money then working in a new. NO matter what dealership it i
some of his used car salesmen make between 50-75k a year. hell i worked for him once and made $10grand in one month and i suck at the job! i just got lucky and sold a lot of cars that month. to bad the next month i made $1200 heh i quite when some 17yr old kid and his gf who was pregnant came in to buy a 1987 camero wich they couldnt afford or need. i told them to get off my lot and not come back till they grew up heh my dad was pissed.
he used to own a few dealerships but got tired of how much work he had to do so he retired. heh that didnt last long before he got bored.
Now he works for a local honda dealership as used car manager. From what he says working in used will get you more money then working in a new. NO matter what dealership it i
some of his used car salesmen make between 50-75k a year. hell i worked for him once and made $10grand in one month and i suck at the job! i just got lucky and sold a lot of cars that month. to bad the next month i made $1200 heh i quite when some 17yr old kid and his gf who was pregnant came in to buy a 1987 camero wich they couldnt afford or need. i told them to get off my lot and not come back till they grew up heh my dad was pissed.
when i sold cars, you also got commision on the financing too. don't let those finance guys fool you. dealerships and salesman make money on the financing (well they used to anyway).
somebody correct me if i'm worng, but isnt a large percentage of dealer profit on the holdback, as in they can sell cars at invoice all year long, but the MFR cuts them a check of a couple points based on the volume of cars they sell?
ie:
500 cars @ $20k ea.= 10 mil. 2.5% holdback, $250k?
ie:
500 cars @ $20k ea.= 10 mil. 2.5% holdback, $250k?
<< dealerships and salesman make money on the financing >>
With the vast majority of buyers belonging to a credit union, those days are pretty much over, save for a few people who can't get other financing, then the dealer can make some income on the financing, but very little today.
compuwiz
that's why dealers advertise soo heavily that they will get you financing no matter how bad your credit.
that's why dealers advertise soo heavily that they will get you financing no matter how bad your credit.
The company my dad works for sells stuff to GM so they got their Silverado for like 3% over cost. They saved like $5,000 or $6000 off of the sticker.
Zebo
Elite Member
- Jul 29, 2001
- 39,398
- 19
- 81
Some salesmen are going to hate me but I'll say it anyway. Never buy a car from the salesmen if you know exactly what you want. Walk back to fleet talk with the fleet manager, tell him you work for so and so and you ask him for invoice price. He'll give it becasue that's what he sells all his cars for invoice and he lives on the dealer hold back. He's a saleried employee who''s only job is to move volume for more allocation and holdback for the dealer next year.
Here an example of the savings. 99F-350 PSD was MSRP of $36,500 and I got it for $29,930 or 18% off a brand new truck exactly the way I wanted it since I had him order me one. Took 6 weeks but well worth the savings...And at the time dealers were selling that truck for more than MSRP becasue it was HOT.
Here an example of the savings. 99F-350 PSD was MSRP of $36,500 and I got it for $29,930 or 18% off a brand new truck exactly the way I wanted it since I had him order me one. Took 6 weeks but well worth the savings...And at the time dealers were selling that truck for more than MSRP becasue it was HOT.
TRENDING THREADS
-
Discussion Zen 5 Speculation (EPYC Turin and Strix Point/Granite Ridge - Ryzen 9000)- Started by DisEnchantment
- Replies: 24K
-
Discussion Intel Meteor, Arrow, Lunar & Panther Lakes Discussion Threads
- Started by Tigerick
- Replies: 19K
-
-
-
Facebook
Twitter