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High Attrition rate for car sales people Posted by Bill Homer [Email]  (#3427) [Profile/Gallery]
(more from Bill Homer) on Mon, 12 Sep 2005 08:36:18
In Reply to: Attrition rate for car sales people, Posidon, Sun, 11 Sep 2005 15:19:17 Members do not see ads below this line. - Help Keep This Site Online - Signup |
I have had friends try car sales as interim employment during the tech bust of the last five years. Some of these guys really like cars, know their product, are good sales people - but they can't make a decent living selling cars, especially new cars.
The problem is the structure of many dealer's organizations. A typical commission structure (and the majority of salespersons' income comes from commission) gives the dealership half of the difference between "cost" and the final sales price, and the "sales team" gets the other half. Some dealerships require all sales to go through a sales manager (you know, that mythical "I have to talk to my manager about this price" person), who automatically gets half of the "sales" side of the deal, whether he does anything to close the deal or not. As a result, the salesperson actually gets one quarter of the margin. On new cars, which are vey easy to shop competitively, look up wholesale prices on the internet, etc., this can be miniscule amount, i.e. $125 on a $500 margin deal. Selling used cars are a much better prospect under this structure. Under this structure, you have to wait to get into a managerial role to make a living wage, have several salespeople working for you.
One of my friends was saleperson of the month (most units sold) at a Volvo dealership for several months running, but quit because he couldn't survive on the low income, moved to a different state to resume his tech career.
posted by 136.182.2...
, Mon, 12 Sep 2005 08:36:18 <-- Viewing This Message, Mon, 12 Sep 2005 22:30:11
, Thu, 15 Sep 2005 12:39:18
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