Why do so many dealers have bad reputations?

[RandyH2]

I've spent <ahem> a lot of time reading forum posts here and have seen this phrase come up many,many times, "I hate my dealer..."

I know I had a bad experience at three dealerships and one very good experience.
1) I told them I had found the Explorer I wanted, yes, I found it not them, at another dealership about 60 miles away. Since I had visited the dealership and done a test drive I wanted to give them the business if they could get the vehicle. "No problem, I'll have our manager look into it and get back to you." I never did hear back from them.

2) The second dealership sells a lot of vehicles but for whatever reason had not ordered anything but XLT Explorers. When I told the salesman, via email after meeting with him twice, that I really wanted a Limited and gave the color, options, etc. he never got back in touch. A loaded Limited showed up in their inventory that was close to what I wanted so I sent an email- the vehicle was for the dealers wife as a demo and would then go to his daughter. Still no offer to find/order my Explorer.

3) This dealership had something close, but I really wanted the stone interior. Great communication, great follow-up. They really seemed to be doing "It" right. The sales agent was Vita Vizachero at Bill Brown Ford: http://billbrownford.dealerconnection.com/staff/ . If they were closer I would make the trip for service, etc. Heck, I may still as the closest dealership is on this list...

4) The dealer that sold me the car was pretty decent until the end when they added $100 to the sales price, just slipping it in as a "typo". Yes, I let them get away with it so I am guilty of reinforcing the behavior. They will never get my business again, which is a bit disappointing as they are a smaller town dealer and I like to keep my money local.

 

[brianwsnc]

They get a bad rap because of Many facators

One is the "hidden" charges, or charges that most of us feel are just added profit.

We must realistic, the dealership supports many people, and the large buliding(s), floor plan (interest on Cars not sold) , losses in customer deceptive trade ins. "I am going to trade that Pos before the trans goes out totally." Who ends up paying for that? the tooth fairy? .. its a COST of doing business.. but drives down profits on one end.. has to be made up on the other..

All businesses are a balancing act, weighing profits againest cost.

Plus.. No one really knows if they "got a deal" when they buy their car. Not knowing always leads one to think the worse.

And then you have service... lack of communcation from Service Advisor, to Tech, to Problem, back to Service advisor, back to customer... and if one link in that chain is weak.. the preception to the customer is THE entire Dealership sucks.. the One bad apple thereory comes into play


And that's my take on why people precieve a discontent with many dealerships.

 

[baxterdown]

That is an interesting question with an interesting (and long) answer.

There are tons of different profit centers (ways to make money) and relationship-based decisions that make the automobile sales business complicated. Where the sale of a house is an easy-to-negotiate good, the sale of a car is not because one of the two parties (the consumer) most of the time has no idea where the other party (the dealer) stands. Here are some thoughts on your examples:

1. Two things could have happened here. 1) The dealer you visited doesn't trade cars with the dealer that had the X you wanted. Some dealers have cordial relationships and trade regularly (especially if both belong to a larger dealer group). Others won't touch each other with a nine foot pole. Or 2) The car also has much to do with the trade. If your dealer doesn't have a comparable X to trade, the other dealer will not let a hot commodity like the X go. No way, not in a million years. Naturally, the salesperson should have called you back with a follow-up even if it was a no-go.

2. Nothing you (or the salesman) can do about the wife's car. The problem, again, is with the follow-up. The salesperson should have followed-up with you.

3. Some dealers are great!

4. Sorry in advance for the harsh words I'm about to say, but: shame on you. You shouldn't have allowed them to get away with it. Like you said, the only good that came out of this was reinforcing the behavior.

Car sales are about volume. The more cars a dealer sells, the more money they make because volume is usually attached to other forms of revenue (profit centers) from the manufacturer. Sometimes it's not just about the money the dealer will make on a specific car, but also about hitting a target number of cars sold, at which time they can make additional profits on total number of units. So in the interest of volume, dealers often focus only on those customers who are in the showroom ready to buy a car in the lot.

You represented very little profit potential to dealers 1, 2, and 3 because there was no car for you. Also you were communicating via e-mail so there was very little opportunity to get you on another car. So, they decided to move on to the next deal; granted in a crappy way.

Now, about dealer 4...

Car sales is a dirty business (and the #1 dreaded purchase by consumers). Here's a news flash: There is no way to "beat the dealer." Period, end of story. Just when we all thought we took the dealer to the cleaners, some manufacturer incentive is playing it's part in the background which we have no idea about and will tip the money scale to the dealer's side.

The thing is that most consumers have ABSOLUTELY NO CLUE about car profits and make their purchase based only on perceived value (I got X off, that must be a good deal). I would venture to say that somehow somewhere someone got ripped off many moons ago. Over time (years and years) the practice got traction and it is now out of control.

The fact that we participate on this discussion board makes us savvy consumers. We seek information and learn. Many of us use that information for things like diagnosing a problem with our car or to try an get a good deal on a purchase. Unfortunately, the vast majority of people are not like us. I have friends who have never used the Bluetooth in their cars because "I don't know how to program it." These folks walk into a dealer not knowing invoice, hold-back, MTR incentives, MTC incentives, etc. And to top it all off, they see a label next to the windows sticker that says "Environmental Protection $1,250 -- Total price $3,000,000" and they buy into it. Naturally, the dealer is in it to make as much money as possible out of each deal and they take advantage of every available option.

Saturn tried to change the business model. And, they were very successful. People flocked because there was no negotiating, which gave consumers a sense of security. Unfortunately, the product couldn't back the model and we all know how that ended. But, CarMax for example, adopted the model very successfully. A big part of their success is that the price on the window is the price you pay. Consumers love it.

In the end, it all boils down to volume. Dealers don't want to deal with people who are not ready to buy on the spot (that is why internet sales are a joke). Dealers also have a bad reputation because we have to negotiate on a good where one of the two parties (us) has no idea of that good's real value. Things would be very different if prices were set; other variables like customer service would play a bigger role.

When we buy an HDTV, we go to a store with a good combination of brands, prices, and customer service. Imagine if the sales person at Best Buy was strictly on commission and you had to negotiate the price of the TV. What a nightmare!

Unfortunately, the car sales model will never change. We are stuck with it. So, our only weapon is education. The more we know about how the system works, the less we're bound to be disappointed.

Jose

 

[182RG]

Do what I did. When you get poor customer service, which is what I received at my local dealership, fire off an e-mail detailing your experience to the Sales Manager and the General Manager.

It will get their attention. In my case, the local salereps dismissed me completely once they found out I was looking for an '11 Ex. They didn't have one. No attempt to find one, order one....they didn't even offer a business card or ask for my name. By the time the General Manager got back to me, I had already ordered a new Ex at a high volume dealer 4 hours away (Beach Ford, Virginia Beach). That experience, was 180 degrees opposite of what I experienced locally. Our salesrep at Beach (Ken) was/is fantastic. Painless, great communication, very professional and accommodating.

Vote with your feet, folks. And be vocal about it.......

 

[kappaknight]

The fact that we participate on this discussion board makes us savvy consumers. We seek information and learn. Many of us use that information for things like diagnosing a problem with our car or to try an get a good deal on a purchase. Unfortunately, the vast majority of people are not like us. I have friends who have never used the Bluetooth in their cars because "I don't know how to program it." These folks walk into a dealer not knowing invoice, hold-back, MTR incentives, MTC incentives, etc. And to top it all off, they see a label next to the windows sticker that says "Environmental Protection $1,250 -- Total price $3,000,000" and they buy into it. Naturally, the dealer is in it to make as much money as possible out of each deal and they take advantage of every available option.

Saturn tried to change the business model. And, they were very successful. People flocked because there was no negotiating, which gave consumers a sense of security. Unfortunately, the product couldn't back the model and we all know how that ended. But, CarMax for example, adopted the model very successfully. A big part of their success is that the price on the window is the price you pay. Consumers love it.

In the end, it all boils down to volume. Dealers don't want to deal with people who are not ready to buy on the spot (that is why internet sales are a joke). Dealers also have a bad reputation because we have to negotiate on a good where one of the two parties (us) has no idea of that good's real value. Things would be very different if prices were set; other variables like customer service would play a bigger role.

When we buy an HDTV, we go to a store with a good combination of brands, prices, and customer service. Imagine if the sales person at Best Buy was strictly on commission and you had to negotiate the price of the TV. What a nightmare!

Unfortunately, the car sales model will never change. We are stuck with it. So, our only weapon is education. The more we know about how the system works, the less we're bound to be disappointed.

Jose

Actually, I'm not sure if you're aware but people in the U.S. can technically negotiate on everything. Houses, cars, TV's furniture, gas, diapers, fruits, etc. The reason we don't try to negotiate on the smaller things is mainly to save time, but people around the world do banter and negotiate on much of the stuff.

Grocery stores do it all the time. They will mark something as a SALE item but raise the price per unit instead of actually lowering it. Since they weren't on sale last week and you didn't pay attention, many will just assume the price is actually lower than when it wasn't highlighted. I've even noticed Costco start selling smaller boxes of tissues and other things while start packaging them in bulk so most consumers won't be the wiser.

The worst offender is probably Amazon, who charges an arbitrary price on most products they sell. Yes, their price is still lower than most but on some items that they know you love and must have, they have been known to charge you a few cents more than a stranger they have yet to track via their cookies.

But I digress... the reason car salesmen have gotten a bad rep is mainly how they act towards people. It starts off with the sales process playing good cop, bad cop - asking the manager for discounts, etc. Over all, people just get a bad taste for it. In the past, people just had to live with it. They know you needed cars and most are not master con artists so you will end up doing what they want - but hopefully with the internet, things will change over time.

Over 93% of the people now do research online before walking into a dealership. For these dealerships that are still ignoring online leads w/o proper follow up, their loss. Also, with online reviews, social media, and the such, I'm hoping these public acts of praise or shame will make the dealers wise up a bit to where the rest of us are talking. Yeah, it's true that most people are still in the dark... but at the same time, the dealership model is outdated. Who's to say in five years we can't all just custom order our cars off of the web and have a courier drop it off at our front door? Skipping the middlemen and the bad service altogether? If they continue sucking, that's probably where the market will shift to.

For any dealers who may be reading this - most of us just want a knowledgeable person helping and reassuring us with our decisions. If we come in the door knowing more than you, that's already one strike against you. The least you can do is try to talk to us in an honest and genuine voice instead of being smug for whatever reason. Also, after the order is placed, just keep us in the loop and respond to our inquiries - even if there are no updates. You are in a service industry and good service and open communication is all your customers are looking for. In the absence of information, your customers will demand action - but why take it that far when all you have to do is hit "reply" and say "we don't know anything yet?" Is it really that hard to just be a normal human being? Imagine if doctors don't tell you anything and avoid you at all costs after they get you to do surgery at their hospital. It'd be insane.

 

[RandyH2]

It seems like automotive sales may be the last stand of bad customer service/buying experience. What a shame, too. I keep going back to thinking, "If we treated our customers that way we would be out of business in a year."

Kappaknight said what I am thinking, "but hopefully with the internet, things will change over time." The one dealership I listed as a positive experience was all done over the internet and telephone. Obviously I am not on the selling side, but I really don't understand the poor experiences. It must come from management down, accepting poor performance/behavior.

Wouldn't it be nice if Ford could take a Corporate stance on the issue- perhaps a "Dealer Integrity" national campaign? The commercials would have to be better than the current "Press Conference" theme they are currently running.

 

[alohamonte]

1. hidden charges, surcharges, fees, taxes, etc

2. bait & switch and/or false advertising

3. you're just a number to them

4. very expensive service and parts

 

[ld50]

very expensive service and parts

It`s unbelievable sometimes, something as simple as a bolt and nut can be like 30 dollars for pete`s sake.
Try pricing out a tire change kit for an 04 Silverado I am talking about the bag with tire iron and spare tire crank -over 400 dollars new!


I had a problem with my work truck`s steering column and had it replaced but they didn't replace the key tumbler. When I asked why, the guy said it couldn't be done, and it shouldn't be a big deal to use two keys. I reiterated that I couldn't believe it couldn't be changed out and he became irritated and defensive. I stirred up the shiite by going to find the manager and suddenly it was possible. The manager said he was probably just trying to "save me money" Is that a joke or what? A dealership trying to save me money, -ridiculous.

I will never get service at this particular dealership again because of this incident where I was looked straight in the eye and lied to. Up to then I had always not liked this particular service guy`s constantly snotty and holier than though attitude and this was the topper. If I hear the guy is gone I might go back, it`s the only dealership in town so choices are limited.

 

[StunnedMonkey]

Dealers also have a bad reputation because we have to negotiate on a good where one of the two parties (us) has no idea of that good's real value.

(snip)

...Imagine if the sales person at Best Buy was strictly on commission and you had to negotiate the price of the TV. What a nightmare!

For me, this is exactly what makes the whole process unpleasant, and why I leave the dealer knowing that I got ripped off. Despite the follow-up comment that in the US we can technically negotiate over any purchase, in practice this only happens with cars and homes. If I tried to offer the Best Buy guy $1200 for a TV marked at $1400, he'd look at me and say, "dude, it's $1400." And that's why I don't mind shopping for a TV, and why I never leave the Best Buy thinking that the sales guy was a worm.

I'd be far happier if they just set the price, built in a reasonable profit, and sold it for that with no negotiations. "Dude, it's $38,500."

 

[JDraper]

I will say that I'm quite happy with my local Ford dealership. This is the 4th new vehicle I've bought off of them in the last 7 years, and I've been happy with every purchase experience.

If you're near Central PA and want a great dealership experience, try Lake Ford in Lewistown. Two thumbs up here.


Now..State College Ford is another story. Won't ever buy from them again after they tried some shenanigans on two purchases from them.

 

[drober30]

4) The dealer that sold me the car was pretty decent until the end when they added $100 to the sales price, just slipping it in as a "typo". Yes, I let them get away with it so I am guilty of reinforcing the behavior. They will never get my business again, which is a bit disappointing as they are a smaller town dealer and I like to keep my money local.

Small town dealer?

"Livonia MI population was 96,942 at the 2010 census, making it Michigan's 9th largest municipality." (Wikipedia, retrieved 5/13/11)

There is a Ford dealer in every direction from Bill Brown Ford.

For as many Fords as I have purchased, I have never been able to put together a deal at Bill Brown Ford.

The Explorer is a sellers market but if you agreed on a price, I have no idea why you would let them get away with the extra $100.

Enjoy your new Explorer! Mines being built tomorrow and I cant wait!

 

[dco43054]

I've spent <ahem> a lot of time reading forum posts here and have seen this phrase come up many,many times, "I hate my dealer..."

My dealer was great. Go see the good folks at Ridenour Auto in New Lexington, Ohio - if you want to take a drive into the heartland. That's probably part of the difference. And if you do make the trip, don't try to squeeze every last nickle out of the deal. They can't afford to deal that way.

The small dealers have to be part of their community. They see the same people all the time. They don't have luxury to piss someone off knowing relying on the fact that there are a lot more someones who will come wandering in at some point trying to shop them.

The other thing is that if someone is pissed at their dealer, they will tell the world. If they like them, they don't feel the to.

 

[Rick]

I've had good experiences with most dealerships. The ones which I have had bad experiences with seem to have the attitude that there are plenty of customers, and very few choices of dealerships. In other words the customers are stuck with a limited resource. The bad ones take advantage of that, while the good ones try to ensure that every customer has a good experience with them so they will have repeat customers, and word of mouth advertising.

 

[Rhyalus]

The auto industry created these guys. I am not sure how much they get paid, but I can tell you that there are no clear pre-requisites for working at a car dealership.

They are not skilled in EITHER the cars OR in salesmanship OR in negotiation.

This probably goes back to the reality that cars get sold with a small margin over invoice from the factory - there is not much room for them to do anything with price. The economics that guide the industry are a bit wacky.

While this is not universally true (I have come across some "OK" guys), I think it can be said to apply very well to the NY tri-state area...(my experience is with Nissan, Toyota, Dodge, Ford, Honda - maybe one or two others that I have gratefully forgotten)

R

 

[chimoman]

Has a bad experience with a Hyundai dealer once. Worst mistake I ever made was buying a POS Hyundai. The Ford dealer I bought from has treated me like gold. They have taken care of everything I have asked or complained about on my Ex. Really good service. I guess that's why their motto is "The place that service built." The Hyundai dealer though, well..... not worth typing about.

 

[Joe Dirt]

I've had good luck with one sales rep, not so much the dealer, although the dealer hasn't really done anything "bad" per se, I've just been extremely happy with my sales guy. I've bought from 4 different Ford dealers, and after dealing with Dennis @ Borgman, I won't buy anywhere else. He always calls back, he always proactively gets info for me that he knows I'll ask about, I'm never left out hanging to dry. He is involved with the parts guys, and the service guys, so everyone is in check. He does what he says he will, and it just works. If you're buying something around here, call Dennis Cook @ Borgman. I know about 15 people that I've sent over his way and everyone has the same story as I do. There is a reason he has a clientele.

I've bought from Fox Ford (Grand Rapids), Jack Demmer (Wayne, MI), Gorno Ford (Woodhaven, MI), Taylor Ford (when it was Ray Whitfield Ford in Taylor, MI), Mike Lynch Ford (Rogers City, MI), Tony Betten Ford (Grand Rapids, MI), Courtesy Ford (Okemos, MI), Wayland Ford (Now Ed Koehn, in Wayland, MI) and Village Ford (Dearborn, MI) and the problem I have with most is the sales reps- they turnover like a revolving door. I'd prefer to have the same person there when I go back in a year later. Even of the people that are still there, Dennis is the only one that remembers what I like and don't like.

Service matters- a car is a massive investment, and should be treated that way. Part of the reason I don't have my '11 yet is because Dennis may be leaving to sell at a different dealer closer to home. If that happens, and with the issues that are currently showing up with the vehicles, I want him there to back me up, which I know he would do. I don't need a 23-year-old Jr. salesman who won't be there in the fall who could care less if I'm having issues with MFT or wind noise from my a-pillar.