It’s not a big secret. Not a mass conspiracy to hide the truth of an industry; and certainly not a shameful career.
A majority of salespeople in the auto industry work primarily on commission.
The financial definition of the term “commission” is a form of payment to a brokerage in which the brokerage receives a percentage of the value .
of each transaction that a client orders (http://financial-dictionary.thefreedictionary.com/commission)
So why are so many consumers disturbed at the idea of a salesperson receiving a commission for assisting them with the purchase of a new or pre-owned vehicle?
The average time it takes a consumer to arrive at the dealership, pick-out and test-drive a vehicle, negotiate the deal, apply for credit, sign the contracts, and take delivery of the vehicle is 2.5 hours. Typically, the salesperson is the one responsible for walking the customer through the “best car buying experience” possible.
This entails helping the consumer find the right vehicle to fit his/her needs, lifestyle and budget, communicating with the sales and finance managers regarding pricing, collecting the consumers information as well as the vehicle and trade information; all while ensuring the consumer is comfortable and informed.
The salesperson is also tasked with providing customer service after the sale. Many great salespeople assists their customers in setting service appointments, making certain the customer has a clear understanding of the vehicles functions and controls and maintaining consistent follow-up to ensure the consumer maintains a world-class experience during the ownership of the vehicle.
So should they not be paid for their time, patience, and service?
The normal John and Jane consumer has been conditioned to reject purchasing anything at “full retail”. This especially holds truth when in the midst of purchasing or leasing a vehicle. Consumers have the “buyer beware” mentality long before entering into a dealership. Package this with the massive amounts of “How to buy a vehicle” and “How to get over on a car salesman” articles online, you have a recipe for disaster in the presence of a mediocre salesperson.
Admittedly, for every one great salesperson, there are two bad ones. Luckily, today’s customer service standards have a grueling scoring process set forth by the manufacturer forcing great dealers to become excellent and bad dealers to go away. Bad customer service can cost a dealer thousands of dollars each month as the manufacturer revokes many of the programs available to an under-performing dealer.
If you are one of the consumers that has received poor treatment from an auto salesperson, rest assure that their career in the auto industry is a short one as these “bad apples” eventually get forced out.
For those who have received excellent customer service from your local dealer and salesperson, let them know. This is the profession that they chose to support their families. Those that do a great job really should be rewarded and, yes, receive a commission.
After all, someone has to sell you the vehicle, right?