Making Money at Car Dealerships? Count the Ways

Over the past few months, I’ve had what seems like a recurring conversation with people in my circle of influence.

Today, while prepping some deals that were coming in later in the evening, I sat down with one of my best salespeople at this dealership, Joe Cleland. He is the inspiration for this column’s subtitle, “The squirrel doesn’t get all of its nuts from one tree.”

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I told Joe that I was taught back in 2003 when I started selling cars at the local family owned Chevrolet-Honda-Pontiac dealership in Boulder, CO, that the key to making it in this business highly depends on your ability to make money. However, sometimes the way we look at the deal or the sale is too narrow. We forget about the various ways there are to make money on a car deal.

I was taught to pretend that the showroom and the dealership is covered in cash, because it is. There is money everywhere if you look hard enough. Sadly, some people will walk around the store, and see a $10 bill on the ground, and not pick it up.

Simply, all you need to do is take every opportunity to maximize your pay plan. Instead of looking at the sale of the car as a “mini” or the buy rate deal as a “flat,” look at all the numbers involved.

Turn over every rock along the way to the sale. You might see a $20 bill under one. You might see $50 bill under another. Heck, you might make $420 if you get good at rock spotting.

My point: The commission on the car deal is just the beginning. There are the F&I spiffs, the parts-department spiffs for accessory sales and the referral fee for bringing in customers’ neighbors, friends and family members to do business with your store. There’s the bounty on the used car you can find to replenish dwindling pre-owned car inventory.

The factory sometimes has spiffs for achieving certain volume standards, such as Mark of Excellence with General Motors. Perhaps selling a GM Card can provide some earn power points that can be redeemed for merchandise or cash in your bank to pay bills or go on vacation.

OnStar and Sirius/XM Radio sometimes spiff for upgrading products your customers are already going to sign up for.

Be creative. Spend time working on what you will say and when you will say it.

I once heard someone say, “If you want what I have, then do what I do.” The problem is, most people, especially people in sales, often take the path of least resistance. It takes effort, persistence and discipline to assemble the paycheck you want to have.

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Feather in all of your income opportunities so that every turn you take with each customer is maximized to its fullest potential.

Like the nut-seeking squirrel, gather a little here and a little there, all over the park, tree by tree. You’ll end up with a fat paycheck.

Justin Gasman is the financial services director at McCaddon Cadillac Buick GMC in Boulder, CO.