Internet Dealer vs. Local Dealer

[LBrown59]

Some Internet dealers are local and some local dealers are Internet dealers.

 

[DonWorrell]

I normally go online and find a price and then take it to my local dealer and see if they can match it. I do consider apples to apples. If shipping or deliver is XX dollars I let my local dealer have that.

A buying problem is "Prep Charges" some dealers charge them and some don't. I just bought a new car for may wife. I got a price from the internet and went shopping locally about 20 mile radius and got two different prices. Here is the catch. I bought a Scion XB which is a fair traded car, one price like a Saturn. Each dealer had a different "Prep Charge". I finally bought the car from the dealer who refunded the "Prep charge". What is a "Prep Charge"? Well ask an honest dealer. It is nothing more than extra profit.

Service is a shot in the dark. Warranty work is deterimed mostly by the manufactor not the dealer. Yes a dealer can put some pressure on th manufactor but the manufactor makes the final decision. Small things like loading tires and etc. are something a dealer can do. But I always like a face to talk to when I have a problem.

I read one post about a guy was saving $4,000 in another state on a truck. I can't understand that if they were the same trucks. Now if you are getting two different trucks i can understand. Few trucks have a $4,000 dollar profit in them unless it was some big truck. Options can make a difference. Some sunroofs are factory and smoe aren't. Of course the quality often aren't the same either.

Some dealers talk a good deal but when you finally see it on paper it goes away. If you saved $1,000 or so I could see the savings and understand. But when you get above that something is wrong. My dad always said if ham is $1.50 a pound in Philadelphia it should be $1.50 in New York City.

I remember back to when I was in the car business. A customer came in to buy a new car. I gave them a good price, I was making some but I wasn't making a killing. I always gave my best price when a person left to shop another dealer. I thought a little profit was better than none. The customer bought for another dealer. About two years later they came to me to trade. When I found out their payoff I was amazed. The dealer they bought from had them sign a ballon note for I think $2,000. Sure they got a cheaper payment than I could of given them but when they finished making payment they still owed $2,000.

Same thing as we have today with sub-prime mortgages. People were offered deals which were too good to be true and may accepted them. Now when the ARM has sprung they are crying foul and defaulting on their homes. They never should of bought the house in the first place but some person made them think they could afford it. Same thing happen in car, truck and yes tractor sales everyday. Buyer Beware!!

Just watch out. I am not saying Internet dealers are dishonest but some of them just might be. I got out of the car business because my comepetitors were to slick for my conscience. I couldn't meet their deals and still sleep.

Don

 

[Eightpoint]

There are some good thoughts expressed here.

With the economy putting the pinch on a lot of folks and the sales of compacts/subcompacts down off their highs I could see a scenario where the internet could "change the game" whereby you have a lot of high volume dealers selling at lower prices across the country and the mom-and-pops selling fewer units and performing the warranty/service work. Those folks who know what model they want may argue that the true service experience happens after the sale. Anyone can be your best friend when you have your checkbook out but in the end the only major difference between a new John Deere 2520 sitting on a lot in New Mexico and a new John Deere 2520 sitting on a lot in New Hampshire is the shipping costs. But when you need something after the sale that's when a dealer's true colors show through...

Sounds like there are a few dealers heading down the path of trying to become the bigger players. Will be interesting to see how it plays out over time and whether the market and manufacturers will embrace change or try to snuff it out.

 

[redneckford]

What is a fair profit on a new tractor??--$100,$500,$1000,$3000, or 5% or 10% or 20% of the cost??? Who pays the operating cost of a dealership---Parts---Service----Warranty----Why do so many dealers lose money on warranty work in the tractor business?(even with factory trained tech's)----unrealistic job rates and payment codes??----can't everyone do business for just cost and stay in business---How do you make a FAIR Profit? Someone has to speak up on the warranty deal---that is where the MFG's in the tractor business are beating up good dealers really bad!----most foreign countries don't even know what warranty is ---ask a few FarmTrac dealers! $3000 dollars up front profit is not enough if you have to eat $3500 dollars worth of warranty work OVER 2-5 years! No two deals or ever the same---one scratch can cost $1000 or more!----different strokes for different folks---it all depends on use and hours----A tractor is built by humans---if you use it it will have issues-----if you leave it parked in the barn it will never break---but it might develop problems from non use---go figure---it all cost SOMEONE!!

 

[GaryS]

I bought a Sthil recently and wanted to buy from the local guy 1.5 miles from my place. It wasn't the best experience. I now know there are less-local but better dealers around.

For the tractor, I bought from a place with a good reputation but the guy just wasn't the best. I've bought a few other things from him but will certainly look around more next time I'm tractor shopping.

I agree with the buy big ticket items local school of thought. I'll buy local if I can and shop online if it makes sense.

 

[Eightpoint]

I'm not a dealer so I can't speak to the business end of running a dealership but there are several posts throughout the forum that make it sound like dealers are bearing the brunt of things. Manufacturers appear to make the rules on what is required to have a dealership and the dealers are left to figure out a way to make it work financially. If a manufacturer requires factory trained service technicians then that is a fixed cost that must be absorbed. Whether there is enough warranty work or other service work to cover that cost is another story.

Just my observation but it looks like some dealers are trying to branch out and increase sales of units by competing on price and shipping anywhere in the lower 48. Other dealers are keeping to a sales territory and doing what they can. Only the dealers themselves know what is working and what isn't.

For consumers, price and service matter - the product is the product. Some customers are willing to pay more to do their part to keep a particular local dealership in business. Others aren't. I don't think that there is a right or wrong - that's just the way it is.

 

[buckeyefarmer]

I read one post about a guy was saving $4,000 in another state on a truck. I can't understand that if they were the same trucks. Now if you are getting two different trucks i can understand. Few trucks have a $4,000 dollar profit in them unless it was some big truck. Options can make a difference. Some sunroofs are factory and smoe aren't. Of course the quality often aren't the same either.

Some dealers talk a good deal but when you finally see it on paper it goes away. If you saved $1,000 or so I could see the savings and understand. But when you get above that something is wrong. My dad always said if ham is $1.50 a pound in Philadelphia it should be $1.50 in New York City.

....snip...
Don

was my post probably, exactly my point, same truck, same options same everything except the bottom line was far apart.

And avoid the lowest monthly payment technique, that isn't a fair comparison unless it's equal terms, interest rate,etc....

 

[Mike Costello]

In 2004 I purchased a 31' 5th wheel. The local dealer gave me a price of about $4000.00 off MSRP. Told him I would think about it and left. When I got home I got on the internet, just out of curiousity, and found a dealer with the same unit that was almost $7000.00 lower than the first guy's great deal. I was flabbergasted! I asked him what was wrong with the unit(you know, customer return). He said it's brand new..I have 3 units here, all the bells and whistles.
Well, I wound up buying from him and saved a ton of money. Bottom line...dealer profits can be unpredictable. It pays to use the tools available to pin down a good price.

 

[MtnViewRanch]

A lot of people seem to think that everyone's prices should be the same. Guess what, everyone's overhead isn't the same. Even if each person makes the same money, where and how the business is run can make a huge difference. As far as someone not understanding that, and all prices should be at least close, they aren't, that's just the way it is. If you are a person that relies heavily on a dealer, then you have to pay whatever the price is for that dealers service ability, but if you are able and willing to take care of things yourself, then a lot bigger world opens up. Some people will say that shipping kills the long distance purchase, sometimes I guess that it might, but a lot of times it does not.

When I bought my 7520 and some implements back in 04, I spent 40k and change, shipping included. If I had bought local it would have been 48k. I live on the west coast, I bought on the east coast, there was not one local dealer of any brand that I was even remotely happy with and everyone's prices were waaaaay to high for me. The only difference in product was I was talked into a lighter duty rear blade than the one quoted locally, about a $900 difference. So I guess you would say that I saved about 7k, that is for the same product 3000 miles away. Oh, actually it was about 8k, the locals weren't going to repaint my tractor like the guys back east, and that paint job cost me $900.

Just my take on things based on my experience.

 

[PILOON]

Some work on rigid % markups and some go for volume!

Some have service facilities that are more efficient than others. (not all mechanics or techs are equal)

In another world; I had a couple of super techs, like 110% efficient and some (short lived) never surpassed 60%.

I did volume, did 'promos'- like make the tractor sale at decent profit but sweeten the deal by adding an extra (no warrantee/bullet proof product, eg;back blade) at my cost.

There are many approaches, solutions and variables.

Yep, hard to digest and analize it as a consumer.

Personally, I like to talk to techs, feel out the sales types and go with my gut feelings.
Are the techs keen and efficient? happy? shop well equipped? stores well stocked? straight answers or BS?

Also admit that the big flashy showroom with pristine shop floors kinda scare me as do the techs that change rubber gloves every 5 mins and drive the biggest SnapOn tool boxes on the block. (and the 3 buxtom receptionists)

I kinda prefer the owner/wife operation with perhaps 2 techs that have always been there for a generation or two.
Sure, I might have to wait a day or two for a part but since he has seen that same problem before he orders in to coincide with my arrival.