Most new and used cars are sold through dealerships, which provide vehicle research, test drives and financing. Dealerships also offer services like maintenance, repairs and car rentals. Car dealers make their money from traditional profit margins, ‘hold-back’ money from manufacturers, and sales incentives or rebates. They often get extra profits from the service bays, as there is a good chance a car buyer will return for routine maintenance or more serious repair work in the future.
Many car dealers also try to lure customers with add-on products, like nitrogen in tires, all-weather floor mats or rustproofing, which can run thousands of dollars. These and other dealer-installed options are often added to a car’s selling price without the customer’s knowledge or approval.
Some dealers are trying to attract a younger clientele by introducing car-sharing and other new-car mobility services. While these may not be the best fit for every car owner, they help to diversify a dealer’s business model and potentially increase customer retention.
In these increasingly competitive times, dealerships need to find ways to retain and grow their market share. One way is by focusing on the quality of the customer experience. To do this, they need to have a dedicated team of staff that is well trained and motivated. Those staff members need to be familiar with the latest technology and able to answer customers’ questions quickly and accurately. They need to be able to work effectively with different teams and departments, including those responsible for sales, finance and marketing. car dealers