Lets Talk About Import Dealers And Car Yards....

[Joe@Xtreme Motorsports]

Hi Everyone,

Lets see where this leads to?

Being an Importer for many years with all the knowledge about the Importing Industry I would like to share with you all what its like to be on the other side of the fence.

Many Importers in Australia and I am not backing anyone or even myself are finding very hard and expensive to find decent and legitimate cars for the Aussie market.

People in Australia aren't prepared to pay real prices for real cars. Everyone wants a bargain and a new car for the price of scrap.

Everyone doesn't understand that the cars are getting older and harder to find. To give you guys an example:

I flew across to Japan recently and spent endless hours and 12 days and went to over 15 auctions and travelled 6000kms and only to be able to purchase 2 cars.

Most of the cars either went for big money or had major problems such as previous damage or rust and corrosion.

This is only half the battle guys.....

Then you have your Sales Site/ Car yard etc...

Overheads...Rent pending on site. Where we were was $11000 per month.

Carsales- $3-5000 per Calender month (30days). Biggest Rip off ever. Their prices just keep rising.

Ebay and Gumtree- Not free for dealers and is approx. $1000 per month.

Insurance- $1500 per month.

Electricity- $1200 per month.

Water- $200 per month.

Telephones and Internet- $500 per month.

Wages???? pending how many staff you want to run with. Minimum $10000 per month for 2 guys. That's without Commissions.

You can do the calculations....

This is only the major stuff. Then you have mechanic's bill, auto electrician, warranty comebacks, Detailer, Compliance and the list goes on.....

You cant imagine how much money has to go into this type of business and how hard it is to actually be on top of the bills.

It is really hard work and very deceiving to the outside public and customers.

Lets face it, you the customer walks in and see a whole heap of nice cars and automatically think WOW...

Looks are always deceiving. Hard work, stress and marriages falling apart from this type of business and I feel sorry for every single person that is involved in this business.

I am not trying to whinge or complain but just stating the honest truth and facts as many people don't know.

Sometimes people pick on other dealers especially about the kilometres but those dealers are willing to take the risk as they are competing with each other and in need

of money to keep their business running. Unfortunately this is wrong and has to come to an end but they are doing this as the consumer/customer still believes that all

Japanese Imports are LOW KILOMETRES...and they shouldn't have more than 50-60,000kms....

Thanks to all that have read through this and I would actually appreciate your honest opinion guys and feel free to comment...

Please no harassment towards any dealers or anyone as I am not here to start fights or wars and just curious on how you all feel.

[TM7GTR]

Lets face it, the average joe off the street thinks Jap imports should have 50thou kms, but any true enthusiast knows this is BS 99% of the time. That's why we get pissed when dealers aren't honest in their listings, like some of the cars that have been caught out on numerous threads on this forum.

No one with a brain would think it's easy to run an import business, but honesty is still and always should be a priority. How can someone sleep at night knowingly ripping people off?

It's far too easy these days to find the truth about something, technology is making it harder for rats to hide.

[Alkatraz]

I hear what you are saying Joe but it all sounds like every single other business in Australia.

If costs are too high and you cant compete then you go out of business. What you don't do is start ripping people off by selling cars that you know are not in the condition that you are advertising. Thankfully it looks like we are finally seeing some movement from the authorities in this respect so hopefully all of the ripoff merchants will be out of business or locked up soon enough.

If the dodgy dealers where actually being shut down, then prices would revert back to where they should actually be and you could make some money. Harvey Norman is still in business and yet you can buy all of their products cheaper online. Just as i can import a car myself for less than buying it locally.

Australia is an expensive place because we have one of the highest standards of living in the world. Basic principles of supply and demand mean that you should still be able to make money as long as there are not too many dodgy people operating in the industry. If you are serious about what you say then you should be focussing some time on trying to get the authorities to chase down and prosecute those in your industry who are doing the wrong thing. Moaning about us not wanting to pay the correct price does not give anyone an excuse to rip people off.

[djvoodoo]

Everyone understands the need to put food on the table and pay the bills. We are not questioning that aspect of running a business nor the hardships that you face.

What consumers are being fed up with is dealerships knowingly and willingly adverstising cars that are not in the condition as described.

As a dealer, you go through the auctions just like any other individual, you see the auction sheets and paperwork and you inspect the car.

BUT

When you try and resell an "R" grade car with multiple panels replaced, 100XXX on the clock and then knowingly advertise it as "mint, mint, mint no accident damaged car" with less than 60K what did you expect?

The world is shrinking, and there is no such thing as privacy anymore!!! it's naieve to think consumers are gullible. Consumers are now smarter than the average retailer!!!!

[mmmE85]

Iam SURE you have made a good living out of importing and selling cars so the rant about costs and the like are rubbish IMHO

If it was so terrible in being in the import business why would you look start up another company......

People on here and like myself aren't stupid and as some import yards think we are. We do our due diligence in checking and re checking the car we are purchasing. If car yards try and pull the wool over our eyes we will expose them for what they are.....

There is a lot of import yards and importers that do the right thing by the customers and have a great standing in the import fraternity and people are happy and willing to recommend them. But when those companies and importers lead customers up the garden path so to speak then consumers will voice there opinions.

Just my 2c

[C4a0s]

What consumers are being fed up with is dealerships knowingly and willingly adverstising cars that are not in the condition as described.

.....

When you try and resell an "R" grade car with multiple panels replaced, 100XXX on the clock and then knowingly advertise it as "mint, mint, mint no accident damaged car" with less than 60K what did you expect?

well said..this is the main crux of it...

[Joe@Xtreme Motorsports]

Lets face it, the average joe off the street thinks Jap imports should have 50thou kms, but any true enthusiast knows this is BS 99% of the time. That's why we get pissed when dealers aren't honest in their listings, like some of the cars that have been caught out on numerous threads on this forum.

No one with a brain would think it's easy to run an import business, but honesty is still and always should be a priority. How can someone sleep at night knowingly ripping people off?

It's far too easy these days to find the truth about something, technology is making it harder for rats to hide.

Very true and I completely agree.

I hear what you are saying Joe but it all sounds like every single other business in Australia.

If costs are too high and you cant compete then you go out of business. What you don't do is start ripping people off by selling cars that you know are not in the condition that you are advertising. Thankfully it looks like we are finally seeing some movement from the authorities in this respect so hopefully all of the ripoff merchants will be out of business or locked up soon enough.

If the dodgy dealers where actually being shut down, then prices would revert back to where they should actually be and you could make some money. Harvey Norman is still in business and yet you can buy all of their products cheaper online. Just as i can import a car myself for less than buying it locally.

Australia is an expensive place because we have one of the highest standards of living in the world. Basic principles of supply and demand mean that you should still be able to make money as long as there are not too many dodgy people operating in the industry. If you are serious about what you say then you should be focussing some time on trying to get the authorities to chase down and prosecute those in your industry who are doing the wrong thing. Moaning about us not wanting to pay the correct price does not give anyone an excuse to rip people off.

Very true and correct. Its getting hard to trust and find legit cars.

Everyone understands the need to put food on the table and pay the bills. We are not questioning that aspect of running a business nor the hardships that you face.

What consumers are being fed up with is dealerships knowingly and willingly adverstising cars that are not in the condition as described.

As a dealer, you go through the auctions just like any other individual, you see the auction sheets and paperwork and you inspect the car.

BUT

When you try and resell an "R" grade car with multiple panels replaced, 100XXX on the clock and then knowingly advertise it as "mint, mint, mint no accident damaged car" with less than 60K what did you expect?

The world is shrinking, and there is no such thing as privacy anymore!!! it's naieve to think consumers are gullible. Consumers are now smarter than the average retailer!!!!

This world is small and privacy no longer exists. The reason why I am taking a step back and reassessing the situation here in Australia.

Iam SURE you have made a good living out of importing and selling cars so the rant about costs and the like are rubbish IMHO

If it was so terrible in being in the import business why would you look start up another company......

People on here and like myself aren't stupid and as some import yards think we are. We do our due diligence in checking and re checking the car we are purchasing. If car yards try and pull the wool over our eyes we will expose them for what they are.....

There is a lot of import yards and importers that do the right thing by the customers and have a great standing in the import fraternity and people are happy and willing to recommend them. But when those companies and importers lead customers up the garden path so to speak then consumers will voice there opinions.

Just my 2c

Actually quiet the contrary. I have been losing money for a very long time with that business. If it wasn't for my building business I wouldn't be able to survive.

The other business as I have explained many times is not mine. I am only helping set up and they have offered me a job and I have said no.

Xtreme Motorsports will still go on and will be back on board soon though I want to run it without me being there as I have further plans as

I have been offered a job in Japan and considering it hence why I was asking these questions etc. and giving the truth and insights to the world behind the

Imports etc.....

I am not on here for support or moral and don't care what people think of me or say or do.

Trying to show everyone what its really all about is obviously not good enough for some and I think it would take a lot of understanding as many have shown.

[StevenCJR31]

If any business man was losing money in business would he not part with it ASAP? I know I would

[Shoota_77]

If any business man was losing money in business would he not part with it ASAP? I know I would

Sometimes it's not as easy as just shutting the doors and walking away. The would be minimal examples of a business being set up with zero initial outlay. When you financially and emotionally commit to starting up a business you a) hope that things will get better and you make a return from the business and b) you don't want to fail so keep pushing that bit longer in the hope that it does improve.

I looked at buying a business last year and it made me realise just how successful a business needs to be to make a decent amount of money. You either need huge turnover, huge margins (impossible these days as EVERYTHING is available somewhere else) or minimal overheads. Obviously a combination of all of these would be perfect but in todays competitive, internet driven marketplace that has become just so hard.

I respect anyone that has a crack at running a business as it takes huge balls. Desperate times can lead to desperate measures but not when it means rip.ping off customers.

[JapaneseOdoCheck]

Out of curiosity,

So we can get a feel for both sides of the story. How many cars have you sold in the past year Joe?

Off the top of my head I estimate 2-3/week but I could be way off the mark. This is just an estimation.

[junkie]

Well, you say it costs you $11,000/month to rent the site you are at now

However, your site is currently advertised as $6,000+GST/month

http://www.realcommercial.com.au/property-retail-nsw-strathfield-500953011

[King GTR]

Junkie that's $6000+gst for only one side

[junkie]

Ah yes makes sense... Sorry disregard my previous comment. Just thought it was odd to have such high rent

[Iron Chef]

Seriously, if I had a dollar for every time someone had asked me to go into a car yard, I'd probably already have retired. I don't know how dealers put up with the stress of it all, to be honest. The GFC and the tsunami were massive blows to the industry, both in Japan and Australia.

Edited November 24, 2013 by Iron Chef

[King GTR]

You make a lot of sense Iron chef

[StevenCJR31]

Also good to see your column back in P.I

[Joe@Xtreme Motorsports]

If any business man was losing money in business would he not part with it ASAP? I know I would

Its easier said than done especially when you have employees and a lease that cant be terminated. When you enter a lease agreement you become a guarantor and your liable till the end.

Sometimes it's not as easy as just shutting the doors and walking away. The would be minimal examples of a business being set up with zero initial outlay. When you financially and emotionally commit to starting up a business you a) hope that things will get better and you make a return from the business and b) you don't want to fail so keep pushing that bit longer in the hope that it does improve.

I looked at buying a business last year and it made me realise just how successful a business needs to be to make a decent amount of money. You either need huge turnover, huge margins (impossible these days as EVERYTHING is available somewhere else) or minimal overheads. Obviously a combination of all of these would be perfect but in todays competitive, internet driven marketplace that has become just so hard.

I respect anyone that has a crack at running a business as it takes huge balls. Desperate times can lead to desperate measures but not when it means rip.ping off customers.

Well said Shoota_77 and you have hit the mark precisely and exactly.

I couldn't justify ripping off customers and hence why I am taking a step back to assess the situation.

Out of curiosity,

So we can get a feel for both sides of the story. How many cars have you sold in the past year Joe?

Off the top of my head I estimate 2-3/week but I could be way off the mark. This is just an estimation.

This year we only sold around 80-90 cars though I have lost a lot of money on some. Example: Toyota Bb owed us $16800 and sold it for $10500.

Another good example was a genuine EVO 8 MR with 62000kms that owed us just over $30,400 and we sold it for $28500 because customers kept telling me

that the mileage was too high...LOL...They didn't care if it was genuine or not they only cared for what was reading on the dash.

Well, you say it costs you $11,000/month to rent the site you are at now

However, your site is currently advertised as $6,000+GST/month

http://www.realcommercial.com.au/property-retail-nsw-strathfield-500953011

That is only one side as I have managed to find someone for the other side. Though they have to wait till the tree is removed and all repairs are done to that side of the property.

Junkie that's $6000+gst for only one side

100% Correct.

Seriously, if I had a dollar for every time someone had asked me to go into a car yard, I'd probably already have retired. I don't know how dealers put up with the stress of it all, to be honest. The GFC and the tsunami were massive blows to the industry, both in Japan and Australia.

Your a 100% right Iron Chef. Looks good on the outside but the stress is not worth it.

Thanks everyone for your input. It shows that there are some true and decent people out there.

The worst part of the industry is that its very, very dirty and if your not a hard ass or a criminal you cant survive.

Hence the reason of taking a step back for now.

[R31Nismoid]

 

Sometimes it's not as easy as just shutting the doors and walking away.  The would be minimal examples of a business being set up with zero initial outlay.  When you financially and emotionally commit to starting up a business you a) hope that things will get better and you make a return from the business and b) you don't want to fail so keep pushing that bit longer in the hope that it does improve.

I looked at buying a business last year and it made me realise just how successful a business needs to be to make a decent amount of money.  You either need huge turnover, huge margins (impossible these days as EVERYTHING is available somewhere else) or minimal overheads.  Obviously a combination of all of these would be perfect but in todays competitive, internet driven marketplace that has become just so hard.

I respect anyone that has a crack at running a business as it takes huge balls.  Desperate times can lead to desperate measures but not when it means rip.ping off customers.

 

One just needs to pick the right industry or path, do a sound business plan or the due diligence on the numbers of the existing one.

Too many people go in without doing proper research on the feasibility of the business, area it's in, costs, projections and so on. Then end up losing massive money or at best getting back their initial 18months later for what was essentially a bad decision and it screws you for many years to come.

In under 9 months, business I run, decent return coming back and looking to open 2nd in the near future. We didnt go into it blinded like so many do which is often the biggest problem

[Joe@Xtreme Motorsports]

One just needs to pick the right industry or path, do a sound business plan or the due diligence on the numbers of the existing one.

Too many people go in without doing proper research on the feasibility of the business, area it's in, costs, projections and so on. Then end up losing massive money or at best getting back their initial 18months later for what was essentially a bad decision and it screws you for many years to come.

In under 9 months, business I run, decent return coming back and looking to open 2nd in the near future. We didnt go into it blinded like so many do which is often the biggest problem

I agree.

Though the Car Import industry is very hard to judge as it has a lot of different areas that you could make or lose.

A lot of the hurt in the industry came with GFC as the dollar crashed and hurt many.

[Seano350GT]

A massive percentage of business fail within the first 5 years primarily due to poor planning..

I understand what's it like to be in the industry Joe as i have been in used cars for several years in the past but have since moved on to new cars.

A lot of customers want everything but expect to pay bottom dollar.. these days it's easy to give your credit card to a dealership in a big city and get them to send you a car on the back of a truck but it's not the same experience as buying in person at your local dealership. This problem is without a doubt the worst part of new cars - people shopping prices elsewhere. Wanting us to drop our pants and do cost price deals and yet be serviced and taken care of etc..

That's off on a bit of a tangent but that's my rant - similar to what you're saying with bills and running a business etc.

The import business i can imagine would be very difficult considering the amount of competition you have, bills and running costs, stat warranty claims etc etc.. not to mention only delivering a small amount of cars every month you would really have to be making good money off each car.

In my work i average $2250 per new car, and i deliver an average of 18 cars per month. Some cars have more margin than others but you know what i mean. I imagine you would have a lot of uncertainty with your profits given what's involved with importing a car and used car reconditioning.. sometimes you take the risk a buy a lemon of a car that costs you too much to recon so you flick it off and wholesale it.