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

[Joe@Xtreme Motorsports]

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.

Very true Sean. I believe the new car industry is tough as you have said too.

People shopping around everywhere and not even comparing apples to apples and just want the lowest price.

It is a very hard market as many people are now involved in it and there is a lot of backyarders that think they can make millions by doing it from home.

I can name at least 10 backyarders who have been ripping off people and getting away with it as there is no warranty or comebacks.

We always honoured legitimate warranty claims and did the right thing by all our customers.

Maybe that's the reason why the overheads were becoming too high and should have told everyone to get lost. Lol...

[Gts-t]

Used car dealers are all the same and always will be

[Seano350GT]

Absolutely, i remember in used cars my old boss was a real hard arse especially with giving money away and doing repair jobs through stat warranty. He was always very very by the book and would not go out of his way to help anyone.. i don't agree with the way he did business but he sure as hell saved a lot of money doing it that way - but burnt many customers in the process.

[Mohsen]

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

New bromics will be out by then

[GTR_77]

Despite the pessimistic view that I usually hold in terms of import car dealerships (and most people within them), I can understand where you are coming from Joe. The amount of variables that exist within the car import industry is astounding and the way that the industry conducts business can be thought of as somewhat market failure because of the few engaging in illegal activity that would cause the industry average price to decline and leave legitimate dealers with an ethical dilemma in mind: go broke (and close down) or engage in this activity (that everyone is getting away with) to continue operations. Unfortunately most have chosen the latter that has caused this vicious cycle.

Externally, one of the main problems (and conversely solution) is the ignorance that can plague the consumer. It happens when even true car enthusiasts personally 'hate' the dealerships and spend all their time cussing and posting on forums (which personally, I have no problem with because it creates awareness for the unsuspecting people who get duped by some of these dealerships, that I really feel sorry for) when really, the energy and blame should be directed towards the ones who are truly accountable for this: the Government.

The government should have already intervened, tightened up the laws and made huge crackdowns rescuing the industry before this entire mess blew out of control as it has now. Unfortunately, with the announcement of the recent supposed 'crackdown' it is all too late. If we think about this for a moment, if the Gov does knuckle down firmly on the dealerships and they do begin to conduct legitimate business conduct, it would be fair to assume that the average price of the vehicles will be raised. This will further affect the industry by decreasing the demand for vehicles from dealerships that already have somewhat inflated prices as opposed to the now flooded private market. In other words (in my opinion) the industry is f#cked in terms of profitability in the future if the government does tighten down firmly due to the further expenses coupled with the less demand from a rising price (and this is having all else equal – we don’t even have to look at the current rising property/leasing prices). Who knows, maybe this is the reason why they haven’t touched the industry for so long?

The flip side is that, if they decide to leave it the way it is, these business’ may continue to operate, but the consumer will continue to get ripped. Personally, I do not enjoy seeing any consumer being ripped off or any of the crap that goes around in this industry and would prefer the entire industry to collapse, but that could have negative impacts economically depending on the size and amount of employees within the import dealership industry ( I haven’t looked into it).

As for you Joe, if you are being legitimate which it does seem that you are (I honestly have not read much on here lately nor know much about your previous business), it seems as if you are at a cross roads in your life and it would benefit you to take some time off and re assess as you have said. Is there any other industry or skills that you are interested in or have previously been a part of? I don’t know how long you have been in the game or what you did in the younger days but it may be time to look at walking away and looking at new/different ventures in a different industry.

Anyway just my 2c, I hope that my opinion has made sense for both sides of the argument.

[Joe@Xtreme Motorsports]

Despite the pessimistic view that I usually hold in terms of import car dealerships (and most people within them), I can understand where you are coming from Joe. The amount of variables that exist within the car import industry is astounding and the way that the industry conducts business can be thought of as somewhat market failure because of the few engaging in illegal activity that would cause the industry average price to decline and leave legitimate dealers with an ethical dilemma in mind: go broke (and close down) or engage in this activity (that everyone is getting away with) to continue operations. Unfortunately most have chosen the latter that has caused this vicious cycle.

Externally, one of the main problems (and conversely solution) is the ignorance that can plague the consumer. It happens when even true car enthusiasts personally 'hate' the dealerships and spend all their time cussing and posting on forums (which personally, I have no problem with because it creates awareness for the unsuspecting people who get duped by some of these dealerships, that I really feel sorry for) when really, the energy and blame should be directed towards the ones who are truly accountable for this: the Government.

The government should have already intervened, tightened up the laws and made huge crackdowns rescuing the industry before this entire mess blew out of control as it has now. Unfortunately, with the announcement of the recent supposed 'crackdown' it is all too late. If we think about this for a moment, if the Gov does knuckle down firmly on the dealerships and they do begin to conduct legitimate business conduct, it would be fair to assume that the average price of the vehicles will be raised. This will further affect the industry by decreasing the demand for vehicles from dealerships that already have somewhat inflated prices as opposed to the now flooded private market. In other words (in my opinion) the industry is f#cked in terms of profitability in the future if the government does tighten down firmly due to the further expenses coupled with the less demand from a rising price (and this is having all else equal – we don’t even have to look at the current rising property/leasing prices). Who knows, maybe this is the reason why they haven’t touched the industry for so long?

The flip side is that, if they decide to leave it the way it is, these business’ may continue to operate, but the consumer will continue to get ripped. Personally, I do not enjoy seeing any consumer being ripped off or any of the crap that goes around in this industry and would prefer the entire industry to collapse, but that could have negative impacts economically depending on the size and amount of employees within the import dealership industry ( I haven’t looked into it).

As for you Joe, if you are being legitimate which it does seem that you are (I honestly have not read much on here lately nor know much about your previous business), it seems as if you are at a cross roads in your life and it would benefit you to take some time off and re assess as you have said. Is there any other industry or skills that you are interested in or have previously been a part of? I don’t know how long you have been in the game or what you did in the younger days but it may be time to look at walking away and looking at new/different ventures in a different industry.

Anyway just my 2c, I hope that my opinion has made sense for both sides of the argument.

Thanks Bill. Fantastic write up and you hit the nail on the head. I agree with you a 100%.

I have and did conduct my business to the best means possible and tried so hard to try and please everyone at the same time.

That in return meant very low profit margins and even trading at a loss on many cars just to try and educate customers that what they are getting is real but unfortunately

I was out numbered by many dealers and backyarders that were up to their tricks and illusions.

I am now enjoying the break as Christmas is coming along and spending time with my family and definitely re-assessing the situation.

I am in the building trade and still have my business operational. I have a development starting in February but I don't need to be there as I have 2 partners that have been

looking after that business for the last 3 years. They know my passion with cars and understand the scenario.

I was always proud of what I did and what I do but after sitting back now and realising how hard things were and the struggle in keeping the business alive is it worth it?