Why choose car dealing?
Or as I prefer to call it, the motor trade, why indeed. Having had experience in more than one industry, I feel more than well qualified to answer this one.
We only need to look out of our windows to see the volume of traffic in even the quietest locations has gone up significantly in recent years as more and more people own cars and more families have two or more cars in the driveway. It is true the world of big business has a fair old grip on the market with their big marketing machines and mass advertising campaigns, but, and it is a big but, the market is positively huge and fast moving.
From a sales point of view, there is something important you should be aware of regarding assets such as cars. First of all, because they are so expensive, you do not need to sell millions of them to break even (assuming you don’t’ have the overheads of General Motors of course) secondly, when you are selling used vehicles, each one is to some extent, unique. This may not seem important at first, but believe me it is, because you can apply something called USPs to each and every vehicle. USPs are ‘Unique Selling Points’. If you are selling new cars, then one dealer’s Ford Focus is very much like the next dealers, so it is hard, if not impossible to justify any price differential. If a consumer can perceive the car he is buying from you is a better prospect for XYZ reason (eg. One careful lady owner), then you can justify a better price in a sales situation. I will mention this USP business again in a later chapter.
Another consideration is the big franchised dealers have an insatiable desire to shift large volumes of new stock with a bewildering array of special offers and discounts. This has the inevitable ‘k...
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...ated in the introductory disclaimer, I make no warranty that you will make a profit at all. However, to illustrate the actual potential, I notice that a local car sales business located on a small very rural industrial estate, miles from anywhere and off a main road etc. etc., is up for sale for £100,000 plus stock at value. I don’t know how long this business has been trading but I didn’t even know it was there until about a year ago. The ‘For Sale’ advert states that the net profit for the business is not far short of £100,000 either. The business does not to my knowledge deal in anything out of the ordinary. It is fair to say that exactly how much you will earn will also depend on how quickly you can turn over your stock, the funding available to you (how much stock you can afford to carry), how well that you conduct your business and your chosen route to market.
Large players can offer competitive prices if they buy in bulk. Smaller players can differentiate themselves by offering niche products and superior customer delight at a premium price.
Offering consumers access to an extensive inventory online along with warranties, service, financing, appraisals, and add the consumer’s ability to sell the car to the dealership is CarMax’s brand. CarMax needs to continue to leverage their competitive strengths while making sure they offer the best-priced cars to the very competitive used car buying consumer. While it may be attractive to CarMax to enter new car market, they risk losing the ability to conduct their business model as manufacturers have various rules and contract requirements to carry the Chevrolet, Buick, Cadillac, Honda, or Toyota product lines. With this, they risk losing their brand recognition and identity with their consumers. Additionally, costs associated with buying an existing dealership with inventory and various licensing and franchising fees have the potential to drive up costs and therefore threaten their ability to price
... the world. From humble origins in the late nineteenth century, the auto industry grew explosively in the early and mid-twentieth century’s, scattered and decentralized, and reconstituted its work force. The impact on everyday life, from where people live to what kind of work they did cannot be underestimated. The hard work people put in to making the assembly line helped almost all companies succeed in making more cars. Just imagine if the assembly line was not created. It would take years to make a car and the cost of a car would be very expensive. Those changes were especially visible in Detroit which was the capitol of the auto industry automobile nation. The automobile industry would not be where it was today if it wasn’t for all the hard work people put in it in the 1900’s. Ford, Chrysler and general motors’ help create what we call today as the automobile.
Getting a used car instead of a new car is becoming a trend in America today. People do not want to spend money for new cars cause of the fact that cars’ values diminish significantly. This is exactly what my friend thought when he bought his used Acura CL 2.3 Coupe 2D for 13,500 dollars last years from a local dealer. Now the question is whether the price he paid really makes sense considering the current options and conditions of the car. Unfortunately, my friend didn’t even do any research before he bought this car. Thus, he bought this car with a relatively higher price than the price that he actually could have. Based on some of the used cars sales websites like kbb.com or edmunds.com which will be discussed later, he can actually buy that car for 12,585 (kbb.com), or 12,233 (edmunds.com). Inspired by my friend’s experience, I did some study on websites that can help you to negotiate for a used car like a pro. I come up with these two websites that I mentioned earlier—kbb.com and edmunds.com.
The history of the automobile begins with the technological advances that occurred in the USA with Henry Ford’s Model T. Since then, the automobile market has had its ups and downs, but it has no doubt flourished into an industry that is the cornerstone of many economies. The world economic collapse due to the Great Depression caused consolidation in the manufacturing market. However, after World War II, an expanding highway network fueled by economic growth as well as television advertising spurred sales for car companies in many countries. The globalization of the industry accelerated during the late 1990 's due to the establishment of overseas plants and the merging of large multinational corporations.
The motor vehicle industry is quite massive. Close to 70% of all car parts from an irreparable automobile
It is no doubt that automobiles have become a way of life in the current society besides the transport sector contributing immensely to the economic growth of every cou...
The American auto industry is one of the largest and more viable industry around the world and American usage of cars
My interest in the field of Automobile goes back to my early years in high school which is when I decided to pursue a career in engineering. As a child I was always fascinated by the very concept of automobile. Further, my father’s constant involvement in the automotive industry as an insurance claims assessor further enhanced my interests in automobiles. He was the one responsible for showing me the correct path to pursue my career in automobile field. Hence, after having completed my primary education, I decided to delve straight into the world of mechanics and engineering and pursued a diploma in mechanical engineering followed by a bachelor’s degree in mechanical engineering. Since there were very few options in India & there was no direct path to get into automobile field.
Porter’s five factors include: the intensity of rivalry among incumbents; the threat of new competitors; the threat of substitute products; the bargaining power of the buyers; and the bargaining power of the sellers (Parnell, 2014). The rivalry with competitors in the used vehicle marketplace exhibits a level of intensity based on the age and stage of this industry. In the US, the automotive industry has been in a mature phase of its life cycle for nearly 50 years (Gao, Kaas, Mohr, & Wee, 2016). As the leader in the industry, Manheim Auto Auction must maintain a keen awareness for potential changes in consumer behaviors or disruptive technologies that would be more difficult for us to quickly adapt to. The second factor, the threat of new challengers entering the industry, coincides with the first factor in understanding our competition. There are high barriers to enter the vehicle auction market and Manheim has set the industry standard for buying and selling used vehicles at live auctions and online. The infrastructure required to open a competing auction is quite significant, along with the necessary permits, licenses, and federal requirements there is limited ability for traditional competitors to enter the marketplace. Conversely, this also means that the industry has very high exit
5. If they don’t like the car I have shown to them than I will give
A vehicle is one of the biggest purchases a person will ever make. Over the years, the prices of an automobile have increased due to the rise of inflation. Due to a price index, the price of an automobile changes over a certain period of time. Economists compare averages of automobiles to calculate the cost of each vehicle that presents itself on a car lot. When all of the above is calculated within the purchase of an automobile, it affects every area of making the automobile to selling the automobile. All of these factors are impacted together for the automobile industry as a whole.
In an unpredictable market customer perception is often the most viable source of information. It is difficult to directly benchmark the CAR prototype against other market offerings and therefore a value based approach could provide a better understanding of the price ceiling. Andy and Marc point out that value-informed pricing techniques are superior for products with a high relative advantage. With the current climate debate heating up, the CAR’s zero harmful emissions and low fuel costs boost its competitive advantage over petrol based cars. Yet risk per se cannot simply be av...
aptable the industry has been, adding technologies to cars, GPS, WiFi, Iphone connectivity and chargers, Bluetooth and also the innovation of Hybrid cars which is keeping up with the environmentally conscious society in which we live. Although the industry is and has been in a bad patch, I am completely confident that, as a result of it's sheer adaptability, it will eventually bounce back.
Due to the high market share and high barrier of entry, Honda and Ford have an oligopolistic relationship within the SUV market. These two companies tend to have similar prices against any other