Why can you buy a car at dealer Invoice but audio

Taters,

Just keep in mind for Hi-End equipment the dealer paid 60% of MSRP plus shipping cost.

10% to 15% off on a single item ain't bad.

If the dealer is lucky he might make 5% to 10% after paying himself, or an employee, a wage plus other overhead costs.

If he gives you 20% off MSRP what does that leave him?

Now if you are buying a system then the dealer has more wiggle room.
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Highly recommended undercoating treatment. Now thats funny.

There is no such thing as a dealer's invoice, if they sell every other car at below dealer's invoice, the auto dealership would be considered non-profit organizations.

When a car sales guy sells you a car, after all the overheads, the dealership owner takes a cut, several levels of managers get their cuts, then the sales guy gets his. Even at the "below invoice price"', they all still get their cuts. Sometimes, the manufacturer would cut their take, allowing the dealerships to either have promotions, or unannounced price cuts.

If you look at the price/cost ratio of a car, it is probably similarly structured as an audio component. It is just that there are less middlemen to get that component from the manufacturer to you than it does a car, and a dealer sells less volume of audio components as cars.

My cousin used to work as a salesman at an Acura dealership. He told me that he's pretty much set for the month financially for selling 4-5 cars.

FrankC

Jea48,

It's amazing the dealers only make 40%. That means the manufacturers are making most of the money. As an example a piece that retails for 1000.00 cost the dealer 600. It probably cost the manufacturer 200.00. That's a 300% markup. It looks like if you want to be in the high end audio business today manufacturing is the way to go.

Auto dealers sell few cars for cash, most of the time it is leasing and financing, not to mention how they get you to buy their insurance. As has been said, 'invoice', 'MSRP' are meaningless, they are just hooks to make you feel better. Also, if you have recently look at the typical car dealer sales order you will find they add about $1,500 of other chargers not including sales tax. Items in the $1,500 are like $400 for 'Documentation/Tile' Fees, Computer fess, Clerical Fees. On and on it goes. These sneaky dealers recently try to charge you twice for 'destination' fees, although you thought they were in the firm price you settled on. So, best to always ask for 'out the door price', that includes sales taxes and any and all other costs and fees. I worked as the personal assistant to a mega dealer years ago. His business model was to make 15% on MSRP, one way or another. Finally, today cars are so complicated that a dealer is going to make serious money on service, since locals have neither the expertise of tools to do the work.