The Economics of Owning a Car Dealership

Comments · 112

• WE

  @WealthyMath · 1 day ago

  Having worked at five dealerships with plans to open my own, I found this video highly informative. I would love to see a future episode focusing on independent used car dealerships

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• SP

  @SpencerTL · 2 months ago

  As someone who has worked at 5 dealerships and plans to own my own, this is a good video. I would love to see one focusing more on the independent used car side

  73

• WE

  @WeepingReddit · 4 weeks ago

  This is actually very accurate. I've for the past 3 years managed a dealership doing around 25 million usd/year and got shocked at how accurate this was! Im located in finland but the principle is still the same. We are authurized dealers getting spred thin by the big brand names making little to no money. And to not talk about the service department with the allocated workhours that we get paid even if it takes twice as long to complete. Great vid

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• HO

  @hope-h5c3k · 2 months ago

  Never realized how much strategy goes into running a car dealership. This was way more interesting than I expected. Great breakdown! 👏

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• TH

  @thorntonhendrix418 · 2 months ago

  bro knows when am eating good video man

  24

• MA

  @masterwealthcode · 1 month ago

  loved the way you explained the behind scenes

• RA

  @Randy.E.R · 2 months ago

  This was a very good episode and sounded accurate. I spent 23 years working as a mechanic at our local Ford dealership. I started right out of high school in 1982 and stayed until 2005. A lot of it matched what was described in this video. This was a very small dealership in the Mojave Desert with only a handful of employees. The dealership was originally opened in 1960 by a man named Bob, who ran it until 1979. In 1981, his son Rick took it over with a group of friends from the same high school. It stayed open under the family’s name, and I think Bob was still the main owner. Some employees who worked there when Bob owned it came back, and all of us in the shop went to the same high school as the new owners.<br><br>The building was very old, dating back to World War II. I believe it was an old airplane hangar because it was next to the local airport, which served as a Marine base during the war. The lighting inside was terrible. There was no heating or cooling, even though we were in the middle of the Mojave Desert. We used a lot of fans and portable swamp coolers to get by in the summer. Compared to today’s dealerships, which are state-of-the-art buildings in auto malls, this dealership looked more like a wrecking yard selling new cars.<br><br>I’m not sure how it stayed open the second time because Rick and the other so-called owners were anything but professional. They seemed to rely on the “good ‘ol boys” vibe that used to work in a small town.<br><br>I made a good living working in the garage. I bought a home and raised a family while I was there. We didn’t just work on Fords; it was more like a regular independent garage. Many customers who bought new cars had other family vehicles that we serviced, too. It wasn’t uncommon to walk through the shop and see a Ford, a Chevy, a Toyota, or whatever else people drove. There was even a joke that we would work on a 747 if one would fit in the shop.<br><br>Despite the good times I had and the decent living I made, cracks were starting to show within the dealership. People were turning on each other, and employees who had been there since Bob’s time were quitting. I could sense the ship was sinking and left before it got worse. The dealership closed in 2012. Between when I left and 2012, it was down to a skeleton crew of about two salesmen and a finance manager. I believe the shop ended up getting by with just a couple of mechanics.<br><br>I used to tell myself, when working there, “If I owned the dealership, I would do this or that differently,” because I saw a lot of things happen that made me scratch my head. After watching this video, I would have probably run it into the ground much faster than Rick and his friends did.

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• FI

  @Finance-q8k · 1 month ago

  This was a very good episode and sounded accurate. I spent 23 years working as a mechanic at our local Ford dealership. I started right out of high school in 1982 and stayed until 2005. A lot of it matched what was described in this video. This was a very small dealership in the Mojave Desert with only a handful of employees. The dealership was originally opened in 1960 by a man named Bob, who ran it until 1979. In 1981, his son Rick took it over with a group of friends from the same high school. It stayed open under the family’s name, and I think Bob was still the main owner. Some employees who worked there when Bob owned it came back, and all of us in the shop went to the same high school as the new owners.

• OW

  @OWNEDOPERATED · 1 month ago

  This breakdown of dealership economics is fascinating! The part at [<a href="https://www.youtube.com/watch?v=2ppyMGoHsoc&amp;t=687">11:27</a>] revealing how the real money is made in the F&amp;I office instead of the car sale was eye-opening. Exceptional content as always! Which business breakdown are you bringing us next?

• OW

  @OwnedEconomics2 · 2 months ago

  Success in a car dealership comes from smart economics, not just great sales. Excellent explanation! 💯&quot;

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• DO

  @docvalvo3903 · 2 months ago

  Very Very well done! I was the GM at a large 3 franchise dealership. You explained the business perfectly!

• RO

  @Rod2RichesUS · 1 month ago

  Great breakdown and informative.