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Old 11-15-2006, 02:42 PM   #1
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How much dollar profit should a dealer make??

I'm still new to this, so maybe I'm being simple. I had posted a thread about being badly treated through an email. While reading the responses, I heard a lot about percentage of discount. How base cost is about 78% of MSRP and I should try to buy around 20% of same. What does that mean in dollars? How much should a dealership and sales person make????

For the sake of sanity and arguement, let's assume that's correct.

That means that a $40,000 ( for example) MSRP is dealer cost of $31,200.

From what I understand there is a owner's 'pack'. This is the amount for advertising ect. This I've heard is 5-10%, let us take the lower number and add that to base.

5% is 1,560. plus 31,200 is $32,760.

Now there is freight, on Aistreams $500. Base cost now is $33,260.

I've been calling ( yes calling not emailing) and I've been told that Airstream's warranty won't start with out a 'walk thru' and 'pre inspection'. I called Aistream, they confirmed this information and further, they don't pay the dealer for that. So add a shop bill to the deal, let us I don't know.......I really don't, but I'm going to guess $800.

Base cost now is 34,060.

One salesman in New Jersey told me they make about 20-25% of the profit and sell about 6 a month on average.

So how much should they and the dealership make??

Sorry about all this, I've been down with the flu this past few days and after my previous experiance......I had time to start diggin!

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Old 11-15-2006, 02:50 PM   #2
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It really comes back to the dealer's overhead Lynn. You can't set an arbitrary figure since overhead is variable. We've often said the goal is a deal that's 25% off MSRP. Some dealers can make a profit on that number, some cannot. So look for a happy medium from maybe 15% - 25%.

To turn your question around, how much income should an individual earn? I know part of my overhead is paying the monthly payment on my Classic!


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Old 11-15-2006, 03:10 PM   #3
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Most large discount retails stores standard rate is 40% above purchase.
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Old 11-15-2006, 03:15 PM   #4
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I negotiated 22 percent off my '05 Safari in June of '06. I got the opportunity to shop the exact same unit with five different dealers, and this was the best deal by $2000+. What the dealer made, I don't really know. I just know that I got the best deal that I could find on the Airstream that I wanted.
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Old 11-15-2006, 05:18 PM   #5
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more importantly should be, how much am i (the buyer) willing to pay? then go from there. or how much is it worth to me (the buyer).

you can drive yourself nuts trying to figure out how much the dealer or any business is making off of your hard earned dollar. and the truth us you'll never really find out, so why bother worrying about it. businesses exist to make a profit and that's what makes the world go around. if i didn't have clients paying me money, i wouldn't be spending money on airstream stuff (or maybe i still would).

i'd suggest you visit 5 a/s dealerships in your area and see who gives you the best price. that will ultimately determine what you have to pay.

*by asking the above question,
i verify that i have already used
the search feature to the best of my ability...
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Old 11-15-2006, 07:00 PM   #6
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The transportation costs from western Ohio to the West Coast will add much more to a dealer's cost and I wouldn't expect discounts to be uniform across the country or even within a region. There are just too many variables. Moosetag's observation is for a previous year model still on the lot -- certainly an opportunity for a deal. Dealers do not have to be flexible if the customer is looking for an in-demand model. The FB (front bedroom) models would be an example. The 75th Anniversary Bambi limited production will sell out with minimal discount (in spite of outrageous price!).

It has been said and I will repeat: Your ability to be first in line for service does depend on whether you bought from your closest dealer. If you buy at a distance your closest dealer will be much more concerned with scheduling units they sold themselves. This is just like standing in line to get warranty service on a home appliance from a Mom & Pop shop when you bought that appliance from Best Buy or Sam's Club.

I've listed my '74 Argosy before and had a very picky inquiry from a very analytical prospective buyer (I think that's enough superlatives to make this clear!). Something clicked when this same person recently posted extreme dissatisfaction with purchase of a brand new Airstream. Enjoyment and appreciation sometimes require a buyer to realize they have to leave something behind and just get on with ... enjoyment and appreciation.

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Old 11-15-2006, 07:27 PM   #7
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Not sure how many of you noticed the recent (last week) new 34' Classic listed in the For Sale section. It was a dealer from Indiana and they wanted to thin the inventory. I had them fax the invoice...asking price reflected a discount of nearly 29%. It sold is about two days. $81K MSRP down to something like $58K.

Based upon what I have read here...that was a terrific deal...if you were looking for a nice. new 34' Classic. It is also the highest discount % I have either heard of or seen in my few short months of research. However, the 34' is not on the "fast moving" AS list. Sure was a good deal.

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Old 11-15-2006, 07:41 PM   #8
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Originally Posted by Canoe stream
Dealers do not have to be flexible if the customer is looking for an in-demand model. The FB (front bedroom) models would be an example. The 75th Anniversary Bambi limited production will sell out with minimal discount (in spite of outrageous price!).
MRSP on the 75th is a whopping $75K up here (Canada). We did 15% off US MRSP matching some none negotiated prices at a few dealers south of the border. There are 40 75th's currently sitting on lots across the US.
One dealer even has one listed at $53.9K. So are they 'rare'? Nope.. not right now anyways. I'd say good time to buy, and yes expect a good discount or select one of the other 30+ dealers. Next spring/summer may be another story. You'd be hard pressed to find any of the 'special' 2006 Quicksilvers left by the end of summer 2006.
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Old 11-15-2006, 08:23 PM   #9
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hi lynn...

there are many threads here on pricing, dealer profits, negotiating a purchase and so on....

try the search engine with some key terms...

here is a useful thread...

particularly posts 11 and 14

condoluminum has written an articile on buying, thats in a 2005 issue of airstream life...

buying an airstream isn't like shopping cars...

no widespread access to the invoice or dealer costs...
way fewer dealers and buyers and units...
so ya can't just calculate base + options and add 1000$ on for the 'profit'...

you will not be able to buy or shop airsteams this that way.

search or ask what others are paying for a given model...

some are really hot and have less discount...

others have more as noted with the 34 classic above...

20-30% is the range...perhaps less during a hot model phase...

some options have more 'margin' built in too, so more room to wiggle...

the 75th is a limited model with materials/elements not yet available in other units...

so production costs are higher than a plain jane safari or ccd...

funny but just 3 years ago the ccds were flying off the lots and at a premium...

then the safari se/ss/ls/ltd/bvds....

next the quick silver... only gonna be '50' but that became 2 runs of 50...

now the 75th is hot...sort of...

the 'ocean breeze' 25 footer is a whale of a trailer and a better value and sweet decor...for less money so look for one...

the decor and design elements of the 75th are to be used in other models next year...

so in a few years this special model will not be so special....don't buy one thinking it is 'collectible'...

in some ways the 75th is a 'halo' model...
if i were a dealer and had one in inventory...
i'd keep it in the show room with no discount on price...
folks would come in to see it...
then buy a safari or classic or international...
for less money and with more features...
at the end of the year, say april 2007, i'd auction it off or have a raffle...
proceeds to a local charity
and write of the 75th with the tax accountant lady doing the magic...
under the advertising budget and whatever else she could cook up...

it's just an airstream....go camping!

how much can you afford to spend on a trailer?

all of the true things that i am about to tell you are shameless lies. l.b.j.

we are here on earth to fart around. don't let anybody tell you any different. k.v.
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Old 11-15-2006, 09:20 PM   #10
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Airstreams have a Huge mark up compared to some tailers. I was told by a former AS sales person. I got into this discussion with him when I was ready to buy. He told me that if a dealer gives you a 25% discount He is still making money. Of course most AS dealers in my area ( there are only 3 in Washington and Oregon all together) don't sell a high volume of AS trailers. The depend on other brands for volume profits. They of course make money on selling you a hitch and accessories. Overhead varies greatly within the dealer chain. This person worked for a CASH dealer. So He could sell them for whatever profit he wanted to.
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Old 11-16-2006, 04:08 AM   #11
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Trying to nail down a single discount that applies to every situation and model is like trying to make cement out of quick sand. Not only is the dealer's factory invoice as a % of MSRP different for each model and factory installed option, the discount can and does change throughout the year (and sometimes from minute to minute during the course of a day - believe it or not!) as Airstream (corporate) gives the dealer special discounts they feel may be needed for him to make the retail sale. One common example of the latter occurs at certain major RV shows, where Airstream may even have corporate sales persons on hand to approve extra incentive discounts as might be needed on a case by case basis.

Personally, I wish more of the purchase negotiating in the RV industry was done on a cost plus basis, more like the auto industry -- show me the factory invoice, and quote me a price that's a % or flat dollar amount above that price. However, while there may be some dealers who will sell this way, I believe that for the moment you have to be content knowing that if you are able to get a 20% discount off MSRP you've done well; if you get 25% off MSRP you've done very well; and if you get above 25%, you've done exceptionally well (and better recheck those numbers a second time just to be sure. )

In any case, if you are able to find an excellent dealer reasonably close to your home that will provide reliable after the sale support and service (there are a few of these dealers across the country) that alone can be worth paying an extra 5% for (or maybe even 10% in some instances) IMO.

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Old 11-16-2006, 09:13 AM   #12
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I am a vintage owner who has never bought new; however, I did purchase two Airstreams and got a great price on both. In fact I remember when I called the gentleman to buy Chummy, we talked at some length after I told him I was buying his MH. He called me back right away to ask what I was going to pay, I said: the price quoted , of course. It was a great price because it was what I wanted and have enjoyed every minute of my purchase. I have never questioned if I could have gotten another dollar or so off of the price. I have purchased new cars and the truck I drive today. I always got a good price since it was the vehicle I wanted. When we put in the offer for our house it was for the house not the deal we were getting.
I am convinced that the people who are obsessed with price will never be happy with their purchase.
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Old 11-16-2006, 09:39 AM   #13
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Originally Posted by Chaplain Kent
I am convinced that the people who are obsessed with price will never be happy with their purchase.
point well said. it all comes down to what is it worth to you. i probably paid too much from my '56 flying cloud for what is essentially a shell (although a heck of a lot less than a 75 anniversary bambi!), and i don't regret it at all because i did lots of research, new the market in my area, and the trailer was at the exact amount i was looking to spend. SO, i'd recommend to figure out what you want to spend and go find a trailer that fits that price. and most importantly, ENJOY the airstream after you purchase it.

*by asking the above question,
i verify that i have already used
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Old 11-16-2006, 10:37 AM   #14
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Cool "How much dollar profit should a dealer make?? " excuse me

Everyone seems to be focused on MSRP and, to some degree, the dealer's profit. While you're playing the percentage game with...not the dealer but the salesman..Keep in mind these basic things.

1. Cost to obtain a franchise from Airstream to become an Authorized Dealer. (It's not cheap!!)

2. Plant cost. (That fancy building and location to house this whole operation)

3. Cost to train and staff the service dept. plus, the parts stock.

4. Cost to train and staff a sales team.

5. Cost to maintain an "office crew". They do all the paper work for titles, sales agreement, etc. It's actually quite a large pile of paperwork as anyone who has bought a new airstream will acknowledge.

6. Salesperson salary is based upon a certain percentage of the sales.
Usually works out to be: 20% on all monies above the cost of the delivered unit and pac monies.

a. Minus the dealers cost for unit.

b. Minus the owner's pac money. (10%)

c. Minus any prep work done in the shop to get unit cleaned for delivery.

d. Minus the cost for the delivery coordinator to walk you thru and explain how everything works.

e. Minus the cost of the hitch assembly installed. (paid to the service shop)

f. Minus any draws from previous weeks of "slow sales period". (Usually 150$

to 400$ per week and, depends on the dealership.) Most salesperson are

lucky enough to earn a commission from a sales of an airstream trailer to

do little more than break even. Now that the Class A are gone from

inventory, they don't even have that extra nice bonus to look forward to.

g. Plus: Airstream sends a check to the salesperson for each and every unit he/she sells. But, only after "all the paperwork" is cleared thru channels.

7. After sales service: warranties or, non-warranties. (You said: You want WHAT and WHEN>?)

8. Additional cost to you when the dealer goes out of business and, you're

now forced to tow your "new bargain" to another dealer several states

away. Some of you have found this out already~!

As a former Airstream salesperson, I can't even begin to list all of the

"pressure items" thrown out at you from:

Sales Managers, Office Managers, Service Managers..

Happy Hunting...
Vern, aka 53FC

WBCCI 5292 AIR 807
NEU #64
New England Unit
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