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Thread: Discount BMW Parts - from a BMW Dealer

  1. #16
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    Quote Originally Posted by GlobalRider View Post
    And on top of him complaining about not making any money (he was kidding), he charges 25% on top of MSRP.

    And you wonder why I shop stateside for my BMW motorcycle parts, my Honda and Porsche car parts and everything else under the sun. I just don't like bending over and spreading my cheeks.
    That's a pretty healthy add-on unless it applies to extremely low priced items. I would guess his quantity sold numbers are pretty low. Is the operation located in an exceptionally expensive part of town? Did the OEM force him into a newer Disneyland and he's actually trying to keep up with the new overhead, or is he exceptionally greedy? I guess folks are paying the tab?

  2. #17
    Alps Adventurer GlobalRider's Avatar
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    Quote Originally Posted by billy walker View Post
    That's a pretty healthy add-on unless it applies to extremely low priced items.
    That is quite typical at the dealers. I know of at least two. Initially it was 10% and I later saw 25% add-ons. And I'm not talking nickle and dime stuff.

    I stocked up on -130, -200 and -300 sealing rings. They were 20 to 40 cent items at the time. Well when you round them up to a buck each, a $28 order ended up being almost $100. I had a talk with the owner...he dropped it back down to MSRP.

    I can do without creative number crunching.

    Anyway, end of story.

  3. #18
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    Quote Originally Posted by GlobalRider View Post
    That is quite typical at the dealers. I know of at least two. Initially it was 10% and I later saw 25% add-ons. And I'm not talking nickle and dime stuff.

    I stocked up on -130, -200 and -300 sealing rings. They were 20 to 40 cent items at the time. Well when you round them up to a buck each, a $28 order ended up being almost $100. I had a talk with the owner...he dropped it back down to MSRP.

    I can do without creative number crunching.

    Anyway, end of story.
    I am familiar with that. As with many things sold in the world deiiferent items have different percentage mark-ups. This is not unusual on very small items. It's the sellers way of trying to keep the margins to a realistic area. I can understand a customers viewpoint on this. And, I know it will always make a dealer look bad. Without it margins would certainly go down and may or may not harm the overall profitability of the store. Variable margins actually exist in many industries in an attempt to keep the overall margin to a "realistic" number.

  4. #19
    Alps Adventurer GlobalRider's Avatar
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    Quote Originally Posted by billy walker View Post
    It's the sellers way of trying to keep the margins to a realistic area.
    You make less on a $1 part and you make lots on a $100 part. Both have the same percentage markup from BMW.

    There is no need for the dealer to mark up anything. If he is going to mark up a cheap part by 50%, then he can mark down an expensive part by 50%. Can't have it both ways!

    There is no need to discuss this further, and I'm certainly not interested in doing so with someone that has a vested interest.

  5. #20
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    Quote Originally Posted by GlobalRider View Post
    You make less on a $1 part and you make lots on a $100 part. Both have the same percentage markup from BMW.

    There is no need for the dealer to mark up anything. If he is going to mark up a cheap part by 50%, then he can mark down an expensive part by 50%. Can't have it both ways!

    There is no need to discuss this further, and I'm certainly not interested in doing so with someone that has a vested interest.
    I do not have a vested interest in any motorcycle dealership. I do know how to read a P&L however. I have intimate knowledge of dealer operations. Unless you have seen a number of P&L's that represent the condition of the industry as a whole you will never understand what I'm saying. I have no idea of your financial knowledge when it comes to dealership operations. If your percentage numbers stated above reflect your concept of what goes on I dare say you have room to learn. Shutting down the conversation will certainly not make you a more knowledgeable person. Before you make comments of this nature you really need to understand what goes on within a dealership from a financial point of view. At that point you can make valid statements. Until then we really have assumptions going on. It is my sincere hope you take this as intended. We are all better off when we understand everyone's needs and requirements. This is NOT an attempt to make you look bad.

  6. #21
    Alps Adventurer GlobalRider's Avatar
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    Quote Originally Posted by billy walker View Post
    I do not have a vested interest in any motorcycle dealership.
    But you do seem to take the side of the dealer, shop or business owner.

  7. #22
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    Quote Originally Posted by GlobalRider View Post
    But you do seem to take the side of the dealer, shop or business owner.
    If you review my commentary in general you will find I believe both a dealer and a customer have the responsibility to be fair and do what's right. There is nothing wrong with making a profit. That's the reason we all have jobs. I have an unfair advantage here. Given my background and assuming I'm being truthful I can automatically tell if someone appears to be knowledgeable in the area of motorcycle dealer profitability. In all likelihood I cannot speak with authority when it comes to your particular career. What makes us different is I do not go out on forums and make comments as to whether other business types are taking advantage of me through pricing. And the reason is simple, the vast majority of my life has been in the motorcycle industry in a management capacity. I cannot intelligently comment on other industries. Why? Because I do not have expertise in other industries.

    I gotta be clear here. I give you the absolute right to look at pricing and buy from whomever you choose and minding your own wallet. What I do feel is totally inappropriate is when people begin making financial accusations against not just dealers but anyone in any business and they really have no understanding to speak of when it comes to the financial side of that particular industry.

    I don't know if you're familiar with the term Class A, Class B, Class C office space. Class A is a whole bunch more money than Class C. For the last decade plus OEM's have pushed dealers into what amounts to Class A real estate. BMW is a considered a high end motorcycle in a niche market. The motorcycle market as a whole is basically a niche market when compared to cars. Niche markets can rarely afford Class A space unless you're working with unusually high margins. You've got service departments paying premium prices for every square foot found within that department. If you were to look at a dealership P&L you might be shocked as to how much that space costs the store. If the store can't take enough green in what do you think happens? What do you think has happened in the last 4 to 5 years within this industry?

    I don't want to bore you with all the financial details. Dealers have extremely large sums at risk. Most of them guarantee those sums with their personal home. Believe it or not most of them actually care about their business. Don't intentionally try to spread negative comments over your perception of their profitability if you truly don't have a handle on the financial aspects of whatever business you're discussing regardless of industry. That is being fair.

    It is my hope this makes sense to you and others who are sometimes so quick to become internet reporters without all the facts at hand.

  8. #23
    Registered User mpmarty's Avatar
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    Growing up in the automobile industry as a GM of a few dealerships I will add my $0.02 here.
    The auto industry is basically a dishonest one, made that way by the actions of its customers. People go to a dealer in an attempt to steal his profit and the dealer responds by stealing it back any way he can. I don't think motorcycle dealers in general are nearly as "bad" as their four wheel siblings but the customers are driving them that way too.
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  9. #24
    Alps Adventurer GlobalRider's Avatar
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    Quote Originally Posted by billy walker View Post
    It is my hope this makes sense to you and others who are sometimes so quick to become internet reporters without all the facts at hand.
    Please spare us or I will have to get the violins out. You make it sound like they live in poverty.

    A local Ford dealer tracks and races a Porsche GT3; I guess a Mustang really isn't that good after all.

    It takes quite a few sales to pay for the ones he writes off, lets not even talk about their operating costs.

    I've worked in a few car dealerships and a motorcycle dealership.

    Anyway, back on track. I got the answer to my original question and my vehicles are maintained far better than they can at any dealership. End of story.

  10. #25
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    Quote Originally Posted by MPMARTY View Post
    Growing up in the automobile industry as a GM of a few dealerships I will add my $0.02 here.
    The auto industry is basically a dishonest one, made that way by the actions of its customers. People go to a dealer in an attempt to steal his profit and the dealer responds by stealing it back any way he can.
    I think you just ID'd the "invisible hand" of the free market and perfectly described Ricardo's "Rational Man". Each and everyone of us enters the marketplace intent on maximizing our income. The consumer maximizes his income by paying the lowest possible price. The merchant maximizes his income by charging the highest possible price. Accordingly, we have the usual dance of the dealer and the customer trying to see who can win.

    Someday, when we're tired of this silliness, the dealer franchise system will replaced by company owned retail stores which will eliminate the wasteful expense of the franchise and dealer/distributor/manufacturer exchange fees. You'll deal with the corporation or national distributor instead of a franchise owner. As a result, the price of new products will drop, just like they did with large household appliances.

    But, what about parts? In this new retail model, the "dealer" is likely going to ignore anything that's older than the warranties he must service, which will drive service to independent shops or force the customers to "purchase up" instead of holding on to older models.
    Cave contents: 99 R11RS, 2013 Toyota Tacoma, 03 Simplicity Legacy, 97 Stihl FS75, Dewalt DW625 & DW744

  11. #26
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    Quote Originally Posted by MPMARTY View Post
    Growing up in the automobile industry as a GM of a few dealerships I will add my $0.02 here.
    The auto industry is basically a dishonest one, made that way by the actions of its customers. People go to a dealer in an attempt to steal his profit and the dealer responds by stealing it back any way he can. I don't think motorcycle dealers in general are nearly as "bad" as their four wheel siblings but the customers are driving them that way too.
    This is utterly ridiculous blaming customers. A dealer principal and/or a GM have the responsibility to conduct business in an ethical manner. What you feel is a reasonable price to sell something is nothing more than opinion in most scenarios and is based on a number of variables. To accuse customers of attempting to steal your profit is insane. A customer has the right to choose where they want to do business and how much they want to spend. The dealer has both the legal and moral obligation to do whatever was agreed upon. The customer has the responsibility to follow through on his/her word. This really has nothing to do with price if both parties agree to the price. Lowering your morals because you percieve your customers morals to be poor is one of the most unreasonable comments I have seen on this forum.

    What a customer does not have the right to do IMO is become an internet reporter minus all the facts. You want to criticize profitability? Go out and learn everything you can about your subject and back it up with facts and then state your opinion. To make negative comments about an entire store and/or entire service department because some human being known as a technician makes a mistake is just as wrong as your comments. Presenting one side of the story is simply not the right thing to do and any intelligent adult would agree with that statement.

  12. #27
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    Quote Originally Posted by GlobalRider View Post
    Please spare us or I will have to get the violins out. You make it sound like they live in poverty.

    A local Ford dealer tracks and races a Porsche GT3; I guess a Mustang really isn't that good after all.

    It takes quite a few sales to pay for the ones he writes off, lets not even talk about their operating costs.

    I've worked in a few car dealerships and a motorcycle dealership.

    Anyway, back on track. I got the answer to my original question and my vehicles are maintained far better than they can at any dealership. End of story.
    You really don't understand the point do you?

    If you have dealership experience let's hear the P&L numbers and support your argument. At least for this one story. If you cannot provide both sides of the story you should not be criticizing others with obvious one-sided commentary.

  13. #28
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    Quote Originally Posted by 36654 View Post
    I think you just ID'd the "invisible hand" of the free market and perfectly described Ricardo's "Rational Man". Each and everyone of us enters the marketplace intent on maximizing our income. The consumer maximizes his income by paying the lowest possible price. The merchant maximizes his income by charging the highest possible price. Accordingly, we have the usual dance of the dealer and the customer trying to see who can win.

    Someday, when we're tired of this silliness, the dealer franchise system will replaced by company owned retail stores which will eliminate the wasteful expense of the franchise and dealer/distributor/manufacturer exchange fees. You'll deal with the corporation or national distributor instead of a franchise owner. As a result, the price of new products will drop, just like they did with large household appliances.

    But, what about parts? In this new retail model, the "dealer" is likely going to ignore anything that's older than the warranties he must service, which will drive service to independent shops or force the customers to "purchase up" instead of holding on to older models.
    Sounds good in theory but let me ask this question. Will the big corporation take care of its customers any better than the franchise? We are all well aware of how difficult and impersonal large corporations can be. And the lack of concern shown by so many of its employees. These very same things can and do exist at the smaller levels as well but my hunch is things would get worse rather than better. I really don't know however.

    I prefer to deal local and keep the money in the local economy if possible. But the local economy then has the obligation to take care of me as a customer should be taken care of. I am not offended by those who disagree however.

  14. #29
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    Quote Originally Posted by GlobalRider View Post
    Please spare us or I will have to get the violins out. You make it sound like they live in poverty.

    A local Ford dealer tracks and races a Porsche GT3; I guess a Mustang really isn't that good after all.

    It takes quite a few sales to pay for the ones he writes off, lets not even talk about their operating costs.

    I've worked in a few car dealerships and a motorcycle dealership.

    Anyway, back on track. I got the answer to my original question and my vehicles are maintained far better than they can at any dealership. End of story.
    I really can't believe your first sentence. All I have asked for is to present both sides of the story. Do not pass negative comments and leave half of the story out of the picture. Apparently that is not a good concept.

  15. #30
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    Quote Originally Posted by MPMARTY View Post
    Growing up in the automobile industry as a GM of a few dealerships I will add my $0.02 here.
    The auto industry is basically a dishonest one, made that way by the actions of its customers. People go to a dealer in an attempt to steal his profit and the dealer responds by stealing it back any way he can. I don't think motorcycle dealers in general are nearly as "bad" as their four wheel siblings but the customers are driving them that way too.
    Well, how do you feel after you ruined my morning via a guilt trip for being an aggressive shopper? "Stealing", that's kinda harsh,don't you think? I find it interesting to contrast your blatant statement,r.e. me stealing when I reflect on my shopping experiences. A recent purchase the dealer sent us a bottle of wine & chocolates(spare me the cheesy crap & make it the lowest price thank you!) yet that was the best price by far & yet I was "chastised" by another dealer where I had also priced & discussed a purchase. I've had the good guys in the white hats(remember them?) actually block me from exiting the store before(that was a good story) and one dealers getting stole from is another dealers business plan. The last place I bought a PU they send me a letter every year hoping I'll come back and yet there are others that hope I never come based on my desire to save money which isn't in their plan.
    One of my fave "car dealer stories" dates back to my caddying days which included caddying for several new car dealers that played together on weekends. Two of the three ended up in prison for various shenanigans in the dealership. I'm not saying thats typical but it has happened where I live now too. They also cheated at golf. They cheated each other during the round while playing for what to me was more than a weeks pay per hole. I'm talking $100 bills on a hole when the bag fee was $2.50 per 18 holes. One of them was the father of a fellow HS student-he didn't go to jail but his son did cheat another fellow student(my friend) out of his business- a really nice BBQ setup in several cities that dealer guy bought into then it got real ugly-still is Grover's BBQ in KS. Then you have the other direction from where I live & dealers there have gone to jail for speedo fixing, then you have the many others that seem to make the news. Yeh, they belong to the BBB and it backs them up regularly as that's where their money to operate comes from so its a full circle operation & yes I've tried that route to avoid a lawyer-and I'm a guy that absolutely!!!doesn't believe in suing everyone!!! No, I wasn't stealing. No, I certainly don't begrudge others earning money and being successful but it was pretty obvious to me as a caddy whose bags I carried. These things are just from one guys experience & they made impressions on me.
    Spare me the stories about how the customers are trying to "steal dealer profit". There is a reason that car dealers & car sales people are low on the food chain of popularity. For whats being portrayed here as a real risky business to turn a dime there sure are plenty of them out there making it happen-MC's & cars?
    "If I had my life to live over, I'd dare to make more mistakes next time...I'd relax,I'd limber up... I would take fewer things seriously...take more chances... take more trips...climb more mountains...swim more rivers...eat more ice cream." Jorge Luis Borges at age 85.

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