Running the Numbers & Experiences with Car Salesmen
by Douglas Samuelson - email:  dsamuelson@frii.com

During the 12 years in my dealership and the 6 years with my competitor, I sold lots of cars and trucks and had many repeat buyers.  One year I sold 228 cars (that's nearly 1 car a day for every working day).  The sales process in our dealerships was relatively simple.  A customer would select a vehicle, I would give them our selling price and if there was a trade-in involved, I would give them our trade-in allowance.  We did not inflate our selling prices nor did we try to "steal" their trade-ins.  I did not have to consult a sales manager; sometimes I would consult with the dealer if the deal was marginal but most of the time I wrote the deal myself and if there was financing involved I wrote up the finance contract.  I had heard the horror stories of the big city dealerships but I did not believe them.

In 1988, I moved to Colorado Springs.  I thought that I would "set the world on fire".  With a population of over 250,000 people I figured that I would be to retire within a few years and could bask in the sun for the rest of my life.  Wrong!

My first sales position was with a new car dealership that had just moved into a new 12 million dollar facility.  The sales offices were paneled with real walnut paneling, the showroom was 50 feet tall with executive offices on a second level, there were exotic plants all over the place, and then there was the sales "tower" where the sales managers resided (or should I say lurked).  On one wall of the tower was a huge bulletin board with each salesperson's name and a square for each day of the month to record each individuals sales.  I could not wait to fill all of my squares.  There were nearly 500 cars in stock and I thought that I had died and gone to heaven.  Within a few days heaven turned to hell. 

My first day on the job I added several new words to my vocabulary.  I was a "green pea" (the newest salesperson).  A potential customer walking around the car lot without a salesperson was an "up".  Several other words (some with racial connotations) I will not repeat.  I came to work dressed in a freshly starched white shirt, dark blue blazer, neck tie, gray trousers, and polished wing-tips (required attire except for the shoes).  I could identify the veteran salesmen from the frayed elbows on their blazers and pizza stains on their shirts (on Saturdays we were not allowed to leave the premises for lunch and pizza was brought in by the dealership).  To this day I am not fond of pizza! The salesperson of the month for the previous month was a young chap and he was wearing a pair of white Nike's.  He had a definite advantage because he could sprint to an "up", beating the rest by a country mile.  Supposedly his career was interrupted for a short time because he had driven his Pontiac demo (his spiff for being salesman of the month at a Florida dealership) off of a pier and into the ocean, while drunk.  Obviously, management at our dealership had relaxed the dress code because he had sold 22 cars in the previous month.

On my first day I was introduced to the "four square" sales system.  It consisted of a sheet of paper divided into 4 squares (4 square originated Poland), with the upper left hand corner assigned to the salesperson, the upper right hand corner belonged to the buyer, the lower left hand corner was reserved for the sales manager, and the lower right was "open ground" kinda like a game of cat and mouse).  After the customer had chosen a vehicle to purchase, and after the customer had completed a credit application, the salesperson would write a number in the upper left hand corner taking much precaution not cross the lines, the customer would write his number in the upper right hand corner, and the salesperson would carry the document (kind of like carrying a wet diaper) to the tower.  The sales manager, dressed in a pin-striped suit, vest, and suspenders, so that he could be easily distinguished from a salesperson (oh, I forgot the 2 carat diamond ring) would then carefully scrutinize the document.  This usually took him about 30 seconds.  Then armed with an assortment of marking pens in various colors, he would scribble the "real" number, sometimes adding a smiling face and a little notation ( a typical note might be "What do we have to do to earn your business"?).  By the way, the sales manager is allowed to write outside of the lines.  The salesperson would then present the "not so real number" to the customer.  After getting the customer off the ceiling, the sales person would then say something like "I think that this is one heck of a deal, what do you think"? After the customer regained their composure the negotiation continued.  The customer would think to himself.  "Maybe I was being a little too tough" and would "bump" himself by writing a bigger number in the lower right hand corner of the work-sheet.  After several trips to the tower and lots of different colored marking pens and not so smiley faces a deal is finally made.

The salesperson then parades their customer past the offices of the other sales persons (some of them munching on left over pizza stashed in their desk drawer) to the finance and insurance manager.  Now these guys and gals are real pros.  The average life expectancy of an F&I person is 52.  It is not uncommon for some of these people to make (you will notice that I did not say earn) $200,000-$300,000.  a year.  There is usually a 2-3 hr. waiting period for the customer to get into the F&I managers office.  By this time the customer is usually so anxious to get home that they are "putty" in the hands of the F$I manager, and the salesperson is praying that the deal does not turn "sour".  "I’ve got to have that commission or I'll lose my Nintendo at the pawn shop". 

Five hours after entering the dealership the customer is ready to leave in their new SUV.  They have just committed themselves to 60 months of payments @ $635 per month.  (They came into the dealership with a payment of $400 in mind).  "We did get a $600   protection package (paint sealant & undercoating that cost the dealer $125 and is not recommended by the manufacturer), and an extended warranty for $2,300.  (The new car has a 100,000 mile manufacturers warranty & the dealer made a grand on the extended warranty alone) and we won't have to go through this hassle for another 5 years.  By the way, what was that salesperson's name?

The P.A. system blares: "Will salesperson Jackson please come to the delivery area to meet your clients Mr. and Mrs. Jones.  There under a brick archway, sitting on a red carpet is a beautiful blue SUV (estimated fuel economy 15 m.p.g-22 m.p.g. highway).  Jackson buttons his blazer to hide the pizza stain.  After presenting the new owners with the service managers card (they'll need it to schedule an appointment for the first recall), and after exchanging cordial greetings, salesperson Jackson reaches up and grabs a rope attached to a large brass bell suspended above the archway.  Sales persons line both sides of the driveway applauding unenthusiastically as Jackson rings the bell and the Jones’s pull away.

Jackson mutters, "Damn, I'm hungry.  I think I have a M.R.E.  in my desk drawer