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  #1  
Old 08-04-2014, 06:50 PM
TylerH860's Avatar
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My business is failing...

Took me a while to come to terms with it, especially having a very good 2013, but as of August, even with one record setting month in May with 24 cars sold, Ad Astra Automotive has barely been able to clear its expenses. Their are 3 main issues that brought it down.

1: Overhead more than doubled. I was sharing the space with another dealer who is going under. Not only did they help with the overhead but I did most of the car buying and selling for them, which supplemented my income.

2: Sources of inventory dried up. Cars at my local dealer auction and nearby sources are selling for more than what I can retail them for. Buy here pay here's are taking over, and don't care what they pay. Good old import cars are gone. The newer ones are always basket cases I cannot fix and make any money.

3: Back shop drama. My mechanic has been slipping due to personal issues. Friendship got in the way of business and I did not let him go quick enough. Things missed in repairs and inspections have cost me big time as I stand behind my vehicles alot more than most used car dealers.

I stand to have an excellent month for August that will put me into the positive, but things slow down wayyyy down from here. The fourth quarter and holidays are very slow until tax money starts coming.

I have a great opportunity lined up, but the change was originally not supposed to happen until next May. I'm going to see if I can start sooner, or do my best to muddle through in the meantime. My lease is up May 1.
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  #2  
Old 08-04-2014, 07:13 PM
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Sorry to hear that. I've heard of difficulties in sourcing cars from auctions and dealer trade ins from a local dealer I tried to buy a car from recently. He said pretty much what your said about his sources starting to dry up. Seems like you are not alone in this.

- Peter.
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  #3  
Old 08-04-2014, 07:42 PM
iwrock's Avatar
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Quote:
Originally Posted by TylerH860 View Post
2: Sources of inventory dried up. Cars at my local dealer auction and nearby sources are selling for more than what I can retail them for. Buy here pay here's are taking over, and don't care what they pay. Good old import cars are gone. The newer ones are always basket cases I cannot fix and make any money.
I've noticed the same thing out here in Sacramento - and add that bigger dealerships (franchised Ford, Chevy, Dodge, etc) dealers are listing cars for the same price as private parts/pot lots.
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  #4  
Old 08-04-2014, 07:44 PM
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Good thing is that used car prices should soften when interest rates rise next year, after QE3 is finally sent to Hell where it belongs.
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  #5  
Old 08-04-2014, 07:59 PM
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Quote:
Originally Posted by iwrock View Post
I've noticed the same thing out here in Sacramento - and add that bigger dealerships (franchised Ford, Chevy, Dodge, etc) dealers are listing cars for the same price as private parts/pot lots.
Also the franchises are keeping all of their trade ins. They will try and retail a $500 hooptie, reputation be damned.
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  #6  
Old 08-04-2014, 10:15 PM
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Having sold a few cars this year, I have gained a new level of respect for the profession. It seems that unless you are selling $3,000 cars for $1800 with a lifetime warranty, you are going to have a hard time. I think it's impossible to make money AND be honest in the used car business.

What are your plans? Get a job?
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  #7  
Old 08-04-2014, 10:29 PM
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I went to a huge DFW dealer only car auction (if you watch Car Sharks it is the auction they are at) and I could not believe the prices they were paying for the cars. Seemed like they were biding retail not wholesale. I walked away confused.
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  #8  
Old 08-04-2014, 10:48 PM
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Quote:
Originally Posted by davidmash View Post
I went to a huge DFW dealer only car auction (if you watch Car Sharks it is the auction they are at) and I could not believe the prices they were paying for the cars. Seemed like they were biding retail not wholesale. I walked away confused.
many of these cars are getting exported as well. i sold a toyota sienna for my wife's friend and the guys were exporting it to the middle east and my landcruiser went to africa. both guys told me what they make over there so it doesn't surprise me that they can outbid a local dealer......
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  #9  
Old 08-04-2014, 10:50 PM
is thinning the herd
 
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Quote:
Originally Posted by lorainfurniture View Post
I think it's impossible to make money AND be honest in the used car business
My father has done it for about 20 years now. I've done it for five.
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  #10  
Old 08-04-2014, 10:50 PM
compress ignite's Avatar
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Sorry

You seem to have taken care of your customer's future (New to Them) cars,
as well as the Customers themselves.

So Very,Very Rare in the Car business these days.

Is all this the result of Car Max ,Etc ?

OR a more dis-pleasurable scenario (Someone is trying to choke off the Indy's in the Pre-Owned Markets)?
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  #11  
Old 08-04-2014, 10:54 PM
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What if you move way up market? I'm hanging out with a girl that used to do high end automotive sales and she made a decent buck doing it.

She sold a lot of Lambo's and Ferrari's and they also leased high end classics.

That might be a business you would enjoy. Typically in sales the higher end product you sell the more money you make, but its also a harder market to break into.
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  #12  
Old 08-04-2014, 11:07 PM
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I would love to do that, but Wichita is the WRONG place.
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  #13  
Old 08-04-2014, 11:25 PM
Home appliance genius
 
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Quote:
Originally Posted by DieselPaul View Post
My father has done it for about 20 years now. I've done it for five.
I tip my hat to you. It's likely that you have an excellent reputation that you are enjoying the fruits of. Tyler does not have that. My furniture business is kind of the same. It has been in business for almost 40 years. I see so many people try to do the same thing that I do only to fail miserably at it.

One thing that always helps is to have more than one source of income, whether it be a rental, or just another facet of your business. Did you do any repairs? Car detailing? Oil change?

When I'm not busy selling washers during tax time, I'm busy doing in home service, and taking care of the rentals.

If it was easy, everyone would be doing it.
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  #14  
Old 08-04-2014, 11:26 PM
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Quote:
Originally Posted by TylerH860 View Post
I would love to do that, but Wichita is the WRONG place.
Specialize in pickup trucks/4x4s?
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  #15  
Old 08-05-2014, 12:05 AM
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Quote:
Originally Posted by P.C. View Post
Specialize in pickup trucks/4x4s?
They sell for the equivalent of NADA or KBB retail around here to the buy here pay heres... Can't make a dime off that.
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