Ontario dealership rescinds sale $ offer after salesman says other dealer complained

[Baggsy]

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This is why I like the Tesla model better. This is the price... no negotiations no back and forth no middleman taking a cut.

I believe that Tesla takes it a step further and doesn't allow much of a secondary market for parts, since they all need to be synced up within the car.

it would be ironic if the purchaser ran a Home Hardware
and it went out of business because everyone in Elliot Lake
started driving to HD in Sudbury instead to save a few bucks

The guy used his own gas to visit a second dealer, because he thought the quote was a little high.
Then he went back and tried to give his business to the first.
It's not like he went in to a brick and mortar to get a fit and then bought online.

 

[GreyGhost]

Sure, but that is not really applicable to the legacy OEM's which distribution channels are riddled with agreements, regulations or laws. Only a completely new company can choose to either go direct or play by the old rule book. First of, it's hard to role dice and go to non-dealership model all of a sudden. Surely your revenue will take hit, your production will take hit etc. .... it's a domino effect nobody will take a chance on. They are stuck with what they have had for eons.

Honda tried messing with the model when they forced dealers to become Powerhouse's to improve the distribution of their non-vehicles. IIRC it went poorly. They required a huge investment (upfront and continuing) to add a small amount to revenue.

If a company wanted to change, they could begin the process. It wouldn't happen overnight, but they could buy dealerships as the owners moved on to create a larger network of corporate stores. I think MB and maybe BMW have some corporate stores, not sure how they started, what percentage of total stores they are, or whether the companies are happy with the experience.

 

[raginduck]

To not even counter offer?
They both get the same atv from the same supplier, for the same price.

To me it sounded like the one dealer wanted to make the most on a customer, while the other dealer wanted a sale.

If one dealership is buying 200 ATVs from the supplier and the other is only buying 50... I can't see them paying the same price.

 

[nobbie48]

Just looked up the dealer. It is not a conventional dealership.

"Welcome to NAPA Power Sports, your one stop shop along the Trans Canada Highway. We began with Napa Auto Parts in 1991 and added on with the power sports line up in 2005. "

Looks like a decent sized outfit offering a bunch of products and services. Sounds like they got their nose out of joint when they saw competition. However, how did the customer approach Napa? Lippy or civil?

 

[backmarkerducati]

If one dealership is buying 200 ATVs from the supplier and the other is only buying 50... I can't see them paying the same price.

I cannot say for sure for Honda but for other makes... They pay the same "invoice" price BUT if you move a lot of vehicles you get money back. I have known large dealers that will start selling models at invoice to make the next threshold and then make it all back on the bonus for number of models moved.

 

[J_F]

I cannot say for sure for Honda but for other makes... They pay the same "invoice" price BUT if you move a lot of vehicles you get money back. I have known large dealers that will start selling models at invoice to make the next threshold and then make it all back on the bonus for number of models moved.

while I'm not sure about bikes, I spent 19 years with a heavy equipment distributor in the GTA
our territory was half the province and sold a pile of units in a year

there was a small farm equipment dealer just north of the city that had access to some of our product line
they would move a half dozen units/year

we had the same dealer invoice net price

but like you say, there are incentives and bonus's based on performance
for us it was basically a slush fund we could tap into on competitive deals
buy down interest rates, discount accessories and attachments etc

was not intended to be used to fight for deals against other companies selling the same product
manufacturers don't like this, performance incentives are to be used to increase market share

and this may be why the Sudbury dealer backed out of the sale

 

[nakkers]

The cost of the product would likely be the same for both dealers.

But there is a cost of getting the product to the dealer.

Shipping isn’t cheap folks.

I manage a retail relationship and can tell you the price of appliances for the same chain of stores is the same. The big boys to get a volume kick back. But generally the whole sale price is the same so you don’t have dealers going to the manufacturer and saying why did you sell xyz to the other guy.

But just try running a business in Elliot Lake. You want access to buy stuff locally and then go and find products out of town.

It might not cost $1200 bring a quad from Sudbury to Elliot lake. But I bet the retailer isn’t sitting on a gold mine either.

There usually is a little more to the story that we don’t know.




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[800over]

Regardless....this sounds like collusion to me. One dealer cannot call another dealer and get him not to sell you a vehicle at a certain price. Free market is gone if dealers contact each other about individual sales. If we did this at my dealership I am sure OMVIC would be visiting us.

 

[crankcall]

Its not collusion. We are not getting the whole story IMO. Its 168kms from elliot lake to sudbury , 2hrs. So buddy gets price A, then goes looking for price B. The only way either dealer knew he was 'shopping' , 168kms away, was if he told them.
So dealer A says, " hey dealer B" why are you dum dums discounting this product? Then the part we dont hear, we share parts and maybe inventory at times up here in the north and professional info and repair trouble shooting, stop being a dum dum. So they do.
They say, hey customer that has all week to shop around, just stay in elliot lake.

If he went to sudbury , bought the machine, he'd have had his deal. But he had to play the smart guy card. If your offered a good deal, take it . Then calling CBC to vent , I was trying to manipulate the dealers and they said pound salt, wheres my fair market. He can walk on a sale , apparently so can they.

 

[jc100]

Its not collusion. We are not getting the whole story IMO. Its 168kms from elliot lake to sudbury , 2hrs. So buddy gets price A, then goes looking for price B. The only way either dealer knew he was 'shopping' , 168kms away, was if he told them.
So dealer A says, " hey dealer B" why are you dum dums discounting this product? Then the part we dont hear, we share parts and maybe inventory at times up here in the north and professional info and repair trouble shooting, stop being a dum dum. So they do.
They say, hey customer that has all week to shop around, just stay in elliot lake.

If he went to sudbury , bought the machine, he'd have had his deal. But he had to play the smart guy card. If your offered a good deal, take it . Then calling CBC to vent , I was trying to manipulate the dealers and they said pound salt, wheres my fair market. He can walk on a sale , apparently so can they.

This is different...you can absolutely walk away from any offer...but this offer was initially accepted wasn't it and only after interference from Dealer #2 was it withdrawn. Also as long as the customer is being above board and professional I don't see the issue with going back and forward between dealers. The one that wants the business will make the best deal.

 

[crankcall]

This is different...you can absolutely walk away from any offer...but this offer was initially accepted wasn't it and only after interference from Dealer #2 was it withdrawn. Also as long as the customer is being above board and professional I don't see the issue with going back and forward between dealers. The one that wants the business will make the best deal.

If you read it as I do, there was a quote from the Sudbury dealer, customer takes that quote back to Elliot lake and says as per article " this is what they will do, what will you do" . Not an accepted offer, just a quote.

Buddy in Sudbury (possibly) hears from Elliot lake, and the salesman says to the sales manager, I spent two hrs with "Fred " and he shook my hand and said thanks, then took my paperwork back to our business associate and tried to leave us sitting. Sales manager says, he's better off buying local. What he really said was F him.

A tire kicker gets kicked to the curb.

 

[raginduck]

And if Elliot lake closes down... then the guy will complain that he has to drive for parts and service!

 

[nobbie48]

If you read it as I do, there was a quote from the Sudbury dealer, customer takes that quote back to Elliot lake and says as per article " this is what they will do, what will you do" . Not an accepted offer, just a quote.

Buddy in Sudbury (possibly) hears from Elliot lake, and the salesman says to the sales manager, I spent two hrs with "Fred " and he shook my hand and said thanks, then took my paperwork back to our business associate and tried to leave us sitting. Sales manager says, he's better off buying local. What he really said was F him.

A tire kicker gets kicked to the curb.

Did buyer stuff the lower quote into the Elliot Lake dealer's face and say "You scumballs were trying to rip me off blah blah blah" earning a shove it attitude from both dealers?

 

[SVeezy]

Did buyer stuff the lower quote into the Elliot Lake dealer's face and say "You scumballs were trying to rip me off blah blah blah" earning a shove it attitude from both dealers?

Or did the buyer go back to the Elliot Lake dealer and ask if they were able to match the lower offer? This is the part we will likely never know but makes all the difference in the world.

 

[Blackfin]

Maybe I missed it (skimmed) but: Any chance the two dealers are owned by the same guy/parent outfit?

 

[Benny!]

Literally everyone does this. You'd be stupid not to. If they did that to me I'd buy elsewhere. If they want to go under then let them.

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[mxs]

Honda tried messing with the model when they forced dealers to become Powerhouse's to improve the distribution of their non-vehicles. IIRC it went poorly. They required a huge investment (upfront and continuing) to add a small amount to revenue.

If a company wanted to change, they could begin the process. It wouldn't happen overnight, but they could buy dealerships as the owners moved on to create a larger network of corporate stores. I think MB and maybe BMW have some corporate stores, not sure how they started, what percentage of total stores they are, or whether the companies are happy with the experience.

I don't know how you start it, without an immediate litigation from the dealers and huge hit in revenue for years to come ... it's really not that simple, at least not in my view. MB and BMW might have some corporate stores, but they have many more independent dealers.

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