Monday, September 19, 2011

BUYERS ARE LIARS!


I’m always amazed by the way car dealers who use deceptive advertising and unethical sales tactics rationalize their behavior by actually blaming you, their customer. The following is a direct quote from an anonymous car dealer’s email I received this morning in response to one of my recent columns in this newspaper:  I don't think you would make any of these comments if you sold fords in a non-metro market. How do you expect dealers to change when consumers think they should pay less than dealer cost for a car and then walk into any other form of retail store and pay what they are asking?? Your ideas are noble but there are other dealers who have tried 'your' methods who are no longer in business.” This dealer is saying that his customers are so ruthless and cunning that they won’t buy a car unless they can buy it below his cost and his only solution is to trick them into thinking that they are buying it below his cost, like tacking on a “dealer fee” to the price they quoted the customer.  He also goes on to say that my “ideas are noble” but I can’t possibly be successful and I will go broke trying. I truly appreciate his concern and I want to assure him, if he is reading this article, that my business is doing very nicely.

This attitude is actually a prevailing part of the culture in many car dealerships. Many dealers, dealer managers, and sales people don’t trust their customers (how paradoxical!). They don’t even like their customers. A very common expression among car dealers and their sales staff is “Buyers are liars”. This means that a prospective customer will not tell you the truth about the condition of his trade-in, he will lie to you about the price he got from your competitor, and he is likely to remove those new tires that were on his trade-in when the dealer appraised it when he comes in to pick up his new car.

There are also a lot of dealerships where used car buyers and people with bad credit are held in especially low esteem. They have nicknames for people with bad credit like “slugs” and “roaches”. Apparently dehumanizing these unfortunate members of our society with derogatory labels makes it easier to treat them so shabbily. People with bad credit are targeted with direct mail and newspaper ads making absurd promises that convince prospective customers that they can finance a car no matter how bad their credit. In some dealerships applicants are coached on how to falsify credit application and pay records. In some cases the applicant may not even know he is signing a false credit application which is federal offence.  In most cases the credit is refused and the applicants are not even given the courtesy of a return phone call to tell them this.

I don’t claim to be a psychologist (and I don’t even play one on TV), but I have read articles explaining how humans will stereotype other people in a fashion that falsely justifies their negative behavior toward those same people. We see this with racism and even in wars. If you make yourself believe that car buyers are out to take advantage of you, “buyers are liars”, you can’t feel guilty about tricking them into paying a dealer fee. If you trick a “roach” or a “slug” into coming in to buy a car on credit when they probably can’t, why should you feel guilty? After all, roaches and slugs don’t have feelings.

What these kinds of dealerships don’t understand is that you must trust a person first before you can expect her to trust you. You have to treat a person with respect before you can expect that person to respect you. Somebody has got to go first. My experience over the past 40+ years as a car dealer is that 99.9% of my customers are good people who I can believe and trust. Those are pretty good odds and I just assume that every customer I am dealing with is part of that 99.9%.  Once in a great while I get burned, but the loss from that one in a thousand that takes advantage is far out-weighted by the other 999 who respond positively to my trusting them and treating them with respect. 

15 comments:

  1. You have absolutely no idea Earl.

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    1. I couldn't have said that better. Or maybe I can. Earl, you are a moron.

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  2. Dear Anonymous,

    Why not come out from behind your cloak of anonymity and discuss your differences with my article intelligently?

    You may be able to change my mind about some things. I'll read whatever you have to write and respond respectfully.

    I'm not afraid to state my opinions publically on this blog...why should you be?

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    1. I am lied to by customers on a daily basis. Trade ins "never had any problems" and the tranny is failing. Never had a repo, what about a loan with X? Oh no, I gave that car back! I am trying to rebuild my credit... I only have this much cash... (has an extra $1000 in his back pocket)... There's a cheaper one just down the street... Show me. Nope. I make $3000 a month. Can I see your most recent pay stubs? Oh, I didn't make that much in the last month, but have before. You must live a blessed life to only encounter this in 1 in 1000. It's daily for me.

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    2. Dear Anonymous,

      I'm posting your reply to this blog column, "Buyers Are Liars", to my Facebook page because you are a poster child for everything that's wrong with the way cars are sold today.

      You and thousands of other anachronistic sales people from the last century have brain-washed yourselves to believe that your customers are crooks and that justifies you lying to them so that your can "out-do" them in deception.

      You just don't understand that most customers are nice, honest people. If you trust them, they will trust you. Not only that, but today's car buyer is ten times smarter, sophisticated, and demanding than those from 40 years ago. They are better educated and have the "Mac-Daddy" buying tool...THE INTERNET. They know more than you do about the car they are buying including what a fair price should be. They know what their trade-in is really worth and what a good interest rate is.

      When you try to pull your old school tricks, they laugh at your and buy their car from a dealer that will treat them with courtesy, respect and integrity.

      Wake up and smell the coffee...join the rest of the successful retailers in the 21st Century who understand today's educated consumer.

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  3. Because, Earl, this is your blog. For you to be anonymous would be pointless. I have been IN the car business and remain IN the car business, and I can tell you that most people WILL lie to you, or manipulate you to get what they want. This includes playing 2 to 3, sometimes more, dealerships against each other, seeing just how far below dealer cost they can get folks to go. Not everyone is like this, of course, there are still logical thinkers that know that it takes money to run a business. If your methods really work, then why are you not in the car business? I think that would be best question for you to answer. Instead, you hide, behind this blog, pretending that you know the daily ins and outs of car dealership operation.

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  4. Its very simple.... laws.... both ways for dealers and for customers. Here's the deal....for the dealer...on new you charge full sticker nothing more.... anddendums are not added unless the customer specifically requests it. On used you charge no more than twenty five percent over dealer cost for sales price.....if dealer buys car X for wholesale trade of 13k his MAXIMUM sales price is not more than that plus twenty five percent. Period.

    As for customers.... there is no haggleing on new car msrp...period unless the vehicle is more than 90 days past the close of the past model year. Then they can only negotiate down fifteen percent of original msrp...period. on used cars customer is only allowed to negotiate down to dealer cost plus twenty percent...period...no lower unless vehicle is more than 270 days on the lot.

    Attempts by dealers to charge above set ranges will result in federal price gouging prosecution and surrender of license. Attempts of customers to negotiate below said rangers will result in immediate prosecution for attempted grand larceny. End of story..problem solved...make it a federal law!!!

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  5. I hope all of that about federal laws was tongue-in-cheek. Cry me a river ... mean, bad customers abusing a car dealer. Oh wait; you don't have to sell them a car for any price you don't like. Wow. Customer playing multiple dealers against each other; funny concept - competition. I guess the guy who goes lowest knows how to make due on slimmer margins (efficient operations?). Or he's an idiot and will work himself out of business. Oh well. Other than lying about the condition of a trade-in; I have a hard time seeing how anything a customer does to get a better deal is unethical. The dealer always has the power to say no.

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    1. I make a living selling cars, its how I feed my family, tithe my church, and pay my taxes. When a customer tells me his credit is great, and waste 3 hours of my time to haggle a nothing deal, and then cant get a loan...he has potentially cost me the opportunity to sell someone else a car and provide for my family. This is the kind of thing that causes sales staff to get the attitude that "buyers are liars". If you worked at best buy and half the customers came in and watched tv and played video games for 3-4 hours, and then just walked out empty handed....it would be slightly frustrating as a member of that sales/management team would it not?

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  6. The thing that burns me up is clients putting forth an offer and then when you accept that offer they backpedal and retract it. To me that is classless. I've had this happen on several occasions after all paperwork was signed and the car was prepped for delivery. We are an honest dealer and refund them fully every time but if I shake your hand and say I'm going to do something then I an putting my reputation as a man on those words and that handshake...

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  7. Dear anonymous car salesman,

    You dealership is a good and honorable one to agree to refund a customer's deposit and cancel the contract when they change their minds. In the long run, you will do a lot more business with a lot more customers than those less honorable dealers who won't let their customers out of their contract.

    Word of mouth is a powerful thing and your reputation in your market is head and shoulders above the others.

    I don’t disagree with you that a handshake and a commitment (especially in writing) should be honored by both parties. But, you are earning the respect and trust of a lot of be people by tolerating those who back out of car deals.
    .

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  8. Dear Anonymous Car Salesman,

    I'm sorry that you don't trust your customers, but that's why they don't trust you. The sense your dislike and distrust and they respond in kind. Below, I've copied and pasted the "code" that my dealership lives by, Number "10" of the Earl Stewart Code is:

    (10) Trust your customers as much as you hope they will trust you. The fastest way to earn trust from someone is to give trust. Somebody has to go first. Let it be us.

    I don't know what dealership you work for, but the chances are mine sells a lot more cars than yours. We dominate the retail auto market from Orlando to Ft. Lauderdale...outselling every other dealer of every other make. Trusting our customers is one of the important differences about us.



    (1) Do whatever our customer asks if they believe they’re right. It’s not important whether our customer is right or wrong, only if they honestly believe they’re right.

    (2) Do what is right for the customer even if you don’t have to; even when not required by law or contract.

    (3) If your supervisor is not available, then you must do what is right for our customer. All Earl Stewart Toyota employees are empowered to spend or do whatever is necessary to do the right thing for a customer. You will never be blamed because you acted in good faith to make a customer happy.

    (4) Always answer all phone calls, emails, texts, and messages of any kind from our customers ASAP. Nothing angers a customer (or me) more than a delayed or no response from us.

    (5) All Customers must be treated with courtesy and respect at all times. Judging a customer to be unreasonable is not justification to treat that customer without courtesy and respect. If you are incapable of dealing with a particular customer, involve your supervisor or me.

    (6) You will always tell our customers the truth, the whole truth, and nothing but the truth. I believe in giving every Earl Stewart employee a second chance except when it comes to dishonesty.

    (7) Your first loyalty is to our customers, not to Toyota. In the rare case where a dispute arises between our customer and Toyota over warranty coverage, for example, we advocate for our customer. We argue and present the facts on behalf of our customer but abide by Toyota’s decision.

    (8) You must personally take ownership of our customer’s problem. This means that if you are the first person to learn of a customer’s complaint or problem, then you have the responsibility to stay on top of it until you personally verify that the issue’s resolved.

    (9) Promise our customers less than you will deliver. Always be conservative when making promises to your customers. Over-estimate the time of a service or the date of arrival of the new car they ordered. Under-promise and over-deliver.

    (10) Trust your customers as much as you hope they will trust you. The fastest way to earn trust from someone is to give trust. Somebody has to go first. Let it be us.

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  9. I don't spend 3 hours playing the "let me talk to my manager" game. After researching, I make the car dealer an offer and explain that I am simply asking for a yes or no answer. Sometimes I get 2 or 3 NOs before I get a YES. I buy from that dealer. I wonder how car dealers feel about that buying tactic?

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  10. Dear Anonymous, you are a shrewd buyer. That is exactly the tactic that works best. Unfortunately, 90% of all car buyers won't spend the time researching and doing their homework so that they can make an intelligent offer. And if they do, most aren't "tough" enough to carry it off with a car salesman and his manager. Congratulations for being smart and tough.

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  11. Earl, I am sorry but I have to disagree with you here. I have been in the business for almost 7 years and have seen it all. Every time I work with a new customer I wipe the slate clean and give them the benefit of the doubt. I would say 90% of them will lie about something, sometimes something small, other times its a major problem. I do think that most of my customers are good, law abiding folks -- and when they get on the car lot they believe they are going to be lied to and likewise feel that it is ok to lie. I can always tell when a customer is lying to me, and inside I just want to say "stop!" And I will tell you something else -- it is YOUR GENERATION Earl -- the babyboomers, that are BY FAR the worst, and guess what? It was your generation that created this problem, and it is your generation now that is further perpetuating it. Babyboomers want to negotiate and spend hours going back and forth, only now they have the internet to use as a sales tool to aid them in this. Guess what? Good for them, they have all the info they need to make a good deal, but instead of using it to make a fair deal, they use it as a starting point lol -- We price our cars at invoice now and that is still not good enough! THEY are the ones that play the games, THEY are the ones that waste time and try to RIP US OFF. Will we buy your trade in at high Kelly? Probably. Sell at invoice or below? Absolutely. Kiss your ass and spend hours helping you decide what color and trim is right? Of course. That's the job. But to do all this and then they snicker to themselves and say they really arent in the market or whatever else nonsense comes out, and I have to go tell my 5 year old daughter and my baby and wife that daddy did not sell a car today because my customer thought it was fun to screw with the salesman is WRONG. PERIOD. In today's market (being hyper competitive) we give you our best shot right up front, and it is a STRONG number trust me on that, and treat you with the utmost respect, only to have customers lie, cheat, and BS right to our face - I am sorry but those days need to end. The cheating car dealers are becoming obsolete anymore, and people need to realize it. Wake up people, retail car sales has gotten TEN TIMES more easier, no need to lie. So sick of nonsense. I will be upfront and honest every step of the way, so please get with the times and understand car sales should be fun, exciting, and stress free.

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