Need new muffler for car to sell. $480 retail. Kept looking, got down to $210 plus $40 freight. That brand is supplied by another company, $190 plus $40 freight, getting better. Looked further, they sell same part, unbranded, free freight for $138. My thoughts, muffler is made China etc, sell to me landed $138. Take off $40 freight, now $98. Their profit margin?, guess around 30%. I reckon they must buy them 50-60 bucks. Doing ok with $480 retail.
It surprised me a couple of weeks ago seeing the profit margin in car tyres
I needed a pair for the front of my GLC, went to the local independent tyre place that we use by work, the manager turned the computer screen so I could see what he had in stock which also displayed their buying and selling prices, although he turned the screen back pretty quickly when he realised what I was focusing on it was easy to see that there was at least a 100% markup across the board, and they are usually the most competitive in the area. Granted they have to fit them and pay to run the business but if I was to ask them to do a puncture repair or fit a tyre that I already had they would only charge £10-£15
I thought the tyre world was based more on small margins & high volumes, obviously not from what I saw
When I sold my Triumph Explorer to the dealership I usually get my Tyres from he looked at the rear tyre and said words to the effect of "Oh we cant sell it with those on"..
They were NOT down to the legal limit at all.. I digress..
I said well it wont cost you what it costs me to replace tyres..
He said " We only make £10 on a Tyre"..
I know lots of people spout BS regularly, but it annoys me when they expect me to beleive it!
£10 my ASS !!
The Tyres on the explorer were Michelin Road 6 which I bought from him at £360 !!!
Years ago worked for company who were fuel parts specialist. We imported Tridon EFI pumps, same as fit 14. $34. Were packaged up as OEM for various car brands. A box with name on it, bits of fuel hose, clamps and fitting instructions. Prices ranged for kits. Sold as genuine part, Nissan GTR was just over $900.
I think with just about everything we buy, the mark up is massive. If we actually got to see the cost price we'd just die from the shock.
That's not true of all things. The dealer margin on new cars is very low. Like 10% or less.
That's why their primary interest is getting you to add options.
Their main profit opportunity is where they can get you to finance a car. Unlike the old days it is now NEVER a good idea to say you have cash. Let them assume you will get finance and then either pay in cash one price agreed or tell them you have arranged finance from elsewhere.
KTM offer an extra years warranty if you take out finance, simple way around it is to take out their finance get some extra bits thrown in and pay it off on the first payment as there is no penalty for early payment, win, win.
Car dealer tricks. They cant get stock, pretty much have to stay to RRP. Toyota Corolla, around 25G. They register new car, drive for a while, then its used car, name your price. Been selling same up to 40G. People are stupid enough to pay. 300 Cruiser Wagon are now 4 year wait.
My dealer used to order car to the spec you wanted then run it for 3 months as a "demo" and sell it with minimum mileage but reclaimed the VAT/New car tax? hence the 20% off :)
Pre-registered cars means they got them cheap too. Dealers will register unsold cars to meet targets from the manufacturer & get the cars cheaper as a result.