What is a dealer prep fee?

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Originally Posted by BMWTurboDzl
As a teenager I was volunteered to help a family friend who owned a Dodge/Jeep/Chrysler dealership. Spent a Saturday washing cars which had just been sold. We washed them, pulled stickers and such, cleaned the interior and wiped down hard surfaces with a spray which had that "new car" smell etc. It's more or less a BS fee but there's an argument to be made that the w/out the fee it would be incorporated into the price anyways.
I was on of the "prep guys".


Yours is a good example of a fee that is or should be listed as a line item on the final invoice. The total is nothing other that the itemized listing of fees, prices or charges EVERYONE should read, understand or question as they peruse.
As a prep guy, you either took on a paid employee position as a "free" volunteer or your term volunteer is meaning something else. My point being the prep stuff is done and does cost the dealership unless they all net 'free' volunteers. B.S. fees and getting ripped-off are sometimes another way of describing things when customers walk in demanding $3000 over wholesale for their trade in.

Originally Posted by demarpaint
A dealer prep fee is just another fee to rip someone off with, or something for a dealer to use as a negotiation tool. Either way it's BS, and drives their profits higher. Some people pay it though. I tell the salesman right from the get go, I negotiate on the out the door price, no hidden fees, no surprises, the bottom line with taxes, etc. If he/she or they don't like it I'll buy from someone else.


That's the trick.
Remove emotion, vote with your wallet and at times, "the dealer" will let you walk away. There are some deals or customers they don't want or need. Sometimes the last day of the month or year does factor in.



Originally Posted by DaleRider

Pssst......dealer prep costs are already figured into the price of the vehicle. For every auto maker. If it weren't, dealer prep fees would be listed on the window sticker instead of a dealer add-on sticker. Use of the add-on sticker usually ([censored] near always) represents just ADM.....additional dealer markup....or ADP.....additional dealer profit.



Originally Posted by Char Baby
I am aware of fees that dealers add on to the vehicle such as:

Paint Sealant
Pinstriping
DOC Fee
etc., ect., ect.

Here's a video(there are others similar) that will help you to avoid this in the future.

https://www.youtube.com/watch?v=g53DkNWRgDE


Yes ! Add-on's may be something you want on the car anyways or not. They are tangible items usually and if you want a car with no UV protection / sealant or ? they call it, no accent striping, mud guards or Lifetime LOF , you can negotiate or ask to take the next car off the rack before it goes to the add-on department. They would have some mark up on those items/labor as does the wrench I bought at AutoZone.

There are some shady business , dealers , managers and salespeople for sure so it pays to read, listen and question. Thinking dealerships give away cars at little to no profit while having giant well-lit showrooms, "free coffee and donuts" , imported marble floors and 72 degree service bays is about as victimized as deserved.
The OP question directed to the mgr or sales staff would provide the insight most of us are looking for. Do we get a straight-up answer winning some trust or something more long winded?

I expect a fair offer when working out a car deal and tell them right up front. If they don't respect my time or honesty, we get that figured out before wasting much time. Some of them respect that direct honesty and reciprocate. Honestly, I'm not out there to train dealers. I find one that works and repeat.
*Heck, if they are all crooks lying and ripping people off, save yourself some time and just go to the one closest to your house!
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Still curious on how one ignores the line items on the invoice and still determines what is a good/ total "out the door price"?

Especially once you consider rebates, incentives, etc..etc.. on the vehicle being purchased. Rebates come off pre tax, incentives are after tax.

Sales tax, DMV fees and some type of doc/processing fee are all a given and have to be paid one way or another, so I get having the ability to total those up.

How are you determining the 'your price' on the vehicle with all things above being considered?

FWIW, I'm no expert, but have been through new/used vehicle purchasing dozens of times and consider myself OK at it, yet I don't do this "out the door" thing.
 
Originally Posted by bdcardinal



I miss Rey Rey. We have Dealertrack and while I am good at the system, it is not anything like Rey Rey. The people that do our new car check in stopped entering the key codes and keyless door codes into the system because "its too much work."

Wow. That's pure laziness. We did it since we saw return business for service and sales. It also made life easier for the techs and parts department with due bills. Sure, Honda now allows anyone to get a radio/navi code online for their cars.

Most of the dealers here still use Reynolds. ERA hasn't evolved, it was originally a Unix program that used WYSE clients for access. Last time I've visited the dealership I worked at, they used a branded terminal program within Windows 10 to access it.
 
They say that the customer who just pays the asking price and drives away is WAY HAPPIER than the guy who spent 8 hours trying to negotiate the best price.

One owner is enjoying his new car, the other is staring at the ceiling all night wondering if they got the very best deal possible ...
 
Originally Posted by geeman789
They say that the customer who just pays the asking price and drives away is WAY HAPPIER than the guy who spent 8 hours trying to negotiate the best price.

One owner is enjoying his new car, the other is staring at the ceiling all night wondering if they got the very best deal possible ...

Who is this "They" you speak of? i bought a car from Hertz where nothing is negotiable and enjoyed the experience, but I would never do that with a dealer. Saturn tried, Scion tried. Both failed
 
Originally Posted by csandste
Originally Posted by geeman789
They say that the customer who just pays the asking price and drives away is WAY HAPPIER than the guy who spent 8 hours trying to negotiate the best price.

One owner is enjoying his new car, the other is staring at the ceiling all night wondering if they got the very best deal possible ...

Who is this "They" you speak of? i bought a car from Hertz where nothing is negotiable and enjoyed the experience, but I would never do that with a dealer. Saturn tried, Scion tried. Both failed

The only one who has come close to direct to consumer much to the ire of NADA is Tesla.

There are some good salespeople and F&I staff out there but most of them are scum.
 
Originally Posted by nthach


There are some good salespeople and F&I staff out there but most of them are scum.


lol, Might have created the very monster we suffer.

Never went to F&I but I'd think it's the last strike at creating, generating or retaining profits.
For every salesperson or F&I staff, there are thousands of customers out there- past, future and present. I tend to think the some customers and "process" has created much of the strife. As much or more so than any group of miscreants in the world of sales, F&I or marketing.
I was lucky to have found the right mix of humor and attitude to make my years of sales and marketing fun.

It was humorous to see some potential customer/s come in all revved up and hot-headed about the crooks and lies he/she invited themselves into because that's how they defined the car business. Such a tell or display of 'intellect' is welcome news to those crafty wizards in the kingdom of sales. The offending attitude, remarks and accusations get met with sneaky opportunities to up-sell or enhance margins.

Likewise, I've seen management b*tch and moan or make fun of contractors doing work for our facility and I know they (contractors) just smile and handle it with the utmost of professionalism. At the end of the project, they get to demonstrate what a pleasure it was to have us as a customer with a final bill that likely covers their costs, profits and a few add-on's to care for attitude adjustments. And they'll come back to bid the job again and again !
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So who is the joke 'on' ? It's always the other guy - right ?

One thing I'm pretty sure I couldn't let myself do is sell cars financed at credit card rates. I'd be the guy trying to get you to a bank or credit union to establish a trend and get started on the right 'note' . Thankfully, my personal integrity stayed fairly respectable through 20 years of sales/marketing although I'd guess my exceptions or lapses were justified by the heat of the moment.

Be friendly and expect to be treated nice or professionally while demonstrating the same when shopping or working out a deal. If or when that isn't happening, move on. If you feel like you might be the biggest a-- in the room, you are probably paying too much and without doubt, deserve it.
 
It's a BS fee. Whenever I buy a car I always ask...what's your BS fee? And they know exactly what I mean. Then I negotiate accordingly.

I once negotiated before knowing there even was a fee...then I just laughed as I gave it all back with their BS fee.
 
Originally Posted by fsdork
Originally Posted by madRiver
The key thing is to negotiate price including all fees including doc and prep and whatever.


Exactly. The total amount at the bottom of the invoice is all that matters. How the lines above are broken down is of no concern.


They are all basically the same around here so this is exactly correct...negotiate the "out the door" price.
 
Originally Posted by bachman

Originally Posted by demarpaint
A dealer prep fee is just another fee to rip someone off with, or something for a dealer to use as a negotiation tool. Either way it's BS, and drives their profits higher. Some people pay it though. I tell the salesman right from the get go, I negotiate on the out the door price, no hidden fees, no surprises, the bottom line with taxes, etc. If he/she or they don't like it I'll buy from someone else.


That's the trick.
Remove emotion, vote with your wallet and at times, "the dealer" will let you walk away. There are some deals or customers they don't want or need. Sometimes the last day of the month or year does factor in.

Having sold cars and knowing every possible way they can rip you off is a big help too. I set them straight right from the get go. If they don't like me or doing business my way, that's just fine by me, I'll find someone who will. I also realize all businesses are in business to make a profit, they just aren't going to hit it out of the park with me. Another tip is never buy a car when you need one bad, or at least don't let them know, smart salesmen can pick up on that real fast, and cash in on it.
 
I find that the smaller dealerships, even from the same auto group push the "lye downs" such as paint sealant more than the larger ones.
Rocks in a tin can to up sell undercoating etc.
The last truck I bought ($88,000 sticker), from a large busy dealership, none of the above was mentioned.
I was their 5th new vehicle before 10am.

There is quite a large HR turn over in the new car business.
A reputable dealership will put the run on the scum, back stabbers and guys that would rent their grandmother out to haunt houses.
 
Originally Posted by bachman
Originally Posted by nthach


There are some good salespeople and F&I staff out there but most of them are scum.


lol, Might have created the very monster we suffer.

Never went to F&I but I'd think it's the last strike at creating, generating or retaining profits.

I was lucky to have found the right mix of humor and attitude to make my years of sales and marketing fun.

Thankfully, my personal integrity stayed fairly respectable through 20 years of sales/marketing although I'd guess my exceptions or lapses were justified by the heat of the moment.



Well, I've seen the F&I office work in passing and they seem to be more high-pressure. I've seen new customers walk out with alarms and paint/fabs. I've been in the finance office with my parents once. But then again, the car business is a low margin business and I can see why dealerships pack on the extras like alarms, lift kits, "pro packs", etc. All of it has a low COGS, we didn't have to get the shop to install them as they are outsourced(KARR Alarms from SWDS is one good example, their tech would be out on the lot installing these wretched things into cars) and it's pure profit for every one sold. A dealership is a high-overhead business, it costs a lot to keep a store open - labor, marketing and floorplan cost a lot.

I've noticed high-end brands generally have better salespeople who aren't about the hustle but want to know you enough to help them out and make the sale. When I worked at the dealership, I noticed the more senior staff generally had a better attitude and took the time with their customers and it showed - they had repeat customers and the tower respected them. The shop never talked smack behind their backs(and would even change their oil for free after hours in exchange for a friends/family referral). The young guns hustled a lot and I've seen their tactics backfire. Of course, most of the techs in the back are surly but most of them are good people and have to deal with salespeople or management all day. If a tech doesn't put you on their doo-doo list, you're OK in their book.

I feel if you treat your customer with respect and at least make an effort to be human and likeable and not just trying to make a deal or get a spiff, it will go a long way. That's what I liked about the more senior salespeople when I worked at a dealership.
 
Originally Posted by fsdork
Originally Posted by madRiver
The key thing is to negotiate price including all fees including doc and prep and whatever.


Exactly. The total amount at the bottom of the invoice is all that matters. How the lines above are broken down is of no concern.


100% correct. This fee is there so the dealer can remove it and make folks that worry about line items think they won. I guarantee you the dealer doesn't care how the numbers add up. They only care about the bottom line. We all should think that way.
 
Originally Posted by nthach
Of course, most of the techs in the back are surly but most of them are good people and have to deal with salespeople or management all day. If a tech doesn't put you on their doo-doo list, you're OK in their book.





Yep, you worked in sales at a car dealership!
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Sorry to say most of us don't like sales guys very much with the few exceptions here and there. After you ask us for a "favor" and walk out of the shop
you'll hear us grumbling afterwards.
crazy.gif
 
Originally Posted by nthach

Well, I've seen the F&I office work in passing and they seem to be more high-pressure. I've seen new customers walk out with alarms and paint/fabs. I've been in the finance office with my parents once. But then again, the car business is a low margin business and I can see why dealerships pack on the extras like alarms, lift kits, "pro packs", etc. All of it has a low COGS, we didn't have to get the shop to install them as they are outsourced(KARR Alarms from SWDS is one good example, their tech would be out on the lot installing these wretched things into cars) and it's pure profit for every one sold. A dealership is a high-overhead business, it costs a lot to keep a store open - labor, marketing and floorplan cost a lot.

I've noticed high-end brands generally have better salespeople who aren't about the hustle but want to know you enough to help them out and make the sale. When I worked at the dealership, I noticed the more senior staff generally had a better attitude and took the time with their customers and it showed - they had repeat customers and the tower respected them. The shop never talked smack behind their backs(and would even change their oil for free after hours in exchange for a friends/family referral). The young guns hustled a lot and I've seen their tactics backfire. Of course, most of the techs in the back are surly but most of them are good people and have to deal with salespeople or management all day. If a tech doesn't put you on their doo-doo list, you're OK in their book.

I feel if you treat your customer with respect and at least make an effort to be human and likeable and not just trying to make a deal or get a spiff, it will go a long way. That's what I liked about the more senior salespeople when I worked at a dealership.



Very On Point .
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I was fortunate to get in when internet buying was a new and growing trend. Not sure I'd have liked it or made it a success as a lot lizard. Just wasn't my style.
I could sell off the lot just the same but the printer feed was keeping us busy. The internet buyer was well educated, well funded, knew exactly what they wanted or darn close and was a no BS deal. We had half the paperwork and none of the credit drama of normal sales floor staff.
 
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