Trust is at the core of every human interaction. Whether you're walking the aisles of the grocery store, having a conversation with your partner, or communicating with your boss at work, trust plays a crucial role in how we approach every aspect of our lives. Apparently there is no trust in a car dealer (not between the customer and the salesperson, and not even between the salesperson and the sales manager). For decades, car salespeople have consistently “talked to my manager” to get permission to negotiate during the sales process.
This tactic, combined with countless other dealer shenanigans, is very frustrating for customers. If you're not familiar with your salesperson saying, "Let me check with my manager," then you're in luck! If not, you must have spent countless hours at a dealership before becoming frustrated and disappointed because the process took so long.
Today I wanted to provide some insight into why salespeople should sit down with their managers and ask them questions during negotiations with a customer, and what really goes on behind the scenes. If you'd rather watch, consider clicking the video above.
Contents hide
1 It starts with trust
2 Most customers prefer to deal directly with a decision maker
3 car salesmen are trained 'whoever is in control wins'
4 The sales manager tries to think two or three steps ahead before trying to close the deal
It starts with trust
It is important to recognize that car dealers have been operating in a similar manner for almost a hundred years. The manufacturer-to-dealer model has been around since before you were born, and the tactics and strategies dealers use to maximize profits are ingrained in dealer culture.
The traditional dealer culture is anti-consumer; that is, most dealers operate in a manner that is not transparent, friendly, or buyer-centric. Dealers have one main goal: to maximize profits, and in this quest many outdated practices have become the reality of the car buying process.
Worth noting is the way dealers are structured from a personnel perspective. There is an owner (a mom-and-pop owner or a large company) and below that are the staff. There is a general manager, a new car sales manager and a used car sales manager, including the salespeople.
The structure may vary by organization, but in general this is the typical makeup of a dealer's sales team.
If you are considering buying a car, you may find this article interesting:Buy or lease: how to choose your next car
The new car sales manager is responsible for (and his salary is tied to) how much gross profit the dealer makes from new car sales in a given month. This means that the manager's goal is to work with their salespeople to get the most out of every new car deal.
Now that you know, it should be clear how the “let me go talk to my manager” tactic came about. Managers do not trust their salespeople to maximize profits. Instead, they're afraid that salespeople will jump straight to the bottom line number after shaking hands (or, I guess, elbowing) their prospect.
Most sales managers operate out of fear. Their compensation is directly tied to the gross profit the dealer generates in a given month, and the idea of giving up "control" to salespeople to make their own independent decisions during the negotiation process is a foreign concept to them. Instead, sales managers typically try to maintain as much control over the process as possible. That's why you often see salespeople turning to the sales manager's office.
Most customers prefer to deal directly with a decision maker
However, this control dynamic is ironic. Car buyers don't want to get caught up in a strange power struggle between a salesperson and a sales manager. Instead, they will simply have to deal with the actual decision maker from the start.
This makes sense considering that most buyers research their purchase14 hours or more. To then be stuck with a dealer negotiating with a salesperson who really can't make a final decision, dragging out the process even further... It's no wonder that buying a car.
The “Let me ask my manager” construct also allows sales managers to assuage their fear of becoming irrelevant. As many car dealers focus on one-price sales, sales managers fear they will not be able to maintain their role at the dealership.
Car salesmen are trained 'whoever is in control wins'
Everything in life starts with trust, but in the car dealership it also starts with control. Outdated training has led salespeople and sales management personnel to rely on the concept of "who's in control, wins." This “us” versus “them” mentality is not pleasant for everyone involved, but as a car buyer it is important that you understand how deeply it runs in the dealership.
For example:
- Salespeople do not want to relinquish control to the customer
- The sales manager does not want to relinquish control to the salesperson
- The financial manager does not want to relinquish control to the sales manager
- The owner does not want to hand over control to anyone!
As you can see, trust is lacking across the board, and when that's the case, getting anything from a dealer comes to a standstill.
The sales manager tries to think two or three steps ahead before trying to close the deal
What actually happens when the salesperson goes to talk to the sales manager? The sales manager surveys the salesperson to better understand how likely the customer is to make a purchase today.
If they are likely to close the deal today, the sales manager will work for the seller to keep as much margin as possible in the deal. If the deal seems shaky, the sales manager can coach the seller to negotiate a slightly lower price to see if he can move the needle.
At the end of the day in the sales manager's office, the word they worry about most is "now." “How likely are they to close the deal now?” The point is to close the deal today, and it is the sales manager's responsibility not only to coach the salesperson to close the deal now, but also to achieve the highest gross profit possible.
So there you have it: this is what actually happens when the salesperson "goes to talk to the manager." Is it frustrating and annoying when it happens? Absolute. Do you understand it nowWhyit happens? I hope so. Behavioral patterns that have existed for decades will take time to erode. Let's hope this goes away in the not too distant future.
