Dealer Cost Estimate

[outdrive man]

Re: Dealer Cost Estimate

From some of the Replys it appears that 70-75% of the MSRP is a pretty good estimate of Dealer Cost. Therefore using the middle of 72.5% of a $9300 ski that comes to about $6750 Dealer Cost. Add $500 for the Trailer brings it to $7250 and multiply by 1.15 to allow the 15% profit which I feel is reasonible and I have about $8350 as a target not including state sales tax. I have found some Dealers advertising the GP1300 for $8300 without a trailer so if I can negioate a trailer included then I am there.

One question for Outdrive Man, did you get quality skis from eBay?? I have watched several 03 and 04 GP1300's on eBay over the last month and they appear to sell for about $500 to $1000 less than when advertised in local Classifieds and NADA value. I assume that is bacause of the risk that you are buying "site unseen" as opposed to Classified Adds when you can make arrangements to see and test the ski. I am simply afraid of buying thru online auctions. I would be less cautious if I knew the seller was a Dealer because they would most likely not want the negative feedback but for an individual it would be an easy way to dump a problem ski and run with the money because they would not care about complaints or negative feedback.

YES, I AM VERY HAPPY WITH ALL OF THE POWERSPORTS ITEMS THAT I HAVE BOUGHT ON EBAY. NOW AS FOR BUYING SITE UNSEEN, WHILE THE AUCTION IS GOING ON YOU CAN ASK THE SELLER TO TAKE SPECIFIC PICTURES OR YOU CAN EVEN VISIT THE SELLER/DEALER TO INSPECT. AND IF YOU ARE THE BUYER WHEN YOU PICK THE ITEM UP OR IT IS DELIVERED YOU CAN REFUSE IT IF YOU ARE NOT HAPPY WITH WHAT YOU SEE. ANOTHER THING IS IF YOU USE PAYPAL FOR ANY PORTION OF THE PAYMENT YOU CAN FORCE A CHARGE BACK FOR UP TO 90 DAYS I WONT WALK INTO A DEALERSHIP AND BUY OFF THE FLOOR EVER AGAIN

[joeyo]

Re: Dealer Cost Estimate

I really think it depends on availability in your area. In July I had a difficult time finding two FXHO. I went to three dealers and two of the dealers only had one and the third dealer only had two left. None of them were willing to sell them below MSRP because they were in short supply.

Finaly the third dealer tossed in a trailer, life jackets and reduced the price of each ski around $800 to $1000. But it was difficult to do. I do not think I got a great deal but when we were signing the paperwork another person came in and wanted to buy the two FXHO at MSRP because he couldn’t find two at another dealer.

JoeyO

[ScottD]

Re: Dealer Cost Estimate

bought a GP on ebay will not do it again.
Blew a piston on the 1st tank of gas.
I payed good money I wanted a ski within travelling distance.
I could not ride it during the 90 days and ebay dosent care they got there money.
Unless you can go see the ski and give it a proper inspection dont buy it no mater how prety it is.
SCOTT.......

[Bill O'Neal2]

Re: Dealer Cost Estimate

For the most part, the dealer markup on current model new PWC's is around 15-19 % on a good selling model. There are exceptions, but that is the general rule of thumb in the PWC business.

The markup on parts and accessories can be alot more, starting at about $40% and as much as 100 % or more on lower cost items.

There are several dealer incentives that come into play throughout the year depending upon such things as supply and demand, overstocking, ect. This is where a sharp dealer can make some extra dough and still give a reasonable discount. Big volume dealers can buy units cheaper than mom and pop dealerships. This is illegal, but hidden in such ways as the manufacture not charging the volume dealers for shipping the units, ect.

MSRP is never much more than 15-19 % of cost from the manufactor BEFORE special incentives, dealer discounts ect. There is also financing incentives and kick backs to dealership that add up to a huge amount of the bottomline.

Extended Warranties are a way to pad the net profit of a sale, as are accessories, and setup fees, which can vary widely from dealership to dealership.

All watercraft need to be delivered to the dealerships so that charge is usually legit, but some dealers will mark it up. I think SD has a set delivery price per unit no matter where it is going in the USA.

A very good deal on a new pwc would be a MSRP retail price of $10,399 and a sale price of $8499.00 before tax, license, registration.

This would represent a very good deal for the customer, as that dealer just gave away almost every penny of the gross profit. He would only do this if he needed to move the unit for whatever reason ( there are many reasons that he may do this). He may attempt to make some profit by selling you accessories, trailer, warranty or whatever, and he may not agree to the deal if you refuse to buy those items at the time of the sale. You would still have to pay tax and registration fees and probably delivery fees too. He may or may not wave setup fees.

Anybody who thinks he is going to walk into a dealership and buy a good selling current model pwc for $2k less than the MSRP is kidding himself.

You can get very close to this if you buy in October, November, December, or January if the PWC you are trying to buy has been there since last riding season. Once springtime hits, forget it! You can usually get about half of that off the price if you dicker during the good months.

I know it is popular to bash dealerships as thieves. Some deserve it. Some don't. Keep this in mind, without pwc dealerships, there would be no pwc community, no pwc parts and repairs. An independant such as myself would not be here if the dealerships were not selling watercrafts. If the customers are unwilling to give the dealerships a reasonable profit margin, they will quit selling watercraft.

According to the latest issue of PowerSports magizine, which is a dealership trade magizine, the industry gross profit per unit varied on an average of $1000.00 to $1700.00 per unit sold in America in 2005.

That folks tells me that owing a dealership that sells PWC's only would be a dead loser. But most pwc dealerships sell quads and cycles too ( which bring even less gross profits) . Profitable dealerships have good service departments, good parts and accessories departments, and good finance managers. That is where they make the cake.

[skraggy]

Re: Dealer Cost Estimate

Very good explaination Bill.And you are about 100% correct on the large dealers vs the smaller ones.Its called business.

The company I do most of my work for is a premier dealer for a large window and door mfg.We do indeed get special discounts due to the volume of our sales,and what we offer the customer.We are a step above most other dealers in FL,being that we offer our own service and warranty personel(that would be me).But,the company that actually pays me is not the mfg....it is the dealer.That is why they get an extra discount,and the dealers that dont offer what we do,dont get that extra discount.

There has to be markup on all products,otherwise,there would be no business to speak of.Just shop around and find you best deal.....thats all you can do.

[TITAN2390]

Re: Dealer Cost Estimate

Thanks for all the insite. It has been valuable information. I have no problem with a dealer making $1000-$1500 on a deal to stay in business. That's very reasonable in my opinion. I know that in the automobile industry (my field) Dealer cost runs 15%-20% of MSRP and it appears that PWC's are similar. I simply wanted to make sure PWC's were not more similar to the cosmetics industry (my wife's business) where products are sold for 2X cost. In other words I would have a major problem paying a Dealer $9000 if I knew the ski only cost him $4500. Thanks again.