"Car dealers have haggling advantages over purchasers: - You buy a car perhaps once every three years, perhaps once every ten."
Correct, this is no different than the mattress industry or bridal industry. There has to be a large premium over the price of the product to support the people operating the business. This is because there are established points-of-sale that were established before doing direct business with the consumer was reasonable, or because there is some additional value added during the sale by a physical presence (test drive, testing a mattress, getting fitted for a gown).
The remaining issue is eliminating the "icky" feeling that comes with buying a mattress or car. This could be eliminated if franchise laws could be repealed, but that's a hard battle. I believe Chrysler had set up a dealership recently in L.A. (to sell Chryslers, Jeeps, Dodges and Fiats), but dealers pointed out how it was illegal and had the state force that dealership's closure.
Imagine if there were brand-owned dealerships, that eliminated the haggle, leveraged their distribution networks to minimize the numbers of actual cars on their floor plan, and allowed customers to buy direct for a flat price. Would be nice, right? Actually, this is possible, but it does involve a bit of legwork. I've bought my last two cars straight from the port of entry, but a lot of legwork is involved, as is developing a relationship with the right individuals. I should blog about that one day, as how to get around the nonsense of the mattress industry.
I'll partially agree with you on this. Car buyers do only buy cars once every few years, but the amount of information available to a car buyer is incredible. You can know exactly what a dealer paid for the vehicle you're about to buy if you try. Dealer's are in somewhat of a vacuum from a data standpoint. Most of them have no insight into the buyer's shopping experience... meaning how many dealers are they talking to, were they on KBB/Edmunds, are they cross-shopping, etc... They may be better at haggling, but it's somewhat by necessity at this point to hold what little margin they can.
Consumers are armed with information and tools, dealers have a lot of challenges fighting this. Lots of people probably don't realize that at CarWoo! this is one of the issues we're helping dealers with when they use our product to engage with buyers. Only when both sides of the selling equation have an equal chance will the bad buying (icky) experiences go away.
Correct, this is no different than the mattress industry or bridal industry. There has to be a large premium over the price of the product to support the people operating the business. This is because there are established points-of-sale that were established before doing direct business with the consumer was reasonable, or because there is some additional value added during the sale by a physical presence (test drive, testing a mattress, getting fitted for a gown).
The remaining issue is eliminating the "icky" feeling that comes with buying a mattress or car. This could be eliminated if franchise laws could be repealed, but that's a hard battle. I believe Chrysler had set up a dealership recently in L.A. (to sell Chryslers, Jeeps, Dodges and Fiats), but dealers pointed out how it was illegal and had the state force that dealership's closure.
Imagine if there were brand-owned dealerships, that eliminated the haggle, leveraged their distribution networks to minimize the numbers of actual cars on their floor plan, and allowed customers to buy direct for a flat price. Would be nice, right? Actually, this is possible, but it does involve a bit of legwork. I've bought my last two cars straight from the port of entry, but a lot of legwork is involved, as is developing a relationship with the right individuals. I should blog about that one day, as how to get around the nonsense of the mattress industry.