Buying an RV - The Dealer is Not the Enemy
by Guest Author Barry Wilder
Statistics show that the 80/20 rule applies to RV sales profits. That means that approximately 80% of all RV's sold will make a dealer an acceptable profit. How much is that? I can tell you it is measured in the thousands of dollars.
I know... I've been in the RV business for years and years.
How about the other 20%? Most of them will fall into the area of "just under the acceptable range". But, they are still paying the dealer several thousand dollars in profit. Actually, only about 3% of RV sales made in 2004 were at a profit margin that would be considered totally unacceptable to the dealer. In other words, the customer won... and won BIG!
Yea, yea... As I said, I've been in the business for years. Salesman, Manager... Owner. Trust me - I've seen it all.
Why am I telling you this? I'm really mad. As angry as I have ever been about anything. I get calls everyday from friends and clients who have been burned over and over again by fast buck "Slick Willie" salesmen selling a load of bull and using high pressure tactics.
There are just too many "Big City Dealers" anymore, who are tarnishing the heck out of the business my family and I have worked so hard to keep clean and simple. My sales people have always been taught to be courteous, helpful, and most of all professional. They return phone calls, they send thank you notes and they treat each and every customer with respect.
They also are taught two basic principles:
1. Make a reasonable profit. We have earned it and we deserve it. We have to pay the rent, utilities, salaries, commissions, etc. So by all means, make us a reasonable profit.
2. Sell RV's. Always try to make a reasonable profit, but if you can't... at least try to make some profit. A little of something is better than a whole lot of nothing.
It's really very easy to save a substantial amount on the purchase of your next RV. If, and only if you know exactly what to do.
Many people walk into a dealership with the impression that they are going into battle. They bristle with resistance as the salesman introduces himself, and begins the cat and mouse game of "I can sell you... No you can't".
The salesman is asking qualifying questions, to hopefully keep from walking all over the lot and showing each and every RV. You are simply trying to see the different styles, options, colors, models, etc. It is a tug of war... But it doesn't have to result in all out war.
Obviously the dealer, as the individual or business that has shelled out literally millions of dollars to provide a good inventory of recreational vehicles, has the right to regulate the flow of potential customers through his doors. He also has the right to dictate what type of methods his sales people use. When people walk through the doors of the dealership, many salesman, like a cop in a bad movie, will subconsciously read you your RV Miranda Rights.
"You have the right to remain ignorant. Anything you say can and will be used against you in the sales office. You have the right to speak to your spouse, and to have your spouse present during any negotiating. If you cannot afford an RV, one will be financed for you at 3% over buy rate."
This is the mentality of many, many RV dealers and sales people across the country. They will use any means possible to sell you an RV from their inventory, and their lot. They will use a multitude of tricks and strategies to "help" you buy on your first visit. They will give you reasons to buy NOW!
You, as the consumer also have a set of rights that you should go over mentally as you walk through the doors of any dealership.
1. You have the right to be knowledgeable. Anything you have learned can be used against the pressure tactics of any unscrupulous salesperson or greedy sales manager.
2. You have the right to take your time. Although you do have the right to know how to use urgency to your advantage.
3. You have the right to know the wholesale and retail book value of your trade in, as well as the RV you are buying.
4. If you finance your RV, you have the right to choose your own source for RV Loans, and the best interest rate and terms possible.
5. If you choose to purchase an RV Warranty, you have the right to a fair price and a reputable company.
Clearly, the dealer is entitled to a some profit. Without it he could never survive. Many dealers make HUGE profits on the RV's they sell. Your job as a consumer, is to make sure that he pays the rent on the next buyer... Not you.
You are your own worst enemy...
Most people never take the time and/or money to learn. They don't realize that when they walk into the dealership and sit down, they have taken a knife to a gun fight. Dealerships spend thousands of dollars training their sales people to make a good profit on each and every person they work with. Yet still, the vast majority of buyers never take the time to really learn how to buy an RV at little or no profit for the dealer.
Unfortunately there is very little good information out there on the subject of RV related SAVINGS! There are plenty of books on how to use your RV, fix your RV, and travel in your RV. There are even some books on the subject of buying an RV. But all of them combined provide very little real-world, down and dirty secrets.
I have read every book that is available on the subject and find all of them very lacking in good advice. If you are only armed with the advice in these manuals, a good salesman will eat your lunch every time.
Not only must you be able to buy your RV very near the dealer's cost, you must be skilled in evaluating the quality, or lack of it, in the various makes and models you have to choose from.
One important thing to consider is the issue of trade-in. Should you put forth the effort to sell your own RV before you purchase another one? Effort, is the key word. If you put in the effort, you deserve to keep the profits of your labors.
If you trade in your RV, the dealer will be the one who puts forth the effort to sell your unit. He will be the one to make interest payments on it while it sits on his lot. He will incur the advertising expense, sales commissions, etc. He will also have to fix any defects or problems as well as providing a warranty on the unit for a minimum of 30 days. In other words, don't expect to get full retail for your trade-in. It doesn't happen... Ever.
People ask me time and time again: "When is the best time to buy an RV?" My answer is always the same. "Anytime..." They then typically reply: "No, I mean is Winter the best time? Or maybe at the RV Shows? What about the end of the month, I've heard that is the best time of month..."
The truth of the matter is this. RV dealers need to sell RVs all year long. Some sales make a lot, some sales make a little. Your job is to make sure you have the skills to play the game effectively.
As long you armed with the proper tools, and by that I mean information and knowledge, you should be able to negotiate a deal that is fair to both individual and dealer. No matter what time of year, remember... Information is power. Use it to your advantage.
Do your homework. Research various models and dealer pricing. Leave your checkbook at home until you are ready to make an offer. Remember the value of the Internet and the ease of shopping it offers.
And remember... Be kind to your local RV dealer. He is the one most likely to be servicing and repairing your RV. A few dollars more - spent locally... Are wisely spent.
Barry Wilder has been associated with his family RV business for over 25 years. He is currently the owner of Best Rate Financial Services, providing loans and refinancing for RVs, boats and aircraft. They also provide RV and Boat Warranties.
You may also want to read: A Checklist for Buying an RV