Why can you buy a car at dealer Invoice but audio

It's amazing the dealers only make 40%.
03-21-13: Taters

Taters,

They don't make 40%

From the remaining 40%

Deduct shipping cost.

Deduct overhead costs.
Rent,
utility bills,
Phone bill,
Yellow page ad,
liability insurance,
content fire insurance,
wages,
FICA taxes,
Unemployment insurance,
local, state, federal income taxes,
Health insurance?

The Banker? The dealer may have a line of credit with a bank. Manufactures require payment upfront before shipping product.

deduct discount to customer, if any?.....

Like I said the dealer is lucky if he makes 5% to 10% profit.

That means the manufacturers are making most of the money.

High quality parts aren't cheap....

In some cases there is middleman, the distributor, he also gets a cut.
.

if you buy direct you can usually get better value for your money.

In new car sales they will usually wiggle a lot. Used cars are where the money in cars is. Prices they buy cars at auction are ridiculously low. Even if they discount used for you they make a ton.

Dealer I worked for told me 60% of their profit came from service alone, parts, used then new, contributed to profit, in that order.

And as others have said, do not forget finance, accessories, warranties and the all important "undercoat!" Great comment Isochronism!

Audio, haven't got a clue.

Best,
Dave

It's amazing the dealers only make 40%. That means the manufacturers are making most of the money. As an example a piece that retails for 1000.00 cost the dealer 600. It probably cost the manufacturer 200.00. That's a 300% markup. It looks like if you want to be in the high end audio business today manufacturing is the way to go.

Taters, you need to take a basic business class.

+1 Drubin, that's pretty standard across any industry. A $1000 item cost about $200 to manufacture, $100 goes to R&D, $200 goes to marketing and advertising, $100 goes into retained earnings or gasp profit. After all, there has to some incentive to run a business, doesn't there? The 40% breaks out pretty much like Jea48 describes.

Taters, go to a local Community College and take Business 101.

Taters, I get 30%-50% off list from various internet dealers. Sorry, I don't kiss and tell. Yea, so I have to deal with the manufacturer direct with any warranty issues, I'm a big boy, I can handle that. I don't need to pay a middle man to handle those chores for me. If I did need the middle man, I wouldn't whine about having to pay for his services. Pay the man!