A car dealer, or auto dealership, is a privately owned business that sells used or new vehicles at the public retail level, depending on a dealer contract with an automotive manufacturer or its sales division. It may also carry various types of Certified Preowned vehicles. It employs car sales people to sell their automobiles to customers. In most US cities, there are at least one car dealership for each block.
Dealerships generally use a showroom in suburban areas where they have a physical address and are not restricted by the restrictions of the local zoning codes. The showroom is the place where new vehicles and traded-in vehicles are displayed and offered for sale. Some car dealerships may have only a single showroom, while others have several. All of these showrooms are open to the general public and display a variety of new and used cars, including SUVs, coupes, sedans, and minivans. They also display a number of luxury vehicles, sports cars, performance vehicles, classic vehicles, and trucks.
How do car dealerships make money? They make money in two ways: through the initial premium they charge for a new or traded-in vehicle, and through the residual income that dealers earn through daily transactions and residual income from trade-ins. Initial premiums are made based on the estimated value of the vehicle before any repair or improvements are made. The higher the potential value of the car, the higher the monthly premiums. This also explains why new car dealerships usually offer very low initial premiums.
The second way car dealerships make money is through the resale value of their used cars and trucks. A dealership can buy a car in a style that matches its branding strategy and then sell it to a customer at a profit. In addition, a used Nissan Greenville NC car dealership can add a few parts such as a new stereo system, leather seats, and a DVD player to an already sold vehicle and then charge more for its resale value. Either way, the dealer will get a profit from this sale, which is what insurance companies pay them for.
So how do car dealerships make money? They still exist because there are still thousands of people who want a new car and would love to find a good dealership to help them do it. Also, franchises are still owned by large corporations, just like franchisees to fast food restaurants, retail shops, etc. People interested in buying new cars visit dealership, look through some inventory, make a decision, and then purchase from the dealership that bests suits their needs.
Does all this make sense? Consider this: if you go to a car dealership to purchase a new car, you may have to spend hundreds of dollars to purchase a vehicle, pay a fee for handling your car purchase also in New Bern car dealerships, and you may need to obtain an extended warranty through the extended warranty company through the warranty office. If you do not buy an extended warranty, the car may not be covered in the event of a mishap. Now think about this: you may need an extended warranty if you purchase a used car. So now you see why car dealerships still exist, even though they no longer have any direct competition due to a huge chunk of money that the major car manufacturers have already given to car dealerships in the form of bailout money.
Check out also this related article - https://www.huffpost.com/entry/buying-a-new-car-read-this-first_b_5a26e8e2e4b0f69ae8ce8082
