When successful store owners have inventory that is either stale (e.g. last year's model) or less than perfect, e.g. (a demo, scratched/dented, open box, etc.) they'd rather sell at a loss than hold on, perhaps forever, waiting to find a sucker who'll let them sell at a profit. (And what's a "profit" when the dealer incurs costs to hold inventory, e.g. finance interest, storage, insurance, etc.?)BRIAN5000 wrote:Do you really think a dealer will sell a car for less then what they paid for it. IMHO not likely.
Moreover demos serve additional purposes:
1. They allow the dealer to show and demonstrate their products.
2. They allow the dealer to offer staff a low-cost perq, i.e. use of the car when the dealership is closed.
3. They allow service department customers to have a low cost "loaner" while their vehicle is repaired.
Those purposes have accountable values that enable the dealer to expense and/or write off part of the value of the vehicle. As a result the book "cost" (ACB) is ultimately much lower than what they paid the manufacturer in the first place. I imagine they still try to sell a demo for more than their book cost, but that's still less (a) than what they originally paid and (b) a potential bargain to a purchaser who understands how retail works and knows how to negotiate/haggle.