How Much Can a Career Car Salesperson Earn?
by SIE BAKER
A salesperson��s pay structure is usually based on commission, with the basic salary being somewhere around ?10,000 to ?14,000 per year. A good salesperson can often bring that figure up to ?50,000, with some exceptional examples of people earning between ?70,000 and ?100,000.
Other benefits will usually apply, such as holiday pay (with average commission), pensions and sometime private medical healthcare. Additionally, it is often the case that salespeople also receive other benefits, such as a fully expensed company car including full insurance, fuel in some form and full maintenance.
Obviously terms and conditions of pay and benefits can vary between employers, as well as variations dependant on performance. The one thing that you may find surprising is how much happiness can play a role in your earnings. It��s true! Happier salespeople tend to be the best in their field �C so this truly is a career where a fun working environment and attitude can help you reach your full earning potential!
Commission is usually based on a percentage of profit from sales with things such as customer satisfaction also sometimes being a factor. The percentage you earn from sales is in the region of around 8 to 14% of gross profit, with the average being over 10%. Variations will fluctuate with manufacturer and the capability of the dealership management, but average gross profit including finance commission on volume used cars to be around ?1300 per unit and in prestige, around ?2,000. Do bear in mind however, that volume-operation can often open the door to further business and sales opportunities. This means that ?1300 versus ?2000 is not such a poor comparison after all.
Gross profit on new car sales is governed more heavily by the franchise than the dealer. Elements of traditional gross profit are now contained in bonus schemes such as campaign, volume, customer satisfaction, quality of representation and performance bonuses. These manufacturers bonuses can often amount to much more than the initial gross profit in any sale. Because of this, most employers find a way of folding these bonuses back into the deal when calculating commission. While this may sound a little confusing, most dealers have simple pay schemes which are easy to understand. Taking these things into account, a volume franchised dealership, under good management and in a good location should be making ?800 to ?1,000 per delivered unit at the gross profit level.
So commission schemes for salespeople generally take into account variable performances of the team and average profits in new being somewhat less than used. In order to do this, commission percentage is often varied by units sold or by total profit �C allowing the best salespeople to be rewarded as such. An additional bonus is often offered on the sale of new cars, to bridge the gap in the profit made on used car sales. Some dealerships split the sales team so that new and used car sales are separate. Average sales units will range from around 150 a year (bottom end) to around 20 (higher scale performance), with many people in a volume franchise exceeding 350 units per annum.
The table below illustrates the bands for theoretical comparison, based on a notional basic salary of ?12,000 and average gross of ?1,300;
Courtesy of 999tom.com Motor Recruitment
