Did you know….

• The average gross profit as a percentage of sales for Buy Here – Pay Here dealers is 37% while it is only 15.2% for franchise dealers.
• The average net profit as a percentage of sales for Buy Here – Pay Here dealers is 16.5% while it is only 1.50% for franchise dealers.
• Service & Parts (typically the most profitable department in a franchise store) average net profit as a percentage of service and parts sales was 8.38%.

Adding a Buy Here – Pay Here operation to your existing franchise store will create a new profit center that is more profitable than any department in your current operation.

• The average age of all vehicles in operation in the United States is 10.4 years.
• 87% of all used vehicles sold at franchise dealerships are 8 years old or newer.
• Franchise dealers wholesale the majority of vehicles in their inventory that are older than 8 years old.
• The average vehicle sold by a Buy Here – Pay Here operation is 10.8 years old, virtually the same as the average vehicle on the road.
• The average used car gross profit for BHPH dealers is $4149 while it is only $2245 at a franchise dealership.

Why would you want to wholesale the vehicles your Used Car department is not going to sell and risk losing money at the auctions when you can retail those same vehicles through a Buy Here – Pay Here operation and make gross profits as high or higher than your average at your new car dealership????

• 70% of Americans have sufficient issues in their credit file that they may not qualify for conventional financing.
• 25% of the population has a credit score below 620, 15% below 550.
• The number of people with scores below 620 has grown by 78% in the last 3 years.

How many of these customers have walked into your new car dealership and left without a sale because you could not finance them? Now imagine how many more people never even came to your dealership because they already knew they couldn't get financed. Adding a Buy Here – Pay Here operation to your dealership provides a way to sell to all these customers.

Alan Mosher is a senior consultant at Constellation’s DCF Consulting Group, a provider of start-up, training and consulting services for Buy Here – Pay Here dealers.