DealersEdge Professional Forums

I'm reviewing my ROs from the last time we participated in this program & the word lucrative doesn't come to mind. Do many of you see positive results from this program or is it a loss leader to keep people coming back?

Our DM pushes this with every email he sends us... No matter how you slice it, the parts department takes a beating on this. GM never reimburses you enough to cover the 4th tire. Plus, we tend to not make a whole lot on the tires to begin with. They've become a loss leader, just like oil changes. My question to you all... How do you handle it when a customer has Tire Rack ship tires to you?

Our store runs buy 3 get 1 free quite often. Not a money maker. We do sell more tires which is what the owners want. What we do is run the 4th (free) tire to advertising. Parts and service splits the cost 50-50. We also run a special where you get 4 free oil changes. I think the 4 free oil changes is better. You have a better chance of additional sales if they come back for the oil changes, and if they don't come back you are not out anything.

Thankfully, we don't sell many tires. The ROI is awful. I know GM preaches how tire sales helps sell more front end parts, however in my 22 years here I have to yet to see an upsell off of a tire sale. That being said, we do well
on LOFS...10.99 for the filter and 5.95/qt for oil.

I have never run a B1G1 for $1 in my GM store, but in my Toyota store is s a 2 month twice a year event. I can tell you that the GM reimbursement rate that Toyota gives would not even get me back to my cost on the GM tires. All said and done, I make about 4.5% In the Toyota store during the months of the tire sale.....That is including tires that are sold at full price because they fall outside the rules of the program (up-sized, off program, and tires that are sold to non-Toyota vehicles) so best guess is a profit margin between 1-2 percent. On top of the low reimbursement rate, the program is run during months that I would be selling tires like crazy even with out the sale (March-April and October-November).... My advice: don't rely on the manufacturer to help you sell tires is to figure out a margin that you're comfortable with, the cost and stock you'll need to be successful, and adjust as necessary. Just a point of reference; my Chevy store beats my Toyota store in yearly gross by about 15% after the reimbursements are posted, and the Chevy store only sells 3/4 the number of tires that Toyota does.

WE DO NOT RUN OUR DEALER AS "BRING YOUR OWN PARTS" THAT INCLUDES BULBS, OIL FILTERS, OIL AND TIRES AND EVERYTHING ELSE

You can get reimbursed from GM for running a buy 3 get 1 free? How does that work?