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-   -   Unfulfilled Dealer Allocation (https://www.corvetteforum.com/forums/c7-general-discussion/3411468-unfulfilled-dealer-allocation.html)

Crossed Flags Fan 01-28-2014 10:41 PM

Well Done (so far)
 
This thread has to be the most interesting and tame ones that I've seen on the C7 forum! (Too bad they all couldn't be this way.)
:thumbs:

Higgs Boson 01-28-2014 11:05 PM


Originally Posted by Dave80C3 (Post 1586038588)
Not a flaw but a smart business model for GM the company. See, we are not customers of GM, we are customer of the Dealer.

So GM like any smart business owner puts its best customers first. For Corvette we all know who GM's best customers are, the large forum dealers.

I am sure if you buy more cars from a dealer than any other customer you expect and receive different treatment than the person who only buys a car every ten years from them.


Because, the small dealer did not buy anything when it was hard to sell. Now that its an easy sell they suddenly want it.



GM has figured that out. Kerbeck is GM's customer, you and I are not. We have to buy our cars from a Dealer, we can not go to the Corvette plant and buy a car. We can not cal the plant and buy or order a car. Kerbeck and many other dealers can.

All business take the best care of their best customers. Airlines up grade frequent flyer, with over 75K miles a year to first class frequently for free. The guy who files five times a year does not get up graded when its less then 5K miles a year.

My local Harley dealer throws a Christmas party, dinner and drinks and band for the top 50 customers for the year. Many of us get first in line for some special model because we are in that top 50 customers every year.

GM is no different, it's rewarding its top 10 or 20 dealers, and doing fairly, the more they sold in 12 the more they get now.

I bought mine from a small local dealer who took cars and sold at a loss in 12 so he could get cars in 14.


Originally Posted by Glen e (Post 1586038743)
And this allocation system is not some brainchild of GM's it is the way the courts have ruled for the last 30 years when it comes to selling hot product. Do some googling on the Honda Allocation Lawsuits of the early 80's when Honda gave product to who they liked. Without a hard and fast mathematical way to allocate product, it does not fly anymore. Dealers challenge it all the time, I have been on the stand twice in my 20 years as a BMW rep, with a dealer accusing me of giving out M3's to his neighbor and not him. (I won both times)

And for those that think the small dealer is getting shafted, if he makes up his mind to be a corvette dealer he can do it. How did we end up with one of the big boys in Montana? or for that matter, one in Atlantic City or Pataskala? Because they decided to do it. He went and bought other dealers inventory when they did not want it, sold it and got the record for the sale. He took C6's when your "little dealer" you want to buy from, told GM to shove it. So if any dealer in the country wants to become a big corvette dealer, he can do it now and he'll be rewarded with C8 hot product.

The truth is most don't want to do it as it's a loaded gun, and basically, dealers don't want anything that does not sell.

I am not speaking just from the perspective of "small dealer" because I have not been associate with a small dealer in the past. I also completely agree that if a dealer is not certified to work on the product, they should not get it.....at all.

I am not even talking specifically about one single model, Corvette or not. If a customer wants a car and they want to buy it from any given dealer and they put their order in, they should be able to get it in the same reasonable amount of time as any other customer ordering from any other dealer. GM is punishing the people that keep the company alive, through purchasing their vehicles AND with their tax money. Not too smart in the long run. I can pick a television and buy it at will from wherever I want. I don't have to buy it from a different state. The whole idea is archaic.

And Stepa_J's perspective is the future, like it or not. It is also the past. The Internet just makes it doable. Unfortunately, this is not allowed. One cannot buy from the manufacturer for reasons outlined in my link above. Dealers fight it. The manufacturers have tried to sell to individuals.

Let me repeat that. Manufacturers have tried to sell directly to individuals. Individuals express interest in buying directly from manufacturers. The manufacturers and individuals want the same thing - a direct transactional relationship.
And some of the people in this thread really actually believe that GM thinks the dealers are their customers. Ha......no.......

GM needs their dealers to hold inventory and market at a local level their products. If the dealer needs to believe they are a customer to do a good job then so be it. The dealer is a tool. A means. A necessary evil. On the other side the dealerships are filled with ends. With people. With jobs. With consumers who build buying power with the buying power of others. Dealers are part of the economy. Dealers should not go away but they need to adapt. They need to realize their strengths and weaknesses. GM and manufacturers need to stop kidding themselves. I consider the customer the group of people who drive and use and service the cars. Who buy parts and services. Those meaningless warm bodies are tired of the dealer experience.

The industry is going to change. The role of the dealership may not always be to deal. It's what the people want.

n8dogg 01-29-2014 08:58 AM


Originally Posted by Dave@Kerbeck.com (Post 1586035348)
I can explain that. Our allocation is over 100 per month. GM gives us those 100 each month that have to be built but GM can not control if we order sold or stock units. Regardless of what we order they have to build because the factory is set up to build those cars and can't not build them because they are not sold orders.

If a smaller dealer gets 6 cars for the year, they get one every other month to space out the allocation and when that allocation comes up they can place the order. Just because a dealer has a pending sold order in the system GM will not pick it up early. That was the way it used to be until dealers started placing "sold" orders with fake names just so they could pick up cars that they shouldn't have.

As far as your dealer being a new dealer with no chance to earn, you are partially right. There are no "new" dealers. Even if it's a new building and a new owner, that dealer is inheriting an existing business plan from a dealer who closed which is what the allocations for all of your vehicle lines is based on. When your dealer principal/owner purchased the franchise he already knew this info. Buying the 2013s to sell will help but for next year. For 2015 allocation they are going to see that your dealer was allocated 6 in 2014 but sold 12 so they see you are growing and will give you more.

It's great to be excited to sell this car because it is one of the best cars in the world with the best owners, but you have to prove yourself to the manufacturer by walking before you run.

Dave

Dave,

Thanks for explaining this to me. I now understand why most big dealers will not deal with small dealers. They worked hard to earn their Corvettes and don't want to give any hand outs.

What's too bad is we are working just as hard if not harder to meet our customer's orders. It's not even about the money, we would buy at full MSRP if we could get the card.

I understand both sides of the allocation argument. But what I do not agree with is this system encourages people to buy outside of their local area. For a company who is/was owned by the Govt you'd think they'd want their own citizens buying locally to boost their local economy.

The Corvette clearly is not so limited that they cannot produce enough to keep up with demand when you have dealers ordering inventory.A target production in 2014 of 25,000 units is pretty healthy.

I think the allocation system should be remodeled. Restrict the amount of inventory a dealer can order (allow more for big dealers, less for small) but allow sold orders to be picked up in the system chronologically. Confirming sold orders are real is not that difficult to do, any dealer that falsifies a sold order gets their rights to sell that vehicle revoked.

Just my $.02

Stingray Al 01-29-2014 09:40 AM

:lurk::lurk::lurk:

Dave@Ciocca 01-29-2014 09:44 AM


Originally Posted by n8dogg (Post 1586040911)
Dave,

Thanks for explaining this to me. I now understand why most big dealers will not deal with small dealers. They worked hard to earn their Corvettes and don't want to give any hand outs.

What's too bad is we are working just as hard if not harder to meet our customer's orders. It's not even about the money, we would buy at full MSRP if we could get the card.

I understand both sides of the allocation argument. But what I do not agree with is this system encourages people to buy outside of their local area. For a company who is/was owned by the Govt you'd think they'd want their own citizens buying locally to boost their local economy.

The Corvette clearly is not so limited that they cannot produce enough to keep up with demand when you have dealers ordering inventory.A target production in 2014 of 25,000 units is pretty healthy.

I think the allocation system should be remodeled. Restrict the amount of inventory a dealer can order (allow more for big dealers, less for small) but allow sold orders to be picked up in the system chronologically. Confirming sold orders are real is not that difficult to do, any dealer that falsifies a sold order gets their rights to sell that vehicle revoked.

Just my $.02

Here's why GM is really concerned with supporting the local economy with giving out allocations. The customer who buys the car out of state is still going to have the car serviced locally (at a dealer or independent garage) and for 8 years out of 10 there is way more money to be made in parts in service of a Corvette than on the sale of one. The first year or two of a new generation is the exception to that rule. Does it stink for a sales guy like you who wants to build the market? Yep. Will your dealer still make the money off of those local customers who bought out of the area? Yep as well.

Keep pushing and you can build up your allocation over the next few years. When a special model comes out or the next generation hits, you'll be in a good position to serve your local market.

Dave

Kracka 01-29-2014 10:18 AM

Good read...email sent to Dave :)

Greg00Coupe 01-29-2014 10:34 AM


Originally Posted by Stepa j (Post 1586038875)
I guess I come from a different perspective. I don't fit the typical demographic probably a good bit younger than most buyers. If I had my way I would go to GM's website configure my car, wire the money to GM and have them deliver the car to my doorstep. No calling dealers, no ridiculous negotiations, no trying to find some one to ship car etc etc.

It will happen someday.

:hide:

Tesla is trying to do that right now........ direct sales. Lot of lawsuits by the dealers in any state right now to protect the dealer network concept.


PS What a great thread!!!!!!!!!! Lot of respect lot of good thoughts and information!!!!!!!! Does show me what a class act Dave @ Kerbeck is. Interfacing with us giving us his side and educating ( at least me ) on things from the dealer side I did not know. GOOD STUFF!!!

rickduff 01-29-2014 10:52 AM


Originally Posted by Greg00Coupe (Post 1586041722)
PS What a great thread!!!!!!!!!! Lot of respect lot of good thoughts and information!!!!!!!! Does show me what a class act Dave @ Kerbeck is. Interfacing with us giving us his side and educating ( at least me ) on things from the dealer side I did not know. GOOD STUFF!!!

:iagree: Great thread - educational and not too argumentative. :thumbs:

Stepa j 01-29-2014 10:56 AM


Originally Posted by rickduff (Post 1586041845)
:iagree: Great thread - educational and not too argumentative. :thumbs:

:iagree:

Dave has been awesome a true professional and I have learned a ton.

Many thanks!

USMCVETC7 01-29-2014 11:02 AM

One thought I don't think I have seen in this thread yet. There are hundreds, probably thousands , of potential C7 buyers out there who for a variety of reasons do not want to buy out of state. They have been trying for months to purchase a C7 from a local dealer with no success. At some point they will give up and purchase another vehicle. Chevrolet looses that sale and possibly that customer for not only the MY 2014 but also for future Corvette sales. They buy a competing brand and never come back to the Corvette even though they liked it better when they first saw it. Although I'm not there yet, I'm close to being one of those customers.

Glen e 01-29-2014 11:07 AM


Originally Posted by USMCVETC7 (Post 1586041943)
One thought I don't think I have seen in this thread yet. There are hundreds, probably thousands , of potential C7 buyers out there who for a variety of reasons do not want to buy out of state. They have been trying for months to purchase a C7 from a local dealer with no success. At some point they will give up and purchase another vehicle. Chevrolet looses that sale and possibly that customer for not only the MY 2014 but also for future Corvette sales. They buy a competing brand and never come back to the Corvette even though they liked it better when they first saw it. Although I'm not there yet, I'm close to being one of those customers.

yes, that is the downside of the allocation system used by the mfrs. But to be very blunt, no mfr cares that much where they are sold, just that they are sold....Chev does recognize it though, as they just opened up the dist system now to any dealer who whats to get certifiedthru training and parts and tool package, instead of staying with the original 900 dealerships of the rollout.

ENCT 01-29-2014 12:50 PM


Originally Posted by USMCVETC7 (Post 1586041943)
One thought I don't think I have seen in this thread yet. There are hundreds, probably thousands , of potential C7 buyers out there who for a variety of reasons do not want to buy out of state. They have been trying for months to purchase a C7 from a local dealer with no success. At some point they will give up and purchase another vehicle. Chevrolet looses that sale and possibly that customer for not only the MY 2014 but also for future Corvette sales. They buy a competing brand and never come back to the Corvette even though they liked it better when they first saw it. Although I'm not there yet, I'm close to being one of those customers.

Funny to read this as I am thinking the same. If my car does not get into the system by 3-1 I may walk. As this is a fun car and not a dd I may get nothing, or maybe a boat or a nice vacation. I agree with you that sales will be lost.
Eric

LIStingray 01-29-2014 07:02 PM


Originally Posted by USMCVETC7 (Post 1586041943)
One thought I don't think I have seen in this thread yet. There are hundreds, probably thousands , of potential C7 buyers out there who for a variety of reasons do not want to buy out of state. They have been trying for months to purchase a C7 from a local dealer with no success. At some point they will give up and purchase another vehicle. Chevrolet looses that sale and possibly that customer for not only the MY 2014 but also for future Corvette sales. They buy a competing brand and never come back to the Corvette even though they liked it better when they first saw it. Although I'm not there yet, I'm close to being one of those customers.


Originally Posted by ENCT (Post 1586042873)
Funny to read this as I am thinking the same. If my car does not get into the system by 3-1 I may walk.

Both of you are only correct if GM actually lost sales because cars weren't ordered. Right now, there aren't enough cars to go around. The big boys are selling 100% of their allocations, so all your model does is allow you and others similarly situated to get a car now from a small dealer at the expense of someone else (who also wants a 2014 Corvette and likely maybe a first timer) who is buying from Kerbeck, MacMulkin, Criswell, Fichter, etc. In effect, you believe your purchase is more important than the person who buys from Criswell - which is 100% wrong.
So for GM, your model is actually a long term loser, because in 2017-2020, when Corvette's are hard to sell, it is only the big guys and their loyal customers who will be buying them.

USMCVETC7 01-29-2014 07:38 PM

Time will tell. Right now the large dealers have a lot of non Z51 inventory taking at least a few weeks to clear. This time next year it will be interesting to see what if anything has changed, and how many potential buyers have waited vs purchased something else. I think it is clear from past years that all the inventory will eventually be sold, its just a matter of how much it will have to be discounted.

Monaco335 01-29-2014 08:10 PM

This thread is persuading me to get my c7 from Dave. Not because he's the largest but because of his honest responses here.

Glen e 01-29-2014 08:12 PM


Originally Posted by spiike32 (Post 1586046509)
This thread is persuading me to get my c7 from Dave. Not because he's the largest but because of his honest responses here.

Indeed, however to be fair to all the forum dealers here, some have diff levels /channels of comm, but I think all of them are perceived as very honest and straightforward.

MikeK 01-29-2014 08:53 PM

This has been an excellent thread and should certainly enlighten those of you who have been hesitant about purchasing out of state and who have been stranded at 1100 for weeks/months. Dave S @ Kerbeck is to be commended for letting all of us consumers know about the workings of GM's allocation system. Of course, Corvette is not the only auto with allocations or the only auto that can be purchased from an out of state dealer.

My first out of state Corvette purchase was in 1998 from Les Stanford (anyone remember Lew Tuller?). My next purchase was a 2001 Z06 from Bill Estes (remember Corvetteseller Bob Benendix, may he RIP) and my 2014 Stingray from Les Stanford with Dennis Tap handling the paperwork and telephone. And yes, I did purchase 3 more Corvettes and other vehicles locally while living in Salt Lake.

One day in 2007, because of a health issue, I decided that I had better get that Porsche 911 Turbo while I could. Walked into the only Porsche dealer in SL and asked to order one. I had previously met the salesman for the dealership and was politely told that they had already sold their 1 allocation and that their 2008 allocation was also sold. A tad pi$$ed, I looked up on the internet (thank God for the internet for being able to conduct this commerce at all) all reasonably close Porsche Master Dealerships and e-mailed them all an RFP. At 10A the next morning I got a call from a dealer in North Atlanta and one hour later had concluded a deal for a 2008 to be delivered to my home in May. Without going into the details, it was a $150K purchase. I have purchased two (2001 and 2004) Lexus RX's from a dealer in Boise and had them shipped to SL after not being able to satisfactorily deal with the only SL (and Utah for that matter) Lexus dealer.

Anybody tried to purchase a new Ferrari? Guess what, most models have a 1-1.5 year wait. Time to get on the internet and telephone.

My advice to all fellow CF members is to get used to out of state purchases for high demand vehicles. I can tell you in all honesty that the top 5-6 forum dealers here are all great to deal with, know their business inside and out and will bend over backwards to make you comfortable with the sale and assist in getting that car to you. We are very lucky with the way GM allows and ships cars sold at one dealership to be shipped to another w/o charge.

Save the Wave!

fireinv38 01-29-2014 09:35 PM

understanding dealer
 
Once upon a time there was a dealership in Paramus, NJ,:flag: called Malcolm Konner Chevrolet. Malcolm Konnor was a wise business man and the number one corvette dealer in the country. Back in the 60's-80's there were no allotments. If you wanted a Corvette you went to Malcolm Konnor and purchased one. You could go to another dealer in area called Hawthorne Chevrolet with their Corvette Corral and purchase one from John Curry. These were the premier dealerships. GM even made a limited edition Malcolm Konner Model. now that's powerful. Konner had 2 corvette salesmen. Both did extremely well, they were not available everyday. If you wanted to buy a Corvette you had to go when one or both were working. if not you could not buy a Vette. Times have changed and strategic planning is needed on sales, inventory and promotions to be successful. As a successful business man i understand the allotment system along with it's good and bad points. The strong survive and to the victor go the spoils:) This debate will be short lived once the novelty has worn off. remember the 1978 Indy limited Edition Corvette. Not worth what it was thought to be worth today. The big corvette dealers will be big and the smaller dealers will sell their cruz's and mid size cars. In the end all will get their cars, some garage queens, some daily drivers. what is good is this Forum has very knowledgeable members who are street smart and successful! Remember if Malcolm Konnors salesmen were not working you could not buy a Corvette:flag:

Tommy D 01-30-2014 09:07 AM


Originally Posted by Stepa j (Post 1586038875)
I guess I come from a different perspective. I don't fit the typical demographic probably a good bit younger than most buyers. If I had my way I would go to GM's website configure my car, wire the money to GM and have them deliver the car to my doorstep. No calling dealers, no ridiculous negotiations, no trying to find some one to ship car etc etc.

It will happen someday.

:hide:

Maybe not the delivery but,

Actually you can order a car from Kerbeck the way you want it because of the allocation system. The discounts are posted on their website all you have to do is place the order and it will be built, speak to Dave.

Look at the dealer allocation system and how it benefits our members. The current system rewards those dealers who have worked hard to increase their sales.

The CF dealers then get a larger allocation.... That allows those of us who want to order cars to get them at a reasonable price(see the discounts on the various forum dealers websites) and in a reasonable time frame.

I see the current system as a win/win for us on the forum. We can get the car we want for a reasonable price with in a reasonable frame. :yesnod:

Most importantly the existing system rewards those dealers who work their butts off to sell Corvettes thus creating competition among the larger dealerships and as we all know competition is a good thing.

btw Thank you Dave for the very informative posts :thumbs:

Corgidog1 01-30-2014 09:22 AM


Originally Posted by Greg00Coupe (Post 1586034675)
Dave @ Kerbeck...... I agree with you 100%. You are a business to make money and work your Azz off. You knew the rules so did the others....... you chose to make a business decision and you guys positioned yourselfs to do well.

No allocation system is perfect. I assume GM wants to move cars and make $$$s.

Funny how folks want to buy local but then when the car can't be serviced they cry too. Little dealers need to invest in training and tools too to take care of the customer.

It always has been buyer beware!!! It won't change. Frankly someone who is DUMB enough to not do their homework........ not check out the allocation.. and give a deposit to a small dealer who is sold out........ get what they deserve.

I love Kerbeck as you all influence the market with you volumes. How many posts do we see that Kerbeck, Stanford or McMillian is offering discounts? Makes it hard on the little guy. But then a lot of little guys are marking up the cars over MSRP.

How many on here complaining would pay over MSRP to support their local dealer??? Ya I did not think so........

Kerbeck has 100s of cars floorplanned sitting under the snow in NJ. And some little dealer who does not know what Z51 means thinks they deserve one of those cars???? LOL

Good post!


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