Washington Subaru Dealer Takes Haggling Out of Car Buying With Bottom Line Pricing
- Subaru dealer Mike Scarff introduced bottom-line pricing in 2006.
- The dealer employs a non-commissioned sales staff.
- Subaru of America named Mike Scarff its number one dealer in the Puget Sound area for customer satisfaction five years in a row.
AUBURN, Washington — With several Subaru dealers in the Seattle area, Mike Scarff Subaru of Auburn knew he had to do something unique to differentiate his store. Looking to offer a new purchase experience for his customers, he introduced Bottom Line Pricing.
Bottom Line Pricing is a style of selling, according to Scarff, which takes the adversarial aspects out of a car deal.
The premise is simple: Offer consumers the lowest possible sales price, or "bottom-line," price on his vehicles, up front and early in the buying process.
The intention was to eliminate the negotiation, a part of car buying that many shoppers find stressful. It also ensures that everybody gets the same low price.
Scarff says, "If the factory came to me and said, 'You can't sell cars this way,' I'd just stop selling cars altogether."
All vehicles in the Scarff inventory have a large "Bottom Line Price" tag hanging from the rearview mirror. This offer applies not only to new cars, but to pre-owned and certified pre-owned vehicles, as well.
Sales Manager Ed Mulnick says the price tags "are on each and every vehicle in stock, prominently displayed, and easy to read. Our customers like this, even the guests that prefer to come browse our inventory after we are closed. They can still see our low pricing."
According to Mulnick, the pricing posted on the vehicles is the same low price shoppers will find on the Mike Scarff Subaru of Auburn Web site.
The sales department receives a set salary — compensation is not commission-based. Salespeople also earn an additional fixed amount per car sold. Because the sales team's pay isn't determined by the amount of profit in the deal, the salesperson can focus solely on helping the buyer find the right vehicle, and not on earning a larger commission.
Scarff said the benefits of implementing Bottom Line Pricing came quickly. The store nearly doubled its market share after implementing the sales strategy. In addition to the uptick in sales, the level of stress was reduced for both the buyer and the dealership's employees. With less stress on the employees, staff turnover was reduced. Scarff has been able to retain a long-term, experienced sales team. Scarff says this is one of the reasons his dealership was rated the number one dealer in customer satisfaction in his area by Subaru of America, five years running.
Scarff has been in the car business since 1983, and is a firm believer in the long-term benefits of his Bottom Line Pricing model. He says it not only contributes to more (and stress-free) sales, but fosters an environment where his employees and customers feel at ease. This promotes an overall better experience for both the consumer and the employee.
Edmunds says: Dealers nationwide are finding ways to make the process easier for consumers to get what they want.