OT: interesting perspective on what the manufacturer can do for you vs dealer

[roadsession]

This was posted on the BMW board - but applies to MBUSA vs dealers as well...

02-09-2004, 11:45 AM
PropellerHead
Join Date: Jan 2002
Posts: 1,703


I'll tell you what I think the big secret is: What BMWNA does is what KFC does. They license their logo, product, name and other advertising rights to franchisees. Like a KFC, your experience with the dealer will vary as will pricing on the items. Some dealers will sell a BMW program and some will not. They are allowed to set pricing (above or below MSRP) and policies according to what their individual market will bear. In the end, it's their dealership- not BMWNA's. When there is customer service conflict, BMWNA is not much more than an ombudsman.

I am not suggesting that BMWNA is powerless in their pursuit of customer satisfaction and dealer interaction, but you must consider the nature of the relationship between BMWNA and the dealer. The dealer is BMWNA's customer. You are BMWNA's customer. THEY pay tons of licensing, hundreds of autos a year and other fees associated with maintaining their 'authorized dealer' status. What is the average an individual owner pays over his lifetime to BMWNA? 3,000 cars a lifetime? Licensing? Advertising? Not likely.

Finally, it's not too different from any other car dealer or retail outlet. Unless the dealer is company owned, the management policies and decisions are made within the confines of that building and within the boundaries of the franchise agreement. Chik-fil-A, for instance does not allow it's franchises to be open on Sunday. If a dealer starts to do things that void the agreement, BMWNA can kill it's authorized status. In doing so, BMWNA stands to lose a lot of money and other more invisible costs. It is up to BMWNA to consider if all of the associated costs are worth pulling the franchise agreement.