The Buy Here Pay Here & Lease Here Pay Here Business and BHPH & LHPH Dealership Management Software

The following is a list of terms and formulas that are used in the basic math calculations performed every day in the operation of a BHPH dealership.  Many of these terms have extensive legal and accounting implications. These definitions are not meant to give you the complete legal definitions or interpretations. The purpose of this list is to illustrate a common language that used in this setting. Some are very basic while other are more complex.

In previous articles I have discussed the dilemma dealers face regarding Cash In Deal with the current high state of wholesale vehicle prices and additional potential sources for BHPH inventory. This month I’d like to take a look at inventory pricing.

Would you like to make more money? If you answered no to that question, you can stop reading. If your answer was yes, you should consider entering the Buy Here – Pay Here business.

Retail Cars You Currently Wholesale

Buy Here – Pay Here offers you the ability to retail vehicles that you currently wholesale and make more profit. Taking trade-ins that don’t meet the standards for your retail sales operation to the auction can be a gamble. Selling prices at the auction rise and fall with the season, market conditions, demand and various other factors. With a Buy Here – Pay Here operation, you are able to set the selling price and make profit margins that are consistently higher than those at most retail only dealerships.

I just got off the telephone with a dealer who was complaining he hadn’t been able to buy a single unit at the auction today. He claimed every car he wanted went for over $3500 and, with a cash in deal policy of $2500, average reconditioning expenses of just about $700 and average customer down of just under $800, he just couldn’t make $3500 cost vehicles fit his business model. Although the numbers may have been a little different in each case, he is certainly not the first dealer I have had that discussion with.