Are your salespeople and BDC reps being paid what they should be?

Car dealers are making more gross profit than ever and managers are taking home paychecks bigger than they have ever seen before. However, on the latest edition of Straight to the Point, host Frank J. Lopes asks, are your salespeople and BDC reps being paid what they ought to be? Does your pay match today?

In the automotive industry, car dealers are experiencing record profitability. However, Frank has been approached by many salespeople and BDC representatives who are wondering what about me? It appears that there are many car dealerships that, years ago, adjusted pay plans to include huge bonuses for volume, shared profits from F&I, qualifiers for CSI, and eliminated conditions on front-end gross. Lopes says that made all the sense in the world until mid-2021.

Related: Are you earning the sale or just benefiting from the law of supply?

Front-end grosses sky-rocketed while volume for most dealerships decreased. Now, we’re facing a new challenge where car dealers and managers who generally only earn from net profit are making more money than ever before. Salespeople and BDC representatives are attuned to this.

It’s time to re-introduce pay plans that add back in an element of commission on gross profit. The inventory challenges have affected every dealership in the country. If you have your pay plans set up on volume only, even star salespeople will not be able to hit the levels they need to and earn the money they were, pre-inventory challenges.

Then, there’s the BDC. Pay of volume of appointments set, appointments that show, and even a little from the vehicles sold. With marketing spend pulling back and leads decreasing, how do dealers expect the lowest-paid personnel to manage? These are the questions dealers need to take into consideration in 2022.

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