For many folks, the purchase of an RV or motor home is one of the biggest purchases they will make in their lifetime, with only their home purchase exceeding it.
Naturally, everyone wants the ‘bottom line price’ on any major investment, including a new travel trailer or fifth wheel. The RV industry has capitalized on this desire with many dealers claiming to be a “wholesale RV dealer”. Is there really such a thing? Let’s see…
The word Wholesale means to sell in large quantity or bulk, with the premise being that the ‘savings’ gained by the seller or dealer in this case – having negotiated a better deal with the manufacturer – are passed on to the buyer.
The reality is this in the RV industry, there are large dealers that either carry a large inventory, or they manage their business in such a way that they extend their market reach across the US, Canada, and European markets – enabling them to ‘move’ more product for the manufacturer. As a large RV dealer, they will often buy 10-20 of the same travel trailer or 5th wheel camper from the manufacture, getting maybe up to a $500 per unit discount for the large buy.
As a dealer, you choose to operate on a small volume, larger mark-up per unit or you can try and sell more units with less overall margin per camper. Dealers can also choose to represent multiple manufacturers, or only sell RV’s from a single manufacturer. Those that choose to partner with only one manufacturer obviously have a tighter relationship with that manufacturer – again, hopefully resulting in a savings for them.
While most RV manufacturers claim to ‘prefer’ that their customers buy their RV with their local dealer – there are no regions defined for the dealers. The popularity of the internet has dramatically changed everything. Sites such as Google, eBay Motors, Craig’s list, AmericaOnWheels, iList and others enable a dealer to sell their RV’s on a global scale literally.
What does this mean to the RV Customer?
For you, it means that by doing your research you can save thousands on your next RV, travel trailer or 5th Wheel camper.
The myth is there is no ‘wholesale RV’ dealer in the true sense of the word – that is just marketing gibberish to try and convince folks that they can get their RV’s to the public at wholesale. The truth is that each dealer pays the manufacturer roughly the same price for the campers they sell – again, if they make a large buy on 1 model, sometimes they can get a $200-$500 per unit discount.
Every dealer has the opportunity to sell you a camper at roughly the same price as any other dealer – it all comes down to their overhead in operating their dealership, the profit margin that they as a dealer desire to make, and the business model they have in place (high volume/low margin vs. low volume/higher margin). It is true that dealers that turn a lot of campers can sometimes work with the manufacturer to get a 'rebate' on a unit they just can't sell. Often, the manufacturer will give the dealer monies to move the unit that has been on their lot for an extended time period in exchange for the dealer ordering more, different models after the sell.
Why doesn't every dealer go the high volume / low margin route?
That is a decision the dealer needs to make. To sell 700-1000 RV’s a year at a lower margin requires a lot of dealer prep work, administrative paperwork, and additional overhead ‘headaches’ for the dealer. But, not necessarily, additional personnel overhead. An efficient dealer can sell 800 campers a year with the same staff as they did when they sold 100 campers.
The problem many dealers face today is that for 50 years they sold campers the same way – advertise locally, depend on word of mouth, and repeat business. They based their service, sales and dealership model on this approach. Again, with the internet and current economy – the playing field has changed. Some dealers are adapting, others are refusing to and they will find it difficult to survive. There is nothing wrong with a small, local dealer, operating in this manner, especially if they have a good loyal customer base, solid local reputation and service record.
What about local service?
One of the questions we get often is ‘if I buy my camper from you, will I get service in my local market?’ It is a fair question and the answer is yes, the local dealer will only hurt themselves if they turn you away. Most dealers receive between $90-$120 / hr for service / warranty work they perform. A smart dealer would not walk away from the income and alienate a customer that might buy a camper or camper accessories from them in the future.That and local word of mouth goes a long way - a dealer that makes an enemy locally can count on them telling others.
So, for your next RV purchase, do your homework. Contact your local dealer, give them the opportunity to earn your business, then see how good a deal you received by going on-line.
What to Search for?
When you go on Google – start by searching for the specific RV model that you are interested in. It is always better to start specific when you go online. For example, “Sierra 375QBQ” – then check the price – be sure to take into account the options included with the price. Often ‘wholesale’ RV dealerships will promote a price online that is low, but does not include very many options… Again, do your homework it will save you money.
We hopes this helps. Feel free to ask any questions that you may have – we will be glad to get you an answer.
