Why a car salesman wants to know your name? Welcome to part one of the video series, How Will Car Salesman Get's Paid. Hello, it's Elizabeth from the Homeworkite team. What's in a name? A customer's name for a car salesman. In short, everything. It's actually the same for any type of salesperson for that matter. Furniture, insurance, real estate, financial planning. Let me set the scene for you. You just pulled up at the car dealership. You want to find a couple used SUVs to drive. So you find your way over to the used car section. It's hot outside and your AC is broken, which is one of the reasons you need a new car. But you see a salesman see you quickly roll up your windows. Now you're sweating because it's hot. And the salesmen are all eyeing your car and moving in closer. Yikes! It's like being a lone zebra on the savannah and suddenly the lion spotted you. How in the world can you test drive the SUVs without opening your window and getting out and speaking to one of these car lot creeps? Well? You can't. The car salesman who gets to you first has just upped you. Now he has to get your name. Do you give it to him? And preferably your phone number. Do you give that to him too? Heck in this car market, most car dealers claim you can't test drive a vehicle without giving them a driver's license first. We're even filling out a credit application. Now they not only have your name, but your address, data, birth, and everything else. It seems innocent enough, but it isn't. So why is getting your name and contact info so important to a car salesman? The moment the salesman knows your name and he says, so go get you some keys, he doesn't go straight to the key rack. His first stop is the copy machine. Take an unauthorized copy of your driver's license in case it feels like pulling your credit unauthorized while you're driving. Then he heads to the computer to check the customer database. If your name isn't clearly in the system already, he takes two minutes and punches it in and claims you as his customer forever. Now you are locked in his account and no matter what, if you buy a car from that dealership, he will make money off of you. Even if you can't stand the guy and you ask to work with someone else. If you happen to already be in the system under someone else's name, he drops you like your heart because for him, it's a waste of time and money to help you. Sorry. Okay, so let's say you drive those two SUVs but you want to do your homework so you leave and come back tomorrow and he's not there. Poo! You get to work with someone else, but they're not all that helpful. Here's why. The second salesman has to split the deal 50-50 with the first car salesman. Even though the first guy worked with you for about 30 minutes and the second guy has to spend six hours getting you through the paperwork and the negotiation song and dance, then wait for a finance to finish chewing you up and spitting you out and then he hands you the keys to your car and says goodbye. Harley seems fair, right? But since when is fairness the model of car dealers? That's the first step in how a car salesman gets paid, claiming a customer as their own by getting them entered into that database software as quickly as possible or just dropping them if they already appear under someone else's name. Here's how it sounds in the car salesman's perspective and it might be a slight exaggeration. Imagine that one day's civilization collapses and all the grocery stores close and you suddenly realize that if you want to eat something you've got to go out and hunt it down yourself otherwise you'll starve. That's what commission sales are like. You pull into the car lot and get out to look at a couple cars and the salesman doesn't greet you. He might have missed his only chance at a paycheck for those eight to ten hours he's sitting on the car lot today. Do you think a lion who hasn't eaten in days looks up in spots and analogue grazing in the grass a few hundred yards away and says to himself, now I'll let that guy go all to skip the next one. A hungry lion doesn't care if the analogue is just looking. He's going to run it down and try to eat it. It's a matter of survival. And that's what kind of motivates the salesman, extreme hunger. So getting your name and getting it into the database system is the very key to making money for him. Yes, there are different types of pay plans but it all comes back to whose customer is it. When car salesman work on a commission only pay plan, the hard and fast rule is if you don't sell you don't get paid. The week eventually fall to the side as the alpha is celebrate their dominance. When a salesman is on a commission only pay plan their check can fluctuate week by week or month by month depending on several things including their attitude, weather, economy, time of year, marketing efforts by the dealership and whether the car lot actually has any cars to sell. By not having a fixed salary, a salesman's income potential is endless. And so is the possibility of getting a zero dollar paycheck. Some dealers let their salesman have a draw check which comes to about one thousand or even two thousand dollars a month based on a forty hour work week of minimum wage. But that is only in advance on the money they expect him to earn in sales that month and he'll get paid on that around the 10th or 15th of the following month. A total commission bonuses and spiff money is calculated and the draw amount is deducted from that amount. And taxes and deductions are then subtracted from the balance. So the car salesman only earns a total of twenty eight hundred dollars for the month and the draw was fifteen hundred. The salesman's settle up commission check before taxes would be thirteen hundred. If the car salesman earns under the draw amount in total commissions, they will not receive a commission check. And this will put the car salesman in the hole with the dealership. It's like gambling with your work. And that can be scary for a new salesman or a salesman who constantly gets blown off by customers. So you can see why many salesmen don't make it just based on the uncertainty of income. We'll pick up what we left off with part two of this series how a car salesman gets paid and talk actual paid plan numbers. It's coming soon. Be sure to subscribe and hit the notification bell and you'll receive a reminder right on your phone when it's hot out of the oven. The entire homework team is here to represent you the car buyer and that's what we love to do. Thanks everyone for coming back. We'll see you in our next video. As Kevin always says, you guys rock. I'm the amazing Elizabeth. Gotta go.