This is the first of a series of articles which the Automobile, Truck, Tire and Accessory Dealers of Omaha contemplate running in this pa
per for the purpose of informing the public regarding the Automobile business, that you may know why it is to your interest to purchase today
from the legitimate Automobile, Truck, Tire or Accessory dealers who maintain a place of business and who are in a position today, tomorrow, and
five years from now to render the service to which you are entitled upon the purchases which you make f rom them.
1 No. 1 1
COFYHIfiHT. I9I7,
RCaiSTER AND TRIBUNE CO.
ALL RIGHTS RESERVED.
volution of. tine Automobile Business
13
HE Automobile business is a giant of ten
years' growth. It occupies a position in Nebraska
second only to one the Railroads.
The business, however, has not been built
without the usual failures that follow the development of
any new industry.. The path of the automobile business has been strewn with
an even larger percentage of business failures than usually accompany the
pioneer work of a new trade development.
Pew of the business concerns who started
in the Automobile industry ten years ago in a retail way are
in existence today. Those few have learned by bitter experience that two
things are vital to a continuance in the industry. These two thingsare: .
Satisfactory service to the consumer or car
owner.
And a profit to the Company engaged in
the business. These two things must go hand in hand in
any business that is successfully conducted.
During' the early years of the Automobile
industry, the business was conducted on much the same lines
as the local Real Estate or Life Insurance business of a few years ago. It was
the last resort for the fellow who thought he had the ability to sell something.
The result was that the cost of doing business was not considered. And dur
ing those years when the demand Was very much greater than the supply of
Automobiles and when selling costs should have been lower than now, the
percentage of failures in the Automobile business was alarmingly large so
large, in fact, that few careful men cared to chance it.
With the passing of years, those who en
gaged in the business have profited by experience, bought
and dearly paid for, by those who engaged in the business during the earlier '
years. And today the majority of the concerns engaged in the business oper
ate on the same basis as those engaged in other lines of merchandising. They
know what it costs them to do business; they know what it costs them to pro
vide such service as is necessary to make good their guarantees, and they
know the kind of an organization they must have to render the service which
the Automobile owner is justly entitled to.
This change in business methods is a decided
advantage to the car owner. The come-by-day and go-by-
hight dealer is gradually disappearing. It is now a safe proposition for the
man who is interested in the purchase of a car to go to a responsible local deal
er and make his purchase. He has the assurance that the local dealer is con
ducting his business on a basis that is profitable to himself, thus insuring the
car owner a continuance of such service as the owner is entitled to during the
life of the car.
In the past, the purchaser of a car was more
than likely to find himself unable to secure repair parts, or,
perhaps, the advantage of expert knowledge in caring for his car six months
after the date of purchase. In many cases the man who sold him the car
would be out of business because he did not conduct his business in such a way.
as to make it possible for him to become- a permanent fixture in the com
munity. The man or woman who pays from $100 to
$5,000.00 for an Automobile, a Truck, a Tire or an Accessory,
is entitled to the advantage of purchasing "from a reputable concern which
may be depended upon to be in business and in a position to render service
six months, a year, or five years from the date of purchase as the case may re
quire. There is only one-way that this can be possible - sound business
methods.
The price of a piece of dress goods is never
questioned. It is assumed that the department store has
progressed along merchandising lines until it knows just what it must get for
an article in order to do business at a profit and continue to serve the com
munity. ,
The percentage of gross profits on Automo
biles is less than on dry goods.
A statement concerning a $2.00 piece of dress
goods appeared in one of the papers recently over the signa
ture of no less authority than Edward Mott Woolley, one of this country s
foremost writers on business economics, in which he stated that the 56c which
it costs to sell a $2.00 a yard piece of goods was made up of: 12c clerk hire,
5c rent, 6c advertising, 2c wrapping, 8c delivery, 23c general store and ad
ministration expense, making a total of 56c. The price of the goods, includ
ing the freight, was $1.37, leaving a net profit of 7c on the $2.00. a yard piece
of goods.
Considering the selling price of the goods as
100, the cost of the goods was the profit 3, and
the cost of doing business 28. ;
If the cost of doing business in the Aiito-
mobile trade were more than half that of the department
store mentioned above, it would not be possible for the dealer to maintain
his showroom, his guarantee service, or his organization for the purpose of
rendering service on the product he sells. Because it is customary for the
manufacturers of Automobiles, Trucks, Tires and Accessories, to establish
the retail selling price, allowing the dealer a stipulated commission. Out of
the dealer's commission he must absorb all costs of doing business before he
can claim a profit.
Thus it will be seen that even by reducing
the cost of doing business to the minimum, the' Automobile
man must do an enormous volume of business at a very narrow margin of
profit in order to equal the income that a man of his standing and, ability
could Obtain in any other line of business which might be open to him.
It is a common error for those engaged in
other mercantile persuits to envy the Automobile man,, be
cause his initial sales are large, forgetting that his percentage of profit is far
below the percentage of profit which accrues to the dealer in other lines, and
that his place of business, service and sales organization are among the most
expensive to maintain.
NEBRASKA BUICK AUTO CO.
. Buick and G.M.C.
JONES-OPPER CO. ,
- Reo and Dearborn
STANDARD MOTOR CAR CO.
Allen, Wescott and Indiana ' , .
OMAHA CHANDLER CO.
Chandler.
STUDEBAKER-WILSON, INC.
Studebaker. . .V
HAARMANN - LOCKE MOTOR
CO. Little Giant and Maibohn.
NASH SALES CO.
; Jeffry.
NOYES-KILLY MOTOR CO.
Saxon and King.
WESTERN MOTOR CAR CO.
Chalmers and Harroun.
C W. FRANCIS TRUCK CO.
Service and Stewart
DORRIS MOTOR CAR CO.
Dorris.
DE BROWN AUTO SALES CO.
Cole.
McINTYRE HAYWARD MOTOR
CO. Stearns-Xnight and Regal.
OMAHA TIRE REPAIR CO.
Goodrich and Diamond.
TOOZER-GERSPACHER MOTOR
CO Dort, Moon and Pathfinder
T. G, NORTHWALL CO.
National, Pullman and Hollier.
L..E. DOTY, INC.
Velie and Monroe.
MURPHY-O'BRIEN AUTO CO.
Dodge, Paige and locomobile.
MID-WEST MOTOR & SUPPLY
CO. Maxwell.
'WHEELER RUBBER CO.
Goodyear, Michelin.
CADILLAC COMPANY OF
OMAHA. Cadillac.
J. T. STEWART MOTOR CO.
Mitchell and Pierce-Arrow.
LININGER IMPLEMENT CO.
Grant and Commercial Truckmobile.
ORR MOTOR SALES CO.
Packard.
NEBRASKA GLIDE AUTO CO.
Glide.
HUPMOBILE CO. OF NEBRASKA
Hnpmobile.