I constantly hear people say gross profits should be no more than the cost of the item, plus $1,000, $2,000, 10% etc.
They obviously never owned a business.
For example. If a person is paid $15 per hour, the employer direct cost with NO health insurance, 401K, profit sharing, etc - is at least $15.975 per hour - which includes the employer share of SS/Medicare.
Many RV sales people are either paid only commissions, others minimum wage as a base.
Running a business is expensive and 20-25% of the sales price going just to meet overhead is not unusual.
Dealerships pay the federal corporate taxes of 21%, most pay state corporate income taxes also. A dealership in Florida for example pays 5.3% on all profits. A dealership in Oregon pays 6.6% on the first million of profits, 7.6% on all profits above that.
Some might say corporate income taxes should not be counted as overhead.
Folks need to remember one very important thing -a business that does not make a after-tax profit for the owner/investors - goes out of business very soon.
Frankly, I would expect an RV to sell for no less than 150% of the dealer costs.
