For Car Sales People! What Is A Draw & How Does It Work

Question

I got offered a job as a car salesman and when I asked about the base pay they told me that they give you a draw and when you sell a car they take a lil portion of that money. Does anybody know about this?

Answer 1

A draw is a cash advance (loan) from the dealer principal so that you won't starve before you sell your first car.  Most dealers don't offer base pay. Your supposed to generate enough sales so that you can live on your commissions.

They then assume that you will do all kinds of free work for them and not expect compensation for it.

Answer 2

A draw is basically money they pay you so you get something in your check each week, but you have to pay that money back with your commisions. When i started i had a draw it was like this. I got a minimum of $300 a week, $1,200 per month no matter what, but I wouldnt get to keep my commisions until my total commision for the month was more than $1,200, then i got to keep whatever was over $1,200. Basically its a good way for the dealership to get cheap labour from somebody, if you fall behind they will just fire you. If you do well you will probably get a raise. Or you can do what i did and move up the ladder and force them to pay you salary.  

Answer 3

That draw is strictly a loan against your future commissions. No taxes,no insurance,no uniform or key deposits should be taken out of it. You will be paying it back on a future commission checks.

Be sure to keep a record of your time, your ups(people that you talk to)any deals or split deals.