Let's Do Business
CREATE YOUR GAME PLAN
As a private-party used-car seller, you will have to handle phone inquiries, make appointments, wait around for no-shows, show the car to serious buyers and tire-kickers alike. You'll also have to negotiate prices and terms, and worry that the financial transaction will clear. Protecting your investment is also a concern. While most car buyers are honest people looking for personal transportation at a good price, there are also fast-talkers who can talk you down, work out a flimsy deal or take advantage of the situation. A game plan is the best method to protect your interests when selling your car.
Game plan — Your game plan should include:
- Asking price – The dollar amount resulting from your research
- Bottom price – The minimum cash you will accept
- Pricing research support – Print out price listings for similar vehicles.
- Information crib sheet – Print out your Magnatize ad and the technical specs for your car.
- Appointment log – Keep a list of phone numbers, dates, times and names.
- Hours of showing – Decide in advance how flexible you want to be.
- Buddy plan – Will you feel more secure if a friend helps you sell the car?
- Test drive plan – Will you and/or your buddy accompany the test drive?
- Mechanical inspection plan – Make repairs? Offer price adjustments? Neither?
- Financial transaction plan – Is there a lien holder?
- Document package – Repair records, warranties, booklets
TAKING PHONE CALLSreturn to top of page
Your crib sheet — Prepare a sheet with all the information on your car available at a glance. When people call they might ask: "Tell me about your car? How many miles? What's its maintenance record? Do you have the 289 or 350 engine? Any dents or scratches? Will you accept less than the asking price?" You need to be prepared for all of these types of questions. As a general rule, let them ask first before you volunteer information. After they've exhausted their questions, you can describe any special features that are part of your pitch, i.e. new tires, new brakes, Sirius/XM etc.
Fresh on the market, always — As a rule, create a sense of "urgency" that the car has just come on the market. Buyers respond to that "first-look" advantage with, "I'll be right over." Even if you've been trying to sell for weeks, make them feel like they've got an inside scoop on a great deal.
Problem car — Be honest if your car has a big dent, torn upholstery or some major problem. Everyone's time gets wasted if the car clearly doesn't meet the buyer's needs. Conversely, some buyers are looking for a less-than-perfect car that they can fix up.
MAKING APPOINTMENTSreturn to top of page
Be accommodating — Today's busy lives make it difficult to find time to show cars to prospective buyers. How accommodating should you be? Show it before breakfast, during work, at night? Remember, your "competition" is the dealer, and some big-city dealers are open until midnight to capture that impulse buyer. If someone wants to come right away, they're typically in immediate need of a car and will likely accept the asking price or close to it. If you put them off, they'll likely try somewhere else.
Don't get stood up — Buyers typically have numerous cars circled in the ads and endless scraps of paper with phone numbers and directions. There's a good chance for a no-show if you don't confirm the appointment. If the appointment is for 7:00 p.m., Thursday, arrange for them to call first before they come. Even if the they say, "I'm coming right over," check and double check their intentions, "I've got some other things planned that I can rearrange, are you really coming now?" Always set an exact time, "Let's make it for 2:00 p.m."
Create an appointment log — Always, always get the prospective buyer's phone number and name. If you have Caller ID, also note the incoming number and if it's different, ask the caller if he can be reached at the incoming number as well. There are three reasons why this is important: 1) If a schedule conflict comes up, you have a way to reschedule. 2) About fifteen minutes before the appointment, call to confirm so you don't get stood up. If no one answers, there's a good chance they buyer's on the way. 3) Keep your vigilance up. When you call 15 minutes before to confirm, does the answering message have a different voice or name? Does someone answer who's never heard of "John Doe." Does the Caller ID number lead to a different person? In any of these cases, you have a reason to increase your vigilance with the buyer.
SHOWING THE CAR return to top of page
So
now, you're a used car salesman — When
the buyer arrives, be direct, shake hands, look the buyer in eye,
greet the person by name. Some buyers are knowledgeable and confident
about cars, others are nervous and unsure. In either case, first
let the prospect look the car over while you stand back. They will
want to open the hood, crawl on the ground, start the engine. If
they have questions, they will certainly ask.
Buddy plan — What's your confidence level? If you feel shaky as a used car salesperson, consider inviting a friend, business associate or neighbor to help you. If you’re intimidated to show your car as a single person, engage in "car talk," negotiate the deal or handle legal formalities, by all means ask a good buddy to back you up.
What about test drives? — A test drive is a 100% must for any buyer. Everyone feels differently about handing keys to a total stranger. Most sellers are very trusting — to the point of being naive — when it comes to test drives. Ask to see a driver's license and insurance card and write down both numbers. Graciously explain, "My insurance agent requires it." Most insurance policies cover the car if you lend it to a friend or acquaintance to drive, but remember, if there's a test-drive accident, it could affect your rates. Check with your insurance agent to discuss your liability before you sell.
Come along for the ride — It's unlikely that the person is looking to steal your car, but again there is likelihood for an accident if the buyer is unfamiliar with the car and controls, doesn't know the neighborhood, or wants to push the car aggressively while testing it. If you graciously offer (or insist) on riding with the buyer for the test drive, you can answer any questions, give directions to a clear driving stretch, and oversee the use of your automobile. Don't be distracting with excessive chat; let the buyer focus on the car.
Test drive help? — If a young or inexperienced buyer needs help in conducting a meaningful test drive, let them make several stops and starts, at different rates of acceleration and turning at various speeds listening for tie rods, bearings and axles. The engine should sound smooth with no puffs of smoke. With an inexperienced driver you may consider driving to a big, empty parking lot before handing over the wheel.
MECHANICAL INSPECTIONSreturn to top of page
Pre-purchase inspection — Once the buyer is committed to purchasing the car, he or she may want to hire a mechanic to inspect the car. This inspection is almost always at their expense. Be flexible and accommodating because the buyer is motivated enough at this point to invest money in an inspection. Items checked typically include accident damage, alignment, brake system, cooling system, drive train & transmission, electrical system, emissions, engine compression, exhaust system, frame, wheel bearings, odometer, suspension and tires. The buyer and/or mechanic may also want to see service records, oil receipts and the factory service booklet.
Mobile inspectors — On-site used car inspection services are gaining in popularity throughout the country. The buyer schedules an appointment at the seller's convenience for the car to be seen by the mobile mechanic. The service comes directly to the car's location (home, office or lot) with complete diagnostic equipment. On-site inspections typically cost from $90 to $130 and are listed in the Yellow Pages under Automobile Diagnostic Service.
Pre-sell inspections — While not common, the seller also has a strong incentive to get a mechanical inspection before the sale. Having a certified inspection document in hand removes one more impediment from the sale, helps support a higher asking price, gives the buyer a money-saving perk, and most important, pre-alerts you to any mechanical problems before negotiations. This is important because the results of a buyer-purchased inspection will likely be used against you as a second-round negotiation tool to further lower the price of the vehicle.
NEGOTIATING return to top of page
Don't show your hand — Okay, let's do business. Always remember that the buyer will be studying you as much as the car. If you're anxious to sell or appear to need the money, the buyer will hit you with a take-it-or-leave-it price. If you're not comfortable playing your hand like a poker-player, by all means invite a business-savvy friend to help you in the negotiation.
Negotiating rounds — Buyers may try to work your price down in stages: The phone call — With the initial phone call, the buyer might feel you out, "Is your $7500 price firm? Will you take less? I'm looking at several Accords today at $6900." Even though you've padded your price, don't play your hand over the phone. If you do, you'll lose your padding before the in-person negotiations begin. Just say, "Come take a look and we'll talk price."
The visit — A hard-driving buyer will use the following tactics to move your price down: 1) Note every flaw in the car. 2) Convey the impression that he's got a long list of other cars to consider. 3) Compare with lower prices in the newspaper. 4) Feel out your urgency to sell or how long on the market. 5) Tell a hardship tale or have a fixed budget. 6) Ask for detailed proof of maintenance. 7) Arrive with a fault-finding companion to throw you off. 8) Wave a take-it-or-leave-it cash offer at you.
Your defense — You have only one defense against these tactics: your homework. If you've done your price research — in the price guides, car lots and through the Internet — know your negotiating margin and have your records, you should feel secure with your price. Don't be combative or defensive. Just present your supporting research from a business point of view. Suppose that price is $3500. If someone flashes $2000 cash in front of your face, take a breath, stick with your game plan and relax. Chances are, the buyer is a dealer looking to make quick cash. You always have the option of letting the car go at a low-ball price later if you can't get your asking price today. Ask for the buyer's phone number so you can get back to him later.
After the mechanical inspection — You and the buyer will have likely negotiated a final agreed price before the inspection. When the report comes back, the results may be used against you. Suppose the report reveals $500 in suggested repairs. The buyer might push for an additional $500 price reduction. If the car is fully driveable as-is, you shouldn't feel obligated to lower the price at all. Yet, you may choose to split the difference or, in fact, may have to get the problems fixed (or price lowered) to make the car sellable. Remember, if a buyer wants a mechanically perfect car, he should be buying new.