Modern Day Car buying
Modern Day Car Buying
People buying cars today do it various different ways and we have all shifted down the digital timeline but even the most old school car purchaser will still visit the internet at the initial stages of the process, whether it be on their own or with the help of their friends and relatives.
The most basic concept of selling is buy low and sell high. With the emergence of car buying sites and more direct routes from supplier to consumer, the gap for a motor dealer from low to high has decreased significantly.
Take your average car buyer today, not even a millennial but your average middle-aged family man/woman looking for a run of the mill family car. First step, hit the net to see what’s available with a broad search, using the search parameters to get a general feel for what they like and what they may expect to pay. Next step, what is mine worth? Easy – general google search and up comes a host of websites offering to tell you what your car is worth and even better, they will offer to buy the vehicle in question with some basic information about it. This is where people differ, some will research it to the death using all of the websites to get the best price available and others use it as a guideline or ball park to which they can work around affordability.
If a customer isn’t getting what they feel their car is worth by way of a part exchange at a dealership, there are various options available to them such as www.webuyanycar.com or www.autotrader.co.uk who advise on trade price, part exchange price and retail price according to algorithms which are controlled by the millions of pieces of relevant data being processed daily. There is no need to drive from dealership to dealership offering your car as part exchange and knowing that they are your only option, there are plenty of options out there now.
The digital age allows us all to process and analyse lots of data and quickly and easily. It has cut out the middleman in so many industries as suppliers go directly to the consumer. That allows customers to sell their own part exchange through the likes of Facebook marketplace, gumtree, done deal etc for free and then for a minimal fee and the more serious buyers autotrader and usedcarsni are available via mobile phone apps. A smart phone can do the whole job from start to finish in minutes: set of photos, quick write up, post the ad and respond to the ads. This ability to do it yourself combined with cutting out the middle man obviously affects the market as part exchange prices are driven up at dealerships to match customer expectation whilst also driving down retail prices to narrow the gap from the private seller to the dealership prices.
Car supermarkets
The emergence of the car supermarkets is a sign of the times. The large supermarket groups with the buying power make it impossible for the typical corner shop to exist hence the closure of the local corner shops and newsagents. The same principles exist in the motor trade – buy in bulk with unrivalled buying power and low profit margins with high stock turnover. Just like a supermarket, prices are fixed with no negotiation although all sales will typically include an ‘admin fee’. The price you see advertised online at the car supermarket is the price you will pay plus the admin fee so long gone are the days when you had seen a car advertised at X and you thought in your head when I get there, I will be able to negotiate and buy it for Y. That homework has already been done for you by these car supermarkets and let’s be honest you have already done your homework online and arrived at this particular car, so you know it’s good value.
As you would expect there’s pros and cons to each method of buying and a drawback is that there are few salespeople at the supermarkets as most of the sales are order taking which in turn means no rapport building or point of contact should there be any issues with the vehicle after the sale. There is little loyalty on either side as it is a quick business transaction with little emotion involved.
The main concern when buying in the mainland UK instead of buying a used car in Belfast or a used car in Northern Ireland, would be if a major malfunction happened with the car. The law states that if you can prove that the car had the aforementioned issue when you collected the car, you are entitled to reject the car and return it within a 6-month period, but it must be proven the issue was there at the point of sale. All reputable dealerships will conduct their own safety checks before sale so if all is in order on the dealer’s part and a fault develops through nobody’s fault, the dealer has the right to have the car returned to rectify the issue. At this stage it is the buyer’s responsibility and cost to return it to the dealership where they bought it. Why should the dealership be punished or made to pay for the transportation return of the car when they could have sold the same car to the man who lived next door and have no expense to have the car returned. Remember you made the decision to buy the car 250 miles from where you live, and you actively enquired about the car and made the conscious decision to make the purchase so at that stage it is imperative to consider all possible outcomes.
Buying locally in Northern Ireland allows you to touch the car, drive the car and get a feel for both the car and the dealership. I suppose it is the decision of the customer on whether they want to buy a car solely on price or they want to incorporate the overall package such as car, service, facilities and loyalty. My dad also taught me, give your business to those who give you theirs regardless of the cost within reason, of course.
Competition
The competition comes in all shapes and forms for a retailer. I had previously explained how customers are able to drive a higher price for their part exchange but on the flip side the competition amongst dealers is high which will drive down retail prices. The speed of the market now is frightening with no signs of slowing down and cars are uploaded as quickly as they are sold. The evidence is there for all to see, every car for sale will be available online somewhere or other and the consumer has the choice in front of them, so most dealers want to be top of the pile either in price or value for money. As the competition to hit that top spot for each particular car increases, the prices start to drop to gain that top spot which can only be seen as a positive for the consumer. At the same time, the transparency is good for the dealer who knows where and what the competition is and hopefully the line ‘we can buy exactly the same one for £x cheaper 10 miles up the road ‘will cease to exist. The proof is in the pudding and its clear for ALL to see what is or is not available.
The emergence of the ‘side of the house dealer’ is now a factor to consider when buying a car. The downside of the internet as we are already aware is that someone can easily pretend to be someone they are not. The aforementioned selling websites now offer to design, build and maintain dealer websites from templates to keep the dealer advertising stock on their platform. A ‘trader’ or a part time seller can stock 4 cars at their house and have a fantastic website looking similar to a 50-car garage outfit because they are formed from the same website template. These practices come and go as they gradually realise selling cars isn’t as easy as they originally thought especially when they come across a major mechanical failure. With rules, regulations and the modern-day Facebook lawyer, it’s not as easy as throwing your advertising mobile over the hedge and starting again. The problems don’t just go away and an engine replacement at the cost of £2000+ can be the end of home traders who don’t budget correctly.
There is no correct way to buy a car as circumstances differ across the car buying spectrum however some points I would advise to consider are:
· Value for money
· Private sale v dealer sale
· Dealer Reputation
· Dealer facilities -own workshop for any aftersales issues
· Dealer online reviews
· Be confident in your research when viewing your short-listed cars
· Once you have done your homework, move quickly as well priced cars move quickly.
If you have any concerns when buying a used car in Belfast or Northern Ireland, please feel free to contact us and ask us any questions. There is no obligation, no fee, we don’t bite and we really are as easy going as we declare. We cant force anyone to buy a car and we let you decide in your own time so if it’s just advice or you want to browse, please call in and join us for a cuppa.