The Tulsa Forum by TulsaNow

After talking to several friends and family over the last few months, I'm thinking of starting to offer a new service and I was curious if it was something people would use. Please chime in and let me know if you think it's a good idea or not.
As background, I'm a licensed attorney and CPA. I've also bought many cars (as well as other things). W/o trying to toot my own horn, I've worked for a big law firm as well as as several corporations as an attorney. What I'm trying to say is that I know how to haggle.

Anyway, I know a lot of people are intimidated by the car buying process. The service I propose is "buying" your car for you. Basically, I would be your broker. You would come to me with the kind of car (model, color, year) already decided. You would tell me what you want and I would go about obtaining it for you for the best price possible. This means I would handle the haggling and dealing with the dealership (or 3rd party) -- basically the part most people tell me they dislike the most about buying a car. Based on my experience, I have ways of determining what the dealer paid for a vehicle, thereby allowing me to know what his "best price" really is and making sure I obtain this for you.

If you had a trade-in or a car you wanted to sell, I could handle this as well and make sure you obtain the best value for this asset as well.

As a CPA, I also know quite a bit about finance and credit. If your credit score isn’t what it needs to be I can advise you about the best ways to improve it. I can also help you obtain the best possible financing rate for you. Furthermore, we’re all aware of the tactic dealerships use of selling you a car based on the payment instead of the price of the vehicle itself. I can understand how this can become confusing, especially when you’re in the salesman’s office and they’re pressuring you and throwing a lot of numbers at you.

The price I envision for this service would be $499. This is all included unless I sell your car to a third party (thereby incurring extra time and expense on my part). In that case, I would charge you a % of the amount I sell your car for (thereby incentivizing me to sell your car at the best price). The $499 would be from start to stop all included.
Please let me know what you think.

Nothing. Don't need it.

Thats just what a car deal needs is another shyster in the mix....!!!!!!!!!!!!!!!

The next car I would like to buy costs around $40K. Your price seems fair to me for that sale.

But if I were buying a car that would sell for half that price, I would say your deal would be too much.

You've never met me. Why would you call me a shyster??

 I won't call you a shyster, but the only way I would have a third party involved in a car transaction is if I was looking to buy a highend car at an auction (By high end I mean collectible or classic car) so that I would not get caught up in the emotion of the auction. I have been able to broker my own deals for $1000 to $3000 off of the price on buying a car, and have not lost my shirt on selling a car. Also when buying, I have had my financing in place before the purchase with a couple of exceptions when I had the cash in the bank before hand. And alot of these purchases came before the internet, and I used NADA books, Hemmings Motor News, and multiple other sources to evaluate my purchase or sale of cars. I just don't feel that I need to pay a third party ~$499 to handle the transaction for me.

Also the "You never met me" sounds like an arrogant statement that an ambulance chasing attorney might use.

Actually, I would rather spend the price of a one month subscription to CarFax or similar type service to check the vehicle history than to pay someone to negotiate for me. You can negotiate all you want, but if you buy a salvage car with a washed title, you're hosed. Also if I were in the market for a car, I would buy one used instead of new (after a check on the car) so I would not take a hit on depreciation. Most cars can lose $3k to $8k or more in the first two years.

Before I'd pay much attention to posters on here i would pay for a real survey of potential users that was more demographically balanced. We have a lot of...uh... strong egos around here.

There are people in the industry who are ad hoc consultants for wealthy folks who don't have enough time for the process but don't want to get hosed. Its usually a brother-in-law, an employee or a good friend who has experience. Your obstacle, imo, is convincing folks that you actually save them time or money. When it comes to cars, no one really thinks they got a bad deal!

I think the only way I would use the service is if I was of a lot better financial means then I am.  It would be something for those who have the desire to own multiple vehicles, the finances to do so, but not the time to invest.  It is a service that would seem to be more restricted to the upper class (not too many volume car collectors around here though) and businesses who have, or are building, a fleet.

your business idea is sound but you are in the wrong market area for it.  Okies have no concept of auto brokers or concierges.  Brokers are a big deal in Europe since cars there are expensive even for basic ones. Plus they have an appreciation of getting a car that matches their lifestyle and personality, not just "what is a good deal on paper and $$" ...while in this country people will spend weeks looking for the perfect pair of shoes and then go buy a Kia.  Brokerages are more viable up in the northeast and west coast where people have an appreciation of hiring a specialist to get a car for them since owning a car there is more expensive.  The rest of the country would rather just mail it in and buy whatever crap a dealer has to sell.

I offer this service for free to close friends and family since it can be no more than a hobby for me around here.  Most I ever get out of it is a free lunch and a thank you.  I don't think you can expect much more around here.

So what your saying is that the average american is not able to research for themselves and locate a vehicle that suits them on their own?

The average American isn't very good at haggling, given that it's generally not how retail business is done here. (although it can be done even at most chain retail stores, in my experience) The Internet has made this much easier, of course, since there's somebody at most dealers who provides quotes over email, so you can play dealers against each other very easily now, and do it outside of a high pressure situation.

I asked a guy I know who owns several dealerships about this a couple of years back and he indicated that he doesn't really care if people haggle his sales managers down to invoice, as there are so many other places profit (holdback is the biggie) is built in to the deal that as long as he's selling cars, it doesn't much matter what they go for. He went on to say that the long term customers he has who pop in every 2-3 years and pay MSRP get treated much better when it comes time for service. Free oil changes, discounts on out of warranty repairs and scheduled maintenance, that sort of thing. Needless to say, the hagglers don't get special treatment after the sale.

Haggling is one thing, and I think it is becoming a lost art, but what inteller seems to be getting at is that most people are ignorant and incapable of actually making a good decision for themselves, and thus need someone to take care of them. 

uh yeah pretty much, just look at the state of this country.

another point for the broker, if he gets a good rapport with a dealer then those same benefits will begin to extend to the customers who use his services.  that sort of thing has to be built up over time though.

I have to agree with the Inteller here. Most folks don't have a clue about buying cars. They don't want to do the research and are very uncomfortable negotiating. Dealers depend on that and will bully you if they sense weakness. I once made an offer for a Trooper that I thought was fair. The manager, Jim Furman, was called in and sniped at me, "You think you know what cars are worth?" I responded, "no, I know what this car is worth to me".

and your just so much better than everyone else, right?

if you say so.

I know I am. :D

that's why a lot of people come to me, they are absolutely terrified of walking into a dealer and facing a salesman.  the only thing that terrifies me is how little these salesmen actually know yet still have a job.

O/T:  Do you know what is going in on the NE corner of 101st & Memorial (in front of Target)?

no nor do I care.  But you can be assured we already have 3 or 4 of whatever it will be.

Of course long term customers who come in every 2-3 years and lay down and pay "MSRP" are going to get preferential treatment.(Why kill off a cash cow?) Free oil changes and routine maintenance is cheap. But discounted repairs outside of warranty, the dealer has to absorb that cost somewhere, and it is usually passed on to the average person that did not pay MSRP, wether it is service, parts, or the price they pay for a car. Also people who buy every 2-3 years usually don't care about maintenance because they know they are going to get it for free, and as for warranty repairs, they don't own the vehicle long enough to have problems or exceed the mfg warranty. These are the people that should lease cars and not buy them. That way in 2-3 years they're done using it and return it for a new one. That way they maintain a constant monthly payment, don't worry about service because it may be included, and are done with it before the warranty expires.

One problem "we" have with negotiating is being prepared to walk if we don't get the deal we want.  We just "gotta have that car" and the dealers know it.

I guess that at 47 years old, no matter how much I may want the car, I'm willing to walk away from that situation and look for the car elsewhere. Even if I was buying a new car, I'm not affraid to walk. If I spend more than an hour and a half negotiating new or used, and this includes a test drive, I walk.

hence the advantage of putting someone in the middle who is emotionally removed from the buying decision.

The first car that I ever bought was in 1982 from Donges Brothers Ford from their used car lot. It was a 1976 Triumph TR7 that they wanted $3800.00 for. I did my research, and went to my Credit Union at the time which was McDonnell/Douglas and had the car appraised. It was appraised at $3200. I offered $3000.00 and they took the offer. When I found the car, I wanted to make sure that I got it. I gave the salesman a $50.00 deposit on the car. When I went with the check to get the car, I got the salesman to give me back the $50.00 deposit to hold the car. I was 19 at the time, and I knew of the art of negotiation, and knew how to close the deal.

Then it just becomes a matter of how much the middle man charges, which is the topic of this thread.

I guess my contention on this is if you are willing to pay a middle man a fee to help you buy a car, (and this is the cynical person coming out) has the middle man worked a deal with the dealership so that they get paid on the front side and the backside of the deal? If you use a service like this, you need to have a contractual agreement, and you would need an attorney to look at the contract so that there would be no conflict of interest in the deal.

Just saying in my cynical point of view to cover my own donkey.

I believe I can get within a few hundred $ of the price a middleman could get.  If I am buying something costing $30K to $40K, I don't really worry too much about $100.

I'm not afraid to negotiate, nor is it difficult to figure what "invoice" is on a vehicle so I'm not a good potential customer for you, but I'm happy to offer some suggestions.

I've got a background in the industry.  I think your consulting fee is high, perhaps you should think about a different business model of working with a certain number of dealerships and make 1/2 your fee on the front from the customer and 1/2 on the back from the dealer.  You are bringing them a customer, after all.  Perhaps you could structure it as a percent of the amount you save the customer off list to the sales price.

One mistake buyers do make is pissing off the dealer by making a ridiculous offer below invoice and trying to make the dealer think they can refer x amount of relatives and friends.  Congratulations, you are the 20th person who tried that today.  Car dealerships are a lot like casinos, the house always wins.  It's not so much making a low ball over as it is being a completely obnoxious prick when doing it.

The actual negotiation for the purchase price isn't all that difficult.  It's when you get into the disposition of your old car it gets hinky, especially if you are looking to trade it. 

My own specialty was F&I or the "business office".  It never failed, someone would come into my office gloating about beating the house down to nothing on their deal.  It was up to me to make it back.  "Sorry Mr. Dingle, you have a few dings on your credit, your rate is going to be three points higher."  Doc fees, buy down points, extended warranties, credit life & health, gap insurance, etc.  An hour later, the house had just made a gross profit of $4000 on a "nothing" deal.

You might consider using the model "buyers agents" use in the real estate industry. A real estate agent really only represents the seller. Buyers agents do not. I fear that if you are doing both sides you're more or less a bookie balancing the books and may lose credibility.

With the ease of access to all pertinent information on the internet, the service is available at your fingertips.

Everything can be done over email, no face to face at all.  Hell, the vehicle can be delivered right to your door and you never have to say a word to a sales person.

I've done it locally and over state lines.

Which would be fine if everyone who buys a car is also computer and internet savvy, online purchasing was beyond reproach in credibility and you do your test driving locally. That is a smaller subset of the population than you might think.

I think there is a niche there, just not sure how big and worthwhile it is.

I know with Honda as a example dealers in Oklahoma cannot sell a car to a "Broker" or they lose cashback and/or holdback on the car.  I work as a salesmanager at Joe Marina Honda and we have Brokers call us often but we have to decline to stay with Honda rules.