I’ve been thinking if there is any room for a fixed cost service model around used vehicle sales. The model would exist online where customers could work with dedicated advisors to purchase vehicles right from auction. The fixed cost would allow for benefits on both sides of the transaction. For example, unprecedented low-overhead for the service vs. traditional models and up-front fixed cost for the customer which doesn’t currently exist.
Here are some quick thoughts I’ve put together…
Fixed Cost Model:
- 4% commission + sales tax
- $500 regional transport fee anywhere in continental US. (for vehicles purchased outside the customers region.)
- No doc fees.
- Delivery (to private residence)
- Full Tank Gas
- Full detail prior to delivery
- Dedicated advisor that works with you to find vehicles, test drive, and purchase.
- No ridiculous dealer fees.
- Know exactly what your “out-the-door” price is once a vehicle is won at auction.
- Set a cap to what you’re willing to spend without being haggled over your budget.
- Save hours, days, and weeks shopping for vehicles.
Applying a fixed cost model allows for the avoidance of common profitability problems in used vehicle sales as outlined in this article:
1. Paid too much for the car.
2. Spend too much on reconditioning.
3. Give away too much at the sales desk.
I recently wrote an article about my recent experience with a similar model. You can read it here.