When it comes down to business, we’re serious. Our whole thing is do what you say you’re going to do when you say you’re going to do it. Set expectations.
Car dealers are terrible about changing the deal when you get there. Everybody is terrible about it—mortgage people, everybody! You know, you make a deal with someone, you get there, and they go, “Oh, by the way, here’s another fee,” or “Here’s a different term.” And we just don’t do it.
If the customer lies to us about the condition, then we do it, we say, “Hey, you didn’t tell us it was, you know…the right front fender was wrecked. And the pictures you sent us magically didn’t show that either, so it’s a $1000 difference.” But that’s, like, half of 1% of the time. The rest of the time, we buy the cars and if there’s something little that they forgot to describe, we just give them what we said we’re going to give them. Because that word-of-mouth thing is just so real and it takes so long to build that brand. So that’s how all that works.
I actually just came from the auction, here. Wednesday is our sale day in Dallas. We have cars all over the United States and we sell them digitally in an auction block.
Q: Tell me what you’re seeing on the frontline, because I’ve heard that there’s a scarcity of used cars these days. What are you seeing?
A: We’re paying more for cars. Take Jeep Grand Cherokees, 2020s. They were bringing $23,000 last March. They got up to $32,000. And now they’re back down to about $27,000. Yeah, it definitely, I’ve never seen a surge, a tide rise in the value of used cars like I’ve seen in the past, since May.
Q: Explain that to me. It’s a supply and demand?
A: New cars, the factories—when they shut the UAW down with Corona, they quit making new cars for three months and it disrupted the supply chain to the point that the used cars started bringing…which, if we sold two-year-old Toyota’s for sticker..probably in June, at the height of it, that’s how short July…July was the height of it. When these dealerships got that low in inventory of new cars, it was amazing. So we were able to offer the customers crazy customers crazy prices also. So, it really was a good time to, you know, make a big splash and bump up our brand.
Q: And, in terms of people doing business with you versus a used car dealer…
A: We’re just exactly what we say we are. You go to the website, make a deal at $34,000, we send the e-doc for $34,000, click, click, bang, bang, get the payoff information or the title, show up at their house with a check, and without a story, without any change order.
I don’t know if you’ve every built stuff…change orders, contractors, they’re the worst. They’re the worst.
Q: You’re in an industry where people are just crying out for transparency.
A: It drives me crazy, Sonic, I mean, the fast-food places won’t let you through without bumping you around. That is everybody’s business model. Bring them in on bait and switch and then bait them and switch them into a profit. And that just won’t do it. And I really think that that’s the secret to, you know, that’s really, after years and years….
What I do is treat these customers, individuals, like I’ve always treated our dealer customers. Because I’ve been a wholesaler for 25 years. So, when you’re bidding cars, your trade-in at the BMW store, they call me, and I say, I’ll give 25 grand. And if you yank them around, you don’t get the call next time. So, I just take that philosophy with the customers and treat them like we do the dealers, because that one car is a deal, but there’s the friend and the aunt and the brother and then, three years later, the next car.
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