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A Franchised Dealer's Guide to Buying a Used Car

By: Scott McBride - Updated: 25 Sep 2012 | comments*Discuss
Used Car Budget Franchised Dealer

If the budget won’t stretch to a brand new car, a used car bought from a franchised dealer may be the next best thing. Rab Alexander worked for a number of different franchised dealers and sold hundreds of used cars during a 22-year career in the industry, so he knows what customers should expect when buying a used car from a franchised dealer.

What Are the Advantages of Buying From a Franchised Dealer as Opposed to, Say, an Independent Used Car Dealer?
Answer: “In general terms, a franchised dealer will offer more comfortable surroundings, a better service and more reliable after-sales support. That’s because they’re linked to specific car manufacturers and are monitored and rewarded by these manufacturers. If a franchised dealer gives a poor level of service that will reflect badly on the manufacturer and so the dealer will be held accountable. That’s simply not the case with independent dealers.”

But Franchised Dealers Are More Expensive Than Their Independent Counterparts Are They Not?
Answer: “The cars do tend to be more expensive, yes, but there are reasons for that. Firstly, manufacturers will often run approved used car schemes through franchised dealers, so customers get the peace of mind of knowing that all the cars have undergone a pre-sales inspection and have had any faults fixed. Secondly, most if not all of the used cars on sale will be under three years old. Franchised dealers tend to keep only nearly new or low mileage cars on their forecourts and, of course, these cars command higher prices.”

How Much Room is There for Negotiation When Buying a Used Car From a Franchised Dealer?
Answer: “In truth, a franchised dealer is unlikely to do as much haggling as an independent dealer. This is due in part to the higher overheads and the fact that the used cars have undergone thorough checks, which costs money. Used cars sold by franchised dealers tend to come with a warranty too, so this is added to the price. Most franchised dealers will put a price on the car that they expect to get, but there can be room for negotiation in certain circumstances.”

If Franchised Dealers Only Sell Used Cars That Are Under Three Years Old, What Does a Customer do if he has an Older Car to Trade in?
Answer: “To be perfectly honest, the best policy is to sell the car privately. But those who can’t be bothered with the hassle will find that a lot of franchised dealers will take it off their hands. The problem is that the dealers will send the cars to auction, rather than sell them on their own forecourts, so the customer will only get an auction estimate of its worth as a trade-in value.”

Is it True That the Selection of Used Cars is Limited at Franchised Dealers Because of the Tie-ins with Manufacturers?
Answer: “Sometimes there is not always a wide choice, but this can work in a customer’s favour. For instance, if a customer knows he wants to buy a Ford, there is sure to be plenty to choose from at a franchised dealer that sells new and used Fords. Also, the big dealer groups can have access to hundreds of cars spread over different outlets, so if the local franchised dealer hasn’t got what a customer is after, he will probably be able to find it.”

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I found the information helpful in clarifying the differences between independents and franchises. However this statement, 'Most franchised dealers will put a price on the car that they expect to get', I felt was somewhat unhelpful and biased towards the dealerships. It has been my experience that a good sales team at a dealership is definately open to some hard negotiation on price particularly in hard economic times. If dealerships want to sell cars it's best to be honest. We all know that the price customers see on the forecourt is not really realistic and no salesman really thinks he's going to get that price. So come on 'used car advisor' you know that bit isn't true! My advice....haggle hard or walk away!
ladydriver - 25-Sep-12 @ 9:13 PM
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