"Do I get any perks, or will I end up at a disadvantage when buying at an Auto Auction?"
Considering the pros and cons of buying at an auto auction will help new and seasoned Buyers make sound investments.
Knowing what to expect when deciding to buy at an auto auction can keep you from feeling apprehensive. With over 2,000 dealers registered at Big Valley Auto Auction, of course, we're biased about our services. However, Big Valley Auto Auction aims to provide information that benefits dealers at every step of their journey.
This article aims to provide an objective look at the pros and cons of buying at Big Valley Auto Auction. By the end of this article, you'll know the pros and cons to help you decide if buying at Big Valley Auto Auction will benefit your business.
Pros of buying at Big Valley Auto Auction, a "Dealer-Only Auto Auction"
Value:
According to John Burley in their book Money Secrets of the Rich, you can expect vehicles at an auto auction to be an average of 20% lower than MSRP. This allows you to mark up the vehicle at retail to make a profit.
For example, when you view an auction's inventory, you might find a vehicle 30% below MSRP and another that's only 10% below MSRP. Prices vary, so we recommend making a budget and flexible wishlist to plan your purchases before auction sale day.
Variety:
You'll quickly see that vehicle selection is abundant when attending an auto auction. The variety of makes and models can make satisfying your customers easier. If you need a fleet of similar cars, you can quickly fill your lot by visiting one or two auto auction houses.
Services provided:
As an independent dealer, you can find yourself buying and selling vehicles at a fluctuating rate. You can reduce the stress of preparing your vehicles for resale by using services offered by the auto auction.
Big Valley Auto Auction offers Title Services, Auto Transportation, Reconditioning, and Inspections so that you can avoid the headache of planning services at a 3rd party provider.
Cons of buying at a Big Valley Auto Auction a "Dealer-Only Auto Auction"
No Test Drives:
To protect dealers and vehicles, BVAA doesn’t permit Buyers to test drive vehicles outside the property. This is standard practice at auto auctions, but some auctions offer test tracks, so it won't hurt to check your options.
We know that putting yourself in the seat of a retail buyer can benefit the amount invested in a used vehicle, so BVAA offers vehicle previews. Previews allow Buyers to turn on the car, listen to the motor, and assess transmission engagement. During the preview, Buyers are permitted to drive the vehicles no more than 8 miles per hour within the BVAA lot.
Preview privileges may be revoked if dealers frequently exceed the speed limit or are found damaging vehicles.
When You Bid, You Must Buy:
If you’re new to auto auctions or plan on attending a different auto auction, you should pay attention to how the auctioneer reads your movements. For example, you may accidentally buy a car if you tip your hat, wink, or accidentally flash your bidder badge.
Cars move through the lanes quickly, so always pay attention to the auctioneer and ask questions if you need to. If you accidentally bid on a vehicle, you must address the bid immediately if the circumstance permits.
Auto Auction Fees:
Auto auction fees are unavoidable at any auction you attend. Some are required fees, while others are optional.
The Buy fee is the first required fee you'll encounter when finalizing your purchase. The vehicle's overall price determines the Buy fee. So, the higher the vehicle price, the higher the Buy fee.
Then there are optional inspection fees to ensure the vehicles you bought are solid investments. Exceptions to this rule are any vehicles that require out-of-town transportation. If you purchase a vehicle that requires out-of-town transportation, it will automatically receive the appropriate inspection.
A Post Sale Inspection is a basic mechanical, structural, and cosmetic inspection that follows the NAAA Arbitration Policy. The Post-Sale Inspection varies depending on the light color a vehicle is run under.
Green Light Inspections receive a full Post Sale Inspection and cost $115.00 per vehicle.
Yellow Light Inspections receive a Limited Drive-Train-Drive inspection and cost $115.00 per vehicle.
Red Light Inspections only receive a Frame check and cost $95.00 per vehicle.
Finally, BVAA has four situational fees. Situational fees occur depending on the policy parameters.
A flooring fee occurs when a Flooring Company is used to purchase vehicles. You will need to pay the $30.00 flooring fee.
A late fee is applied to the total vehicle cost when you don’t finalize your purchases by the end of the auction sale day. You will need to pay the $150.00 late fee.
Arbitration fees are applied when a buyer submits an arbitration, and it is deemed invalid. You will need to pay $95.00 mechanical arbitration fee.
An NSF fee is charged when you pay with a check and no funds are in your checking account. You will be charged a $150.00 NSF Fee.
Are you ready to buy at a Big Valley Auto Auction?
Now that you know the pros and cons of buying at BVAA, you can determine if buying inventory at BVAA will benefit your business. The research doesn't end here. If these pros and cons have sparked you to research further, subscribe to the BVAA Blog for more information about all things auto auction!
The BVAA Light System gives an insight into the condition of each vehicle and whether or not it is arbitrable.
"What should Buyers expect from an auto auction arbitration?" will prepare you to submit an arbitration form and what outcomes to expect.
For more information, please call us at (956)461-9000 or email us at registration@BigValleyaa.com
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