It's been said it takes 10,000 hours to master something; the automotive industry does its best to make you feel like you'll need at least that many hours to buy a new car. The shadiest trick in the car dealer arsenal is making your information hard to decipher and even harder to get. Your eyes glaze over as the very well-groomed salesperson goes on and on, extracting every last bit of information possible. What a hassle. Meanwhile, you're on autopilot since you've been at the car dealership so long. After (literally) hours at the dealership, the questions compound in your head.
- Did they mention your interest rate?
- Did you agree to monthly or biweekly terms?
- Does that include a warranty?
- What is the warranty for again?
- What are they offering for your trade?
- Your aunt said you could get a higher trade-in value at this other place. Is it worth four more hours in a new dealership?
Luckily, the internet has created a platform where new and innovative business models can force dealerships into a more competitive environment and offer consumers different ways to consider their purchases. There are a few types of online car buying services, each with unique incentives and many different ways they aim to aid the consumer. Check out how each of them works to make your next car-buying experience the best yet.
Option #1: The Marketplace
According to GreenProfit Solutions Inc., 95% of people ready to buy a car begin with a search with an online car buying service. 80% of those people are trying to decide what they want, and online marketplaces like Autotrader, Cargurus, Kijiji, and even Facebook Marketplace, offer aggregate platforms where you can search as specifically or broadly as you'd like, based on your priorities, find multiple sellers, and compare the vehicles side by side.
Kijiji and Facebook Marketplace both cater to private sellers, which can be a little trickier to navigate. Upfront, you may save, but we recommend buying certified pre-owned (CPO) vehicles which will have been inspected for possible issues prior to sale. Pro tip! Ask the seller for the vehicle's CARFAX before leaving with the vehicle. They might not be inclined to do so as it will be an extra cost, but this should be crucial anytime you consider purchasing privately. Make sure you're aware of any and all history of accidents. Kijiji also offers the option of searching exclusively for CPO vehicles. Or, here's a great idea, shop for your next vehicle at FFUN Cars, where you have the option of buying your vehicle online, in-store, or a combination of the two, and every car comes with a free CARFAX report.
Autotrader and Cargurus are fantastic places to start if you know what vehicle you're looking for and are curious about what a good price might look like. While Autotrader uses Kelly Blue Book to verify their market value, Cargurus uses an internal algorithm that will rate the pricing between 'great' and 'overpriced.' Both sites allow you to compare directly between new models and used vehicles, as well as help to lend transparency as to where the market is at. Using the intuitive car comparisons on either site, you'll see how different years, trim levels, and KMs affect the sticker price of a vehicle. You'll also see listings from both dealers and private sellers, side by side. Both sites also aim to help you understand what an auto loan might look like based on the information you can provide. Cargurus will even pre-qualify you with an offer you could take straight to the dealer. We're going to slide in (again) the option of purchasing your next used vehicle from FFUN Cars, where you can do all of that, including getting approved for a car loan in two minutes with zero (that's right, zero) impact on your credit score.
Marketplace sites will give you an idea of what's available in your area, will help to solidify what your price range should look like based on your priorities for your next vehicle, and will italicize what to look out for when looking for a well-priced vehicle. What sucks about marketplace sites is that you can't ultimately secure the deal or financing through them, which means there's still room for Shady McSheisterson to pull something shady at the dealership when you arrive. Maybe the "market fluctuated" so that the vehicle's price has gone up. Maybe they charge admin fees and air fees, and tire fees. Maybe the financing that Cargurus pre-qualified you for didn't take an actual look at your credit, and now the lender has issues and wants to jack up the rate or lengthen the term. At this point, it might all seem like a waste of time.
Option #2: The Middleman Negotiator
While marketplace business models aim to disrupt the way cars are sold, Canadian car services like Consumer Reports, Unhaggle, and My Hopscotch are on the move to revamp the way cars are bought. Unhaggle and Hopscotch offer to do the work of negotiating for you. 10,000 hours + experts who know that to truly understand 'market value' is to have an intimate understanding of the ins and outs of the automotive industry, and they've made it their business to do the heavy lifting for you.
'The market' is not meant to be easily understood in a snapshot; it's more like a snapshot of macroeconomics, and who really has time to dig into all of that? These professional negotiators will take a look first at what you want and what you believe you can afford, then they reverse the game by creating a competitive environment for dealers who will reverse bids to compete with each other for your business. This is a great way to force a dealer's hand into honouring the most accurate market value on the sticker price but can be a little tricky when push comes to shove. Let's say, out of ten dealerships, one comes in priced just slightly above your price range, but you go for it anyway. They evaluate your trade-in and run your credit only to come back with a monthly payment way higher than you expected. Tack on the fees and you're suddenly wrapped into a seven-year, overpriced auto loan for a new car that doesn't even fit the third car seat you didn't know you needed when you bought it.
While Unhaggle focuses specifically on new vehicles, consumers can expect to save an average of $3,241 using their negotiators. They also give you the opportunity to completely build your perfect car, knowing dealers can trade or order directly from the manufacturer to get you what you want. Unhaggle will even freely provide a breakdown of dealer MSRP which you could take straight to a dealership to negotiate yourself or pay $500 and have one of their very skilled negotiators handle it for you.
Option # 3: Online Automotive Retailers (like us!)
As far as online car buying services go, the new kids on the block are retailers that establish themselves entirely online. Retailers like Canada Drives, Clutch, and the best one, us, seek to offer you the pieces to the puzzle as you're comfortable giving the information. These companies specialize in used cars and set themselves apart by their ease of use and the convenience with which you can pull together all of your information. Best of all, each of these sites offers consumers tools to find their own information independently and allows you to apply them to the deal as you see fit. Free online trade evaluations make it easy to take the offer to another dealership to negotiate, but if negotiating isn't the name of your game, online retailers offer a non-negotiable value determined by the car's packages, trim level, accident history, and kms. Typically, you won't see a shift in the offer based on wanting to trade it vs. selling it, whereas a dealership may offer you a higher value to trade with them but may give you less of a deal on sticker price when actually applying your trade to your purchase.
An old adage with car buying was to keep your information close to the belt, get the dealer to agree to a sticker price, and then add in your trade and a financing package so the dealer couldn't adjust the sticker price on the other end. Online retailers have made this philosophy their cornerstone. Your credit rating is what it is, the value of your current vehicle is what it is, and the market value of the vehicle you want also is what it is. By offering you clarity on pricing across the board, in-house financing, which gives them the option to pursue a loan with multiple lenders, and the option to derive any of this information independently from the other puzzle pieces, online car retailers eliminate the feeling of secrecy and eliminate the need to negotiate. Another huge perk is the lack of good-looking salespeople trying to sell you on their life as much as on the car.
As much as our purchasing has moved to having the option online, especially in this strange post-pandemic era, it can be difficult to consider such a large purchase entirely online. To bolster confidence and encourage car buyers to give it a try, we offer a 30-day money-back guarantee. Not to mention, you can also enjoy a 24-hour test drive. Don't like it, no problem, we'll come to pick it up from you or you can return it yourself. These are just a few benefits of buying your next car from FFUN Cars.
Final Thoughts
Deciding it's time to purchase a vehicle is just the first step in what will amount to a long process of decision-making. Using online Canadian car buying services can empower you through the process by offering you glimpses into what is actually going on behind the scenes in the vehicle purchase. Use the tools offered on these sites to get a better understanding of 'True Market Value' and what that really means for your wallet when you're ready to buy.
We'll throw it out there one more time, shop FFUN Cars, where we have loads of well-known brands, such as Toyota, Nissan, Honda, Kia, Hyundai, and more. We have designed our entire process to make it convenient and transparent for you, whether this is your first time buying a car or your tenth. It doesn’t matter if you’re in the market for a sedan, SUV, or minivan, it's simple; browse our inventory, take vehicles on a 360° virtual tour, and complete the transaction. Yeah, yeah, there are a few other steps, but #trustus, we've made the car buying process pretty easy. Why? Because we're awesome.
