Register now to get rid of these ads!

Hot Rods Consignment Dealer Business Practices

Discussion in 'The Hokey Ass Message Board' started by lothiandon1940, Jan 3, 2020.

  1. A friend of mine just made phone contact with a consignment dealer in the Dallas area regarding a '36 Ford 5-window Coupe they had listed online for $42,000. This appears to be a very nice car (one would certainly hope so). My friend is a serious no-nonsense guy with ready cash. He has been the owner of a small custom shop for many years and is a good judge of car quality, already owns some very nice vehicles. He made a serious offer of $40,000 during the phone conversation and the dealer told him that they couldn't contact the owner with the offer until my friend forwarded a $1,000 deposit! He told them to get lost and moved on. Is this the typical business practice of most or all consignment dealers? I've never dealt with one, although there have been cars that I might have considered. I understand the desire to weed out tire kickers and dreamers, but this guy (my friend) was dead serious and would have bought the car if it weren't for this practice. I just wonder if folks who consign cars to these dealers are fully aware that not all offers will necessarily be forwarded to them, the owner. Hope this thread doesn't open up a bunch of drama as I'm sure there are honest, upfront dealers out there. I'm just interested in knowing if this is common practice...Thanks..........Don.
     
  2. chevy57dude
    Joined: Dec 10, 2007
    Posts: 5,187

    chevy57dude
    Member

    Guess the flakes got to the business so bad they're trying to filter 'em out. Might be the way it's done these days, but I 'aint paying anyone just to make an offer!
     
  3. Can you imagine how many cold calls, without stopping by, without seeing the car, bullshit “would you take” offers are made vs those from serious buyers?
    That $1000 deposit creates a serious offer and considered a purchase contract contingent upon ( stuff). Plus that consignment dealer already knows his bottom line.

    Here’s another one. Friend of mine consigned an OT elcamino. With all the right shit on it and an outstanding car. My friend wanted to see 26,700 walking away from the sale. This car was listed at $40,000 they never sold it, never got an offer. His time expired and he sold it the same day.
    Ok so the rest of the story is he was in the middle of moving out of state. It was fall and needed storage anyway.

    Besides, if you want to make a real offer on a house then you need to put up that $1000
     
    Last edited: Jan 3, 2020
  4. ................But if you put yourself in the position of selling cars, you have to expect that only one person is actually going to follow through. I realize that it's a pain to deal with all of the looky-lou flakes, but isn't that kinda part of dealing with the public.
     
    Register now to get rid of these ads!

  5. Hnstray
    Joined: Aug 23, 2009
    Posts: 10,980

    Hnstray
    ALLIANCE MEMBER
    from Quincy, IL

    @lothiandon1940

    No......for decades, in Real Estate, it was called ‘earnest money’. In a professional business setting, there is absolutely no good reason to not back up an offer with a commitment to buy at the offered amount as evidenced by a deposit. A Realtor seldom, if ever, takes an unsecured verbal offer to the property’s owner.

    A consignment company selling cars, trucks, farm equipment or any other higher dollar goods is an agent of the owner of the goods. In the business world there is a big difference between a bonafide offer and a “wouldyatake”.

    It is often in the Buyer’s interest to accompany an offer with a commitment deposit to persuade a Seller to seriously consider the offer, especially if it is significantly below asking price.

    Further, the seller’s acceptance of a written offer with a deposit becomes a Contract binding the Seller as well as the Buyer. The Seller can have ‘remorse’ too....or receive a better offer.....in either case disavow the verbal agreement to sell and leave the Buyer empty handed. A written agreement, with deposit, protects all parties’ interests.

    Ray
     
    Last edited: Jan 3, 2020
  6. alanp561
    Joined: Oct 1, 2017
    Posts: 894

    alanp561
    ALLIANCE MEMBER

    Good morning. I bought an OT Italian sporty car from a consignment shop in Grand Rapids MI who insisted on a $500 down prior to me seeing the vehicle. There rationalization for this was that there was another potential buyer in California. If he decided that he didn't want to get into a bidding war and withdrew and I didn't buy the car, they were out a sale. Now mind you, it involved a 1600 mile round trip for me if I bought the car so I was dead serious about the purchase. I made the trip and when I got there, I brought this up to them again. The manager insisted that was the way they did things so I asked what would happen if when I had inspected the car in person, I didn't like it? His answer was that they would return my money. I assured him that if I didn't buy that car, because they had such a wide variety of collectables, I would be leaving with any one of his cars that I liked and were in my budget. I probably should have bought the generic 29 A with the 350/350 combo but it would never have cornered like the little Italian roadster.

    Sent from my SAMSUNG-SM-G891A using The H.A.M.B. mobile app
     
    Boneyard51 and lothiandon1940 like this.
  7. alanp561
    Joined: Oct 1, 2017
    Posts: 894

    alanp561
    ALLIANCE MEMBER

    Yeah, and a handshake and a promise doesn't get you too far anymore either.

    Sent from my SAMSUNG-SM-G891A using The H.A.M.B. mobile app
     
  8. Nope, you can pick and choose who’s getting into your office and sitting at your desk in niche markets. You can’t discriminate but Classic car sales is a niche market. In this case the dealer wants a deposit (probably fully refundable and actually has a boiler plate disclosure) before you get into the office.
     
  9. And realtors will talk to anyone.
    When it comes to their business they want buyers lender qualified, they want that earnest money on escrow with their office, and then they go to work. If you’re a cash buyer they want to see “proof of funds”.
    They work hard and it kinda pisses everyone off if the buyer doesn’t have what it takes to close the deal.
     
  10. Moriarity
    Joined: Apr 11, 2001
    Posts: 15,813

    Moriarity
    SUPER MODERATOR
    Staff Member

    It seems like it is the norm these days for people to make offers over the phone before they had ever seen the car... I fucking hate that shit, If you are going to make an offer on a car, be man enough to stand there in person with cash in your pocket, look the seller in the eye and make an offer... maybe I am just too old fashioned.....
     
  11. Jalopy Joker
    Joined: Sep 3, 2006
    Posts: 23,992

    Jalopy Joker
    Member

    had this happen when looking at a OT car at a dealership - wanted a deposit check for $1000 before being able to drive the car - after drive and contemplating price, etc I decided against buying - they wanted to make a sale, even for another car and do not want to return check - had to threaten calling Police to get it back - yes, could have canceled check - but, what a hassle - for a nice low buck OT car that I thought I had sold I accepted a local check - "buyer" took car - later he called and said that he changed his mind and already canceled check! - did drop car of, luckily - no checks after that - next, had a very nice Hot Rod For Sale while at a big car show at a very good price - had all sorts of people tell me that they wanted to buy it - short of swearing on their Mother's grave, etc - when I asked for a $500 cash deposit to hold it they all disappeared - except one guy - he saw the car and liked it but, too many people looking at it - he called the next day to see if I still had car - he said he was a semi-truck mechanic and had to finish truck he was working on - said if I drove my car to his place he would give me full price - about a 45 minute drive - drove there and he did not even sit in seat of my car - said that cash was in bag on his shop counter - my wife verified it and we said Thank-You and we left car/title and left - a few weeks later I bought a Hot Rod project truck for my wife at a swap meet - seller's shop was about 4 doors down from shop where I had sols my car - small world - so, yes deposits are a real word thing -
     
    catdad49, 47ragtop, Hnstray and 2 others like this.
  12. I understand that the dealer wants to weed out the flakes, but it just seems that a sale was lost because they wouldn't be willing to let the owner know that a serious cash buyer was ready and willing to step up. Wouldn't it be better to let the owner know this and then require the $1,000 deposit to assure that the transaction takes place, even make it non-refundable at that point.
     
    catdad49, raven, Boneyard51 and 8 others like this.
  13. I sell comparable low dollar vehicles and stuff on the facebook marketplace. And I get offers all the time from someone who hasn't even looked at the item. I tell them that the only way to find out Iif I would accept that amount is to be here in person with the cash. So far not even one of those lowballers has showed up.
     
  14. I used to keep check books from dead accounts, if someone wanted a deposit for something, I'd hand out a rubber check. I always got them back in the end, no harm done. About the '36 Ford, do a search to see if it was advertised anywhere else prior to the consignment deal. You may be able to find the owner and deal direct.
     
  15. oldolds
    Joined: Oct 18, 2010
    Posts: 2,866

    oldolds
    Member

    Hmmm. I understand the good faith money thing. I dislike the part where they said they could not take the offer back to the customer without the deposit. There should have been no need to take that offer back to the customer. The contract with the seller should have a sale price on file in it. The dealership would want it that way so if your friend had walked in with the cash so they could sell the car before he walked away.
    I dislike the consignment collector car dealers. They are the whores of the industry. They screw the buyer and seller and their sales people to make the deal. They only care about the dollars not the car or the people. They are worse than new car dealers to work with.
    That is my personal opinion.
     
  16. ...........So if I'm understanding what you are saying, the dealer and the car owner should have in place (written into their contract) a "bottom line" price that it would take to sell the car. That would make sense to me. The prices at most of these consignment dealers seem inflated to me and I get it, they make more money if the car sells at that inflated price. But what about the owner who just wants to sell the car. Can he specify that if the car is listed for say $50,000, he will be happy to walk away with $42,000 after commission if a buyer comes through for say $48,000? It just seems like a poor decision by the dealer to not let the owner know about any serious offer. Guess I'm just naive.
     
    raven, Boneyard51, Dino 64 and 4 others like this.
  17. Hnstray
    Joined: Aug 23, 2009
    Posts: 10,980

    Hnstray
    ALLIANCE MEMBER
    from Quincy, IL

    @lothiandon1940 ...the point is.....the offer can easily be meaningless if the person making the offer does not ‘put his money where his mouth is’.... Without that security there is absolutely nothing to prevent him from saying “Thanks, I’ll think about it”.

    You may think that is okay, but if so, then you also have to concede that it was NOT an offer, but simply a “would you take” falsely represented as an “offer”. If a buyer just wants to know if the price is negotiable, ask. If the potential Buyer wants to know if he can buy it for his price, make an offer. The consignment dealer did not lose the sale because he declined to entertain a verbal offer, it was lost because your friend chose not to make a binding firm offer.

    Just for the record, I am NOT a fan of the automobile consignment dealer model. I prefer to sell my own stuff and buy from the owner directly. Now, in some cases, that will be a Dealer who owns the cars. No problem. But some folks, for various reasons, do not wish to deal with a stream of potential buyers. They contract with a professional seller.

    What I AM defending is the ‘legitimacy of the process’ that is described here as a means of keeping everybody ‘honest’ in the negotiation in third party transactions.

    Ray
     
    Last edited: Jan 9, 2020
  18. Shamus
    Joined: Jul 20, 2005
    Posts: 1,130

    Shamus
    ALLIANCE MEMBER
    from NC

    I have a couple of cars for sale on the H.A.M.B. & other sites. I get a lot of "will U take" & "what's the bottom dollar" offers. If I quote the "bottom dollar", I always get "I'll give U $??" always a lower offer. I have decided that I will not negotiate over the phone or email/message. If they are serious, they will come look at it or send a rep. I would not send any money just to ask the owner if my offer was acceptable. I personally would never buy a vehicle without physically looking at it. Too many things that can be hidden or even over looked. I'm sure we've all heard the horror stories of the "good deal" I got on eBay (or other online seller) that turned into a nightmare. "Buyer beware."
     
    catdad49, raven, HSF and 8 others like this.
  19. DERPR30
    Joined: Jun 3, 2010
    Posts: 782

    DERPR30
    Member
    from HARVEY LA

    I WHOLEHEARTEDLY AGREE WITH SHAMUS A HUNDRED PERCENT
    U GOT TO BE CAREFUL THESE DAYS
     
  20. Malcolm
    Joined: Feb 9, 2006
    Posts: 7,506

    Malcolm
    Member
    from Nebraska

    That $1,000 down practice would've made me turn around and run, as well. I'd have a hard time trusting I'd get the money back if the car were not as described.
     
  21. Hnstray
    Joined: Aug 23, 2009
    Posts: 10,980

    Hnstray
    ALLIANCE MEMBER
    from Quincy, IL

    You have always had to be careful. Human Nature has not changed one bit in all of recorded history.
     
    BamaMav, Wanderlust, Blues4U and 3 others like this.
  22. DDDenny
    Joined: Feb 6, 2015
    Posts: 12,925

    DDDenny
    Member
    from oregon

    That's gospel in my songbook too Mark!
    I'm not intantly rude because I want to make a sale but if they keep up with that approach all they hear is a ringtone.
     
    Moriarity likes this.
  23. Gman0046
    Joined: Jul 24, 2005
    Posts: 5,788

    Gman0046
    Member

    A while back I saw an interesting car being sold by Gateway Classic Cars in Nashville, Tennessee. They were asking 36K for the car, I told the salesman I might be interested for 32K if the car turned out to be what I thought it was. He tried to get me to pay 2K with my credit card to hold the car. Naturally I refused. I later read on the internet that this is a common Gateway ploy to get customers to give them a non refundable deposit without telling you its nonrefundable. Gateway is a bunch of thieves with a horrible reputation and an unbelievably low Feedback Rating. Just Google Gateway Classic Car complaints and see for yourself.
     
    Last edited: Jan 3, 2020
  24. 6inarow
    Joined: Jan 24, 2007
    Posts: 2,183

    6inarow
    Member

    Not sure I would put "earnest money" down on a car. Houses generally cost more than $40 grand and the industry is very regulated by banking and legal. Not sure I would pass out cash for a car to a dude I just met without a little protections. I mean what could possibly go wrong???
     
    raven, Hombre, vintage6t and 2 others like this.
  25. Jalopy Joker
    Joined: Sep 3, 2006
    Posts: 23,992

    Jalopy Joker
    Member

    remember that the owner that consigns the car is usually charged a daily fee for their ride being on display at consignment shop too - so, with the sale percentage that is given to consignment shop, and "space rental" the buyer can be in for a big hit - know a guy that was overly optimistic when he priced his "unique" ride for consignment shop - car has been For Sale there for over a year now
     
    lothiandon1940 likes this.
  26. young51
    Joined: May 11, 2009
    Posts: 22

    young51
    Member

    A number of years back we had a fairly established consignment dealer in town "Specialty ....." that was raided for dubious practices. Raided as in Federal agents seizing the cars and establishment. Basically they would have a car the owner wanted $35 for marked up to $40k. They would accept full price offers and tell the owner "we have a buyer for you but its a lower offer and can only guarantee you $32k" A lot of buyers accepted not knowing they actually received a full price offer. The sales people were pocketing the extra few thousand in each case. Would never trust these types of dealers...
     
    Hombre and lothiandon1940 like this.
  27. 47ragtop
    Joined: Feb 8, 2007
    Posts: 634

    47ragtop
    Member

    My take on this is. If you are not there in person it is just another BS offer. # 1 Either be there in person or send an authorized to purchase agent to purchase or #2. Ask them the routing numbers where to wire transfer the money. Money Talks. BS walks !! 33 plus years in sales may have made me just a Little jaded .Later Bill
     
    arkiehotrods likes this.
  28. I am in the heavy truck business-the only way we will hold a truck-new or used is with a deposit. I won't accept random offers over the phone. Offers are in writing with a signature and a deposit and are binding.. I have sold to Customers out of the Country,State or Province-but not until they have reviewed any information,pics,video's references etc I can send them so they are comfortable with whatever they are buying. The last thing we need is a Customer showing up to pick something up they have purchased and the vehicle not being up to their expectation.
     
  29. RJP
    Joined: Oct 5, 2005
    Posts: 1,287

    RJP
    Member
    from PNW

    Last three cars I've bought I never laid eyes on till my guy dropped them in my shop. I don't offer anything over the phone, HOWEVER I will ask if the price is written in stone. If I get some smartassed answer, or the seller says price is firm, the conversation stops.

    If my guy is standing in front of the seller...
    1. He has a copy of the ad.
    2. The price I'll pay for the car in his head.
    3. My cash in his pocket.
    If numbers 1 and 2 happen, he pays with my cash, loads up my car and leaves. If 1 and 2 don't happen, he leaves with my cash and the car's still for sale. I don't pay him to put up with sellers bullshit...I'm old fashioned too...
     
    mgtstumpy, teach'm and Moriarity like this.
  30. jim snow
    Joined: Feb 16, 2007
    Posts: 900

    jim snow
    Member

    Dead nuts on. Right there. Snowman
     
    lothiandon1940 likes this.

Share This Page

Register now to get rid of these ads!

Archive

Copyright © 1995-2020 The Jalopy Journal: Steal our stuff, we'll kick your teeth in. Terms of Service. Privacy Policy.

Atomic Industry
Forum software by XenForo™ ©2010-2014 XenForo Ltd.