87% of South Africans are worried that they won’t get a fair deal when selling their car through a dealership and 64% claim getting a fair price for their car as their top priority when selling. This is according to a poll commissioned by online secondhand car buyer , CarZar and executed via News24. The survey also found that 58% prefer to receive cash for their car rather than trading-in. However, in contrast, safety concerns mean that 80% of respondents prefer to have their car inspected at a dealership than in a private location.
Other survey findings were:
● 85% of respondents had sold a car during their lifetime
● 50% of South Africans prefer to sell their car privately, although in practice many do not go this route
● 85% of people are concerned about the safety of money transfers when selling a car online
● 61% of respondents have concerns about transfers and paperwork being handled correctly – these are valid concerns because, the new owner has 30 days after the purchase to transfer ownership and if he gets any fines within that period; the seller is still liable
● The vast majority of people (81%) gather their information online before selling, with online car websites being the most consulted source (61%)
Rob Thompsett, Relationship Manager at CarZar says South Africans seem to be quite knowledgeable about how to get the best price for their car, but there are still a lot of perceived risks to not selling via a dealership. “The fact that you will almost always get a better price by selling privately or via an online car buyer like CarZar seems to be well understood. But security risks – both in terms of fraud and personal safety still weigh on the minds of a lot of South Africans.”
According to Thompsett, consumers still do not fully understand the big difference in price for a trade-in compared to the price you get when selling privately or through an online sales facilitator, “CarZar was launched for those South Africans who prefer to find a convenient and easy way to sell their car and have cash in hands to buy their new vehicle without losing any value when trading-in.”
It is likely that the convenience of a trade-in is also likely to draw some people to go this route. “There is often a perception that the paperwork associated with selling a car is very cumbersome, actually it is a pretty quick process and can be completed in half an hour. The convenience of driving one car into a dealership and leaving with another is appealing to consumer, but they are losing thousands of Rands in the process.”
He said having cash in hand gives the seller far more bargaining power at dealer level. “If you have a cash deposit, you are able to negotiate a far better deal for yourself. With a trade-in, they have to make their mark-up on your vehicle so the deal has less flexibility.”
Thompsett said sites like CarZar are a nice middle-ground between selling privately and selling at a dealer. “A lot of the concerns raised in this survey are addressed by the online car buying model. Pricing is reached transparently, paperwork is handled for you, there are inspection centres for people preferring to go that route, or thoroughly verified assessors visit you. Cash is paid on the day and, if the seller is buying another vehicle, they are placed in an excellent negotiation position.
He concluded that word of mouth is key in South Africa. “More than half of us consult a friend or family member when buying a car. This could be the reason for the rapid uptake in business for sites like ours!”