There are still plenty of things you might probably know about selling a vehicle, and that includes the fact that you can actually consign it even at an auction.
What does this mean? In business consignment happens when a seller (A) reaches out to another seller or business (B), which agrees to carry the goods. At the end of a certain period like a day or a week, B pays A for the goods that have been purchased less other agreed fees such as perhaps rent of space. A has then the option to get the remaining merchandise and sell it elsewhere or allow B to continue selling them, repeating the process in between.
In the auto world, consignment works similarly. A person who wishes to sell his vehicle goes to a dealer or an auctioneer, who then sells the car. However, instead of paying for its trade-in value, the dealer or the auctioneer gets only a commission from the sale.
The setup is often considered advantageous for the car’s owner. First, he doesn’t have to suffer from the possible very low trade-in values. Second, he can avoid the hassle of selling the vehicle himself and look forward to better gains from the sale.
It’s not bad for the dealer or the auctioneer either. Aside from the fact they have additional inventory that can generate income, they don’t need to spend for inspection and warranties. The latter should be taken care of by the owner. Warranties, on the other hand, have been shown to be a great buyer motivator.
How to Sell Consigned Cars
If these benefits are not enough, you’ll also realize that selling them consigned in an auction is no different from other methods of auctioning. There are only three things to keep in mind:
- Make sure that the auction accepts cars on consignment.
- Don’t forget to sign up as a consigned seller.
- See to it that sale on consignment is allowed in your state.
Some auction houses now allow you to apply for sale on consignment online. All you have to do is to upload the required documents, which may include the title of the vehicle and the dealer’s license, if you’re a car dealer.
If they have an online arm, you must also upload photos at different angles (side, front, back) with proper descriptions. The auction house may also need additional information like make, model, year, color, location, remaining mileage, condition of the vehicle, and whether it’s been identified as salvage, junk, or lemon. Several of these auctions may need you to cover the vehicle for a warranty that’s good for 90 days to entice buyers.
Normally, sellers and car owners are given ample time to sign up for the auction, but houses do recommend completing the requirements as early as possible. This way, there’s a good chance you’ll be provided with prime lots, or locations that have the highest traffic and most attractive to buyers. This definitely increases your chances of having your vehicle sold real quickly.