BY : Chris Saraceno

Most customers looking to trade in a car bring to the dealership unrealistic expectations about the value of their trade-in.

Shared: From your friends TechAutoCareers.com® the online resource for the Automotive Sales Consultant

Experts believe the Automotive Sales Consultant is the best person at the dealership to manage the customers’ expectations of the value of their trade. And, sales consultants can best help customers arrive at a more realistic number – one fair and acceptable to both customer and dealer -- by conducting a Trade-In Walkaround.

A former colleague of mine and a nationally recognized automotive consultant, John Beagan, taught me early in my career that most customers come in for a trade-in with three numbers in mind:

• What they’re hoping to get.
• A figure they are willing to do business at.
• A number they won’t take any less than.
Customers arrive at these numbers in a couple of ways:
• From the amount they still owe on the vehicle.
• From Internet websites such as the National Automobile Dealers Association; Kelley Blue Book, AutoTrader.com and Cars.com.
• From dealership eCommerce web sites.
• From walking around dealership lots.

However, none of these sources provides all the information customers should take into account when estimating the value of their trade-in.

First, the amount they still owe the financing institution on the car is not a reliable gauge. Very often the market value of a vehicle depreciates faster than the decline in the remaining principal due on the car.

Second, when a customer gets their trade-in numbers from Internet websites such as the National Automobile Dealers Association, Kelley Blue Book, AutoTrader.com and Cars.com, from dealer eCommerce sites, or from walking around dealer lots, they see a range of numbers and always pick the highest value. Depending on the condition and mileage of their own car, that number may not reflect the car’s actual value.

Third, customers often overlook the added cost of the work required by the dealership to make the car ready for the re-sale market.

They are unaware of reconditioning costs which may include: Fixing mechanical problems, or fixing body damage -- to name a few examples: bumper repair, windshield repair, paint touch up, paintless dent removal, headlight restoration, interior repair, wheel rim repair and much more.

Customers may also not take into account the expense incurred by the dealership in assuming the risk of guaranteeing the vehicle for a 30-or 90-day or one-year warranty period, once it is re-sold.

Also to be factored in is a small percentage of the overhead expense of running the dealership.

Yet it is critical to the customer and the sales consultant that they arrive at a price that is satisfactory and fair to both, so a deal on a new car can be made. Too many new car sales fall apart late in the sales process due to the fact that customers aren’t willing to accept the amount the dealership puts on their trade.

The Trade-in Walkaround is an effective way to bring customer expectation more in line with true market values and it should be introduced early on in the Sales Process.

Even before the customer enters the dealership, sales managers should make sure that their sales consultant team is well-versed in how to conduct an effective Walkaround.

In many respects, a Walkaround is similar to a real estate agent showing a prospective home buyer new property – pointing out the good points, as well as the things that need repair and leading the customer to an appreciation of the true market value.

The Best Sales Managers model how to complete a Trade-in Walkaround with their sales consultants -- including tips on what to do and say through a wide range of potential customer reactions. Handling the customers’ trade is actually similar to the new vehicle sales process, because what sales consultants essentially need to do is sell the customers’ trade-in number back to them.

Role-playing with the sales manager or other sales consultants is the single best way for sales consultants to learn how to present the customer with trade-in information and deal with customer concerns and questions.

Good Sales Managers also make sure their sales consultants know how to properly fill out a Trade-in Appraisal Form.

The Trade-in Walk around’s should always be conducted before the dealership’s Used Car Manger does a formal appraisal and after the sales consultant knows the customer wants the new vehicle he/she has been shown. (Since accurate appraisals take time, an appraisal of the customer’s trade-in should not be used as a tool to see whether the customer is a serious buyer or not.)

First, Give the Customer an Overview

Before beginning the Walk around with the customer, The Best sales consultant always present an overview of the Walk around, explain its benefit to the customer, and then ask the customer’s permission to begin.

It’s important to limit the Walk around to 10 minutes or less. Taking too long or being overly critical of the trade-in car will offend most customers.

Right away, the best sales consultant will introduce the dealership’s Appraisal Form as a tool to guide documentation of the car’s condition and repairs needed that the Sales Consultant and customer will notice during the Trade-in Walkaround.

The best sales consultant start with looking under the hood area. Comparing the customer’s vehicle to the new vehicle they have been shown increases the customer’s chance of buying.

If they find a defect while examining the car, sales consultants often don’t have to say anything to help set expectations for the customer. Sometimes a questioning look, a nod of the head, or doing something twice like starting and restarting the vehicle will be enough to help bring the customers’ expectations of what their vehicle is worth in line with its true market value. This is often more courteous than making a negative comment.

However, sales consultants should show the customer the items being noted on the Appraisal Form without being overly critical of the vehicle. Getting the customer’s agreement on these items that need to be corrected is important. Doing this will make the customers aware that the vehicle may not be in as great a condition or worth quite as much as they originally thought.

At most dealerships, after the sales consultant has conducted the Trade-In Walk around, the Used Car Manager looks at the customer’s vehicle, road tests it and comes up with a formal appraisal. If the sales consultant has conducted an effective Walk around, the Used Car Manager’s formal appraisal will not be a surprise to the customer.

Conducting a fair and efficient Trade-in Walk around is the best way to keep more deals on track, increase sales and profitability for dealerships, and satisfy customers that they are getting the fair market value for their trade-in.

P. S. Urgent if you’re looking to optimize your interpersonal skills for success order a copy of " How to Succeed in the Automotive Sales Industry " @TechAutoCareers.com. Then settle in for a satisfying read that will surely enhance your interpersonal skills for success this year, it is not just a book but a service.

If there is anything thing we can answer for you please do not hesitate to get in touch with us @TechAutoCareers.com® we are looking forward to working with you - and hopefully conversing with you. Again, thanks from I.C Collins and Tammi Collins @TechAutoCareers.com® Feel free to be yourself get to know our members on Facebook, Google+, and Linkedin.

We want to take a minute and THANK all the people that comment, like, and share our posts daily. We appreciate you all @TechAutoCareers.com

Now it's your turn. What do you think? Is this something you can benefit from or do you have a few tricks up your sleeve that are just as powerful? Make your voice heard by leaving a comment below. Don’t forget to hit the share button if you know others who will find this post useful.

I.C. Collins ~ Author, Educator, Trainer and President: Has One Simple Goal: I believe it is my mission and purpose to remind you, that you are meant to have the best life possible! You were created with intention and purpose and I am here to simply help guide you through your life’s journey.