Deposits

In the beginning of my automotive career the deposit was king. The desk wouldn’t even look at you or your deal if you didn’t have something from the customer other than a piece of paper and a credit app. Money talks, bullshit walks as they say. If your customer was using a trade for his down payment it was easy, a key and the registration or title would suffice. But if he was putting a grand down, the desk wanted to see the grand up front. Getting the customer to write the check or even worse give you the cash before finding out if he had a deal could be difficult, but the penalty for bringing a deal to the desk without it meant you’re deal might be immediately turned.

As a green pea I had a lot of deals turned.

Get something out of the customer, that was the trick. If he wouldn’t give you the full grand, get something out of the mooch! A hundred? Twenty? A $5.00 bill? His watch? His shoe for Christ’s sake? You had to get a deposit!

.The reasons for this were sound. It was part of getting a true commitment from a customer to buy the car. It wasn’t enough that you had the guy sign a line that said, “Customer will buy and take home today for $1000 down and $250 per month.” No, sir, you had to get a piece of him too!

I swear to God I once saw a guy take a baby to the sales office

Is it a good idea today? Maybe, maybe not. In reality a proper written write-up is probably all you need, but I suspect most desk men still want something to hold the customer. Nothing’s worse than a salesman going back to the customer with his freshly-minted pencil only to discover the guy had bolted on him like a spooked horse.

In reality a customer who bolts has probably done you a favor, but the desk usually doesn’t look at it that way, especially if you have a pattern of people running out of the dealership like they’re on fire even before you have a chance to bump them. The desk begins to think you’re weak; that you can’t commit a customer properly and generally don’t have any control. Do that enough times and you’re out the door! But if the desk has faith in your abilities, the more they are not as likely to require you to resort to getting a customer’s shoes before they’ll look at your deal!

What about the other times when a deposit comes into play? For instance, what about the guy who wants to give you some money to hold a used car? Do you take it? Over the years I’ve come to the conclusion that in most cases NOT taking a deposit is more effective than taking one, and I sincerely hope that lightening won’t strike me for saying this.

First, what if you take a deposit on a car and someone else offers more money for it? Take the money and run, I say, but that can get a little sticky legal-wise. Same thing if you tell him a deposit is non-refundable. It’s a good bluff, but good luck getting that past a small claims court judge!

Second, sometimes when a customer has a deposit on a car he thinks it’s safe to spend the rest of they day shopping for a car he might like a little better. What’s the hurry? He can always come back and get yours. “Hell, I’ve got a deposit on it!” he thinks.

I feel the threat of losing a car can be more effective than letting the guy think he’s in control of the situation. If you can create the emotion, you’ve got to make it clear that he’s going to lose that sucker if he doesn’t buy it now!

In my opinion a deposit on a car should be like an aspirin, it should wear out in four hours. And I think that if you decide to take a deposit you should let him know that.

Customers will always ask, “Has anyone else been looking at the car”? “How long do you think it will be here?” Well, how long is a piece of string? The car might be there two months from now; it might be gone in an hour. The point is do you really want to take that chance?

When you get your deposit at the time of the write-up keep the reasons for it a little nebulous. “Its good faith money,” is probably your best bet. Or “I need all the ammunition I can use to get your stupid offer through my boss!” Tell him anything, but DON’T TELL HIM IT WILL HOLD THE CAR!

The only thing that should hold a car is its emergency brake.

Talk to you later,


David