Auto Broker walks the walk, talks the talk for you

For people who find car shopping unnerving, there is an alternative: you can send a professional buyer into the showroom to wrangle a deal on your behalf while you relax at home. Auto buying by proxy offers savings in time, shoe leather, anxiety and, possibly, money. Independent brokers will find you the best deal on the vehicle you want in return for a fee. Like real estate agents, they shop the market with your needs in mind and are not tied to a maker. A broker is the intermediary between the auto dealer and the consumer. A good one will complete the paperwork, deliver the vehicle to the buyer’s home or office and explain its features. Such services mushroomed in the affluent ’80s. But Mohamed Bouchama, executive director of Car Help Canada (http://www.carhelpcanada.com), a consumer advocacy group, suggests that the need for a broker has diminished in recent years. “Competition is fierce in the car business now,” he notes. “Dealers are discounting $1,000 to $1,500 right off the top.” He believes that most consumers can negotiate a car deal just as well on their own and warns that the unregulated broker industry has attracted some unscrupulous operators. Some collect a fee, then disappear. Others double-dip: collecting a fee from both the client and the dealer. “I’ve always said that anyone who doesn’t have anything better to do gets involved in the car business,” says Bouchama.

Automotive adviser and broker Mark Derry stresses that his job involves a lot more than negotiating a low price. “I learned really quickly that people hate car salesmen,” says the Mississauga native who now lives in Bloor West Village. He used to sell cars at a Mazda dealership in Rexdale, but today runs CarSense, an auto broker service (http://www.carsense.to). During his five years as a sales rep, Derry, 33, observed all kinds of consumers. While some researched their decision with care, many others seemed to buy on a whim. “I met a lot of people who were lost. People often spend more time shopping for a pair of pants than they do

for a $20,000 or $40,000 vehicle.” Because automotive brokers eat, drink and breathe cars, he contends that they’re better equipped to find the vehicle that fits the client’s needs. It’s not that a consumer couldn’t replicate the research; it’s just that few people can devote as much time to the task and so decide to buy his service, according to a focus group he conducted.

“My typical clients are a couple, both working, with young children. They can’t get out to the dealerships often enough,” says Derry, who has been in business for seven years. Instead, he will go to their home, often in the evening, and consult with them on their automotive needs. Once the desired make, model and options are determined, he hunts down the best price. The second reason shoppers turn to him is trustworthiness — the perception that Derry is likely to be unbiased and candid about the deal. Saving money is the third reason people hire a broker, an area in which Derry says he shines. “I like negotiating. I enjoy beating down the dealer.” Many dealers view brokers as partners, not competitors, he adds. “For the most part, dealers appreciate my business. It’s about the numbers, and I help them move units.” He has built relationships with selected car dealers across the GTA and negotiates directly with senior managers. “I don’t buy 10 of anything but, over time, they know I will give them enough business to qualify for the same aggressive pricing a fleet buyer would receive. “He recently closed a deal on a new Nissan Titan pickup for $2,300 less than the Automobile ProtectionAssociation’s car-buying service had negotiated for its members, he claims. Derry charges a flat fee of $385 (plus GST) to find a new car for a client. “It’s the same amount of effort whether you’re looking for a Hyundai or a BMW.” His preferred status with certain dealers means buyers can’t choose the store they buy from, but this doesn’t seem to be a problem, says Derry, who holds a BA in economics from the University of Western Ontario. “Dealers are used to servicing cars that were not purchased in their own showroom.”

He will also navigate the treacherous used-vehicle market for clients. He estimates that 60 per cent of his used sales are done through reputable dealers, while the rest are private sales he locates in classified ads. “I evaluate the vehicle, take some digital photos, show the car to the client, arrange for a third-party mechanical inspection (if requested) and negotiate the sale price,” he says. Searching for a pre-owned vehicle takes more legwork, so he charges more: $550 to deliver the used car to your door — plated and registered. Because no two used cars are the same, Derry established ground rules to make sure he and his client don’t get burned. He won’t buy a car that has ever been registered outside Ontario (since accident records can’t be traced across provincial borders) and generally won’t shop in the sub-$3,000 price range. He tends to favour imports over domestic products. “The best deal on a used car is not the cheapest price, but one that is a one-owner vehicle with no accidents, original paint and with its service records intact.” Derry favours used imports for his own transportation, currently driving a 1997 Mazda 626 and a ’95 Miata.

If you equate car shopping with wading in shark-invested waters, consider hiring an auto broker to do the job for you. But choose carefully. Talk to previous clients and call the Ontario Motor Vehicle Industry Council (http://www.omvic.on.) to see if the broker has voluntarily registered.

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Apr. 23, 2005

MARK TOLJAGIC

The Toronto Star