Oh, the angles we could take on navigating the used car lot game. The wheeling and dealing, financing and warranties are all great topics. Let’s put all that aside for now and go back to the used car search. How did that used car end up where you’re seeing it?
I use the word CAR loosely here. What I’m focusing on is passenger cars and pickups, 1 ton dually and smaller. I’ll just refer to all of these as cars for ease of writing.
The Used Car Lot Game – How Did It Get Here?
Used cars end up on lots for one simple reason. Someone no longer desires them. Private parties, car rental agencies and corporate fleets replace vehicles regularly. These cars find their way to the used car lot in one of three ways.
Someone traded to a dealer for another car, new or used.
Many cars are auctioned off in a public or private auction.
Sellers may deal directly with the dealer.
What Happens To The Trade-in?
Let’s make this easy. We’ll use the new/used car in my driveway. It’s a clean ’07 Chevy Trailblazer LS with 155,000 miles. The Jeep dealer assigned a cash value to the car. Let’s say this value is $3,000. Now the dealer owns the car for 3 grand. Normally, the used car manager make the first decision, should we keep this car for our used car department?
This decision is not a firm decision in most stores. The car may look right, but could turn out to be a real junker. The only way to know is to let the dealer’s service department inspect the car. It could need brakes, suspension work, or many other repairs to meet the franchised dealer’s standards. In the case of our Trailblazer, there was nearly $2,000 worth of work that needed to be done. Remember this number. It’s important.
Do We Fix It, Or Wholesale It?
When the used car manager sees this estimate, he has to make the choice to keep the car, or to sell it on the wholesale market. Again, remember that term. We’ll get to these wholesale cars soon.
It’s also important to know that most dealers charge the used car department full retail for all their repairs. They also tend to lean less on aftermarket parts. In the case of our Chevy, the same franchise owns the Chevy dealership right across the street. The Trailblazer was repaired with genuine GM parts.
Brake work, suspension work and a few seals made up the bulk of the repairs on our car. Any reputable dealer will gladly show you their work orders, and what they repaired on the car. New car dealerships have no interest in selling anything they know will bite them in the ass down the line.
Let’s Wholesale That One
Tha same used car manager may have decided the Chevy wasn’t worth spending another 2 grand to make it right. He also has a regular supply of trade-ins that have more miles and problems. These cars will never see his used car lot. Somewhere on that lot is a back corner full of these beaters, high milers and rust buckets. They may have some life left in them, but they don’t meet franchised dealer criteria.
Used car wholesalers are all over these cars. Keeping the corner budget car lot stocked is a full time job. One of these wholesalers may buy that Trailblazer as-is. Let’s say he bid 2,800. The wholesale department is rarely a profit center. In fact, (my opinion) if the wholesale department isn’t loosing money, that used car department is leaving cash on the table.
What Happens To The Wholesale Cars
The dealer was looking at a $2,000 repair bill on that Trailblazer. The wholesaler either owns, or is selling to a used car lot with no franchised ties. Once here, the repairs focus on safety and sellability. Lights, brakes and horn are biggies as far as safety goes. Oh, and they can go to the discount auto parts store and pick up the cheapest parts on the market. They may even buy used parts.
And that suspension work? Probably not happening. If the car drove fine without the repairs, it’ll keep going a few thousand miles more.
Wholesaling to another franchised dealer is also not uncommon. If a used car department is heavy on inventory, that manager may decide to sell a group of cars. That Trailblazer could have been packaged up with several other used GM cars and sold to a Chevy dealer needing inventory.
Why We Bought From The Dealer
First off, those corner budget lots serve a purpose. They sell budget transportation to people with limited funds. I have to admit, I’ve had some very dependable cars that were well under $2,000 dollars. I’ve also bought some more expensive used cars that turned out to be real lemons.
I knew the Trail Blazer had to be a little above average for this dealer to keep it. We bought our new Jeep from them. Our daughter bought her new Dodge van from them. If you’re in Green Bay, you can’t go wrong with Grandrud Jeep. They’re a class act.
I also knew the service department was able to do a more serious inspection on the car, and repair it with good parts. Did I pay more for this? Probably not. I did my homework before we made an offer. Had I bought it for $1,000 less at a used car lot, I’d still have new brakes, but I doubt the seals and suspension work would’ve been done. If it was, it most likely would have been a budget repair with the cheapest parts.
What About Those Auction Cars?
Auto auctions are a blast. I’ve been to quite a few back in the 90’s. These weren’t public auctions. They were GM auctions. GM rental returns, lease returns, factory buybacks and other cars owned by the manufacturer were up for bid.
Local dealer auctions are also big. All you need is a dealer’s license, or be representing one. This is where quite a few of the used car lots get their cars. They may be repossessed cars or vehicles that have been on the lot for too long. These auctions are also another way a new car dealer can “wholesale” his undesirables. As they say, “one man’s junk is another man’s treasure.”
Disclaimer here: None of this is cast in stone. I’ve been out of retail car sales for years, but the business model remains the same.
Related Topics In The Show
Why wholesale operations should be money loosers
Boo Hoo cars and EVERYBODY RIDES
Carmax and car vending machines
What’s not covered by the as-is sticker
ACV vs private party
Franchised dealers and budget lots
We talked about the wheeling and dealing end of the car business back in Episode 70, Buying a Car or Truck. Tips and Tricks From Buck’s Car Salesman Days.
We close the show with a list of songs men should never sing in the truckstop shower, or any shower where others can hear you.
TopSpeed.com has an interesting post on the GM 4.2 inline 6. It validates why I have faith in getting another 100k out of our new (used) Trailblazer. The Chevy is an 07 with 155,000 miles. It’s well equipped and in great condition. The original window sticker is still in the glove box, so I was able to verify the gear ratio, suspension options and factory tow package.
Like all newer vehicles, there’s way too much plastic under that hood. One thing that’s not under that hood is an EGR system. Due to the variable valve timing, EGR isn’t required to meet the EPA requirements.
There are an abundance of these vehicles with 250-300k on them. Who’d trust a Chevy with an aluminum block after the Vega debacle? But this block is made quite differently with it’s foam/sand casting.
The design and construction of these engines is the same in the 4, 5 and 6 cylinder versions.
Fake Trucking News?
Pretty much everything in this story is crap. It’s pay and working conditions that make this job unattractive to many. Check it out in this Freightways.com article. Talk about some big assumptions. Four of the 5 here are pay and working conditions. The 5th, immigrants, is totally bogus. Trucking is well over 18% staffed with immigrant drivers.
And while we’re picking on them, we might as well pick apart a few assumptions made in their article on the next decade. This one is pure speculation. Amazon won’t be the only player in retail, and the automobile transportation isn’t entirely made up of new cars. And I believe most new cars aren’t going out on for-hire trucks.
Terrifying Windstorm Quickly Turns Into A Sh*tstorm - YouTube
You’ve got to watch this one. It’s not even a tornado. It’s a strong wind gust that lifts these portable bathrooms into the air. Oh, and the blue stuff rains down.
Note: This is a sponsored post by Eric Weisbrot of JW Surety Bonds.
The freight brokerage industry plays a critical role in the transportation framework given that nearly all household and commercial items are shipped from one location to the next. Licensed brokers carry a substantial burden because of the intermediary position they hold within this framework, but not all aspects of the business come naturally to brokers.
Keeping up to date with training and education requirements is key to remaining successful as an established freight broker, or starting out on the right foot as a newly licensed broker. Below are the top ten online resources and training schools made available to freight brokers, no matter where they find themselves in the industry.
Brooke Transportation Training Solutions
One of the leading freight brokerage training schools online is offered through Brooke Transportation Training Solutions. The organization offers in-person classes in Texas, California, Florida and North Carolina, but it also provides a comprehensive online training and career center. The courses give freight brokers a foundational education in operating a sound business, skills necessary for the job including communication and sales, as well as marketing guidance. Courses range in cost depending on the location and the reach of the training.
Transport Training International
Transport Training International offers a variety of freight broker training classes both online and in-classroom, with downloadable materials and interactive training modules. The company stands out as an online resource for several reasons, including the fact that thousands of brokers have completed its training and the company provides ongoing support post-graduation. Transport Training International also offers guaranteed freight broker placement for those who want to work as an independent broker after completing the training.
American Broker Academy
The Seattle, Washington-based American Broker Academy is a well-known training resource for new and established freight brokers. It offers a variety of courses aimed at helping freight brokers stay compliant with regulation changes, understanding how to operate a business, negotiating rates, and communicating with customers. There are classes available at the Seattle location, but also several online courses and articles for those who prefer to learn remotely.
Based in Florida, JPL Enterprises International operates a transportation management consulting firm that provides strategic training to freight brokers. Through educational DVDs, live in-person classes, and training-on-demand services, JPL is one of the most comprehensive freight broker training resources available online. The company also provides many articles relevant to the freight brokerage business that allows for individual education at one’s own pace.
One of America’s largest freight broker training schools is Load Training, which offers home school freight training, live hands-on courses, and private freight training classes. The company also offers a free freight broker training kit for newly licensed brokers, as well as a substantial resource center that can be accessed anytime, online.
JW Bond Consultants
JW Surety Bonds also offers resources for freight brokers online, including an all-encompassing e-book on establishing a freight brokerage business as well as an up-to-date list of the top 12 freight broker training programs. The surety bond agency also provides several online resources to freight brokers above and beyond educational requirements, including bond pricing information, how to assess training programs, and how to operate a successful freight broker business.
While Study.com is not specifically geared toward freight brokers like some of the other online resources listed here, the website has several training programs available for free that are relevant to brokers in the business. The majority of the courses listed on the site are organized by the education institution offering the class, and nearly all are available at no cost.
In addition to formal freight broker schools and training programs, it is necessary for brokers to keep up to date with regulatory changes and trends in the industry. The Department of Transportation offers some resources online, as does the Federal Motor Carrier Safety Administration. Some leading industry blogs also provide information and insight into upcoming changes to regulations relevant to freight brokers.
Online Articles and Forums
Blogs and freight broker forums can be invaluable online tools for new and established freight brokers. Some articles available online offer industry insights along with best practices in the ever-changing landscape of the business, while online forums allow for the easy connection with industry professionals. Checking in with these resources regularly helps freight brokers stay abreast of important information in the business.
Managing The Business
Regardless of the size or niche of a freight broker, there is a constant need for assistance in operating a successful, profitable brokerage business. Not all freight brokers are experts in the business management realm, but fortunately, there are ample online resources for helping in this crucial area. The Small Business Administration offers several guides for new business owners, including an interactive tool that gives direction on creating and updating a business plan. There are also several business management software solutions that help freight brokers keep up with the digital trends in the business, with a detailed list along with reviews and pricing found here.
The combination of these online training programs and resources can make all the difference in creating and sustaining a successful freight broker business.
Eric Weisbrot is the Chief Marketing Officer of JW Surety Bonds. With years of experience in the surety industry under several different roles within the company, he is also a contributing author to the surety bond blog.
Take a hot dog and bun, wrap it in foil, then shoot it into the crowd at a baseball game. What could go wrong?
But Wait! Pilot Needs A Hot Dog Cannon.
That’s right. We can think of 3 good reasons Pilot/Flying J should place at least one of these potato gun knockoffs in each truck stop.
Shoot hot dogs directly into trucks at the fuel island. Drivers can order from the Pilot app, then roll down the window. The hot dog, bun and condiments will be neatly wrapped in foil and duct tape, landing in the cab.
Using hot dog sized cuts of swim noodles, you can simply pop any driver with this behavioral tool any time he or she decides to leave the truck unattended at the fuel isle.
Within the store, this can still be a handy tool for corrective action. No more free refills on coffee or soda. And what a great way to deal with shoplifters.
Starbucks allows loitering, now closing 150 stores. I can’t help but make a link between loitering and free truck parking. Someone has to pay for that space, those restrooms and the other amenities. Nothing’s free.
Burger King Selling Beer
Burger King teams up with Budweiser to sell beer at their Whopper bars. Foxbusiness.com
Really Bad Ad
We found a great example of someone putting makeup on a pig in this one.
Should Have Asked Buck And Don
What do you do when your girlfriend kicks your butt in arm wrestling? Not just once, but repeatedly. Oh, and she really gets a kick out of challenging you in front of friends and family. Digg.com is the source for this one. Needless to say, we all have a few ideas for this poor guy.
Trucker runs over a real dumbass. The Trucker’s Report has the story. You know this bonehead will hire a lawyer. What kind of stupid do you have to be to cross the street by walking under a semi trailer?
Saying goodbye to The Mongoose. NHRA loses a legend. From Hemmings.com. A good racer, and a marketing genius from the wonderful world of NHRA drag racing passes on. If you’re like me, you remember those grudge races between The Snake and The Mongoose. You probably also remember all the Hot Wheels cars and sets that were branded the same. Tom “The Mongoose” McEwen lost more than his share of the races, but he sure brought home the bacon for the NHRA.
The return of the Honda 50. Another post from Hemmings.com. Who doesn’t remember that little Honda from the 60s and 70s? Fifty cubic centimeters of good, clean fun. And it really looked like a dwarfed Honda.
Well, they’re coming back, along with a few other retro models from the “good old days.”
I have to take the hit on this one. The show just isn’t the same without Don the Beer Guy. His wit and banter just add the the magic that makes The Trucking Podcast happen.
Unfortunately, I failed to mark the dates he mentioned for 3 day camping trips. You guessed it. This week was one of them. I did have the good fortune to remember it about 5 minutes before we went live.
Look at the bright side. After 3 weeks off, Don the Beer Guy should be well rested, brighter and funnier than ever. You can count on it.
This week’s show notes were written by Robert Paterson of ProDriverProject.com. He’s been a friend of The Trucking Podcast for years. I invited him to write about what he’s been up to, and his pigtail wedge.
Flickering trailer lights are a real pain!
Ever drive down the road in a big truck only to look back in your mirror and see your trailer lights flickering? They flicker when you hit a big bump in the road or they will just flicker for no apparent reason. There’s the proverbial ‘SIGH’ and you immediately start looking for a good place to pull off the road to fix the problem.
This is a very common, and sometimes costly problem in the trucking industry. Flickering trailer lights is a D.O.T. offense with penalties up to $200 and 6 points on a driver’s C.S.A. score. EVERYONE who has driven a big truck more than a month has at one point had to deal with this. Most truck drivers know how to begin troubleshooting.
Unplug the pigtail, use a small screwdriver/knife to spread the prongs apart in the trailer connector (which I have found rarely ever works),
Then jam something in the trailer connector with the pigtail.
“Jam something” is the optimal phrase here. Tear off a piece of your dispatch paperwork, fold up a placard, toothpicks, paperclip, plastic zip ties, broken piece of a wooden pallet, anything to keep the pigtail steady and maintain electrical contact between the pigtail and the trailer.
Paper in the plug
The problem is: ALL of these work SOME of the time. Here is link to a video to all of the fixes below.
Folded paper will compress and fail at some inopportune time later in the day. Completely useless in the rain.
Paperclips are metal. (Can you say electrical short?)
Plastic zip ties work but you have to have multiple sizes because not all trailer connectors have the same gap between the pigtail and the plug.
Broken pieces of a pallet may not be readily accessible.
What is my idea?
So I’m sitting in a Macy’s shoe department waiting on my wife to finish shopping and I get the idea that a shoehorn will solve all my problems with the lighting issues with my truck. I went to the counter and asked for a shoehorn. They gave me one for free. It was pink! I took it to work that night and it didn’t fit.
Back at home the next day, I started cutting on my shoehorn in my garage with a Dremel. After many tries of cutting, shaping, and testing over many days, I finally got the design right and it worked!
I thought everyone should have one of these, but mass producing this thing would be a huge job. The Macy’s in my hometown was going out of business so I went to Dillard’s and got a dozen free shoehorns. I cut a new wedge, tried it out that night and then went back to Dillard’s to get another shoe horn. It wasn’t until I lost about a dozen wedges that I realized that I needed a lanyard to attach it to the pigtail. After spending about 30 minutes in my garage cutting each one, I realized that making them by hand was not going to work. Also, Dillard’s was getting wise that I obviously was not using these for shoes and didn’t want to give me any more shoehorns.
My “geeky” brother-in-law said, “Why not have them 3D printed”? After a brief discussion of what exactly was 3D printing, I went to trusty old Google and found a website, www.3dhubs.com, where I submitted a 3D file of my Pigtail Wedge, the number of pieces I wanted. Then I had to sift through a bunch of 3D printers to pick the vendor that I wanted.
The final solution.
After many months of successfully testing my new Patent Pending product on thousand of trailers, I now introduce to you: The Pigtail Wedge, a specially designed 3D printed tool to fill the gap between the electrical cord and the trailer connector ensuring a solid electrical connection.
The Pigtail Wedge
The Pigtail Wedge is designed to fix two problems.
A study on my website shows that the average trucking company loses about $500 per year per truck because truck drivers are having to fix this common issue right at the point when that driver is ready to start rolling the wheels to make money. A small company with 100 trucks has a potential lost revenue of $50,000 per year.
The LTL carrier that I work for was having a special issue with its pigtail (as many companies do). Many of their tractors were having pigtail failure after only 3 months. That’s 4 pigtails per year per truck. At $65 for one pigtail, that is $260 per year to replace pigtails and the lost revenue for the down truck. You can see where the dollars just start to add up. By using my Pigtail Wedge, my company was able to extend the life of each pigtail from 3 months to 9 months so far, saving both time and money.
So, whether you are a company driver who wants to keep the D.O.T. off your back, or a trucking company who wants to help your drivers be more efficient, The Pigtail Wedge may be just what you are looking for.
We have 2 types of people in The Trucking Podcast audience. The overwhelming majority of the listeners download and listen to the show every week, but we never hear from them.
Let the records show, we love you all. You take time to subscribe, download and listen to every episode. We are truly grateful for each and every one of you.
The Engaged Listener
These are the people we hear from. They leave voicemails and send email. Many of them even reach out via Facebook Messenger.
These are the listeners who shape the show. Their input and feedback help us decide what type of content to bring the rest of you.
ARI Is A Listener We Love To Hear From
Ari has a unique background that would lead most men into the white collar business world. Not Ari. He had a taste of the open road and decided to follow that call.
Few people understand how being on the road makes some of us come alive. Although we are from different generations, we share a love for an industry that will make or break you.
Convincing Ari to be on the show took a little persuasion, but I jumped on the chance when he finally agreed.
As you all know, The Trucking Podcast isn’t an interview driven show. I do have guests when time allows, and when I know you’ll enjoy the conversation.
We Want To Hear From You
Truckers come from all backgrounds. Each driver has a unique story, and a different way to look at trucking. Reach out. It can be an email or voicemail, but we would love to hear from you.
Trucking In The Morning – Update
Trucking In The Morning is my way of giving more content, but with an easier workload for me. But why haven’t I done any lately?
The simple answer is time. I haven’t had the extra time lately, but I will be continuing these episodes soon. Oh, and you’ll have to go to the website to hear them.Just click on the Trucking In The Morning tab in the menu.
Yes, you can flunk orientation. I nearly did just that several years ago. Consider this a truck driver 101 lesson. Getting fired before you were even hired really has to stink for many reasons.
You’re now unemployed and starting that job search all over. You may be pretty tight on cash. Oh, and you’re 900 miles from home. No problem. That company will surely give you a bus ticket home. What? No bus ticket?
Bus and Dump
According to a recent article at FleetOwner.com, bus and dump is a common practice with many trucking companies. They give you a conditional job offer and send you a bus ticket. But if they find a reason to rescind that offer, you’re on your own.
Tips For Advertising Your Car Or Truck
Have the wrecker set it down and pull out of the picture.
Pictures taken with your scantly clad wife, girlfriend or daughter alongside the vehicle will definitely attract the wrong kind of men to your ad.
If it’s a project, just admit that. It’s gotten out of hand and you’re in way over your head. Include pictures of parts separately, not piled in the back seat, trunk or truck bed.
Mow and rake the grass so we can see the bottom half of that project you abandoned out back 6 years ago.
Clean, clean, clean. No one wants to buy your used dumpster.
Price the thing. There are way too many ads that don’t show a price. And that $1 Craigslist trick? Don’t bother.
You know the mantra. Having strong freight broker relationships will make you more money. Since the broker already knows you, he’s just going to step up to the plate.
Let’s look at the realities of any sales relationship. The buyer and seller both see the value of repeat business. But you have to know just what that value is.
Two Sides of Freight Broker Relationships
From the carrier’s side, there’s a lot to be gained. You don’t have to provide your credentials with a broker you’ve already used. You’re familiar with their way of doing things. You also know if and when they pay. You may even know how they handle problems that may come up.
These are many of the same things the broker enjoys with your relationship. It’s just easy to do repeat business. The phone calls are quicker and more pleasant. But history tells us there’s more.
Selling Cars And Booking Loads
Most of you already know I spent over 10 years in sales. Nearly all of that time was in car dealerships. I also spent time in insurance sales and office equipment. Retail automobile sales just fit me best.
Know, Like and Trust
In every sales training class I’ve taken, these are major themes. These are the key words in building your customer base. A customer that knows, likes and trusts you will spend less time verifying what you’ve said. They believe you at your word.
We build these values so we can take advantage of the relationship. But it’s not just about time. You think, hope and count on getting a better rate on a load.
Think Like A Salesman For A Few Minutes
I always made more money on repeat customers. I spent less time with them, and I had a better idea of what they wanted. They always got a good deal, but certainly not the absolute best I could do. My family liked a roof over their heads and 3 meals a day. I had to get the most commission out of every sale.
Why Should A Freight Broker Be Any Different
A freight broker works on the same sales concept. Building a relationship with an owner operator helps him execute faster bookings. I’m sure he also makes more money. Brokers aren’t just going to give away the farm because they know you.
I’m not totally discounting the benefits of freight broker relationships. What I am saying is buyer beware. Trust but verify. Know your lanes and rates. Execute your bookings in a timely matter, and don’t be taken advantage of.
Trucker’s Edge Pro
The Trucking Podcast has an affiliate relationship with Trucker’s Edge, DAT’s load board for the owner operator with one truck, or just a few trucks. The Pro account is a fantastic way to do the trust but verify thing. Features in the Pro account include:
15 day lane rates
loads with rates posting first
broker days to pay
broker credit scores
all the features of the other plans
it works great on your smartphone
You can try Trucker’s Edge Pro by following the link. You can also call DAT and give them the promo code PROMO741 for the same 30 day free trial.
You can catch my interview with Todd Kalhar from DAT right here Truckingpodcast.com/Pro for a better description of Trucker’s Edge, and the newest features.