The following interview was held via email with Tyler Elliston, CEO of Carsala - a website that offers used car buyers an alternative to all the hassles of used car shopping by doing all the grunt work for them. The site has been around since 2008.
This Q&A was prompted by a reader query about the company. Are you curious about something related to the used car industry? Send an email to usedcars.guide@about.com and I'll do what I can to help (if the answer isn't already on this website!)
Q. When was Carsala founded? How has the company's growth been since that time?
A. Carsala was founded in 2008. The growth has been promising, even during the economic downturn. Our brand recognition is clearly on the rise and our customers are referring friends and family at a high rate.
Q. How many deals has Carsala worked out?
A. I can't give you exact figures, but I can tell you that the number of deals we've negotiated is easily in the thousands.
Q. In your disclaimer on a sample premium report, you say, "Many ads online are for cars that have already been sold. Carsala analysts believe the cars listed here are still available." How do you know if a car has or hasn't been sold?
A. We confirm that the link to each ad we found is still valid (that we don't get an error when following the link) and then we go to each dealer's website to confirm the car is still there. If a customer hires us for negotiations, we will then call to confirm availability and negotiate the price. If, after negotiations, a customer believes she may want to buy the car, we'll confirm the availability and price in writing.
Some dealers will intentionally leave cars on listing sites after they've sold in order to get inquiries/calls/visits; they often do this with great deals. We simply want to set expectations that if it looks too good to be true, it might be. The dealer may have sold it a month ago. We ensure our customers don't fall victim to bait-n-switch tactics by confirming availability each step of the way (ultimately, in writing).
Q. Is your "discount price" based on the KBB.com average retail figures for the car?
A. It's based on the asking price. We charge the customer 20% of the greatest discount off asking price we negotiate. Usually, this is also a substantial discount off the KBB values.
Q. Explain how your "free" professional negotiations work. Is the 20% off the average asking price or the average dealer retail price from KBB.com ?
A. First, the customer must decide which cars to negotiate for. We do a search and analysis for free if the customer has hired us for negotiations (or $49 if they haven't). The customer tells us which of the cars she wants us to negotiate for; the customer can also add cars she found herself. Then one of our negotiators calls the dealers of those cars to get the lowest prices. If we don't get any discounts off the asking prices, we don't get paid (for the search or negotiations). If we do get discounts, we get paid 20% of the best discount.
Q. Your Carsala PriceChecker seems like a good program. Why offer something like that for free and not charge for it?
A. It's hard to earn car buyers' trust. We believe that providing real value for free like the PriceChecker and free report sample helps accomplish that. First and foremost, we want car buyers to get great deals with minimal effort. Obviously we'd like car buyers to use the services we charge for, but even when they don't, it gives us satisfaction to know we helped. Those people tell others about us too.
Q. You put out a press release that says, "consumers can save, on average, over 25% off CarMax prices through search, analysis, and skilled negotiations." CarMax isn't known for low prices, but how is it possible to save that much off the price of a car? That's a huge swing.
A. I know, it's shocking. Ultimately, it's possible to save that much with:
- - extensive searching. We often found dozens if not hundreds of similar cars for every 1 CarMax car considered.
- - extensive negotiating. We negotiated for 10-20 cars to compete against every 1 CarMax car considered.
- - skillful negotiating. Our negotiators are really good. Most are former dealers who know how to talk the talk and push the right buttons at the right times.
