Scratching your head and wondering what is the difference between buying or selling a vehicle on a peer-to-peer marketplace and a dealership?

Buying

Dealership

• Warranty
  Dealerships will often have a short warranty period in which the buyer can return the vehicle if there are any issues that arise during this period. This can ease buyers’ minds in that they can return the vehicle at their convenience if there are any issues with the vehicle that didn’t show during the test drives.
• Vehicle condition assurance
  A dealership must abide by laws and regulations to sell a used vehicle. A buyer does not need to worry about the condition of the vehicle as dealerships cannot legally sell a damaged vehicle or misinform the buyer of the vehicle’s condition.
• Payment options
  There are a variety of payment options when at the dealer, ranging from financing, to cash payments and leasing. This flexibility of payment options may be attractive to many buyers.
• Limited inventory
  When purchasing a vehicle at a dealership, the buyer is limited to whatever vehicles are on the lot. This lack of vehicles options may not suit the needs of the buyer and the buyer may have to travel to many different dealerships to find the vehicle that fits their needs.

Peer-to-peer marketplace

• More room for negotiation
  Sellers who use peer-to-peer marketplaces may have a variety of reasons to sell their vehicle. Oftentimes, sellers want to sell the vehicle as quickly as possible and could be willing to part with their used vehicle for less. Once the negotiation phase has been reached, a considerable amount of time may have passed and the seller may not want to go through the whole process again with another buyer. Having the monetary funds on hand to transfer immediately to the seller can be very enticing, and the seller may be willing to sell the vehicle for less.
• Cheaper price
  As sellers on the platform aren’t necessarily bound to making a profit on their vehicle, prices for used vehicles are usually lower than dealerships. This price difference can be explained by the lack of dealership factors such as commissions, vehicle repairs or overhead costs.
• Control in the buying process
  When purchasing at the dealership, buyers may not feel like they are in control of the process and are being strung along for the ride. By using peer-to-peer transactions, buyers can go at their own pace and not feel pressured by any salespeople. When buying on a peer-to-peer marketplace, it is possible that seller is inexperienced in selling a vehicle and will not use any of the tricks dealerships may use. Moving at the pace that the buyer is comfortable with is crucial to not having any buyer’s remorse and can lead the buyer to making responsible, calculated decisions about their used vehicle purchase.
• Diverse vehicle options
  As peer-to-peer marketplaces do not have a physical location, there are many different vehicles that are listed by sellers for the buyer to browse. In this type of a marketplace, a wide variety of vehicles can be found, from vintage to custom makes and models.

Selling

Dealership

When selling to a dealership, the dealership will make sure to inspect the vehicle for any damage or for places where work will be required. After a thorough examination, the dealership will decide whether to make an offer on your vehicle or not. Any additional costs that the dealership will have to incur to resell the vehicle will be deducted and reflected on the offer price.

Peer-to-peer marketplace

Selling on a peer-to-peer marketplace has the benefit of the seller being in control of almost every aspect of the sale. The seller can set the listing price to what they believe their vehicle is worth. The seller would also have to be involved in their listing, marketing their vehicle and arranging a payment.

Which one should I choose?

When you are buying or selling a used vehicle, having trust in the other party is crucial to completing a transaction. Built on the trust of knowing who you are dealing with, what you are buying and what to expect in the process, BCAA Auto Marketplace is BC's online automotive marketplace for used vehicles.

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