When compared to personal or family cars, buying a car for business is a process which requires more research and preparation because it directly affects your efficiency and productivity.
When buying a car for your business, it’s hard to believe that so many things can go wrong. However, trial and error is not the best way of solving a problem in this case. From the size and choice of safety features to the ways you’re going to use it and the message it sends, here’s a quick guide to doing it right the first time.
A car you can afford
If your current car isn’t yet paid off and you’re considering getting another, you need to be sure you can afford to finance another vehicle. If possible, wait until the loan on the current car is paid off and then drive it for another year while you set aside the money you used for monthly car payment in an interest-bearing account. For example, if you used to pay $300 a month and continue to set aside the same amount for one year, after 12 months you’ll have $3,600 to use as a down payment for your next car. Also, think twice before you reach into your savings to buy a premium class car. Purchase within your abilities, not over.
Look for dealerships with commercial programs
You need a dealership with a specialized commercial division. These people will know more about commercial vehicles and financing options, which simplifies the transaction and ensures a better deal. Browse the dealerships in your area that finance and sell cars to companies, and you may even find those that offer fleet discounts if you purchase more than one vehicle. Using the available information from your local business bureau, you can compare their ratings and eliminate those with bad customer reviews. Finally, check their websites and see what’s on sale in the commercial division.
Consider both new and used cars
A not long time ago, a slightly used car was the best money-saving option when purchasing a new(er) vehicle, owing to the simple reason that new cars depreciate rapidly the moment they are rolled out of the dealership. However, recently the supply of used cars has decreased as a result of many “new for old” replacement programs, while more people believe that the quality of the new cars is incomparable to previous generations, so they hold on to their vehicles longer. Due to these two factors, buying a new car might be more realistic, but you should keep your mind open to both options.
Buy a safe car
While the safety of your vehicle should be one of the topmost priorities in all situations, with company cars, the owner carries a much larger liability. Compare crash test ratings to see how well your choices performed in controlled collisions, and make sure the one you buy has side and curtain airbags in addition to frontal ones. Also, you can decrease the impact of accident, theft, or damage by choosing better car insurance that includes emergency claims assistance, car hire after damage or theft, and roadside assistance. Large cars, weighing more than 1,550kg, generally provide better protection in accidents than smaller cars, while greater ride height within a given weight class has also shown to decrease a chance of life-threatening brain damage in side-ramming collisions.
Size matters
While some businesses will appreciate the refined aesthetic of a German executive-class sedan, if you need it to shuttle four colleagues with a trunk full of sample goods and catalogues to clients a county or two away, perhaps an estate or a flat-floor minivan might be a more comfortable and economical choice. Consider the typical workday of your vehicle and the type of journey it has to make, and you’ll instantly know what size and type of car you need. On the contrary, if your business rarely takes you outside the city limits, a small hatch will park almost anywhere and be more fuel-savvy in the crawling 2:30 traffic.
To trade in or not to trade?
One thing is certain – you’ll always get more money for your old car if you sell it instead of trading it in at a dealership. If you sell it yourself, you can hope for 20% more than a dealer would offer to shave off the price of a new car. Whip your car into shape and post it at several buy-sell-trade websites. Make sure to wash it thoroughly inside and outside before the photo shoot, and prepare the service and maintenance records. If you live in a region that sees all four seasons at their best and worst, your windshield is likely to show chips from sand and rocks on the road. However, although a new windshield can cost around $800, many insurance providers will replace it for free or for a low flat rate, provided you have comprehensive coverage.
When compared to personal or family cars, buying a car for business is a process which requires more research and preparation because it directly affects your efficiency and productivity. If you educate yourself on the essentials a reliable company car should have, you increase your chances to negotiate a better deal.
Join the conversation!