Whats the point in residual values in sales pitches

D14

Member
We've all heard it hundreds of times from salesmen 'it costs more in the first place but is worth more 2nd hand'. I don't think this holds any truth any more with any brands in particular JD. All dealers no longer seem to want trade ins of any description and seem to say 'sell it yourself, you'll get more for it'.
So the point is if you sell back to a dealer your only ever going to get offered the trade price so it being worth more is incorrect and bares no relevance to the sale. Selling privately if you can be done with the hassle obviously would realise more money but not everybody wants to do that and have the hassle of dealing with multiple people for a few thousand more.
 

Farma Parma

Member
Arable Farmer
Location
Northumberlandia
My last three new tractors were all sold privately at a later date & even a used one also sold with zero issues or comebacks
Ive found most dealers dont want the hassle of your used model unless its really tidy or in high demand.
So just have to sort of Insult you with the very lower than expected trade in price as its basically leaving there hands directly to there trade man.
Id have no issues dealing the same way in the future.
It seems as if Fendt are poss the only single brand who do cost more new than most of the rest but do hold there residual value way above everything else.
even the mighty deeres iam afraid to say.
 

KB6930

Member
Location
Borders
I think JD's still seem to be holding value a friend of mine got a price to change and he had an option to trade in a JD or a NH the JD is 5 or 6 years older and a smaller tractor by at least 80 hp I think the blue one had slightly more hours but very little difference and they were the same trade in value
 

ColinV6

Member
Why am I not suprised with this attitude from JD, they know people will run back and buy another one anyways so if they can remove the hassle of dealing with your trade in and still sell you another, why wouldn’t they.

Vote with your wallets people.
 

balerman

Member
Location
N Devon
I think JD's still seem to be holding value a friend of mine got a price to change and he had an option to trade in a JD or a NH the JD is 5 or 6 years older and a smaller tractor by at least 80 hp I think the blue one had slightly more hours but very little difference and they were the same trade in value
Yeah but how do did you call the horsepower of the NH,if you use the numbers on the bonnet,that is boost figures,could be way less than that.
 

D14

Member
I think JD's still seem to be holding value a friend of mine got a price to change and he had an option to trade in a JD or a NH the JD is 5 or 6 years older and a smaller tractor by at least 80 hp I think the blue one had slightly more hours but very little difference and they were the same trade in value

Not sure about that. The 2nd hand market is awash with used Deere's. Stealer offered me £45,000. Independent dealer said he'd pay £54,000 and says he's retail it at £60,000 with movement to do a deal.

So if I went privately potentially on a good day I could get around £60,000, yet the main stealer offered £45,000. Thats just disgraceful and shows zero respect for their customers. I then had a ring round a few local farms and they've all found the same. Anyway I am not selling now and will keep it and won't be buying a new one from the dealer. When the time comes I will look elsewhere.
 

lloyd

Member
Location
Herefordshire
Not sure about that. The 2nd hand market is awash with used Deere's. Stealer offered me £45,000. Independent dealer said he'd pay £54,000 and says he's retail it at £60,000 with movement to do a deal.

So if I went privately potentially on a good day I could get around £60,000, yet the main stealer offered £45,000. Thats just disgraceful and shows zero respect for their customers. I then had a ring round a few local farms and they've all found the same. Anyway I am not selling now and will keep it and won't be buying a new one from the dealer. When the time comes I will look elsewhere.

Will you share the model ,age,hrs as would be interesting to see
how bad the dealer was offering. :)
 

thesilentone

Member
Livestock Farmer
Location
Cumbria
C'mon people, this comes up time and time again. When a dealer ' retails ' a s/h item he also takes the liabilities that either the contract of the sale or the law of the land go with it. That has a cost, and needs to be allowed for.

When ' traded ' there are few liabilities, and trade is usually to get rid quick.

If we sell a s/h item, we also have to agree the terms of sale, or alternatively sell with ' not warranty implied or given ' this of course affects the selling price also.
 

Wisconsonian

Member
Trade
Here in the US, there are lots of stories of guys trading in 3-4-5 year old trucks and getting more than they paid for them, of course they don't mention that the new truck is twice the price it was 4 years ago.

Lots of desirable tractor models are the same price now that they were 10 or 20 years ago, that doesn't mean that the new one will hold the value as well though, those models are usually pre emissions.

A far better example would be years ago when you could buy a Toyota Corolla for a little more than a Kia etc. At the time the new Corolla would hold it's value so well that it was a much cheaper car to own than the competition, if you regularly traded in. I say years ago, because the depreciation on used cars is less than it used to be, Kia has caught up.
 

David.

Member
Mixed Farmer
Location
J11 M40
Not sure about that. The 2nd hand market is awash with used Deere's. Stealer offered me £45,000. Independent dealer said he'd pay £54,000 and says he's retail it at £60,000 with movement to do a deal.

So if I went privately potentially on a good day I could get around £60,000, yet the main stealer offered £45,000. Thats just disgraceful and shows zero respect for their customers. I then had a ring round a few local farms and they've all found the same. Anyway I am not selling now and will keep it and won't be buying a new one from the dealer. When the time comes I will look elsewhere.
Do you really think a private buyer is going to cut you a cheque for 60k, retail money, in the knowledge that he will get no backup if it goes pop first time out?
 
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thesilentone

Member
Livestock Farmer
Location
Cumbria
What is the salesman's job?


This is about understanding (or not as the case may be) how s/h equipment is valued.

There are many different ways valuations are made based on who the buyer / seller is.

In simple terms.

1) Trade (like we buy any car .com) where you get trade price, based on an inspection and/or test drive. Deal done, no warranty, once it gone, it's gone. This is for selling quickly and at the lowest price.
2) Private sale, in this case, we decide to sell privately, we are not dealers (or retailers) and we sell with the terms we agree with the buyer (eg: good working order, or needs a clutch, etc, etc, etc) these terms should be written on the invoice, deal done, no warranty implied or given.
3) Trade-in, this price will reflect what the dealer values your s/h at. Many other competitors will give a value, the reality is, only one value has any credibility, and that is from he who buys it !! The hours, general condition and market value will be taken into consideration LESS what is costs to turn around. These costs will include collection and delivery, a workshop inspection, any remedial work, any future warranty and a margin for the dealer.
4) Retail. This is the price on a dealers forecourt, sold with a limited warranty and good faith that the item is in good condition and will be stood behind by the selling dealer.

There are many dubious and different values banded about, and the reason for these will be manifold, however, if you are like me, the only figure that is of interest is: How much to change !!

How that figure is agreed or how the retail price and trade in values are distributed is important, as it may affect how much tax I need to pay, so I would consult my accountant before making any high value purchases.
 

milkloss

Member
Livestock Farmer
Location
East Sussex
Can't see many dealers wanting to put a warranty on a second hand sale this day and age. The machines coming through now are immensely over complicated for turning a bit of dirt or whatever. Just look at some of the expectations from members on here when something goes wrong. Not saying their not entitled to make a claim but there's mega money involved in some of them.
 

Steevo

Member
Location
Gloucestershire
Can't see many dealers wanting to put a warranty on a second hand sale this day and age. The machines coming through now are immensely over complicated for turning a bit of dirt or whatever. Just look at some of the expectations from members on here when something goes wrong. Not saying their not entitled to make a claim but there's mega money involved in some of them.

Exactly this!

Main dealers offer trade price for trade-ins, but then anything they do sell directly themselves never goes through the workshop and is usually sold with zero warranty but they want retail price for it.
 

D14

Member
Do you really think a private buyer is going to cut you a cheque for 60k, retail money, in the knowledge that he will get no backup if it goes pop first time out?

Since when has a dealer offered a warranty on anything used? I’ve never come across it. Used is used, whether it’s from a dealer, private sale or auction.
Warranty exists on new only and then in some cases it’s only 12 months.
 

D14

Member
This is about understanding (or not as the case may be) how s/h equipment is valued.

There are many different ways valuations are made based on who the buyer / seller is.

In simple terms.

1) Trade (like we buy any car .com) where you get trade price, based on an inspection and/or test drive. Deal done, no warranty, once it gone, it's gone. This is for selling quickly and at the lowest price.
2) Private sale, in this case, we decide to sell privately, we are not dealers (or retailers) and we sell with the terms we agree with the buyer (eg: good working order, or needs a clutch, etc, etc, etc) these terms should be written on the invoice, deal done, no warranty implied or given.
3) Trade-in, this price will reflect what the dealer values your s/h at. Many other competitors will give a value, the reality is, only one value has any credibility, and that is from he who buys it !! The hours, general condition and market value will be taken into consideration LESS what is costs to turn around. These costs will include collection and delivery, a workshop inspection, any remedial work, any future warranty and a margin for the dealer.
4) Retail. This is the price on a dealers forecourt, sold with a limited warranty and good faith that the item is in good condition and will be stood behind by the selling dealer.

There are many dubious and different values banded about, and the reason for these will be manifold, however, if you are like me, the only figure that is of interest is: How much to change !!

How that figure is agreed or how the retail price and trade in values are distributed is important, as it may affect how much tax I need to pay, so I would consult my accountant before making any high value purchases.

So it’s ok that the branded dealer offered £45,000 yet the independent dealer said £54,000 and that he’d then retail it at £60,000 with a view of negotiation. I’m not questioning the independent dealer at all in this as he’s been very honest. However the branded dealer who is known for saying buy this brand to get better residual value is full of rubbish.
 

thesilentone

Member
Livestock Farmer
Location
Cumbria
So it’s ok that the branded dealer offered £45,000 yet the independent dealer said £54,000 and that he’d then retail it at £60,000 with a view of negotiation. I’m not questioning the independent dealer at all in this as he’s been very honest. However the branded dealer who is known for saying buy this brand to get better residual value is full of rubbish.

My opinion is irrelevant.

I assume you sold it to the independent and negotiated a big discount on the new one, cash sale ?

I would have.
 

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