This topic may be surprising considering that 90% of my blog has been about pottery, but I want to share some thoughts on car shopping. My old car broke down recently and it was time to buy a new one. It was so overwhelming and stressful that I couldn’t sleep when I first started looking (that’s not very characteristic for me). And literally a day after I bought mine, someone one Facebook asked for car buying advice. I guess i’m not the only one who thinks it’s difficult.
I now have a car that I’m quite pleased with and am about to share what I think the steps are for a fool-proof car shopping experience. I used a spreadsheet with a bar chart to help me narrow down my choices. I happen to think it’s quite clever and will explain it in more detail towards the end (download the spreadsheet). Ok, here we go!
1. Determine what you want/need form your vehicle. Without committing to a make or model, make a list of characteristics that are important to you and put them in a spreadsheet . E.g. vehicle type, price, warranty, number of seats, appearance, age of the vehicle, safety rating, mpg, stereo quality, availability of bluetooth, all wheel drive, etc.
2. Look for what’s available, not what’s theoretically possible. Unless you’re on an unlimited budget and don’t care when you get your car, it’s simply impractical to search all the possible makes, models, and features. You will definitely drive yourself mad. Look up car dealerships in your area on google maps and look through their inventory for things you may be interested in. I narrowed my search by size of the car, age of the car, and price.
3. Sample. Pick a few cars that differ on key features that you care about and test drive several. For example, if you aren’t sure if you want a van or an SUV, try driving one of each and see which one you like better. As you test drive, fill in your impressions and other car parameters into your spreadsheet.
4. Gauge price fairness. For each specific car on your spreadsheet, look it up on KBB/TrueCar and see how fair the price is for the features and condition you’re considering.
5. Pick the winner. The spreadsheet should help you narrow down your choices or at the very least organize them and make them easier to compare on a limited set of parameters.
The Clever Spreadsheet
This green section is where you enter your data. The MPG, price, and year are objective. Look and feel allow you to factor what you enjoy into the calculation. You would rate each car on how nice you think it looks and on how it feels driving. You could always break this down into more parameters.
This grey and red part transforms the information you entered into the green portion into a comparison and adds all the relative scores into a total score. The comparisons can be arbitrarily simple or complex; just think about what makes sense. Make sure that in your calculation higher score indicates that the car is better. For example, a higher number for MPG is good. A higher number for price may not be good. Let’s look at a couple of formulas:
- Looks compares the looks rating of the car to the average Looks score of all the cars
Excel formula: =[@Looks]/AVERAGE([Looks])
- MPG compares the average of City and Highway MPG for each car to the average of City and Highway MPGs of all the cars in your pool.
Excel formula: =SUM([@[MPG C]]:[@[MPG HW]])/(AVERAGE([MPG C],[MPG HW])*2)
- Deal compares sale price to what you found to be reasonable of this car online.
Excel formula: =[@[Fair Price]]/[@Price]
This is where all the research and test driving pays off.
I sorted the data by Total Score and it’s pretty clear which car is winning. The chart allows you to see why it’s winning. In my example Vehicle 1 is much newer than all the others, has the best warranty, and feels good to drive. It isn’t the best looking car and doesn’t have the highest MPG. By contrast, Vehicle 7 is cheap, looks nice, and has a decent warranty, but feels crappy, and is mediocre on the other parameters.
If you find that in your chart the top car is winning for some parameter that you realize isn’t important to you, you can remove that parameter and see if things look more accurate. You could also use this information to negotiate your sale.
There you have it.