Old cars that are often sold 'as is'. - File

While many people take a calculated approach to business, both in terms of a mentally-tough attitude, as well as doing the necessary addition and subtraction to figure out margins of profit and loss, there is a special kind of calculation which goes into sales done on an 'as is' basis.

And it does not take high-powered accounting; neither does it come from one side of the transaction.

"When you are selling something 'as is', it is on the basis that something may be wrong with it. In fact, most of the times there is something wrong with it that is immediately identifiable," said part-time car salesman Marcus. "In my line of work, we call it 'as is', but they have it all the time in appliance stores and hardwares, where they call it scratch and dent or repossession."

"In the store, they will put what is wrong on it, you know, like on a television they will put 'not coming on' or there will be damaged lumber in a hardware. So you know what you are dealing with right away. In car business now, chances are there will be damage that you can see right away, to the body, or the transmission might not be working, but a mechanic would really have to look to see the engine damage and wear to things like the CV joints," Marcus said.

Negotiable

He says that while all prices for items sold on a one-on-one basis are normally negotiable, the 'as is' price is even more so. "It is understood that there is fixing up to do, so the person is buying something that they will have to spend on. So the seller keeps in mind how much somebody would have to spend to get the item in functionable condition and the buyer does so as well," Marcus said.

Looking around

Of course, that means that there is a lot of looking around to be done, a process which refrigerator technician and salesman Garth, who operates on Mannings Hill Road, St. Andrew, is familiar with. He buys old units then fixes and sells the best of them, scrapping the rest for parts either to refurbish other fridges or for the sale of components, such as the motor.

And, as he buys and sells mostly on an 'as is' basis, he points out another important consideration. "What you get is what you buy. There is no guarantee, no warranty. If it break down tomorrow morning, you are on your own," Garth said. "That is why it cheaper too. We work good, still, so we have a good name and people come. It don't make sense for you, as a businessman, to send out things that break down quick, because people going to stop come to you, so even if something go wrong soon, most times we just set it and call it that," he said.

Marcus points out that "there is always a lot of negotiation, because naturally, the seller will underestimate the price of what is needed to improve on the 'as is' item, while the buyer will overestimate what is required. There is also labour cost and sometimes people will come to a deal where the seller will also provide the labour, free or at a reduced cost, as long as the buyer supplies what is necessary and the repairs are done at the point of sale".

"If you can deal with it right, you can get a car for cheap and set it up for much less than it would take to get the identical year and make in comparable condition, without damage. All those cars that people bringing in from foreign, damage, is 'as is', although they don't say it. And plenty times they bring in the parts with it too, and even offer to put them on and do the fixing up," he said.