When it comes to purchasing new products, most people would want to have nothing less than the best but it is not possible for all to achieve it. People have their own financial constraints and they need to go on a spending spree keeping these constraints in check. So what do we do when we can’t afford something new? We either settle for something less or just delay the purchasing activity until we are financially well of enough to go forward with it. But there is another option which we can exercise. Instead of purchasing brand new product we can buy something used or “second hand” as the market famously calls it.
The advantages of purchasing something second hand is that it comes at a lesser cost and already has been tried and tested and is reliable. However, there is a whole bunch of disadvantages that accompany a second hand product but not much should be expected from something already used that is now being resold at a considerably lower price. This second hand resale system is quite omnipresent in most of the sectors of our economy. While in real estate, it doesn’t make much of a difference in the automobile industry it decreases the value of the product considerably. If it vehicle has been used for a considerable period of time then the second hand value might even come down to a half of its retail price. Now it becomes quite feasible for various people with budget constraint to make the purchase.
In the automobile industry ‘tote the note’ somewhat refers to this practice of purchasing already used vehicles. When people have already used their new car or motorcycle for a considerable period of time and want to change it for a better one they sell it off in the market. The car dealers make good use of this opportunity and purchase it at a much lesser price. A whole lot of such sold cars lie in the junkyard of these car dealers. They have expert mechanics that thoroughly check the vehicle and make the necessary repairs as and when required. Often people sell vehicles when their performance is affected and the servicemen or repairmen of the car dealers repair this lag and make sure the vehicle is now in top notch condition for re-sale. When more customers approach them asking for second hand cars they have a whole lot of such vehicles to offer. And now as the performance of the particular vehicle has been significantly improved, the price also is increased significantly. This gives the dealers a plausible reason to make profits moreover as it is they who serve as a pool of interaction they get to demand their own prices making a significant profit in the deal.
Again the cars are sold and customers buy it at a reduced price. Thus the car dealers make a profit while the customers get to have the same vehicle at a decreased cost, albeit used ones. This ‘tote the note’ system is predominantly applicable to automobile industries alone however it is often seen in furniture world, hardware market, electronic goods market etc. The same reduced price and repair principle applies in these markets as well. As customer’s requirements keep increasing every day and purchasing power remaining more or less the same, the ability to purchase brand new products goes down and hence such practices are kindled and flourished.
Some people who have enough financial capacity do not prefer this system for various reasons however it is not much different from the actual retail market and is widely recognised in all parts of the world.