Off-Site Vehicle Inventory Storage
NOTICE: The information below was obtained directly from the Division of Motorist Services (DMS).
The Division of Motorist Services has issued a position paper distributed to field staff which concludes as follows:
“…licensed dealers should be allowed to store excess inventory at an offsite location but under no circumstances should the physical “in person” inspection, test drive, or purchase of a motor vehicle take place anywhere other than a licensed location.”
This DMS position will allow you to store inventory off-site and advertise that inventory through the internet or other media. To prevent a violation from occurring, be sure to never allow the customer to view the inventory in-person at any location other than your licensed dealership location. The entire position paper is below:
Subject: Off-site vehicle inventory storage by licensed Florida motor vehicle dealers.
Introduction: There has been lengthy internal discussion on the exact requirements of Florida Statutes 320.27(3), and whether or not this statute allows for off location storage of vehicle inventory by licensed dealers and if so under what conditions. This position document will review the pertinent statute and provide guidance when addressing this issue in the future.
320.27 Motor vehicle dealers.—
(3) APPLICATION AND FEE.—The application for the license shall be in such form as may be prescribed by the department and shall be subject to such rules with respect thereto as may be so prescribed by it. Such application shall be verified by oath or affirmation and shall contain a full statement of the name and birth date of the person or persons applying therefor; the name of the firm or copartnership, with the names and places of residence of all members thereof, if such applicant is a firm or copartnership; the names and places of residence of the principal officers, if the applicant is a body corporate or other artificial body; the name of the state under whose laws the corporation is organized; the present and former place or places of residence of the applicant; and prior business in which the applicant has been engaged and the location thereof. Such application shall describe the exact location of the place of business and shall state whether the place of business is owned by the applicant and when acquired, or, if leased, a true copy of the lease shall be attached to the application. The applicant shall certify that the location provides an adequately equipped office and is not a residence; that the location affords sufficient unoccupied space upon and within which adequately to store all motor vehicles offered and displayed for sale; and that the location is a suitable place where the applicant can in good faith carry on such business and keep and maintain books, records, and files necessary to conduct such business, which shall be available at all reasonable hours to inspection by the department or any of its inspectors or other employees.
Discussion: The ease and popularity of internet shopping has had several major effects on licensed motor vehicle dealers. Two of the effects that relate to the topic under discussion are the increase in internet based shopping and purchasing of vehicles, and with this the decrease in need for physical display space at dealer locations.
There is no argument that it is best practice, and the law requires, that when a person inspects, test drives, purchases, etc. a motor vehicle in person it must be done at a licensed dealer location. However, if a consumer is “window shopping” via the internet the physical location of the vehicle becomes of little concern. Allowing licensed dealers to store excess inventory at offsite locations, as long there is no consumer access to the location, saves the dealer money, allows them to provide a larger inventory of vehicles for sale, and does not impact the consumer.
Conclusion: The primary piece of statutory language under debate reads” The applicant shall certify that the location provides an adequately equipped office and is not a residence; that the location affords sufficient unoccupied space upon and within which adequately to store all motor vehicles offered and displayed for sale;” ( underlined for emphasis). We contend that a vehicle for sale by a licensed dealer via the internet, newspaper, or other media, is offered but not displayed for sale. As long as the consumer is not allowed physical access to the off-site storage area the spirit and letter of the statute is preserved.
For this reason, licensed dealers should be allowed to store excess inventory at an offsite location but under no circumstances should the physical “in person” inspection, test drive, or purchase of a motor vehicle take place anywhere other than a licensed location.