Independent Dealer has plotted every dealership operated by members of the ID50 and it reveals some glaring holes where they could compete more strongly.

Of course, those holes already have local dealers selling used cars. However, when compared with ID50 members, many lack the funding and physical resources to successfully operate across multiple sites. The growth of dealer stock-funding facilities (such as Manheim, NextGear Capital and BCA Partner Finance) is a direct response to these operators’ limited scope to boost sales volumes.

 

There is capacity in the market for independent dealers to grow. There are about 1.1m more cars aged six months to five years in the market today than there were in 2010 as the UK’s economic recovery took hold.

Independent dealers with ambitions to expand their territories will need to carefully consider changes in consumer habits. Research for last year’s  BCA Used Car Market Report found that of those who bought from dealerships 63% visited one to two forecourts before purchasing their used car, while 28% visited between three and five forecourts and 8.5% visited more than five.

Local dealerships remained the preferred choice for the majority. Barely one in three (30%) was prepared to drive for more than 40 minutes to buy their next used car, and while in their online research phase, one in five (21%) regarded the distance from home as one of the four main factors in their search, after price, brand and model range.

Many of the ID50 seem to have already factored this into their business planning, with a preference to be close to a motorway or at least a major arterial route. Of course, the major metropolitan areas are popular too, with multiple ID50 dealers operating in or around London, Birmingham, Manchester, Glasgow and Cardiff.

Yet other major conurbations such as Belfast, Edinburgh and Newcastle are being ignored by the ID50. Perhaps these are dominated by national franchised dealer groups – Arnold Clark has its own 21-site network of used car supermarkets, and Pendragon is expanding its Evans Halshaw Motorhouse and Car Store concepts.