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Scottish buying power to spread south of border

The Scottish Motor Dealers Buying Group (SMDBG), set up 18 months ago to enable operators to buy services in bulk, is in talks with retailers in England as it looks to build up volume. The group, founded by Paul Barnett, managing director of Dundee-based Barnetts Motor Group, has 18 members in Scotland.

Each is said to benefit from average savings of £13,500 a year, though some claim to have cut costs by more than £30,000. Members of the group range in size from five to 20 outlets, with total annual turnover of about £1bn.

Douglas Reid, SMDBG administer, says the organisation helps dealers of a certain size compete with larger retailers which often have their own professional buyers. He is hoping to sign up between 10 to 20 dealers in England by December.

“We have taken our time setting up the business in Scotland and now we have an opportunity to establish it with other dealer groups,” says Reid. “There is a huge market in England and we are talking to a number of groups throughout the country.”

Increasing the size of SMDBG will give it the financial muscle to move into other cost saving areas and improve existing agreements. It presently tackles utilities, maintenance and support, but is looking to obtain discounts on tyres, lubricants and other high volume consumables.

Under the scheme member dealers pay a small joining fee and a percentage based on the savings achieved. Once ordered, the goods or services are delivered to the individual dealerships, which are then invoiced separately.

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