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M-B Direct to open hub used car sites

Mercedes-Benz Direct is planning to launch a series of smaller satellite sites to operate around the 10 main showrooms, mimicking the structure of the retail network.

In an exclusive interview with AM, managing director John Bisset says miniature 40-car M-B Direct sites will start to pop up in the wholly-owned London, Manchester and Birmingham hubs.

A new branch at Solihull, which opened during the last week in August, will feature up to 70 used and nearly new Mercedes. It follows the opening of three new sites in May after the company closed sites at Bristol, Poole and Chelmsford.

The hub and spoke concept aims to help consolidate the network and is being trialled with a site at Kingston on the A3, which has space for about 50 cars. “These sites require a different management style and an marketing approach that relies heavily on visibility,” Bisset says. Despite restricted space, the sites will offer drivers big site choice with one rather then several versions of different models.

Bisset also wants Direct sites to move away from nearly new sales and start focusing on older three- to four-year-old cars, a move that could put it head-to-head with the franchised dealer network.

“The two operations will complement each other rather than cannibalise sales. There is space for both operations to exist and we will be able to offer a range priced between £7000 and £70,000,” insists Bisset. “When we used to have the site in Poole, the franchised dealer actually saw his used car business grow on the back of the increased awareness that the Direct site achieved.”

Bisset reckons 85 per cent of customers are new to the Mercedes-Benz franchise, trading out of everything from Fords and Vauxhalls to Ferraris, Porsches and Jaguars. One in 10 of every used Mercedes is sold by a Direct site. A-class accounts for about 40 per cent with C-class 30 per cent and E-class taking 10 per cent. The remainder is made up of so-called “sexy” cars, rarities like the SL55 and CL500.

n DaimlerChrysler UK has revealed that its pioneering retail outlet at the Bluewater shopping centre in Kent will close at the end of the month. DCUK says the outlet, which opened in May 2002, does not meet the minimum franchise standards set for Mercedes-Benz retailers.

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