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Auctions play a key role in dealerships' success

A motor group that has grown by 35% in the last 12 months claims it is still on course for further expansion. But auction houses will continue to play an essential role as Marshall – Britain’s fourth biggest privately-owned motor group – stays on an acquisition trail aimed at making it a national player.

“We see the people we work with as partners in our business and this certainly applies to auction houses.

“We look to them to promote our stock to their customers and do so in a way that will help achieve the highest prices,” said Christopher Walkinshaw, business development director at the Cambridge-based company that operates 54 dealerships and represents 22 car manufacturers.

Fourteen outlets have been added during the last year and Marshall – ranked 13 in the country’s top 20 groups – is now running three sites in Yorkshire as part of its drive to operate beyond its traditional boundaries.
“We are quietly optimistic about the market and the balance of business for the rest of this year.

“We have enjoyed a very strong period of trading and orders are strong at the moment,” said Walkinshaw

“We’re spending a lot of time looking at and appraising growth opportunities, but every move has to be right for us because we have no ambition to be big just for the sake of it.
“What is clear is that as we expand, we will take our auction partners with us,” says Walkinshaw.

In a relationship spanning two decades, Aston Barclay has seen Marshall grow from 20 dealerships and Walkinshaw acknowledges that it provides an essential channel for disposals. Marshall retails around 13,000 new and 14,000 used cars each year and uses the auction house to sell around 7,000 vehicles annually.

“That level of activity makes Aston Barclay an important partner. Even though we like to retail as many vehicles as we can, some of the cars it handles are part-exchanges that either don’t fit our stock profile or ones that we have planned to retail, but have failed to sell. We have a very strict stock age policy and release cars immediately a certain period is reached without them being retailed.

”The auction plays a big part in our disposals, but it sources relatively little stock because most of our used vehicles are trade-ins. In addition, we have opportunities to buy used vehicles from some of our manufacturer partners and also buy from other sources, such as Motability.

“But the auction house is essential. It works well and provides the complete transparency that is good for our businesses and also good for governance and control.

“As a retailer, our number one objective is finding our own retail or fleet customers, but any good business needs an arrangement for vehicles that don’t sell through its main channel and the auction is a natural fallback.

“Aston Barclay has done a good job for us over the years and as we
increase our throughput, we will also increase the number of cars it handles,” said Walkinshaw.

Aston Barclay sells around 250 units each month for Slough-based SMC Group, which sells Ford, Suzuki, Mitsubishi, MG and Seat through eight sites from Windsor to Gravesend in Kent

According to group buyer Mark Baxter, the arrangement has made life a lot easier.
“We used to trade all our vehicles, but it was extremely time-consuming – if I had to trade cars again I’d never have the time to do any other job. I buy around 200 cars each month and that’s time-consuming in itself.

“We’ve worked with Aston Barclay since 1998 and like the fact that if you want something done, you can talk to the person responsible and it happens,” said Baxter, adding: “The auction provides the sales and picks up all our vehicles. We get paid the following week and we’re generally happy with the prices we achieve.

“Using the auction helps us manage our stock, which is vital to running the business. We’re constantly looking at prices and making adjustments. It’s a competitive market and if stock isn’t managed properly, you’re soon in trouble.

“Aston Barclay is a slick operation and is a big help at plate-change time. We’ll have extra cars to handle in September, but all we need to do is list the vehicles coming in and book extra transporters in advance,” he said.

SLM takes 'big step' to auctions

Family-run SLM Group has enjoyed significant benefits since switching to auction-only disposals and forming an underwriting department three years ago.

“The additional facility gave our sales managers an extra tool in the form of values on a daily basis that have allowed us to capitalise on a market that is quite lucrative.
“It’s a big step up from the old industry norm of trading at cost or even at a loss and having sales managers arguing over every scratch with traders. It allows us to be proactive on values, rather than relying on guides that tend to be reactive,” said underwriter Colin Stone.

Based at St Leonards, Sussex and celebrating its 50th anniversary SLM has six dealerships, a used car centre and a body repair operation and retails around 3,000 new and used cars annually.

“We wanted an auction house that would provide a totally professional service, achieve strong prices and care about what we do – and I have to say that we’re very pleased with the results.

“We sell up to 1,500 units per year via Aston Barclay and we get feedback from them as well as being able to tap into their regional results,” Stone said.

“One of their major plusses has been going online – this isn’t new, but the way it is presented and the condition reports it provides gives buyers extra confidence.

“Instead of having to interpret condition that’s graded by
numbers, buyers get a blow-by-blow account of every mark and dent, the state of the interiors and the wheels. It’s a bonus.”

And he said the company also liked the fact that its product got good exposure, which allowed it to build a strong relationship with the buyers.

“And we receive prompt payment,” he says.

 

 

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