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Stocking insight: Dealer focus now on used vehicles

Many dealers retain more part-exchanges

Adrian Rushmore, Glass’s editor in chief, said many dealers are retaining more of the better quality part-exchanges as it takes time and effort to source good used cars, and where better to look for them than your part-exchanges.

It’s a theory backed up by the 2012 AM Awards Used Car Retailer, car supermarket Eddie Wright in Scunthorpe. It has put more focus on preparing trade-ins for retail through its in-house refurbishment team. It also keeps tight controls on stock levels, with stock becoming slightly older and cheaper because it noticed annual disposable income in Lincolnshire has fallen since 2008. The company rigorously ensures a maximum of 42 days on stock.

Rushmore said used car transactions have actually begun to improve. However, any real improvement ahead in 2013 will put a very significant strain on the availability of used cars, both on dealer forecourts and in wholesale.

High Street inspiration

High street retailers are a major source of inspiration for Graeme Potts, now managing director of Vauxhall and Chevrolet retailer Eden and former MD of Inchcape Retail.

Potts follows an ethos of promoting and stocking what the customer wants to buy, not what happens to be available. It requires inventory management skills, having the right mix and price range to ensure a dealership can do business with its customers.

As Potts said: “There is a lot of nonsense talked about ageing policies in used car retailing. Why would I buy a retail product for a retail customer, then 60 or 70 days later sell it to one of my competitors at a price lower than I paid for it, fully reconditioned, so that he can sell it to one of my customers cheaper than I paid for it? Yet that is what we often do in our industry.

“I would rather give a retail customer the deal of a lifetime so that our reputation soars in terms of value and quality, than give it to a competitor to sell.”



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Comments

  • Jonathan Hunt - 12/12/2012 23:20

    When are we as an industry going to learn, its us that set the prices in the market, we seem content to continue reducing our margins to compete with each other, inspite of difficult supply and all the investment we have, heres a novel idea why dont we ALL increase our prices and margins as one from january 2nd 2013. I know it will never happen but more fool us.

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  • Martin - 13/12/2012 11:35

    Good for Marshalls and the others mentioned, I wonder how many dealers and groups have made the same wise investment in used car skill and resourse? It is a massive hole in many dealer operations with countless used car stocks not refreshed and clogged with self reg and Pack cars. result, low margins or losses on cars not sold quickly.

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