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.”