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.”
An award-winning journalist and editor, with two decades of experience covering the motor retail industry, and accredited by the Institute of Leadership and Management (ILM) plus the National Council for the Training of Journalist (NCTJ)
As editor of AM since 2016, Tim is responsible for its media content, planning and production across AM's multiple channels, including the website, digital reports, webinars, social media and the editorial content of AM's events, Automotive Management Live and the AM Awards. His focus is on interviewing senior leaders of franchised dealer groups and motor manufacturer national sales companies to examine latest developments in UK motor retail.
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.