North West based Williams Group is using a reverse auction system for its collection and delivery of vehicles in order to reduce logistic costs.
Jeff Fairbotham, Williams director, identified logistics as a potential area to save money for the business after reviewing how much the group was spending on collecting and delivering cars.
He told AM: “We were looking at areas of the business in areas in which we might be able to keep costs down.
“We have a high volume of collection and delivery but we wanted dealerships across the group to have a standard approach.”
The business piloted a new online service called Motor Trade Delivery (MTD) which looks to match dealerships with logistics companies for logistic jobs.
Dealers post jobs at a discounted rate initially; the price then gradually rises to a maximum, defined by what the dealership would normally pay per mile. Logistic companies compete to bid to provide the lowest price for the dealer before it reaches the maximum pence per mile limit.
Williams has now signed up with Motor Trade Delivery which launched on July 1.
Fairbotham said: “We have done a costing exercise and it will save us double digit percentage from the costs involved in moving vehicles.”
MTD says is can reduce logistic costs by up to 30%.
Dealers can choose to only post jobs to logistic companies they have used in the past and know will provide good customer service. The logistic companies will also potentially gain access to a larger pool of jobs they were not able to compete for before.
Robert Smethurst, MTD managing director, told AM he is in talks with Swansway Garage’s Volkswagen Commercial business in Liverpool to use the system and is also in talks with several other large UK dealer groups.