Andy Whitehair – Autofinity, CEO
Here’s the second of my two-part report on this year’s AM Live. Our third event but our first as a sponsor.
With such a well informed and highly experienced panel of used car experts, our discussion – The Science of Used Car Stocking, was lively, informative and prompted a high level of engagement from the audience.
I was joined by panel members Neil Smith, former Imperial Cars operations director and Cazoo retail operations director, now heading up automotive consultancy, Motorvait; Craig Petty, sales director at Hatfields, where Autofinity’s ViHUB has been in operation since last year; and Alex Jones COO at Bristol-based Carbase/Vanbase, the largest used car and van retailer in the South West.
More take-aways
Gut instinct
The combination of gut instinct and science was recognised by many dealers in the audience. As a data man myself, daily price swings can be huge which can make a mockery of instinct. Data sceptics, the panellists suggested, should take 10-20 cars and undertake a trial whereby data is utilised in support of regular used car processes. Not only will the differences between vehicles that sell quickly compared to those which don’t become almost immediately apparent, but so the understanding of the local market and its demands will be more easily identifiable.
Price to sell
The temptation to hang onto a vehicle until it sells is still a temptation many fail to resist. In such a fast-moving market, once a vehicle reaches 30 days in stock, the advice was simple ‘take a hit and sell the car’. Don’t fall into the trap of holding out for the margin. If there is a 6-7% price swing each month as the sector has seen on some models, then the vehicle needs to be off the dealer’s stock list. Within volatile markets, our panellists all agreed they track prices daily.
The devil is in the detail
Granular detail, in fact, is now vital when uploading used cars to online marketplaces. The vehicle must be described correctly and there should be complete transparency on the make and model and, more importantly, the level of specification and number of optional extras. Options have become even more important both as a differentiator for prospective buyers searching online and to maintain profit margins. It is not unusual for some premium vehicles to sport around £7k of options which may not be immediately apparent when would-be buyers are viewing the vehicle visually. It is understandable that some dealers avoid listing options for fear of uploading a wrong car description and landing themselves in hot water but equally, that could be the difference between a quick sale and the vehicle considered as overpriced by buyers.
The importance of prep process oversight
How many cars are sold on a Saturday and delivered on a Friday? Why is a particular car not ready to be driven out of the dealership leaving the driver waiting around for it to be prepared? Days to prep is as valuable a KPI as stocking days. The sooner a sold used vehicle is delivered to its new owner, the happier the customer and the quicker the profit is realised.
I was delighted to report to the panel audience that ViPREP, our prep oversight and management module, has enabled dealer users to concentrate on prep days in a way that had been impossible previously. Neil reported how dealers he has worked with have reduced a vehicle’s prep days from 47 to 32 days simply because information was readily at hand enabling problems to be identified and rectified faster.
And finally…
Once again, I would like to extend my thanks to Neil, Craig and Alex for joining me on the panel, for their highly informative observations, lively debate and for making my role as chair relatively straightforward. I would also like to thank all the visitors at AM Live who attended our session and to those who visited us at our stand. I hope you found my roundup a useful reminder and for those of you who were unable to attend AM Live or our debate, hopefully, I’ve given you some helpful insights.
Our 60-day trial enables dealers to experience the benefits of ViHUB free of charge.