Three weeks into the new year and already trade insiders say that demand for used stock is running at ‘unprecedented’ levels with all the metrics in auction halls pointing to a healthy market.
Manheim says that it has seen conversion rates running at better than 90% with many vehicles beating their CAP Clean value and BCA adds that it has sold more vehicles in a single week than at any time in its history, establishing a new single sale day record in the process.
Andy Conde, of Manheim, said conversions are running at more than 90% and many vehicles are fetching more than 100% of CAP Clean. While that may be linked to a shortage of supply there is a feeling that growing consumer confidence and demand now the General Election is behind us is an equally big driver.
He said:
“Usually the first week of trading of the year is a relatively sedate affair whilst everyone dusts off the Christmas cobwebs but from day one the demand for used cars has been unprecedented. The growth in auction prices is obviously related to supply, or should I say lack of supply, but I have noticed a feeling of confidence across the board since the election result, something that’s not restricted to just our industry.
“Buyers are certainly chasing the stock wherever it goes, and we are seeing vast numbers attending those sales that have large volumes. With high prices and high conversions comes the added high expectations from our vendors. I am constantly asked how long the current trend can last for and the answer I give is simple – as long as the buyers and the demand are there, the status quo will remain.”
Meanwhile, BCA reported record sales of more than 26,000 in the second week of this month with packed halls at its 24 centres and plenty of online business too. It echoed Manheim in reporting excellent conversion rates and strong values across the board.
Incredibly Strong Demand For Stock
Manheim says the picture is equally strong in the used van market with its first LCV sale seeing more than 90% of the 360 entries being sold and beating the CAP Clean figures in the process.
Stuart Peak, Manheim’s LCV specialist, said:
“The year has started with a bang with an incredibly strong demand for stock. First-time conversion on the day came in at just over 93% with vehicles selling at a shade under 105% CAP Average – what a way to kick off the year!”
He said the December sold volumes increased by 8% year on year and that days to sell second-hand vans came down by four against 2018 despite them being older and with higher mileage.
For more information on Click Dealer’s services, contact The Clickers on 01782 478 220. You can also reach us via [email protected] or through our contact page.
A well-made video could be the single most influential factor in securing or losing a sale and for the first time last year, one million were made in a single month and put online.
Video of a used car or van is regarded as being more important than stills because it supports the dealer’s claim of being transparent and having nothing to hide. With mobile phone technology and apps, it is a simple job to do in the showroom or forecourt and is often cited as being the differentiator in a buyer choosing one vehicle over another.
Last March saw more than one million dealer videos being made in a single month for the first time and 11.95 were produced and uploaded to retailers’ website and social media during 2019.
A Necessity For Retailers
Videos should be short and ideally have some commentary highlighting the vehicle’s major points. The best ones show mechanical areas such as the state of the tyres as well.
At its recent awards event to highlight and reward the best, Alistair Horsburgh, CEO of CitNOW, an industry pioneer and leader in the auto video sector, said:
“With personalised video now a mainstay for the automotive industry, it’s amazing to see retailers going above and beyond, demonstrating true best practice to transform the customer experience and build transparency throughout the automotive industry.”
Ollie Parsons, Head of Client Services at CitNOW, said:
“Six years ago, we were producing a million videos for customers in a year. Now, we’re making well over ten times that. These numbers are staggering, and it goes to show how the motoring industry in the UK has really embraced and adopted video. Automotive video has gone from an enhancing tool to a necessity for retailers in recent years.”
For more information on Click Dealer’s services, contact The Clickers on 01782 478 220. You can also reach us via [email protected] or through our contact page.
Customers buying a used car or van are increasingly turning to the industry standards watchdog for information and guidance so they know their rights and are better prepared in the event of a dispute with the dealer.
In a sign that should be ringing warning bells in the used car trade. The Motor Ombudsman said that its Knowledge Base, which was added to its website 12 months ago recorded more than 146,000 views last year, the equivalent of around 400 a day. TMO says there has been no slackening of pace so far this month and that it intends to add more subjects and cover more areas that car buyers feel could cause a dispute.
The most common query was asking how to get a deposit refund followed by searches for consumers’ rights to return a vehicle within 14 days of purchase and the implications of buying a vehicle at a distance and at physical premises.
Other top ten topics from the used car sales section covered mis-sold warranties, the dealership not sending the new keeper slip to the DVLA after a customer had part-exchanged their vehicle, a car being sold without a service and repair history, and a vehicle breaking down in the first few hours of ownership.
Consumers’ Rights To Return A Vehicle
Bill Fennell, Chief Ombudsman and Managing Director of The Motor Ombudsman said:
“Use of the Knowledge Base by consumers as the first port of call for information prior to raising a case with our dispute resolution team, has grown considerably during the past 12 months. It has therefore been very encouraging to see just how popular this tool on our website is proving to be. Going forward, we will be looking to expand the subjects included within our existing library to help to ensure that we continue to address the main issues and queries that consumers are ultimately searching for. The first few days of this year have already shown a significant level of activity across the Knowledge Base, and we expect this trend to remain consistent as awareness of this already popular resource grows further.”
The top 10 most viewed articles on the Knowledge Base in 2019:
Can I get a car deposit refund?
Can I return my car within 14 days of buying it?
The garage has not fixed the problem with my vehicle, what can I do?
I was mis-sold my car, what can I do?
What do I need to do if I reject my new car?
The garage has damaged my car or property, what can I do?
The garage cannot find an intermittent car fault, what can I do?
How do I complain about my car?
What can I do if I have a problem with my car purchase?
Can I complain about a mis-sold car warranty policy?
For more information on Click Dealer’s services, contact The Clickers on 01782 478 220. You can also reach us via [email protected] or through our contact page.
Click Dealer has announced the launch of a visionary new partnership with V12 Vehicle Finance that delivers a frictionless used vehicle wholesale and retail trading experience for independent and franchised dealers.
Both companies have combined an identical business philosophy to develop new systems that deliver an integrated platform to increase dealer profitability through time, cost and administrative efficiencies.
This will be the first time the sector has had an end‐to‐end used vehicle technology proposition that covers sourcing used cars, wholesale stock funding and a multi‐tier consumer finance offering. These were all identified as key pain points for dealers and have been resolved through Click Dealer and V12 Vehicle Finance’s close co‐operation and investment in new technology.
What Does the Partnership Mean for Dealers?
At the heart of the proposition is the Click Dealer platform which seamlessly manages all aspects of a dealer’s business in one place, leaving more time to spend on selling used vehicles. Once in the platform, a dealer can manage their used vehicle sourcing, wholesale stock funding or consumer finance provision.
ClickStock: You Spoke, We Listened
Following the Click Dealer customer survey at the end of 2018, it became apparent that sourcing quality used stock at the right price, was a major issue for dealers. With that in mind, a new ClickStock used vehicle portal has been developed to offer dealers access to thousands of used vehicles for sale from leading independent auction companies. Dealers can source vehicles at all participating auctions, with pre‐sale and buy‐now stock, visible to bid on at all times.
Once the vehicle sits within the Click Dealer platform, dealers can upload wholesale stock directly into their own website for sale to consumers supported by imagery and detailed descriptions.
Wholesale Stock Funding Options with Click Dealer and V12 Vehicle Finance
Alongside the Click Dealer partnership announcement, V12 Vehicle Finance has also launched a new Trade and Forecourt wholesale stock funding plan for part-exchange and trade sourced vehicles. It provides single funded value ceiling of £50,000 for independent dealers and £65,000 for franchised dealers on 120‐day funding terms.
Vehicles can be funded up to 100% Cap Clean values and this includes VAT on LCVs. It joins the wholesale auction stocking plan launched in partnership with Aston Barclay earlier this year.
Each time a dealer buys a used vehicle via the ClickStock portal, a part exchange from a consumer or a vehicle directly from the trade, it is electronically transferred into the Click Dealer platform with a click of their mouse. These vehicles can then be funded via V12 Vehicle Finance’s range of wholesale stock funding options all in one place.
Consumer Finance Through Click Dealer and V12 Vehicle Finance
A dealer only has to key in the majority of customer’s details once, when applying for consumer finance (Hire Purchase) within the Click Dealer platform. The dealer can instantly select the Near Prime funding option through sister brand Moneyway if a customer is declined for Prime. Each finance transaction is completed electronically within minutes whether the customer is in the dealer showroom or whether they have applied online.
“Our partnership began by looking at how we could integrate Click Dealer platform processes and systems with our stock funding and consumer finance proposition. Our joint vision is to take friction out of all dealer processes to provide confidence and value to dealers, as well as benefit the consumer customer journey,”
Explained David Mercer, Managing Director of V12 Vehicle Finance.
“Our partnership will help address every dealers’ challenge of locating and buying used stock more efficiently and then converting the car into a retail sale whatever their credit profile, whilst working within FCA compliance regulations. Our dynamic new online proposition sets new standards of excellence for the dealer community,” He added.
“We have relationships with over 1,600 independent and franchised dealers and we know how their businesses work in microscopic detail. “When we start working with a dealer the used car journey from wholesale to retail sometimes involves logging onto as many as 10 different systems which is a highly inefficient use of their time. This comes through systems being developed in isolation rather than with a strategic eye on the complete dealer and end user customer journey which is where the Click Dealer and V12 Vehicle Finance is at.
“Our joint vision from the outset has been to deliver a 100% an end‐to‐end online used car proposition. Ultimately, we have streamlined systems and processes to take away the pain points experienced in sourcing, stocking, selling and financing used cars as well as running their dealership businesses more efficiently.
“Dealers will ultimately reduce stocking days, sell more used cars and underwrite more finance business which has to be good news for the industry,” he added.
On completion of phase one of the launch, both companies will continue to explore future new technology integration benefits that can be rolled out to dealers.
For more information on Click Dealer’s partnership with V12 or specifically about Wholesale Stock Funding Options or Near Prime Consumer Finance options, get in touch via [email protected], 01782 478220 or via our contact page.
It’s a common problem for many filmmakers both professional and amateur – copyright laws. What content can you use in your video legally and without consequence? It’s easy to justify breaking copyright law by thinking that you’ve got away with it in the past and loads of other businesses do it. But failure to heed this advice could result in your YouTube/Social Media account being frozen or deleted, or even worse, a lawsuit against your business.
Having music over the top of videos is essential to add some atmosphere and cover up any soft background noise like wind or traffic. So, I’m sure you’ve heard that Ed Sheeran Song ‘Shape of You’, it’s catchy right? M&S used it in an advert a while back. Maybe you’ve bought it on a CD to play in your car or as an mp3 file on your phone, maybe you found it on YouTube for free. Can you use it over the top of a video? That would be a no.
Facebook and YouTube have software in place to detect copyrighted music and it will be flagged up and as a first precaution stripped of all audio. You’ll then be asked to prove you have the rights to use the music, which unless you contact the record company directly you won’t be able to get.
So, as much as that track fits perfectly with your video, forget about it, it’s more trouble than it’s worth! Instead, turn to YouTube’s Free Music Library. There must be thousands of pieces of music that are all copyright free. Some are better than others, so try a few out and see if any appeal to you.
Don’t Get Beat Up
YouTube will now pick up on copyrighted music and instead of banning its use; it will allow ads to run on your video. Not ideal but ask yourself if it’s worth it, sometimes the answer is yes.
Also, remember that even if you find a video that says ‘Royalty Free’ this doesn’t mean it is copyright free. What this means is after you purchase the song rights initially, you don’t have to pay again, it’s yours to use as many times as you like.
Even copyright free music can come with terms and conditions that declare you must credit the creator when it’s used. A small note of text in the video description will suffice.
Don’t Be A Video Pirate
You’ve made your video, but now you’ve added in parts of someone else’s video as well without their permission. Similar to music, you can’t do this without permission, but Facebook and YouTube won’t be able to detect it. However, if the original content creator gets wind and sees you’ve been making money using the content they made, then they may demand compensation, which can cost you thousands.
Keeping Your Record Clean
Here’s a simple breakdown on how to make sure your videos tick all the right boxes:
Use only video footage you or someone else in your business has recorded
Include your logo in the bottom corner to prevent others from stealing your video footage
Add music that you create/produce yourself or use any of the multiple free music libraries on the internet to find the right song. Check out one of YouTube’s free music channels here – https://www.youtube.com/channel/UCht8qITGkBvXKsR1Byln-wA
Credit any contributors in the video description
Don’t assume Royalty-Free means it’s free to use
When filming, keep anyone who has not given permission to be filmed out of the video
Be careful to keep any sort of branding out of your video
Don’t film anything that promotes cars in a fast and racy manner, even on your own private property – The Committee of Advertising Practice (CAP) is clamping down on this sort of video that glamorises speeding, power and fast cars. This includes videos of what is considered dangerous driving like skidding and wheel spinning. Even revving the engine excessively can be seen negatively
Videos that are too short can be flagged as spam and will get less reach. Make sure they’re longer than 30 seconds unless on a platform such as Instagram
Equally don’t make videos too long. YouTube allows you to upload videos up to either 128GB or 12 hours, but I’d recommend nothing over eight minutes – and that’s for something really in-depth. If you need to break a video up into episodes, do that. People won’t sit and watch YouTube for an hour, but between two and eight minutes, you might get good engagement levels.
For more information on Click Dealer’s services, contact The Clickers on 01782 478 220. You can also reach us via [email protected] or through our contact page.
SUVs will move into the firing line even more than before as the car market – new and used – increasingly adopts the green agenda but there are some hybrid and EV versions with perhaps a stronger sales message than others.
Mark Bulmer, senior valuations editor at HPI, has highlighted a half dozen he says could have a better chance of selling on the back of their eco-credentials as much as their styling or performance and that could be a crucial differentiator.
In no order, he starts with the classic Mitsubishi Outlander PHEV. This plug-in hybrid was at the forefront of the move to make big SUVs more acceptable and its appeal is still strong even with newer contenders in the market.
Toyota is synonymous with hybrid technology and its RAV 4 Hybrid gives diesel mpg without having to plug in for a recharge. Mark says it will remain popular in 2020 because of its low CO2 score for such a large SUV and residuals should hold up well.
A second Toyota is the futuristically styled CHR Hybrid. As with the RAV 4, it recharges itself so doesn’t need plugging in and it too delivers good mpg. Toyota’s legendary build quality guarding against any mechanical problems is a further strength and it has good residuals. Retail prices start from around £17,000.
Models Entering The Used Car Market
Jaguar’s all-electric I-PACE is a relative newcomer but has been available long enough to now see models entering the used car market. Apart from its head-turning looks, it has sports car performance and a good range with a large range per charge. As more cars become available in the market, this should make the I-PACE more affordable but retail prices are in the £50,000 to £70,000 area.
Kia’s new Niro SUV is highly regarded in the new car sector and comes in hybrid, PHEV and more recently, full EV versions. The Niro has good eco-credentials for a used SUV and although it might be a while before the EV model is available in reasonable volume for the second-hand market it will be much sought after when it does.
Finally, Mark mentions the MG ZS EV which he says should be on the shortlist for any electric vehicle enthusiast and used examples will come to the market this year. He said:
“Affordability is one of the key drivers that will help this car do well, along with a seven-year warranty which also builds confidence in this newcomer to the market. This car also boasts a good range and, if all the reviews are to be believed, it will be a forerunner for what’s coming in the next few years.”
The electric MG SUV should retail used at around £19,000 to £21,000.
For more information on Click Dealer’s services, contact The Clickers on 01782 478 220. You can also reach us via [email protected] or through our contact page.
Is your dealership taking advantage of the full market by offering a parts service? If you’re looking to make a change and get into the parts market, or already sell parts but are struggling to compete with more specialised service centred dealerships then follow these tips to get things flowing smoothly.
The Part With The Strategy
You need to draw up your blueprints for your operating strategy. This will help with the allocation of parts in order to support infrastructure and efficiency. With a process in place, you’ll be able to better manage allocation and use of parts at minimum time and cost. All your staff need to be briefed and trained on how to follow the process and this will reduce the risk of any wasted resources.
The Part About Quality Control
Only source parts from reliable suppliers. It’s also worth double-checking if the part is compatible with the manufacturer model before any work is done. If you have any parts in stock for a long period of time, inspect them thoroughly before selling them. If they have developed signs of rust or imperfections, then you shouldn’t be using the part without making the customer aware. This could reduce the lifetime of the part and lead them to another costly repair.
The Part Where You Advertise
Using a site like eBay to list your stock, with plenty of links to your eBay page on your website can help increase the visibility of your parts offering. If you use social media, shout about it on there as well. If your customer has bought a vehicle from you and remains satisfied, they’re likely to trust you as a parts provider as well. It’s rare but sometimes rival dealers and service centres might also buy parts from you if you have it in stock and they need it for a quick turnaround on a job. Sometimes scratching someone else’s back can come in handy if you need something yourself in future.
The Part Where You Supply For Demand
You shouldn’t ever have parts in stock that sit on a shelf for months. Have some commonly used parts in your stock room, but if you notice anything isn’t selling, stop ordering it in until its stock has depleted and then review the demand for it. The parts you should become most familiar with are low-value parts that move reasonably fast.
The Part Where You Go An Extra Mile
Not everyone needs a mechanic to fit a part. They just want the part delivered to fit it themselves. Offering a delivery service is always a good way to retain customers thinking in this way. You can charge them extra for delivery as well and set a maximum radius that you operate delivery in.
For more information on Click Dealer’s services, contact The Clickers on 01782 478 220. You can also reach us via [email protected] or through our contact page.
Putting the focus on making money from a deal rather than just moving metal, absorbing the new FCA restrictions on finance commission, sourcing quality stock as competition hots up and watching the possible impact of disruptors such as Cazoo entering the market will be the main challenges for dealers in 2020, says one of the best-known independents.
Umesh Samani, who runs Specialist Cars in Stoke-on-Trent and is a founder member of the IMDA, says that this year retailers should concentrate more than ever on doing deals that make them money as structural shifts in the car industry look set to fuel even stiffer competition.
Umesh said:
“We see too many dealers putting their main effort into shifting volume rather than doing what any business has to do, which is making a profit. I think 2020 presents us with several challenges, some we have seen before and some new, but building a sustainable business means building profit.
“Looking to the year ahead, many people will have to get their heads around how the new regime on finance commission set down by the FCA will affect their trading; certainly it will be harder to add bolt-on profit into a deal.
Doing deals that make you money
“I think that franchised dealers will be in for an even tougher year than the last one. Their manufacturers will be pulling back from throwing so much money at getting people into a new car halfway through a PCP term. With new sales getting harder we’ll see the big groups and retailers holding onto more of the used cars and vans coming back and that will make it harder for independents to source proper stock. This was a growing issue in 2019 and could be bigger this year.
“And I think we will all be watching what impact new players like Cazoo have. Many of us already do what it promises, such as the home delivery convenience, but not on their scale so it will be interesting to see what effect it has. Is it just PR or is it a serious new player? Time will tell.
“There is nothing new in businesses facing challenges, but for 2020, my message would be to concentrate on doing deals that make you money.”
For more information on Click Dealer’s services, contact The Clickers on 01782 478 220. You can also reach us via [email protected] or through our contact page.
Used car retailers sold more units to businesses on finance in the year to October with a 3% sector gain exactly mirroring the percentage drop in orders for brand new vehicles paid for through a point-of-sale funding package.
New figures released by the Finance & Leasing Association (FLA) show that although there has been a recent slowing in finance sales to businesses overall, more than 60,000 cars and vans paid for by dealer-sourced finance were chosen from second-hand stock in the period. Although that figure is dwarfed by the 394,000 ordered and delivered that way from new cars and vans, there was a measurable swing away from new to used.
October itself saw a collapse with a fall of 46% and there was a 15% drop in Q3 as industry waited for clarity on the election and Brexit but the September 2018 to October 2019 timeframe did register the 3% gain.
Leaving this month aside, there were more gains in finance-led sales from dealers in the second-hand arena with a two percentage point gain in both Q3 and the 12 months-to-October measurement.
Used car and van market should see some growth
Dealers are also seeing higher volumes of POS finance going through with improvements of 3 and 4% respectively in the value of advances over the two longer periods.
The FLA says it sees reason for optimism as the trade goes into the new year now there is more stability at Westminster and forecasts that while there may well still be trouble moving brand new metal, the used car and van market should see some growth.
Geraldine Kilkelly, Head of Research and Chief Economist at the FLA, said:
“The consumer car finance market is on track to report new business volumes in 2019 as a whole of around 2.4 million cars, a similar level to 2018.
“Consumer confidence should improve as uncertainty about the economic outlook reduces, which will help support demand for car finance next year. New business volumes in the consumer car finance market are likely to remain stable in 2020, with a modest fall in new business volumes in the new car finance market offset by single-digit growth in the used car finance market.”
Falling stock levels meeting continued strong demand means that most sectors of the market will see good conversion rates and high prices being paid at auctions as we head towards the end of the year.
In its latest National Association of Motor Auctions says that while there is the usual seasonal slowdown, dealers are still sourcing good stock to open 2020 with. Nearly half of its members expect conversion rates to strengthen, especially for first time presented vehicles.
Values should remain broadly steady overall with most predicting petrol values will increase or remain similar and 75% predicting the same with diesel. Used hybrids and EVs should stay much the same too.
However, good second-hand Euro 6 vans continue to perform strongly and a clear majority of NAMA members say that values will remain steady at best but probably go up. This market has shown strong performance during the year and this should be the case again into 2020. Pre-Euro 6 vans are generally expected to remain stable but over 30% of those responding expect their values to increase.
Louise Wallis, Head of the NAMA, said:
“December is typically a quieter month for auctions with lower volumes of activity. We continue to see demand for good quality vehicles, which with the lower volumes will push conversion rates and values up. NAMA members expect to see a strong used car market in the new year.”
Expect To See A Strong Used Car Market In The New Year
NAMA’s report backs up the latest data from Cox Automotive which also says auction prices at Manheim are being kept high by a stock shortage. It says 87% of vehicles sold first-time last month and with strong competition for younger and fresher, lower mileage cars the average sold price rose by 6% in the month and by 4% year-on-year.
Philip Nothard, customer insight and strategy director for Cox Automotive said:
“Stock has been in strong demand over the last few months and prices have remained high as a result. October saw the highest volume seen all year at Manheim, but the number of vehicles in the wholesale market tends to reduce as we come to the end of the year.
“Usually we’d expect demand to slow down in line with supply, but this year competition for good quality vehicles has remained fierce throughout November.”
Nothard said one factor skewing the stock shortage is the knock-on effect on fleets holding onto their vehicles in autumn 2018 until the tax implications of WLTP became clearer. Now this has been clarified more should be de-fleeted next year and higher volumes should eventually appear at auctions.
For more information on Click Dealer’s services, contact The Clickers on 01782 478 220. You can also reach us via [email protected] or through our contact page.
