Franchised dealer groups are set to up the ante when it comes to acquiring stock. Having traditionally relied upon the part-exchange route to generate retail stock they have realised that, as the new car market has shrunk, there are likely to be less quality cars to re-sell on the market.
Having stood by and watched the rise of car buying sites and often ending up acquiring the same cars through secondary routes it is high time that dealers, with the manufacturer’s logo above the door, offered a similar service to private sellers who, given that the dealerships are specialising in that particular brand, will arguably pay more.
You might well ask why it has taken franchised dealers so long to catch on to the “buy your car online” concept. Are they just so busy trying to sell and service cars that they cannot commit the resources necessary to successfully offer the type of service required to make it happen?
In the case of larger dealer groups who represent multi-franchises they are in the unique position of being able to capture potential sellers and divert them to another brand within their stable. The challenge, of course is to ensure that the selling process is as quick, smooth and easy as the competition makes it.
Of all the many people who currently look to sell their car in this way it is feasible that a large percentage of these people will need another car to replace the one they are getting rid of. They can’t all be downsizing or moving abroad so it must surely be that they have not had a good past experience when attempting to trade in their current car or indeed the dealer has declined to take in the car via part-exchange.
There are also many buyers who still believe that by having no car to trade in and going armed with the cash instead will entitle them to a better deal than they perhaps might have got otherwise.
Although this may be true in some cases, the larger dealers will actively encourage buyers to part-exchange their car as they often recycle these cars via the auctions or other wholesale routes and this generates further income streams for the business.
It will be interesting to see in the coming months when and if the industry heavyweights enter the fray and cotton on to what the statistics tell us; that people want to sell their car in a hassle free way and want to get the cash in their banks as quickly as possible.
Being that a huge percentage of cars generated in this way end up on the wholesale market, if they don’t get their car buying websites up and running quickly they will have to contend with empty spaces on their forecourts or drastically change their selling criteria to fill their showrooms with cars.
They will also continue to buy the cars generated by the operations of car buying sites on the wholesale and auction markets and give their competitors profit at the same time.