Fleet News

Listening to dealers gives an interesting perspective

'ON-GOING research at CAP into dealer attitudes to the market is revealing from a disposals perspective. A representative sample of dealers nationwide are questioned each week about their general performance and specific requirements for used stock.

Many answers are unsurprising but, given that – after the retail customer – the trade buyer is key to success or otherwise in the disposals industry, they should always be listened to. For example, most are keen to get their hands on small hatchbacks, up to five years-old. The same goes for people carriers of all sizes and seating configurations, regardless of engine type.

Demand is, however, not quite as enthusiastic for the biggest models but in a market that has learned to satisfy personal requirements with smaller vehicles, that is no surprise.

But the question that produces perhaps the most revealing results relates to what they do not wish to acquire for stock. You might expect prejudice against gas-guzzlers, or maybe convertibles – given the limited top-down opportunities there will be in the coming months.

And there are some who do take this view. But what emerges now – almost universally – is a determination to avoid buying work. That means mechanical, bodywork or interior refurbishment.

Many dealers are well stocked up following September and are now waiting to get some cash and forecourt space back before going on any further buying sprees. But this does not mean the trade has come to a standstill – rather that dealers are not so desperate for stock that they are prepared to buy 'hassle'.

One dealer took me this week to see the vehicles waiting for attention in the back compound. Some had been there for two or three weeks, costing money instead of generating it.

His problem – and this is shared by many dealers I speak to – is the lead time for refurbishing part-exchanges and cars bought for cash. Many find the turnaround time costly and inefficient and, in today's market, are simply avoiding this frustration by ensuring that whatever is bought for stock can be made ready for retail with just a wash and vac, wherever possible.

Frustrated at always being at the back of the queue – behind private service and repair customers – sales departments are in turn seen as more of a hindrance than a profit centre by service managers, who often prefer to see their income flowing from outside.

This is, of course, nothing new to the industry, but disposers can work it to their advantage at the moment. Clearly the best way is to offer cars that don't fuel the friction between sales and service departments, so that the former can get on with the job of selling quickly to the retail customer.

That means ensuring that cars stand out as clean and mechanically sound. If a car can clearly be put straight on to the forecourt it will stand head and shoulders above the rest – and there are plenty of cars to stand out against.

But it is not only volumes that increase. New car choice is growing all the time and this is illustrated by the New Vehicle Data systems at CAP. For example, our NVD manager Helen Butterworth reports that 1,545 new cars were recorded in the database by this time last year.

So far in 2003 a further 1,768 have been added – making a grand total of 5,684 cars available in the UK today.

Many manufacturers have increased their variety of models, sometimes by moving into new sectors. Take the Jaguar X-type diesel, Volkswagen Touran and Touareg, Ford Focus C-MAX, and Peugeot 307 CC. Many new engines have also been introduced, as some change from Euro III to Euro IV.

No wonder people are confused – and no wonder there is so much call for an up-to-date record.

I wonder whether this may be over-complicating matters and am tempted to question the impact of so much choice – especially when they reach the used market. Disposal managers are moving into a time when simply keeping track of what they have got is a full-time job. But only by understanding the shape of the market can anyone be as successful as they need to be.

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