Fleet News

Vehicle sale special feature: build 'em up, knock 'em down

MANY van fleet operators still view Britain's auction houses as scurrilous nests of rogues, where sheepskin-coated dealers huddle together to fix prices and where honest sellers are likely to be ripped off. John Charles attends a variety of commercial vehicle sales around the country and digs up some top tips for the fleet operator thinking of taking the auction route for defleeting vehicles for the first time.

The success or otherwise of a van auction site depends not only on the vehicles it sells and the services it provides but also on the quality of its bacon sandwiches. This was one of the curious facts I uncovered on my auction sojourn across Britain in search of information which will help Britain's hard-pressed van fleet operators get the best value from their vehicles at selling time.

Scoff if you will but it's true. The bread must be soft and white. The bacon must be slightly crispy but not incinerated. It must contain enough fat to make it juicy but should not taste as though it is full of rubber bands when bitten into. Needless to say, there must be copious amounts of ketchup – both red and brown – on tap.

A lot of punters have travelled a long way to be at a particular auction to bid for vehicles, so it stands to reason that they want some pukka scoff when they get there. Below-par bacon sandwiches could mean they will go to another site down the road where the fare is better.

So for a van fleet operator wishing to take the plunge and try selling vehicles at auction, the first step is to pitch up at the prospective site incognito and take a look at the catering facilties.

At most major sites, visitors will walk into the main entrance to be greeted by the tempting aromas of sizzling rashers and steaming tea and coffee (percolated, not from a jar). It's rather like baking a loaf of bread in the oven when prospective buyers come to look at your house to make them immediately feel at home.

If this proves to be the case at the site under inspection, our operator should next try a butty and ascertain whether or not it meets the standards indicated above. If not, he should add one point to the minus side of the scoresheet. If the catering facilites are a burger van at the back end of the site choking under a cloud of diesel fumes, add another minus point (or preferably cross this site off the list altogether and try somewhere else).

Assuming all is well on the bacon sandwich front, proceed on to the auction hall itself. For those who have never attended a van auction, it's worth a visit even if you are not intending to sell any vehicles.

The idea of the day is for the auctioneers to sell as many vans as possible (pretty obviously) so one of the tricks they employ to keep things rolling is to put on a bit of a show for the buyers, just for the amusement of those gathered round.

They gabble away at nineteen to the dozen and shout, gesticulate and joke with the crowds in a bid to hustle things along. Their aim is to sell between 50 and 60 vans an hour – that's about one a minute. As it doesn't cost anything to get in, it's a kind of free cabaret.

Next thing for our operator to do is to sit at the back and study those eager buyers who have turned up. There will be old men with their old wives huddled near the back staring intently at the day's brochure. They are likely to be looking for one vehicle only and will sit mute for hours on end, suddenly coming alive at the right moment when their chosen vehicle is driven into the hall.

As bidding gets under way they will wave their pamphlets wildly at the auctioneer in an attempt to gain his attention and will often collapse back into their seats crestfallen as the bidding goes way past their meagre maximum. These people are unlikely to be of interest to our operator.

Looking past the usual gaggle of women and babies (no-one quite understands why they are there – perhaps they've been lured by the bacon sandwiches!), down on the floor lies the real business end, where shrewd dealers screw up their eyes, toke on their Golden Virginia home-rolled fags and look knowingly around.

These are the men our operator must court. These are the men who will buy – or ignore – the type of van he is likely to be offering.

As each prospect is whisked before the audience, these men suddenly crowd round, kicking the tyres, opening the doors and even climbing up to look for tell-tale damage on the roof.

Then with a crafty wave to let the auctioneer know they are interested, the bidding is open. Some raise an eyebrow, some scratch a nostril and some give a sign that only the auctioneer understands. And within a minute, each van's fate is sealed. It either goes back out into the yard for the next auction, or thousands of pounds will change hands as a successful purchase is completed.

So having made the decision to try a few vans at the following week's auction, what should our operator do next? Simply call the firm concerned and arrange for a meeting – it's amazing how much free advice is on offer. After all, every auction company will be eager to gain new fleet business. A company rep will take the seller through the processes on offer, will advise on which times are best to sell which vehicles and will suggest a reserve price that each vehicle should carry.

Most of the big auction companies now offer refurbishment and valeting facilities. Many fleet car sellers have realised that £300 spent on cosmetic repairs can mean an extra £600 on the price the vehicle makes under the hammer. It's amazing how much better they look even for a wash and brush-up. Fleet van sellers are slower to take up on this option but the auction house will advise whether or not such a course of action is likely to be cost-effective.

After all, used van buyers are a wary bunch so don't forget that some will be buying a vehicle as cheaply as possible as a workhorse to use, abuse and throw away. They do not look kindly on what they see as unnecessary 'tarting up' and will certainly not pay extra for it.

And what about those decals? Some vans are sent through auction halls with signs painted over by brush. That means a dealer will have do a respray job before the van can be sold on. Hence the bids will be lower.

Van auctioneers do nothing but sell vans all day long so they are experts on what sells and what doesn't. Our operator should ask to speak to an auctioneer, who will be only too happy to share his knowledge.

For example, many vans are being offered nowadays with a bewildering array of paid-for options, such as ABS brakes, electric windows, CD players, satnav systems and automatic gearboxes. The basic rule of thumb is that buyers will not pay a premium for what they consider unnecessary extras – it's just more to go wrong in their book. So while a snazzy small van with metallic paint and alloy wheels will probably see some hot bidding, buyers will be left totally unimpressed by gadgets such as electric windows and mirrors. Automatic gearboxes, as available on Ford Transit and Mercedes-Benz Sprinter, even have a negative effect on prices.

They cost about £1,000 extra new, but command a lower price at auction. Meanwhile, the jury seems to be out on the satnav option as the technology is still in its infancy. Don't expect a premium for a van containing telematics technology, however.

The jury is very much out on the question of alternative fuels too. First reports suggested doom and gloom prices for vans powered by liquefied petroleum gas (LPG) and compressed natural gas (CNG), but in the southern region, Ken Livingstone's London congestion charging appears to have reversed the trend after he made alternative-fuelled vehicles exempt from the £5 a day levy.

Colour is an important factor. Companies with fleets of blue or green vans are in for a disapppointing time when defleeted vehicles go on the block. While wily dealers will bid like crazy for a white Citroen Relay, they are likely to light up another fag and sit on their haunches as a similar Relay is offered in green.

Dealers soon get to know which fleets offer well-maintained vehicles and which put out old nails. So similar-looking vehicles from company A and company B may attract different bids if buyers know the van from company B is likely to have been thrashed to death and only serviced once in a blue moon – or not at all.

Timing is important too. If our fleet operator has 30 identical vans to sell, he would be foolish to put them all through the auction in one go. Once again, the auctioneer will advise on this.

Having the correct paperwork and service histories on hand is crucial. From February 2003, new legislation was introduced in which a vehicle could not be taxed unless the owner had a V5 document. Thus if a dealer buys a van without a 'logbook', he will have to apply to the DVLA for a new one, which could take weeks, leaving an unsaleable vehicle sitting on his forecourt. Some of the major auction houses are now refusing to handle such vehicles. Obviously, if a service history is available, the bids are likely to be keener.

Finally it must be remembered that you get nowt for owt these days, so the cheapest auction house is probably not the best.

One visit to the auction will convince any fleet operator of the need to be on hand when his or her offerings are going under the hammer.

Apart from gaining a lot of expertise which could lead to improved prices, the seller will be on hand in case bidding stops just under the reserve price.

Instead of taking a reserve bid on the day and calling up the seller afterwards – who may then reject it and leave a disgruntled buyer with no van – the auctioneer can call over to the seller and sort out the deal there and then.

The auction world has come a long way in the past 10 years and the big players have spent vast fortunes on improving services and finally laying to rest the old 'gipsies, tramps and thieves' image.

Auctions now offer a first-class method of selling vans and any fleet operator would be foolish to ignore the possibilities they offer.

And don't forget – those bacon sandwiches can be addictive.

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