How are we all doing at the moment?

[Daylight 28]

After reading Umesh's post about smaller independents I thought I'd ask the question:

Are you guys busy at the moment?

Personally I've had a few pieces of good stock priced very well and sat with me for a while now, no time wasters, just no interest at all. I bumped into another small independent dealer locally yesterday and he reported the same, the phone is a little quiet right now. Is it holiday season a bit early or what's going on?

[Philip Nothard 26]

Hi, I'm hoping to organise a Google Hangout over the coming weeks to discuss this, as I've had numerous conversations over recent weeks discussing this very topic and the concerns over profitability and increasing costs.

Let me know if you wish to be included, and I'll ensure it circulated.  This will be for the dealers and not led by myself, just the organiser and chairperson :-) 

philip.nothard@cap,co.uk 

[countryman 13]

I am beyond 'a little quiet'!

For me it has been very quiet for some time, last month was one of the worst that I have had on record.

To be honest, it hasn't really picked up as it ought since the Easter break; Initially I put this down to Easter Holidays, General Election etc., but for me it never truly recovered.

Worryingly we are now coming in to the summer holiday season which is traditionally quiet anyway! I rely on a bouyant second quarter to fund a quiet July/August.

Anyway, enough doom and gloom ...

[Daylight 28]

Interesting Philip, i'll drop you a mail on that as it's always good to hear what other dealer's experiences

Countryman- I'd probably say it's been very quiet for me too to be honest! I guess we all have a sense of pride and many people don't want to stand up and admit things aren't great in case everyone else is having it away and we're just the only one! It's not doom & gloom (well that wasn't my intention), just sharing experiences and talking about it helps us find ways to make things better for ourselves or at least justify it a little.

Anyone else? Any thoughts on what is causing this unseasonal slowdown?

[Anglo9 26]

With the exception of June the entire year so far is about 30% down on where we should be , very little activity & lots of 'think about it' customers .

Seems like a buyers market for sure , reducing prices doesn't seem to really get things going...yet prices at auction still strong , go figure .

FYI , we are a small , appointment only dealer 20ish cars £6-£10k late /high mileage ex lease stuff,but well prepped...maybe this stock is out of favour ?

Good luck guys

Dave

[Phil H 124]

It's quiet in the van job also and to be honest it has been all year. The only thing that I can put it down to in the van job is that now we're coming out of recession all of the builders, plumbers etc who've been struggling since getting laid off in 2008/09 are now getting jobs cards in with the big boys and a company van included. No worries or hassle about having to find jobs to pay the bills just turn up, build something, get paid and go home. Now these big companies buy their vans new on lease so therefore contribute to the record new van sales that we hear about and create a shortage of customers for us smaller dealers. 

Now as for the car job IMHO it may be quiet not just because of the seasonal holidays arrived early but after seeing used cars prices going up every month for the past four years  (we all know who's to blame for this) and record people buying cars on finance have we come to the point where secondhand cars are just simply to expensive and not value for money. The gap between a  secondhand model of their choice and a brand new one is only a few pounds per month extra over a longer term. This would explain the record new car sales and the quietness in the second hand market. 

I could be talking a load of tosh but I'm sure a few of you out there agree with me. 

[jimreidvehicle 255]

Guy , guys , guys!

It's very easy to talk ourselves into doom and gloom , that is something the trade is very good at. Be very careful that we don't talk ourselves out of business. We all came through what happened in 2008 so we can do it again.

It is quiet, we are much quieter than we have been in the past and the trade in general (well at least the ones I talk to ) suggest that the used market is back about 20% compared with last year, although we are not back by that!

Cost continue to creep up and compliance becomes a reason to print money especially when it comes to FCA, but let's look on the bright side, there are many more cars out there to buy, condition of these cars seem to be better of late too.

One of things we have found which is a little gem is selling cars on Facebook, it's very cost effective and when you have time on your hands why not sign up to this great course http://www.fbfortheforecourt.com/ which gives you baby steps , on how to sell using FB, just an idea!!!!

Anyway back to it! Upwards and onwards :-)

 

[It's me 612]

Deader than a crusty donut,im with Phil H with regards the problem,im also seeing this year as being one of the most customer pernickety ones ever, where they expect new cars for old lamps (think alladin) for old money and my cars are always double mint

[Tom 164]

The beginning of the year started ok, then march/april was quiet May picked up and June was our best month. The last 3 weeks have been very good indeed with loads of enquiries and sales. This week has tailed off slightly but I'm still positive. Only thing I have noticed is a lack of finance requests. I've not done any finance for months. 

[sparky 274]

The gap between a  secondhand model of their choice and a brand new one is only a few pounds per month extra over a longer term. This would explain the record new car sales and the quietness in the second hand market. 

I could be talking a load of tosh but I'm sure a few of you out there agree with me. 

You are of course correect, I guess the key is then to have some stock which this doesn't apply to. Every now and then I get tempted to buy the odd Clio and Corsa like it was the good old days, and then I  have to  remind myself of the deals which are available on these things brand new, the urge to buy soon goes away. Whilst buying a 10 year old 4x4 or MPV has it's worries, one of them isn't worrying about about how much they are new. It would take a lot more than £99 per month and just adding some fuel to get into one of these beauties. I guess it's a bit of a trade off then between turnover and margin and in sleepy north wales, margin wins all day long.

 

The job is ok at the moment, agree with TML that in houese finance is quiet although I'm doing quite a lot with Zuto (formally carloans4u) at the moment. Now that business is one success story, why didn't we think of that?

[DanNextGear 4]

I speak to a lot of smaller independent dealers on a daily basis and the general feeling is that it has gone quiet. Good stock is hard to purchase through the auction at a decent price. 

One me thing that is apparent is that we cannot predict the patterns anymore.. Seems to be up and down all over the country. 

 

Dan 

[Daylight 28]

Really interesting so far guys, appreciate the input. Any information about what you're selling well and what you've had hanging around you is also good as it gives us an insight into where the trends are lying too.

Keep it coming!

[RH Trading 80]

Its picked up slightly in June and last couple of weeks have been OK for us, mostly smaller older cars priced around £3k-£5k are selling and thankfully no returns yet this month (he touches wood). Have some newer, more expensive prestige stuff that seem to be getting little interest so I'm guessing PCP deals look more attractive for brand new cars against these, Its getting hold of these cars for decent money that I'm struggling with, auctions seem to be full of strangers and privates that bump up what I'm bidding on

[Edward Roots 1]

From talking to traders the impression I get is that the right combination of car (spec, colour, engine) seem to be selling well, but anything less desirable may struggle. Every car will sell at a certain price but it's just a battle to still fit a margin in between the two. 

I also think that new car pcp's are affecting the used car market, as it is so easy for a dealership to keep refreshing a customer into a new car cycle. Especially with the difference in new car APR compared to used. 

 

 

 

 

 

[Phil H 124]

Interesting point about PCP's getting refreshed a bloke who works in the plastics suppliers next to me bought a new fiesta only last year on a PCP. It was a bog standard 3 door in DC Red but after a year he's realized it's too small and needs a 5 door so he still had a year to run on his old PCP but has managed to get a new 5 door Zetec with air con in metallic blue and it's only cost him another £20 per month over a 3 year term instead of 2 years, he said it was a no brainer.  

I was reading an article the other month about how Car Clocking is on the increase but not by dealers it's getting done by consumers who are potentially getting hit with huge excess mileage charges when these PCP's come to an end, so they clock it before the first MOT and are getting away with it. Heres's the article for those of you who missed it.

http://cardealermagazine.co.uk/publish/clocking-back-dealers-victims-time-says-glasss/91790

Edited July 16, 2015 by Phil H

[Steve92 80]

Some of the lease rates on fiestas are really good, I've been looking at the Nissan Leaf and Renault Zoe, the leaf was around £180 per month and the Zoe £150 per month, both include the battery rental and over 24 months with 7500 miles per year and no deposit.

As for busy, it's not bad, but then I don't know any different

[James Baggott 227]

Very interesting topic all and welcome to the forum to those who are new here. It's great to see you in here and intereacting. Let's hope it's just the weather!

[Gavin@Rousdon 137]

Not to bad down in the South West, as Jim says we are very good at talking ourselves into doom and gloom!!. It's a bit of a lottery as to what sells with cars that should go easy going overage etc etc, Convertibles have been a mixed bag, Mini's convertibles no problem whereas BMW/Audi are hard work. I think this time of the year brings out a lot of non buyers who don't really know what they want but like looking and asking, mix this with the increase in emails asking for £2000 to be knocked off the price of a car and it can seem a frustrating time. 

In footballing terms you have to 'Grind out a result' !! When it gets going again and look over the year as a whole I think we all will be happy compared with a few years ago.

Edited July 18, 2015 by Gavin@Rousdon

[Steve92 80]

I picked up an Audi cabriolet this week, it's a nice thing but there doesn't appear to be much interesting it at the moment.

[umesh 336]

Keep smiling ! keep taking the tablets !  

Its not on fire - its not dead that means cars are selling .. think its a nationwide issue ! #StayPositive 

[Philip Nothard 26]

I agree, the comments and conversations this week - are that its in the main 'okay' - we are monitoring the overall market closely, with retail and consumer demand, relative to stock supplies and auction activities.

See recent survey results below:

Other noteworthy changes:

• A rise in June in those reporting an increase in footfall of 15% from 9% in May. However half are experiencing a decline – with the remaining third seeing no change. 
•  A notable change from May is that 30% are enjoying an increase in online activity, up from 18% in May. The remainder are either not seeing any change or have felt a slight slowdown.
• The pressure on retained margins looks to be continuing throughout June as 58% of those responding indicated they were being squeezed – an increase from 41% in May. Sentiment suggests that the increased competitiveness caused from greater volumes of available stock and costs are putting pressure on profitability.   
• Interestingly those reporting an increase in stock availability has eased slightly from 52% to 38% in June; whereas a number felt that it had actually deteriorated over the month - from 9% to 20%. However just under half felt that there was little or no change from last month.  
• As in May, the quality of stock remains reasonably stable, with the majority of 63% reporting no change from last month. However those experiencing a decline in quality increased by 4%.
• This month there is little to separate those who feel that the current trade values are reflective of the market, with 48% reporting they are and 50% feeling they are too high. What’s certain is that only 3% felt they were too low. This question is very subjective, as it is very much dependent on where they are sourcing stock and what sector into the market they are operating within. 
• As we approach the half year stage over half the dealers feel that retail and consumer demand has eased slightly from last month. However those reporting an increase remains in double figures.   
• Reviewing where dealers source their used car stock is without doubt very diverse, dependent on the business strategy and sector within the industry they operate in. From those surveyed, 42% of their stock was sourced via natural part-exchanges. However the remainder was split across various sources. Auctions accounted for only 21%; whereas 15% of stock purchased is now sourced via Direct Purchase or Cash for Cars processes and the other stock is from areas such as Trade-to-Trade, Manufacturer Direct sales or Direct ex-fleet. This is a question which would be useful to review again as the year progresses to observe whether this ratio changes over time. 

 

All,

 

I'm also just circulating this month By Dealers, For Dealers Survey on the market and again, early responses are certainly very diverse.

I welcome anyone to join in and be involved and if you want early sight of the results, please drop me an email and  I'll add you to the circulation.

Link below, it only takes a minute - very short but very current and most importantly, it's your survey!

https://www.surveymonkey.com/r/HJYV9BR

[Phil H 124]

Hi Philip,

interesting figures, does your 15% of cash for cars process purchases figure include the auction websites (WBAC, WWAC, M4YM etc) buying this type of stock or are these direct purchases included in auction stock sold to us?

[Philip Nothard 26]

I would suggest that the figures represent Auctions in general, not the vendors - a good point made, as the volumes through BXA from UK Car Group are without doubt rising and supplying a large proportion of the market - not forgetting the less obvious ones.

There are an increasing number of dealer embarking on 'serious' direct purchase strategies - more than just adding on their adverts/website, that they buy cars.

[Daylight 28]

It's been a few weeks since I started this thread, so let's grab a real world update.

Have you guys that were quiet picked up? Have those that were still selling well quietened down? We're into August now so are we experiencing the august calm or has it unseasonably picked up again?

 

[Steve92 80]

We sold 3 on Saturday we had an enquiry about one car that we sold but is still on the web and there is a potential that the car I'm collecting today could fit that customers requirements. Everything that went last week had been with us between 1 and 6 days.