Dealers are making the switch because they can achieve increased profits on part exchange stock of between 15-20 per cent, says the firm.
Steve Turney, managing director of Hyundai Milton Keynes, said: ‘We have used local trade buyers across both of our sites to dispose of our part exchange stock for many years.
‘We found that it was very time consuming dealing with up to ten trade buyers at a time, many of whom would visit us on a Saturday – a busy time for potential and existing customers visiting the dealership.
‘This was very disruptive to our business. We also tried auctions, but found that it was more hassle than it was worth as service books went missing, vehicles got damaged and exposure for the vehicles was limited to the one-day auction and the trade buyers present.
‘We decided to try out Dealer-Auction and have found it to be performing exceptionally well on all levels. We are seeing an uplift in profit per vehicle of around 15-20 per cent; our vehicles are exposed to thousands of trade buyers over a few days; we control the stock as it remains at our premises until it is bought and picked up by the buyer; we only have to deal with Dealer-Auction and not a host of different trade buyers.
‘What’s more, Dealer-Auction works very hard to get the best price for us on all our stock. If a vehicle does not achieve the reserve price, Dealer-Auction will speak to various trade buyers about their best offer and passes them over to us so we can make a decision as to whether we want to sell or not.’
Dealer-Auction has seen a rise of over 40 per cent year on year, in dealers signing up to its online auction service. Gavin Smith, co-founder and director of Dealer-Auction explains: ‘For too long, dealers have had a zero return on their trade cars from local traders and auctions and have just secured their money back on vehicles. Many franchise dealers are now seeing their trade cars as an opportunity to increase profitability.
‘Typically dealers have been making on average up to £300 per vehicle and for some franchise dealers, using Dealer-Auction this has bought in substantial incremental profit in the last 12 months. ‘
Dealer-Auction offers trade cars from franchise dealers to thousands of pre-vetted, registered trade-only buyers. The firm’s listing system does not rely on the right buyer being in the right place at the right time. Instead, Dealer-Auction works behind the scenes to secure the highest possible price amongst a database of potential trade buyers.