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Funding the return to growth

Sponsored: With the used car market heating up, Liam Quegan, managing director of NextGear Capital, reflects on dealers’ return to growth after the latest lockdown and why not all funding is the same

Time 9:20 am, June 8, 2021

After a challenging 12 months, it seems many dealers are returning to growth. Does that match your experience?

Yes. Most of the dealers we’re speaking with are in an optimistic mood and emerging from the latest lockdown with fire in their bellies.

There’s some concern about reports of a third wave and what this might mean, but this is being counterbalanced with strong consumer demand for used cars.

Our sentiment survey in February told us 43 per cent of dealers expected used vehicle margins to rise this year. If we were to ask that question again today, I’d expect that number to be even higher.

Demand for quality used stock is as fierce as ever. What can dealers do to ensure their forecourts stay stocked this summer?

Wholesale demand and CAP performance is very strong, but the good news is retail prices are keeping pace, so there’s still profit to be found.

Dealers do need to be on their A-game though to buy well and sell quickly.


That includes having the basics in place, not least access to funding that gives them the freedom and confidence to bid or buy when the right vehicle comes along.

That means not being strangled by admin and not being restricted to just a handful of sources.

Liam Quegan NextGear Capital

Liam Quegan

There are various options open to dealers looking for funding. What are the considerations?

There’s a variety of funding products on the market and I’m not here to dictate our way is the only way. But there are things it pays to know.

Traditional loans with fixed payment terms might not be best if your need fluctuates. Some wholesale funding comes with an expectation of reciprocal consumer finance or is restricted to a single stock source.

With that in mind, what are the questions a dealer should ask of a potential funder?

I’d suggest dealers ask the following of their lenders:

  • What percentage of the vehicle is funded?
  • How long are those vehicles funded for, and what are the repayment terms?
  • Can the funds or credit line be used to fund associated costs such as auction fees or transportation costs?
  • Where can I buy vehicles from?

There is no right or wrong answer to any of these questions, but they will help you assess if the product on offer will help or hinder you in meeting your objectives.

What makes NextGear Capital different?

With NextGear Capital, we’ve created a funding product that gives dealers freedom and flexibility.

The key difference is that dealers receive 100 per cent funding regardless of source. The pandemic forced many dealers to search for stock outside of their usual channels and these new habits will stick for many.

We’re also integrated with more than 70 auctions and vehicle wholesalers where the full hammer price plus delivery and buyer’s fees can be settled directly.

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If buying from another source, including part-exchange or a private sale, 100 per cent of CAP clean or invoice price can be funded.

Another plus is that dealers only pay for what they use – be that one vehicle or 100.

Discover how NextGear Capital can help you on your return to growth at

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