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Where’s my Manager? M.A.A. MISSING AT AUCTION

Closed for Business

closed will return after the auctionLast Tuesday I drove down the used car golden mile of Buffalo NY, a street called Delaware Ave. If you’re not from the area, there are about 20 successful used car lots within a few miles. After my fifth stop without finding a soul, I realized that it was auction day. The lot owners never opened for the day because they were 15 miles away at the local off site auction.

Next to Impossible to Find a Used Car Manager

Even franchise dealers deal with MAA. When a major local off site sale is running, it is next to impossible to find a used car manager at any dealership. The problem is even worse for Independent Used Car Dealers, because in many cases they are a “corporation of one”, so they are forced to close their doors if they want to attend an auction.

Is there another way?

As I continued driving the golden mile I passed a dealership with all the hoods up and balloons on the cars. This was impressive, it was a cold 6° outside and they were showing the world that they were open. I almost got into an accident as I swerved across two lanes to pull on to their side lot. As I walked up to the front entrance the mid twenties tattooed owner met me at the door and welcomed me in. (Note: Only in Buffalo would the owner be in a tee-shirt in winter)

After I introduced myself and we spoke for a minute, I asked, “Why aren’t you at the auction?”

“I buy and sell my cars almost exclusively online.” he replied.

“How’s business been in this weather?” I asked.
“We are having our best month since we opened. We’re really happy right now.”
Just then we were interrupted by his brother who walked in all smiles with an IPad in his hand trailed by a customer. “Let me show you this blue one” he said pointing to the screen as he walked her into his tiny office. I found out later that he was showing her cars that he could buy for her online. He was using the auction websites as a float so he did not have to stock as many cars, a common practice among small dealers.

Lets recap: It had not been above freezing in 45 days; every other dealer within miles of his location was closed because they were at auction. They were leveraging Digital Wholesaling to float inventory and they are a thriving used car operator that was open when their customers needed them. Sounds to me like a strategy that other independent dealers could consider duplicating.

Yes but, it still takes time to buy cars online!

happy manager after winning a car onlineMy partners and I spend a lot of time teaching the Digital Marketing for Wholesale, (DMW), strategy. The idea that; if you post your wholesale cars on a used car marketplace, such as AuctionSimplified.com, on day two of its arrival, you may sell a few without fees or transport costs and spend less time at the auction.

The most common argument against it is; “buying online takes as much time as buying at auction.” They are right; it does take time and concentration to buy cars online but the value of you being at your dealership out ways the effort 10-1.

For used car managers at franchise dealers of large used car operations: Being at your dealership allows you to properly manage the service RO requests. Review with the service advisor and truly understand that really needs to be completed and what is unnecessary.
It allows you to be available to answer those never ending quick question. I can’t imagine how many times a day salespeople and other employees come up and say, “I just have a quick question.” We sometimes misunderstand how important it is to be accessible to our staff. Some of those quick questions can be critical.
It also allows you to be there when your team needs an in person trade appraisal.Sure, your staff can call you when you’re at auction but we all know that a live appraisal, where you can really see and drive the car, are usually more accurate.

For small dealers and single employee used car lots you just cannot afford to be closed for business especially in this market.

Technology has already changed the game, with dealers using the Internet to showcase and source inventory while using smartphones to conduct business away from their desks. – Manheim

automotive wholesale case studyBuying wholesale online allows for better buying decisions because I can used the tools and tech to properly value a wholesale car.

While our auction software,auctionsimplified.com, was still in beta we case studied our early adopters. They were a small group of used car dealers in southern NY. These wholesale buyers purchased cars using online bid sales hosted by our company. We asked a series of questions regarding the things they liked about buying online. It was not long before we found a common denominator: buyers make better decisions when they bid online because they have the tools they need at their fingertips to value and price their purchases to market. Here are some of the answers in that study.

“I like the fact that I can sit at my desk and really take a non emotional look at the car I am trying to buy.”

“I book the car out and compare it to the local market then bid. Its funny, I end up paying more sometimes because I will see that there are none in my area or that the starting bid is way too low.”

“I go to the dealers inspection day, look at the cars then come back to my office and use my buying tools to be sure I am making the right decision.”

Note: The inspection day they are referring to is found at dealers who run their own online auction and hold a viewing day for their wholesale buyers. To see an example, play the video below.

 

Digital wholesaling is not a new idea but it’s underutilized.

Off site auctions play an important role in dealership profit strategy, I am certainly not suggesting that you should avoid them completely, but modern dealers are looking to buy more online and be available at their lots and used car offices. Dealers who embrace DMW, Digital Marketing for Wholesale, find that they need to leave their lots less as the technology becomes more mainstream.

Photo Sources:
-“Winter Balloons” by Kevin Leigh taken at Transitowne Automotive Group in Elma, NY
-Video of “Inspection Day” by Kevin Leigh, taken at Gault Automotive Group, Endicott NY
-Photo of Kevin Leigh by Paul Maze, PhotoTech Studio Buffalo, NY

2015-07-14T02:03:08+00:00 By |Categories: Auction News|Tags: , , , , |

About the Author:

Co-Founder / Writer / Serial Growth Hacker

Kevin Leigh co-founded Dealer Simplified, LLC, a company dedicated to simplifying automotive software. The goal of Dealer Simplified is to jump-start the profit centers in dealerships while keeping the processes and software simple and easy to understand and implement.

Kevin is also an accomplished author and is passionate about writing and blogging. His latest novel, “Gollup the Woods” was inspired by the stories he heard from his father on their many trips through the Irish countryside.

Kevin currently resides in Alden, New York with his wife Mary and their three boys. Leigh spends his spare time volunteering with various community organizations.