A new way to source stock more cost-effectively and attract even better qualified buyers who are ready to convert
It’s fair to say that our industry is going through a significant period of change, driven in no small part by the ongoing effects of the pandemic. At Auto Trader, we remain committed to digitising the car buying journey and helping you (the retailer) to make more profit, by removing inefficiencies in the market. That’s why we’re introducing a new proposition called Guaranteed Part-Exchange (GPX) to our marketplace, in partnership with Manheim Auction Services, part of Cox Automotive UK. It’s designed to provide you with even better qualified buyers and a more cost-effective way to source stock. The product is currently undergoing important beta testing with circa 100 retailer partners but will scale up significantly throughout the testing phase. In this blog post, we’ll tell you more about it, as well as how you can register your interest to be one of the first to benefit from it.
Reduce lost sales and attract better qualified customers
According to our research, almost 1 in 3 (29%) of sales will break down due to part-exchange disagreements(1). That’s not just lost sales, but lost time, lost effort and lost profit. On the flip side, the same research also revealed that nearly three quarters (73%) of people would be more likely to visit a dealership if they had a guaranteed price for their part-exchange agreed in advance of visiting the retailer(1). As a result, GPX will help you resupply your forecourt with a continuous flow of part-exchanges, whilst simultaneously creating highly qualified buyers who are ready to convert.
Giving you more time back to focus more on selling
We know car retailing isn’t for the faint of heart. It’s a constant juggling act of getting buyers through the door, converting them profitably, sourcing new stock, all whilst trying to constantly improve the customer experience, keep cash flow moving and save time to focus more on selling. With the development of this new proposition, we’re aiming to help reduce those challenges. GPX will deliver highly qualified buyers who come with a guaranteed price for their part-exchange, ready to do the deal. Best of all, there’s limited to no risk for the retailer, because the part-exchange is underwritten by our partner, Manheim.
So how will it work?
Potential buyers will arrive in your adverts and see an option to get a guaranteed price for their part-exchange, which is powered by Auto Trader’s award-winning valuations(2), as well as Manheim’s own industry-leading algorithms to reflect condition and current trade price fluctuations. If the buyer is interested, we’ll ask them a series of questions about the condition of their part-ex. This is one of the areas of the product we’re focusing heavily on to make sure it’s as clear as possible. Once they’ve answered questions about their cars condition, they’ll be given a price for their part-exchange that the retailer will guarantee to offer them, subject to it being accurately described.
Here’s where the Manheim underwrite comes into it. If you want to keep the car and retail it on yourself or if you want to dispose of it through your existing disposal methods, just pay the guaranteed price and progress as you would for any normal sale. If you don’t want to take the part-ex in or if you just don’t want the risk, you’ve got the underwrite as an insurance policy. If that’s the case, you can simply dispose of it to Manheim – be paid the guaranteed price and have it collected from your forecourt within 5 days of Manheim accepting the deal.
A solution that makes the process more efficient AND keeps stock with the retailer
“Our aim is to create opportunities for retailers to sell more vehicles and to support them to operate as efficiently as possible through providing insights and guidance and developing innovative product solutions such as Guaranteed Part-Exchange. GPX also improves the online car buying journey for consumers, the need for which has been accelerated dramatically as a result of the pandemic.”
“Sourcing stock effectively remains a real challenge for many dealers. They’re either having to overpay through constrained traditional channels, competing for shrinking stock, or worse, missing out on potential sales opportunities driven by the exceptional demand in the market. We wanted to create a solution that not only makes the process more efficient, but also keeps the stock among dealers and helps boost their profitability.”
Karolina Edwards-Smajda, Commercial Products Director Auto Trader
A combination of industry-leading wholesale and retail data to drive valuations
“Our new relationship with Auto Trader brings together a combination of industry-leading wholesale and retail data to drive valuations. From our side, we bring insight around auction behaviour, buyer behaviour, vendor behaviour and also our understanding of how both small and large things relating to a car’s condition can affect price, which you can’t see from just analysing data. We can then layer this knowledge onto data that we get from combining our observations to give industry-leading accurate valuations. That is really where we differentiate ourselves from the other players in the valuation space.”
Paul Humphreys, Managing Director, Car Buying & Mobility Solutions, Cox Automotive Europe
Want to be one of the first to benefit?
We’re currently undertaking important beta testing with a number of retailers but will increase that number significantly over the coming weeks. If you’d like to be one of the early adopters of the product, please contact your account manager or simply complete this short form and we’ll be in touch with more information and next steps.
Sources
1: Auto Trader Car Buyers Tracker, survery of 1,320 consumers on our marketplace, August 2020
2: Auto Trader’s valuations are award-winning, as voted in the Car Dealer Power Awards Used Car Valuations Provider of the Year, 2019 and 2020.