your new auction gameplan - efficiency, metrics and more money
TRANSCRIPT
December 12, 2016
Your New Auction Gameplan – Efficiency, Metrics and More Money
Moderator: Lori Dearman, Executive Webinar Producer, WebAttract
Majd Saboura Director of Wholesale Business Development,
vAuto
Moderator: Lori Dearman, Executive Webinar Producer, WebAttract
Who’s In the Audience?
A diverse audience of over 200 professionals registered from 31 states and provinces.
Poll #1
How has your auction sourcing process changed in the last 12- 18 months? (please select one)
A. We’re going to more auctions than we used to.
B. We’re buying a few more cars online than we used to.
C. We don’t go to physical auctions; we only buy online.
D. Our process really hasn’t changed.
Majd G. Saboura Director of Wholesale Business Development, vAuto
Turning Wholesale Buying into Competitive Advantage
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The wholesale landscape is becoming increasingly complex
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Wholesale Market Trends Increasing supply
NAAA Member Auction Volumes
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Monthly Lease Penetration Rates
Source: Edmunds.com
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Wholesale Market Volumes Off-Lease Units Driving Supply Increase (units in millions)
Wholesale Market Trends Price Volatility Or A New Normal? “Almost everyone is expecting that prices will decline. To get to what we’ve expected for 2016, we’re going to have to have a steeper fall off.” - Thomas Webb, Chief Economist, Manheim
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Retail Market Trend Strong Market—Record-Setting CPO Sales
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Retail Market Trend More “near-new” used vehicle inventory
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Retail Market Trend Margin Compression Continues
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Two Take-Aways From Trends
NEED TO “BUY RIGHT”
TO MAXIMIZE FRONT-END GROSS
INCREASED INCREASED COMPETITION FOR THE AUCTION VEHICLES
“RIGHT”
Two Common Auction Complaints
1. Tough To Find Right Cars 2. Tough To Buy Right Cars
On The Money
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With more wholesale supply why is it so hard to get the right auction
vehicles at the right prices?
Poll #2
Which of the following matters most when you evaluate auction vehicles? (please select one)
A. Wholesale Book Values
B. Retail Asking Prices
C. Market Days Supply
D. Cost to Market
E. Other
Two Responses To Auction Sourcing Challenge
Look Harder
Look Smarter
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Experience/Instinct Driven o Not using tools and technology
o Not using market/scarcity reports
Preference For In-Lane Purchases o Visiting 1 or 2 auctions – maybe?
Look Harder, Dealers
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More effort/time with less reward o On average review 100 to buy 1
o 40+ hours a week researching/prepare
More frustration/greater risk o Need to replace sold inventory with
something
o Greater risk of aged inventory (e.g., buying wrong car/over-paying)
Look Harder, Dealers
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Look Smarter, Dealers Less time researching, more time buying 85% discipline / 15% instinct
Increased focus on right vehicle for their market—not cars they’ll never buy
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Look Smarter, Dealers Online emphasis for efficiency Expand Auction sources – on average 7-10 auctions
More online vs. in-lane – 60/40? 70/30?
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Look Smarter, Dealers Data-driven, disciplined Assess profit up-front then condition/history
Stick to data/metrics to guide profit-focused purchase
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Look Smarter, Dealers Total Gross Mindset Complete view of all data points
Sell more, faster, to combat margin compression
Give up front end gross to gain total gross (F&I, etc…)
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Biggest complaint today is overpaying for vehicles at auctions! Look smarter dealers redefine overpayment… Look smarter dealers redefine overpayment…
Biggest complaint today is overpaying for vehicles at auctions!
Crystal Ball
• More technology used in lanes and online
• Shift toward online purchasing than in-lane
• Ongoing margin compression
• Continued pressure to increase auction effectiveness and efficiency
Poll #3
How can vAuto help you develop your auction game plan? (please select all that apply)
A. Send me an auction sourcing best practice e-book
B. Set me up for a Stockwave demo at NADA.
C. Contact me for a consultation
D. I appreciate the offer. I’m good for now..
