Pioneering for profit...

I like to think of myself as something of a pioneer. Back in 2001 I was the sales manager for a start up Saab dealer. Saab had a very sharp used car manager who awoke me to the possibilities of used cars on the internet. He had developed a basic excel spreadsheet which imported data from Saab's used car management system and it allowed you to monitor your prices for similar vehicles against other dealers in the network. 'If I were you' he said 'I would be £100 cheaper than your nearest rival and you will get incremental business'.

So that is precisely what I did. In my first two years before I left for BMW we had it away. There were very few people embracing the technology in this fashion, instead preferring to opt for what appeared to be more lucrative and a a less price sensitive local market. The benefit I had was I worked for a sizeable group in a middling brand so I was lucky to have a powerful cheque book at my disposal. Saab was a brand (probably still is to some degree) where sellers are happy to get a bid on late plate cars so I was able to buy effectively and still maintain my budgeted margin.

However, like all good things it came to an end. I left for BMW and there I found a group of similarly plugged in operators who were exercising a similar strategy. Gradually more and more people saw this process as the route for success which naturally undermined the whole concept as prices were forced down in an attempt to control the market. I modified my approach and instead focused my purchases on very odd cars, 6er and 5er manual derivatives for example.

Life is nothing if not cyclical and I can see a return to those good old fashioned values. Customers are now wary of buying a car just because it is the cheapest, having travelled long distances only to find a car that has been mis-described or on VCAR. The price of fuel means customers are less likely to drive 100 miles to be disappointed. Dealers are equally wary of distance selling regulations so they too find the lure of being cheap for the sake of it not as strong as it once was.