Trade buyers are increasingly splitting into ‘two tribes’ of online and auction-based buyers, according to used car valuations specialists Glass’s.
The group found that young dealers who have grown up with technology are now more likely to buy stock via the internet, sight unseen. However, businesses headed by older people still prefer to attend motor auctions, where they can check the quality of the cars before parting with their money.
Whichever ‘tribe’ you belong to, you still need to have a good level of motor trade insurance and road risks insurance to cover the stock you’re buying. If you’re boosting the number or the value of the vehicles you’re bringing in to the showroom, check that you policy is sufficient to cover the additional stock.
Glass’s Robert Pontin, who leads the company’s valuations, said it’s likely most dealers use both physical auctions and online dealers to buy in new stock. But he found that each group struggled to understand the motivations of the other.
Mr Pontin told AM-Online: "What has surprised us is the extent to which trade buyers are increasingly seeing themselves as a member of one of these camps and the lack of understanding between the two.
“Online buyers can't see why you'd want to trail around the country visiting auctions and auction buyers don't understand how online buyers learn about what is happening in the market without visiting auctions.”
Glass’s said there was a definite age divide between the two tribes. Online car buyers were younger, technically savvy and tended to buy used vehicles in volume for their businesses.
Those attending physical auctions, however, were older, and had a good knowledge of the type of customer they deal with, which cars attract them, and the margins they can achieve from each vehicle they are buying in to sell.
