Blueprint For The Successful Used Car Stock Acquisitions Business?

In terms of defining and outlining a blueprint for what this business will look like, well this is an impossible brief to deliver on, in terms of a generic basis. Each individual business will have to build and staff their own used car stock acquisitions business, construct and launch their own initiatives, allowing for many factors that are going to influence and dictate the best way to proceed.

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The primary governing factors here (there are more to allow for) being the used car markets you are trading within, whether you have a new car franchise to leverage and your ownership structure. So in terms of a blueprint, the outline below could only realistically be considered by the private owner of used car business operating out of a new car franchise trading in premium, specialist and/or high performance new and used car markets. Even then there will be bespoke solutions and amendments to consider, but as an outline for what this business should look like (when built), it acts as a template.

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It will not though work and/or be achievable to build this business within an existing and/or standalone organisation operating outside of these parameters, and for a host of reasons I have expanded upon before; so are not for repeating here. Those who are interested as to why I would say this, will find my thoughts and justifications for this stance in the articles in my feed.

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Process and Commercial Strategy

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The number one priority of the used car stock acquisition business must be the generation of inbound used car stock acquisition opportunities, on an industrial scale; note, inbound not outbound. Then the driving of those acquisition opportunities into the hands of the professional(s) with the experience and interpersonal skills required; success (volume and margin increases) will not be guaranteed without this “End-to-End” solution/acquisitions ecosystem having been built.

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With this ultimate aim in mind, the next issue to grasp is that (like all businesses) your used car stock acquisition business must be (first and foremost) a highly effective marketing business. A marketing business with one sole message to portray and take out to target audiences; the message that your business is the number one trusted buyer of the cars you are looking to purchase.

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However to achieve this you will need to have built the foundations and secured access to the expertise required. Contrary to popular belief, this doesn’t need to cost your business a lot of money (in terms of marketing and advertising spend); it does though require that you secure access to the professionals possessing the skills and expertise required. That required to be capable of finding targeted audiences of commercial value, constructing the messaging initiatives required and taking them out to the aforementioned target audiences.

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As previously mentioned the sole aim of this business and the associated initiatives is to drive inbound stock acquisition opportunities to your business; and into the hands of the professional(s) possessing the expertise and interpersonal skills required, to maximise both the volume of acquisition opportunities and the potential to increase margins. But to succeed in these objectives (as a minimum) the business must have the ability to;

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1.???? Ensure that new and used cars supplied by the business are “Locked-In” to returning to the business for resale.

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2.???? Building the commercial database that money can’t buy; the database containing the owners of the cars (not originally supplied by your business) you want to purchase. Knowing where to find them, how to contact them and obtain their personal contact details.

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3.???? How to build trust with this target audience in terms of the disposal their current car, the content and messaging campaigns that will be required and the strategic use of social media in these aims.

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4.???? The ability to construct entire campaigns of continual data collation through to successful acquisition, and across multiple used car markets; all of which will operate (on a customer level) very differently and be nuanced in successful delivery.

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5.???? The ability to create, nurture and build relationships of commercial supply with manufacturers, leasing/finance companies and business users; relationships that are “Peer to Peer” and where professional respect is understood and paid to both parties.

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Marketing and Content Messaging

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The importance of content marketing to the successful used car stock acquisitions business is paramount, especially with the target audiences this business must attract. This is not a post to explore complex and in depth marketing strategies; suffice to say that the content marketing initiatives of the business must start with the aim of earning the trust of target audiences, which will only be achieved by demonstrating to target audiences that you are the trusted expert; not by telling them you are.

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From here a continually adapting suite of “Content Based” and ”Direct Messaging” campaigns must be written and deployed to both targeted and existing audiences; on a continual basis.

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To succeed here the business will have to identify the engagement platforms that their target audience interacts with (in order to make contact and gain the attention of targeted audiences) and then drive that audience to their own platforms; social media platforms etc. This is now the job that never stops and must continually adapt around the behaviours of the targeted audiences.

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Maximising Retail and Trade Disposal Routes

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One thing lost on many is that the successful used car stock acquisition professional and business is always buying; no customer (trade or retail) must contact the business and hear that it won’t make an offer on a car and/or purchase it. That is not to say that you may not want some cars for used car stock; that does not mean though, that they are not a profit opportunity for the business.

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It is also important to remember the professional damage that declining to bid on and/or purchase a car will do to your business in that moment. ?Navigating this though takes a lot of expertise and interpersonal skills, when it comes to cars you may not want to purchase; think used EV’s at the moment for example, which is an issue I will cover in detail in a future post.

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But be in no doubt; every acquisitions opportunity is a profit opportunity and every acquisitions opportunity lost, is a profit lost. However, taking advantage of the opportunities and maximising the profit opportunities that the aforementioned inbound initiatives will generate, will take the disposal network required, including as a minimum;?

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1.???? Creation of the trade networks and the suite of disposal routes required to ensure maximum profitability and that all cars offered can be purchased.

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2.???? The effective management of the above networks, the building of long term relationships and to the benefit of the overall business.

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3.???? The development and running of the retail used car businesses required and for all the used car markets the business is operating within.

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4.???? A complete understanding of stock profiling; most profitable units and the routes to maximum levels of profitability, whether trade or retail. ?

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Overall Business Operational Capability

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Building and/or aligning a successful used car stock acquisition business to an overall business that is not operationally ready for what that will involve (both operationally and on a daily basis), is akin to strapping a rocket to skateboard; so to be avoided at all costs.

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Luckily, and in reality, it probably couldn’t happen; not because of the capabilities of the used car stock acquisition professional/business, but because the overall business would then itself become the “Drag Anchor” to used car stock acquisition success.

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When buying and selling assets for a profit (any asset not just used cars) all businesses have a finite amount of money available, so will eventually run out of money, if the business is not set up to handle the increased volumes of stock being acquired. So a comprehensive understanding of the utilisation of the funds employed to the business is going to be paramount; combined with the operational and business development expertise to ensure that profit opportunities can be/are being maximised.

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By default the experienced and successful used car stock acquisition professional has (ideally) become one, via a journey of high level used car business development experience and expertise; the two tend to go hand in hand.

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It will take this high level of overall used car business development expertise to ensure that the volumes of used car stock being generated are maximised, in terms of their route(s) to profit; trade or retail.

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To succeed in this regard the overall business will need to be meeting or developing towards achieving the following retail and operational goals, as a minimum;

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1.???? The operational capability to prepare all retail used cars within 3 working days of arriving on site. 5 days if “Smart” repairs are required, 10 days for more substantive body shop repairs.

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2.???? A used car operation running with the expertise required to ensure that the rate of stock turn is at a maximum rate of 45 days per unit; moving towards (and then adhering to) 36 days per unit as a maximum.

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3.???? All trade stock being disposed of and paid for within 7 days of arriving on site; ergo no all auction disposal policy.

4.???? Enjoys an in depth understanding of financial structures and the use of alternative funding sources in successful used car stock acquisition.

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5.???? The effective management of physical and future used car stock holdings.

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Contrary to popular belief, developing and then running the business above rarely (at inception) takes financial investment. What it does require though is the professional possessing the used car business development expertise to improve the operational running of the overall business, in the areas of the business required in order to meet the objectives.

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Only thereafter, and when the business is running at maximum operational capacity, should the argument be made for costed investment in the operational facility; as required and an investment that will be paid for by the then resulting increase in profits.

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Succession Planning

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Another often overlooked priority when building the successful used car stock acquisition business is succession planning. For the business to thrive and prosper long term, and for the overall business to then enjoy the associated tertiary profits, the building of this business must be done in the name of the business; not any individual.

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Now the individual is important but make it all about an individual, and the business itself is vulnerable should that individual then leave the business. So at all times the messaging portrayed by the business should lead with the business, but with the individual as the point of contact.

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Thereafter, succession planning is paramount. Like many specialised roles requiring high levels of advanced interpersonal skills, confidence and charisma, not many will be suited to the role of running the successful used car stock acquisitions business.

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Unfortunately, there are no books that can be read or training courses to be attended. The best person to identify those with the potential and skills required will already be a successful used car stock acquisitions professional. Growing into the role takes years and experience at the “Coal Face,” so the sooner this process is underway (and with the right individual showing the potential required) the better it will be for the business.

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Like all roles involving high level interaction with human beings and the psychology involved, I learnt from watching others; my professional peers. ?I always sensed that I had potential but knew that I had a lot to learn and from many people; so I stuck to them all like a wet blanket for years.

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Because of this someone with my experience will know instantly who will suit the role and who can be grown into the successful used car stock acquisitions professional. As with all high level and specialist roles, people who haven’t done the job themselves will not be able to identify and/or develop the attributes required. So this succession planning process must start in earnest and as soon as possible.

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Now the business outlined above is a level of expertise (and profitability) that some of those reading this can look to enjoy in the future; all the foundations required may not necessarily be in place at the moment, but it can be achieved.

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Anyone owning a business operating in the aforementioned (premium, specialist and high performance) used car markets who is curious to understand how this can be achieved, can feel free to contact me via LinkedIn, so we can arrange a mutually convenient time for an exploratory call, in order to explore synergies and the potential to collaborate in this regard.