Retail-ready or refurbish?

It's a fact that vehicles looking their best attract significantly higher buyer interest and equally true that this results in a faster sales turnaround. But the question remains - just what is the best way to get cars and vans to forecourt standard while simultaneously maximising profits?

While many traders assert that buying in ready-to-retail condition is the answer, others maintain that the margins linked to refurbishment are consistently higher. So let’s look at the pros and cons of each of these approaches in turn.

The used sector today overwhelmingly prefers ready-to-retail stock but it remains in short supply, relatively speaking. We have found that one of the most noticeable trends of 2019 is that the sector has increasingly shifted from ensuring vehicles reach the used market in grade one to two condition rather than grade two to three.  

The premium being paid over grade two to three is very much worth this as most traders prefer vehicles that can be quickly advertised and retailed, and are willing to pay accordingly. Consequently, it rewards companies looking to defleet to present their cars and vans to traders in a showroom-ready state of repair.

However, the refurbishment route is also worth investigating. With cars graded one to three receiving the most competitive bidding, traders can potentially profit from considering lower priced grade three to four stock, which also attracts fewer bidders.

This especially works well for dealers with their own refurbishment facilities who are able to bring vehicles up to condition relatively quickly, cost-effectively and efficiently, rather than having to rely on third party suppliers. Overall, while stock turnaround may be slower, margins can be higher.

So, when it comes to retail-ready or refurbish, there is no one answer that works for all traders - but whichever approach you choose, epyx is here to help you use 1link Disposal Network to maximise your strategy.

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