St Leonards Motor (SLM) Group operates nine franchised dealer and two used car sites in East Sussex, Kent, Norfolk, Suffolk, and West Sussex. It rolled out INDICATA nearly a year ago to maximise stock turn and overall efficiencies in its group used car operation. It has nearly 600 used cars in group stock at any time and introducing INDICATA coincided with a more digital online approach to selling used cars.
SLM director Jason Barlow tells us more on the decision to sign up to INDICATA and the results it has seen across its group used car business in the first 12 months.
As SLM runs a cross section of franchised dealers for Toyota, Nissan, and Vauxhall, it is important for the business to take the emotion out of what used car are sold for. Instead, it is all about focussing on making sure every used car in stock is competitively priced rather than what individual general managers think a car is worth.
INDICATA has taken away the guess work of what cars are worth, instead the group follows a set of KPIs developed in house to help run the used car business more efficiently. Each general manager works to those KPIs to ensure SLM adopts a group approach to buying and selling used cars across its group.
Comparing prices across the market
What we liked about INDICATA was that it compares prices across the whole market, not just Auto Trader, that way we know we are using the most powerful data to help us make the right used car decisions.
Its used widely for when we are valuing part exchanges from outside the franchises we run. We know we are using solid data to value cars not just our guesswork. This is also very important in our two used car dealerships as there is no way we can be experts in every single make and model that we stock.
We are also stocking more premium higher cost used cars from BMW, Mercedes, and Lexus so it is important that we do not lose sight of stock turn and pricing on this higher value stock. INDICATA gives my team peace of mind they are making the best decision for our business and the customer.
Transparent part exchange values
INDICATA data makes valuing the part exchange very transparent with the customer as they can see what their car is worth on the day. Prices obviously move up or down on a daily basis. In the recent lockdowns that we have experienced prices were going up on a daily basis and we had to stay on top of this both when buying stock and also when selling it. We were often changing prices of stock on the forecourt daily.
The team rely very heavily on Market Days’ Supply as it enables them to gauge how desirable a part exchange is when we come to sell it.
If its highly desirable it may enable us to offer the customer another few hundred pounds extra as we know we will turn the car very quickly. When selling that car, we can also be confident in not discounting it as our data tells us where it sits in comparison with other used cars in stock with local dealers.
SLM has seen a reduction in stocking days
Within less than a year we have already seen a reduction in stocking days and an improved stock turn of 8.2. We have also seen increased profitability and during lockdown when we were not selling as many new cars the group focussed more on used cars which will continue post lockdown. We have proven that used cars can be very profitable and we are in great shape to keep that going whether we are trading digitally or physically.
2020 was the year we decided to introduce more of a digital approach to selling used cars. In addition to adopting INDICATA we also started investing in PPC advertising and spent more time on social media.
SLM was well placed to offer used cars digitally
During lockdown more used car buyers were looking at stock digitally and on social and we were well placed to put our used cars proactively in front of this audience. The used car market is much more digital now and we believe that buyers will continue to invest more time in these areas to find their next used car rather than visiting our sites,” explained Jason.
INDICATA also adds value when buying replacement used car stock. It helps us decide what to buy and at what price. It shows where SLM should go stronger on stock when buying online and when pricing used cars it is about using the insights to decide whether to take a smaller profit but sell the used car stock more quickly.
Singing off the same hymn sheet
Because all of our cars sit on the one portal I can come in and spent 30-45 minutes reviewing the dashboard and altering any of the KPIs as I see fit. I can then get on with other work for the rest of the day as I know the 25 users of the system are all singing off the same hymn sheet.
This has also meant we now have bi-weekly meetings between the GMs from the different brands where we can discuss the market and more importantly how we are performing against our KPIs. There we can voice our thoughts on how the market is moving and also look at INDICATA to see if there are any other data insights that we can learn from. It really has changed our used car business and the mindsets of our sales team.