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LEADS nurturing software house, AutoPlay, is talking to its dealer customers about using its systems to locate the used car stock that will be needed in preparation for the kind of used car market that is likely to emerge as the car industry recovers from social lockdown.

This mindset is in keeping with industry analysts like KPMG Motor Industry Services which are currently encouraging dealers to think about the sort of stock they will need to see the year out because the used car market could change significantly as the impact of the pandemic on jobs and businesses hits home. (See separate story).

The general manager of AutoPlay Australia, Brendan Bates, told GoAutoNews Premium that dealers often struggle to find suitable used car stock “but ideal cars are actually residing in their databases”.

These are the cars that dealers have been appraising as a normal part of their business; appraisals in the service lane, appraisals of cars offered as trades in the showroom and appraisals of cars offered to dealers by people sending online “sell-my-car’ enquiries to dealerships.

“Details of these cars are available in their systems. The dealers don’t own these cars but they know all the relevant details and they know where they are.” Mr Bates said.

He said that ramping up appraisals across the dealership, and conducting remote appraisals, has the potential to line up ‘virtual used car stock” that dealers can tap into.

This could be achieved while complying with social distancing laws and to alleviate concerns of people who remain conscious of contracting the COVID-19 virus.

Mr Bates said that “virtual stock” can be called on when an online lead comes in on a used car.

“A particularly appealing car might generate four or five or even seven or eight leads on one single car in the dealers used car stock.

“They can only sell that car one time. So potentially all the other leads for that car are wasted.

Tracking down ‘virtual stock’

“What AutoPlay does is match a fresh lead, when it comes in, to other similar vehicles that the dealer has in stock. This gives the sales people a shot at selling alternative similar cars to those other buyers.

“That works if the dealer has similar vehicles in stock. But there is another source of similar vehicles that AutoPlay can track down and that is your ‘virtual stock’.

“These are all the dealer’s old appraisals. AutoPlay looks at all these appraisals in the system and, if it finds a car that is a potential candidate that might satisfy one of the other buyers’ requirements, it alerts sales staff.

“It might have been an appraisal done during a sales enquiry or cars appraised when they are in for service.

“These are all ‘virtual stock’ that the dealer is not directly holding but the dealer, using AutoPlay, knows where they are.”

Mr Bates said that the service driveway was an especially important source of ‘virtual stock’.

“Every day the service driveway sees 20, 30, 50 or more cars and the majority are there for retail service work.

“There is no rule that says that the dealer cannot assess the value of those cars and the quality of those cars and keep that car on record. So we have all these cars and, if someone is looking for a car like that, then we know where it is.

“We know what it was like last time we saw it and we know what value we put on it.

“This is a really good practice. Dealers know it is a good practice but from our data we would like to see more dealers doing it more diligently and more often.

“I think that, after this crisis, dealers will be better off if they know where that good quality stock is.

“They don’t own it but their service customer owns it or someone they talked to online owns it. It is out there and the dealership has a view on what it is worth so they can make those matches because the AutoPlay technology makes those matches for them.

“So all they have to do is look at the list generated by AutoPlay.”

Mr Bates said that when JobKeeper support runs out there will be people who will need money. Others have lost their jobs already and have had to hand their company car back.

“That could throw a dynamic into the market where people who in the normal course of events would not be ready to replace their car may well find themselves having to cash up on their car and seek a lower-priced used one.

“So the ability to link appraised vehicles to future leads in a market where stock might be constrained for some time, and having access to ‘virtual inventory’, would be a good thing,” he said.

“Many dealers have a sell-my-car link on their websites to generate leads for the dealership to purchase good resaleable stock.  We have seen an increase in that activity where dealers are trying to remotely secure new stock from members of the public who are looking to sell their cars.

Subject to the cash flow positions of most dealers, that is a really good endeavour at this time because it helps on two fronts:

  • People who are tight for cash might want to offload a really good car
  • Dealers are always looking for good stock

All the factories overseas have either downed tools completely or certainly are producing at a lower rate and dealers need to get a handle on what their supply of new stock is going to be like later this year.

“In some franchises the lead-up to the new year could become a very heavily-focussed used car market. There has already been an increased used car focus and that looks potentially to go higher and so access to that good quality used car stock is going to be hugely important and to be able to facilitate that remotely is going to be important.

“If I was a dealer I would be using all the technology and processes as best I can during this crisis period.

“So access to stock is going to have to be top-of-mind for dealers

Remote appraisals gaining ground

“Our digital technology enables those leads that come in to be reviewed and appraised off-site or remotely using a phone or desktop to be shared across your panel of valuers, also remotely,  and then the transaction can take place at the end of that,” Mr Bates said.

“Where people are offering their car to a dealer via one of the sell-my-car features on the classified websites, the dealer can communicate remotely with that person using AutoPlay to gather photos of the car and send them back a valuation.

“The dealer might have a valuer in the dealership who is able to put a price on it or they might distribute it to their panel of valuers and get a price back from all their different partners.”

“All those processes in AutoPlay can happen remotely with SMSs and access to our website to look at the vehicle and see the appraisal notes and so on.

“That appraisal process can happen without anyone leaving the dealership unless it is to eventually pick up the car when they buy it.

“AutoPlay coordinates the whole process and partners with lead generation and appraisal system providers to help dealers,” he said.

By Neil Dowling

Dealer Auction