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BURGEONING online car dealership website, run by brothers Michael and Paul Higgins, is aiming to increase its sales volume by 300 per cent this year with a turnover of about $13.5 million worth of cars bought from sellers and then sold on to online buyers.

The Sydney-based company was created in late 2016 when it entered the highly cost-sensitive arena of buying cars from private sellers and then reselling those cars to buyers recruited from its listings on the internet.

HelloCars now has 22 people working from its office in Sydney which is currently the only HelloCars site in Australia. The company has identified regional offices in Brisbane and Melbourne as the next area of growth but is in no hurry, based on business advice to focus on consolidating the business before looking to expand its base.

HelloCars says its USP is that it seeks to take the hassle out of the car buying and selling process by bypassing what it says is the stressful experience that dealerships and classified sales can sometimes produce.

Michael and Paul Higgins, HelloCars

Its business model promises to offer customers better prices and shorter buying and selling times than alternative buy-sell processes.

HelloCars co-founder Michael Higgins told GoAutoNews Premium the pressure to buy a car was removed with their “online dealership”.

“I have a background in automotive both on the manufacture side and dealer side. I felt that in the dealer space, no one was really doing used cars very well from a customer perspective in Australia,” he said.

“The whole environment is quite stressful, you walk in and there’s a lot pressure to buy then and there, and, if you decide that this is the car for me, then you have to go through the negotiation process.

“Some people love it but for the vast majority of people it’s quite an intimidating process.”

Mr Higgins and his brother and co-founder Paul decided to create HelloCars after seeing online dealerships in the UK and US. He said no such service existed in Australia.

HelloCars differs from classifieds sites such as Carsales and Gumtree where the onus is on the customer to buy, sell and organise promotion for their vehicle. But HelloCars operates like a traditional dealership, just without the showroom and therefore fewer overheads.

“By cutting out the expensive overheads of a bricks-and-mortar dealer we’re able to operate on a much lower margin,” said Paul Higgins.

“Customers that partner with us receive a fair price, guaranteed to be at least $1000 more than a traditional dealer,” he said.

The capital cost of stock acquisition is privately funded by the Higgins family. Sales revenue also is used to cover the cost of acquisition.

HelloCars customer Adriane Kolbas receives her 2014 Range Rover Evoque purchased through the site

Here’s how it works

If a person wants to sell their car on HelloCars, they arrange for an inspection of their vehicle to be conducted at their home or place of business. This can be carried out as soon as the same day.

HelloCars’ mechanics conduct a 230-point safety check on the vehicle and then make an offer to the seller. If the offer is accepted, the car is typically picked up within 48 hours and taken to a warehouse in western Sydney where the cars are stored.

The sellers are paid in full for their car on the same day (or on the next business day on weekends) that their car is collected.

According to HelloCars, the whole process takes between one and five days; whereas a private sale in Sydney takes an average of 45 days.

The company protects its investment in funding the used cars in stock at the warehouse – and its reputation for quality cars – by only buying cars for onselling that have completed less than 130,000km, come with a service history and have passed the 230-point check.

Buyers get that level of peace-of-mind but also receive 12 months of free NRMA roadside assistance and a seven-day, 500km money-back guarantee.

HelloCars lists its vehicles for sale on classifieds sites and sees Carsales and Gumtree as important partners for their business.

Car buyers are offered a fixed price for a vehicle. If they choose to buy, delivery is free for customers in the Sydney metro area, while other areas will incur a shipping fee. Alternatively, the customer can travel to Sydney to collect their vehicle.

According to the Higgins brothers, its buyers are confident in purchasing vehicles through HelloCars without physically seeing them due to the comprehensive information provided on each vehicle listing. This includes a raft of photographs and technical information, superficial damage report and details of the aforementioned 230-point mechanical check.

By Robbie Wallis and John Mellor

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