Top 5 tips for greater car-buying profits


Written by: Carbuyertom

Car market trends and going with the seasons can often be the most challenging elements for used car dealers when considering what stock to buy. After all, all traders want a pitch full of desirable cars throughout the year to ensure constant profitability. 

However, working with car trends and the seasons can actually enhance profits for an experienced dealer.

Jason Stokes, Director of says;

“As buyers of used cars online, we obviously take into consideration not only the type of vehicle but also the specification and time of year when we are making the final decision to purchase. 

“However, there are many more factors to consider than just the stock itself for any trader who wants to keep profitability as high as possible, all year round.”  

Top 5 key factors to consider when buying used cars for trade stock

1. Protect forecourt margins by introducing new model mixes to your stock

Many dealers operate their used stock by sticking to fairly narrow trends. This can often result in a decreasing circular of popular marques, models, price ranges and mileages, and dealers can fall into the trap of looking at other used sector vehicles. 

Discussion with trade retailing peers will provide substantial information to other brands that are selling well. If dealers keep their network open as widely as possible, they can learn from other traders’ mistakes and successes.

2. It's all in the detail

There is a vast array of vehicle options available to new car buyers and any used dealer will know that at the showroom end these extras will add substantial amounts to a new vehicles OTR delivery price. 

As many of these options are standard on most vehicles, some premium options on a vehicle that you are looking to buy for stock may make a difference to the forecourt value.

3. Pricing matrix

Habitual discounting can be the rogue enemy of many used vehicle dealers and all too often, this habit goes unnoticed or accepted on a unit-by-unit basis. 

For example, what percentage of used cars are sold for the full screen price and are discounts readily given or other freebies? 

Some dealers may prefer to discount or provide ‘over-trade’ part exchange valuations, in which case, pre-sale screen pricing is your their protector, allowing them to 'set up' the vehicles to allow for these sales tactics. 

As many traders will know, just £100 extra profit per unit on a 40 vehicle used dealer’s forecourt with 50% stock will net an astonishing extra £24k per year. 

4. Finance first

Most large used car retailers will be working with a used vehicle finance provider.

When looking at used vehicle and finance options, there can be a notion from buyers that finance is an ‘added option’ and worse still, an ‘afterthought convenience’. 

If dealers have to be asked by a used vehicle buyer if you they finance, then there is obviously substantial room for improvement in this area and lost profits to gain.

5. Go the extra mile

Sometimes it's difficult for traders to stand out from the crowd from other used retailers in their locality. 

  • Making the site look interesting 
  • Ensuring that all cars are easily assessible
  • Arranging test drives easily for potential buyers 
  • Making sure that all cars at all times are ready to go – with fuel and a charged battery! 

These simple things can often make the difference between success and failure – traders that know this go the extra mile every time.



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