The automotive industry is a huge part of the UK economy, so it makes sense that there are lots of businesses that want a slice of the action.
Car auctions are an incredibly useful resource for sourcing vehicles, parts and accessories but many find that the margins can be a bit narrow. Here are some tips to help you maximise your investment at auction.
Buy smart: Focus on high-demand vehicles and parts
Car auctions can be overwhelming places, and you may be tempted to bid on everything you see! But this is a time when you need to be focused and only search for specific pieces.
Focus on vehicles and parts that are in high demand. This means keeping an eye on the trends in the industry. You can do this by regularly checking automotive bloggers and subscribing to relevant magazines.
Set a strict budget
Budgeting is key to making sure you don’t overspend and affect your financial projections. Before you head to the auction, try to make a rough plan. Remember to account for the hidden costs such as transportation, auction fees and potential repairs and reconditioning.
Try to avoid bidding wars. One way to do this is to set a maximum bid based on expected retail or fleet value. If the price goes higher, you will avoid spending more and regretting it.
Leverage online and physical auctions
When people picture auctions, they may imagine a room full of antiques and the auctioneer talking really fast. Now, though, there are different types of auctions that you can take advantage of.
In-person car auctions are the best way to inspect the items before you purchase. This reduces the risk of buying a dud or a vehicle with issues that may have been overlooked. These gatherings are also great for potential networking opportunities.
Online vehicle auctions have also seen a rise in popularity due to the lack of travel costs and time associated with physical auctions. Buying second-hand vehicles from private dealers can often work out cheaper, but you do risk not being able to see the goods before purchase.
Speed up resale with efficient reconditioning and marketing
When purchasing, think about what you can turn around quickly with minor repairs or a small level of reconditioning. You may want to keep repairs in-house so you will know what you can reasonably achieve.
Once you are ready to sell, make use of multiple platforms such as dealership websites, online marketplaces and wholesale networks. Although this requires a bit more administrative work to keep track of what has sold where it gives you a higher level of exposure to potential buyers.
Remember to use high-quality photos and detailed descriptions in your adverts. Grainy or blurry photos will not entice anyone and make your business look a bit dodgy! You could invest in a proper camera, although many smartphones take clear, sharp photos easily.
