Unconsidered Trifles

By Tony Moorby June 06, 2018

It’s been a good few years since I was actively involved in the business on a daily basis but I still maintain a voyeuristic peek through publications, websites, newsletters and so on.

 My curiosity is constantly fueled by the changes going on – some like a bull at a gate and others a little more nuanced – but all contributing to a vastly different world of vehicle distribution from basic wholesaling to sophisticated retailing tactics.

 Coming from the auction side of the business, I remember the sense and feeling of walking into the lanes on sale-day morning and immediately getting a vibe of what the market was doing there and then. 

The feeling wasn’t driven by a single event but a confluence of hundreds of little bits of feedback – who’s here, how many, buyers or sellers, the weather, the look on familiar faces, are there any new ones? 

The available inventory contributed to the overall sense of livelihood. Were dealers letting go at reasonable prices or hanging on for a swing in the market? Were buyers stepping forward eagerly to outbid their competition? 

One day could be vastly different from the next, as could an auction a hundred miles away. 

Local sentiment was openly at the forefront in the ultimate expression of the immediate free market.

 The big stock exchanges were just the same – the clamor and excitement one day, the searching for bidders the next.

 A number of years ago I wrote about the growth of predictive inventory acquisition and it’s grown to the extent that the days of the old-time wholesaler are probably destined to go the way of the internal combustion engine – only faster.

 The folks that hawked their wares from one dealership to another, hoping to land a deal and pick up a trade or two to go on and do it again, are getting as rare as hens’ teeth. 

They used to be the eyes and ears of the trade – the jungle drums keeping everyone within the sound of the beat. 

And a good man (or lady) could underpin a deal on the dealer’s doorstep for a set price and the dealer could finalize a deal, while the wholesaler was pitching his knowledge and his reputation against the rest of the market. 

It all sounds a bit loosey-goosey these days but the network hung together like a spider’s web – staying strong so long as no one picked it apart.

 The international stock markets now do millions of deals in nanoseconds and while this efficiency is to be admired, one has to ask at what point does predictability not follow reality. It’s happened and expensive runs and losses in the hundreds of millions have been the result almost before anyone has looked up from their computer screen.

 Dealers can now rely on similar software, not just to predict what cars they’ll need and when but the information gets overlaid into all kinds of other databases they are provided an ongoing stream desirable cars and the reach gets ever further out. 

Even lease portfolios are now committed to pre-sales before their maturity dates. One question remains; are these residual values realistic when the stock finally becomes available? 

We’ve seen those gaps before causing a rush to acquire when undervalued and gluts with dropping prices at the opposite end.

 It’s then that we need the flexibility that’s brought by the broader, national market; to bring balance back to pricing and product spread throughout. 

Shakespeare had a character in The Winter’s Tale called Autolocus listed as “A Snapper-up of Unconsidered Trifles.” It’s likely that we’ll always need a few of these.

Last modified on Friday, 15 June 2018 15:08

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