A new light commercial vehicle centre has been opened by CD Auction Group, and it’s the first of many new sites planned to help expand the company, reports Daniel Puddicombe
CD Auction Group has opened a dedicated LCV site as the online-only remarketing company aims to continue an upward trend in sales volumes.
According to Andy Brown, CEO of the company, the establishment of the new centre, located a couple of miles from its headquarters in Corby, Northamptonshire, is the first of many to come.
“We’re looking to take a couple of sites – maybe somewhere up the M4 and somewhere along the M6,” he told What Van? at the launch of the new centre. “As the business grows, it’ll give us a better proposition in the marketplace.”
In time, CD Auction Group is looking to ape web giant Amazon’s approach to business by having big warehouses all over the country.
“Buyer cost of collection will be reduced,” explained Graham Howes, commercial director. “We have to have the stock come into us and then go out and it is the same with Amazon. It goes in and it goes out and they cut the time of delivery costs by having lots and lots of big sheds around the country, and it will be no different for us. We’ll just need to get the vehicles in, prepare them and then sell through our online system.”
“The movement cost is the biggest challenge,” Brown admitted. “So if we can dissipate some of that with another site – a two-acre site with a washbay, an inspection area, storage area and image studio is all we need – we can sell them online from Corby. This move is very important as it gives us the capability to learn how a remote site works.”
Despite having buyers from across the country (and indeed the world – Howes cited an example of a customer from Malta buying a Citroen Berlingo) Brown explained the need to prove the business model works close to home before expanding further afield.
“Remote sites is the way in which this business will grow, and having a local remote site gives us a really good opportunity to learn how to operate a remote site because if we have any problems, it’s only a couple of miles away so we can get up there and sort it out,” he said.
The new LCV site is rented from a haulage business CD Auction Group uses to transport vehicles to and from buyers and there is a possibility of using more land in the future, should the business need to, Brown added.
Part of the need for the new LCV centre is that the firm’s van sales have gone through the roof in recent years; two years ago, there was an 85/15 car/van sales split in terms of ratio, whereas that is almost a 50/50 split nowadays, with the company running a van auction every Thursday. The eventual aim is to put LCVs under the (virtual) hammer three days a week and cars on the other two days.
However, Brown ruled out a move to take on the likes of eBay, citing stringent consumer protection laws and a desire to not over-complicate matters. When What Van? visited the site, we were able watch the end of an auction. Sales always finish at 1pm – providing continuity for customers, Brown said, as they know to be near a computer at 1pm on Thursdays – although if more than one buyer has bid on a particular model, they are given five minutes to up their offer after the cut-off period, with this process continuing until one person has the highest bid and their competitors have bailed out.
Both Brown and Howes advocated that process, claiming it is a lot better than eBay, where you can easily be ‘sniped’ at the last second by a computer programme. In some cases, auctions can continue for around an hour and a half after the cut-off period.
The company claims to have a very good record on returns – with just three vehicles in three years – that Brown puts down to the way that it markets its vehicles.
“We have six [images] of the outside of the vehicle, five of the inside and pictures of damage. We do not have a grading system so our approach is to tell everybody what the damage is and then the buyer can decide because they can judge it from the quality of the pictures we provide,” he concluded.