Five Questions with Karen Braddy - Part 2
Like many dealers, Bill Shenk – owner of Destination Powersports and the man behind Dealernews’ current Dealer Lab* project – is interested in getting some pre-owned units into his store, but he’s full of questions about auctions. Before heading to a local Manheim Specialty auction location to stock up, we worked with the Dealernews team to help answer some of his most burning questions. This posting is the conclusion of a two-part series (click here to read the first part).
BILL SHENK: What are the options for transportation to deliver the purchased units to my dealership? How do I find a transporter, and how are the transportation costs calculated so I can be close on final cost estimates during the bidding process?
KAREN BRADDY: Auctions have a wide network of independent transportation partners. Dealers are also welcome to make arrangements with their preferred transporters or dealer-employed drivers. Many auctions have a dedicated specialty manager or transportation coordinator to assist dealers with post-sale transportation needs.
Manheim Specialty also aggregates and consolidates motorcycle and powersports units at designated auction locations to increase the volume of inventory available for purchase. As a result, dealers attend sales at fewer locations; this means the transportation distance and rates are predictable each time. While transportation is a variable that needs to be worked out by the buying dealer, it is not a major obstacle in purchasing units.
In addition to transportation, most auctions provide a host of ancillary services ranging from full service reconditioning such as detail and mechanical repair to inventory management and floor planning.
SHENK: Many dealers, including myself, don’t have the cash available for new or used inventory, so we use flooring options to secure new units. What are my flooring options for used?
BRADDY: While cash is always welcome, auctions accept many forms of payment. Manheim Specialty will accept payment from any of the floor plan options from OEM used wholesale floor planning; Manheim Financial Services (MAFS), GE Money, Automotive Finance Corp. (AFC) and Dealer Services Corp. (DSC), and dealership local banking relationships.
If dealers choose to floor-plan through MAFS, financing is available for 100 percent of auction purchase price with extended terms of up to 120 days for motorcycles and ATVs.
SHENK: Traveling 500-plus miles to attend an auction is very expensive. How do I buy online without undue risk?
BRADDY: I always recommend for dealers to have some experience purchasing at a live auction prior to participating online, and this experience should include building a relationship with the specialty staff at the auction. To reduce risk when purchasing online, dealers should thoroughly review inventory listings, photos and condition reports prior to bidding. Any questions during this process can be directed to the specialty staff at the auction with whom you have already built a rapport.
Once a dealer is ready to buy online, there are two main options if you’re shopping with Manheim Specialty. Simulcast allows dealers to participate in a live sale via the Internet. Bids can be placed in real-time while the unit is being auctioned on the block or via proxy bid where an automated system bids on your behalf based on limits you set. Units purchased this way incur an additional $50 online fee.
There’s also Online Vehicle Exchange or OVE.com, which is a 24/7 bid or buy now wholesale marketplace. OVE.com offers buyers the ability to see, compare and purchase units either in a “Buy Now” or online bid environment. Auctions guarantee negotiable title for the buyer and payment for the seller — even online. Today, more than 40 percent of motorcycles and powersports sold at Manheim Specialty locations are sold via Simulcast or OVE.com. The data proves that many dealers are confident purchasing used inventory online.
What other questions are you looking for answers to before you’ll make a visit to a Manheim Specialty Auction location near you? Let us know in the comment section and we’d be happy to help get you a response.
*Full Disclosure: Manheim Specialty Auctions is a sponsor of the DealerLAB editorial initiative in Dealernews and the Shop Talk LAB Community on www.dealernews.com.
Karen Braddy is the General Manager of Manheim Specialty. She has been with Manheim since 1990, and launched the Specialty initiative for Manheim in 2005.