Dealers are acutely aware of the challenges that these market movements bring and are, on the whole, ready and willing to invest in digitisation to ensure their businesses have ongoing relevance. For funders, some of which will have seen significant digitisation in other sectors within their portfolios, there exists an excellent opportunity to deepen relationships with dealer groups and to grow their businesses by supporting retailers through the digitisation process.
In light of this, an increasing number of funders are packaging essential digital tools for dealerships alongside their finance offerings. We’ll look at some of the key developments.
Digitised Wholesale Funding
With the growth in wholesale unit funding has come opportunities for more flexible, digital solutions that facilitate the rapid turnover of stock that many dealers have been experiencing. Funders have developed cloud-based systems that allow dealers to add and remove vehicles from their facility as the stock moves through the sales funnel.
Not only does this ensure that vehicles are only financed for the period that they need to be, but it also enables dealers to be more fleet of foot in acquiring new stock. In the most advanced cases, these systems also link directly into wholesale vehicle sourcing and management systems to automatically add vehicles to finance portfolios when required. All of this promotes the throughput of vehicles and greater opportunities for both the dealer and vehicle finance provider to grow their business.
Delivering Deep Insight
With finance providers becoming the aggregators of so much data on stock inventory, turnover rates and vehicle margins, they have become invaluable sources of insight to dealer groups. This can include:
- Optimal stock selection based on the dealer’s own sales data.
- Insight into potential stocking opportunities from wider market trends such as alternative marques, high-performing older vehicles, popular equipment levels and optional extras.
- Regular reporting on performance of dealerships within the group and individual members of the sales team.
- Highlighted gaps in processes and inconsistencies in management practices.
- Opportunities to reduce the risk of compliance issues and fraud.
Ambitious dealer groups are increasingly demanding this level of data-driven insight in order to make better management decisions and identify opportunities to grow. Wholesale vehicle finance providers in a position to provide this insight have the ability to identify high performing dealers to maximise their own business growth.
Customer Experience / Sales Process Efficiency
Where wholesale funders are also providers of consumer finance, there are significant opportunities to enhance the experience of customers using online tools embedded in a dealer’s website. Examples include:
- Minimising the level of customer detail required upfront to pre-qualify them for finance, thereby not detracting them from their vehicle research.
- Providing online finance calculators that allow modelling/comparison of finance options for a specific vehicle and the variation of parameters such as up-front payment, term etc.
- Integration of facilities such as Open Banking to ease the form filling process.
- White labelling of calculators to ensure a consistent brand experience.
In addition to easing the customer journey, funders can also bring efficiencies to the sales process by digitising the paperwork associated with the vehicle sale. This can include:
- Digital verification of documents such as a passport, driver’s license, or other identification ID. Consumers capture images of the document using any device, and this is then assessed by intelligent software to determine its relevance and authenticity. This facility can be used remotely by the customer or in the dealership to speed up the application process.
- Identity verification, using facial recognition technology that compares a customer-taken selfie with images from a passport or other ID.
These technologies can be combined with e-signatures to dramatically cut the time involved in closing the sale, provide a more convenient, remote service for the customer and enhance compliance performance.
Stock Inventory Audits
While there are definite opportunities for mutual business development and growth offered in each of the areas above, digitisation of vehicle inventory audits and stock management provide perhaps the greatest synergy between outcomes for auto finance providers and dealer groups. Good practice and collaboration here go to the very core of both parties’ interests, and for that reason, it warrants its own article which you can read here.
Automotive finance is an industry that has been slower than others to adopt digitisation in the past but it’s clear this rate of adoption is gathering pace. Dealer groups are increasingly looking to their financing partners for assistance with adopting new technologies and there’s no better time than now to be able to offer these solutions while providing the necessary support.
CheckVentory Audit gives auto finance providers confidence in identifying dealer groups that offer the greatest potential for growth while highlighting areas of risk where they exist. The technology used increases operational efficiency and promotes a collaborative partnership between funder and dealer in understanding and optimising their stock inventories.