The value of the van market shouldn’t be underestimated

In some respects the used van sector has similarities to the used car sector in that the most desirable models command the highest prices. In addition, the condition and previous usage – i.e. a used van that has been used for small parcel delivery – is most likely going to have had less wear and tear than a builder’s van of the same year. Market research shows that the average new van is churned at 75,000 miles, irrespective of age.

When looking to acquire used vans for your dealership to resell, it is imperative to understand specification and payload. Colour is less important as are optional extras, because most self-employed people will have, for example, their own sat-nav systems.

Check the history

Service history is key and perhaps even more vital than a used car. Additionally, a reliable and comprehensive used vehicle warranty and service plan is key to the sales process. If a used car breaks down, the consumer normally still gets to work whilst it is being repaired etc, however a van user risks considerable loss of income if their vehicle suffers the same fate.

Finance penetration levels on used van sales can be low compared to cars because underwriting criteria for the self-employed can be quite stringent. As such it is important to have a finance provider in place who understands the sector and who has a rate for risk profile product for the self-employed.

The challenges that exist in sourcing used car stock are heightened when it comes to used van buying, as whilst there are less models to buy, condition and specification are most definitely specific disciplines where the lack of either is where the battle is won or lost.

Aftersales opportunities

Extras selling is challenging: it is unlikely that you will sell many extras on used vans. GAP is a hard sell due to usage and mileage, while paint protection and minor damage insurance are also most likely out of the question.

In terms of increasing dealership profitability, and looking for additional revenue avenues the van/LCV sector is one that is becoming increasingly prevalent amongst dealerships as the demand for these vehicles shows no sign of abating.

By Ian Allen

Read more on Auto Retail Inspire

Snap up your next customer before your competitor gets back to them

Concentrate on value to perfect your finance deals