Dealership group builds web platform to boost used inventory

Building a website through which consumers can quickly get their vehicles appraised and then sell them to Performance Automotive Network has helped the Cincinnati-based dealership group supplement its inventory of used cars and trucks and cut costs tied to visiting wholesale auctions.

Even before the coronavirus pandemic and resulting new-vehicle supply constraints, Performance Automotive Network was exploring how to change its used-vehicle acquisition strategy. Shane Dever, the company’s director of operations, zeroed in on one method — buying more vehicles directly from consumers and fewer from auctions.

If the dealership group could provide a way to do that that didn’t require customers to walk into a dealership to get an appraisal, often an anxiety-inducing event, all the better, said Nathan Myers, used-car director for Performance Automotive’s Utah and Cincinnati operations.

“We wanted to create a separate experience for the consumer that they felt comfortable with,” Myers told Automotive News.

That idea turned into ezcarsale.com, a mobile car-buying service. Would-be sellers can use a vehicle appraisal tool on the site to get an offer range. Or, Myers said, they can schedule an appointment online or via phone call for a vehicle acquisition specialist to visit their house or office for an appraisal.

Upon visiting, that specialist inspects the vehicle and verifies its condition. If all is as it should be, they can cut a check for the seller’s vehicle on the spot, Myers said.

“Everything is agreed upon,” Myers said. “The transparency is the customer knows up front what they’re getting.”

After first starting in 2019, ezcarsale.com was relaunched in August 2021 following a revamp that included putting in place the staffing and advertising needed to maintain it.

It was a little slow to start out, Myers said. Performance Automotive — which has 14 franchised dealerships and two used-only stores in Ohio, Kentucky and Utah — was purchasing 30 to 40 vehicles a month. But since March 2022, the mobile service has generated acquisitions of more than 100 vehicles a month on average, he said.

In 2022 through November, Performance Automotive bought 1,213 vehicles using the platform. A team of up to eight employees handle sales leads, and another three drive to sellers’ locations and pick up vehicles, Myers said.

The group, which retailed about 20,000 new vehicles and 30,000 used vehicles in 2021, tries to “buy everything,” Myers said. About 65 percent of the acquired vehicles join the group’s retail inventory. The other 35 percent are wholesaled.

Performance Automotive joins a widening throng of dealership groups exploring new ways and the use of technology to jump-start used-vehicle acquisitions. Some are getting results buying consumer vehicles via social media, right off the street or even through buying centers established solely for used-vehicle acquisitions.

Another goal of the mobile service is to save money on transportation and auction fees.

Auction fees can be as much as $800 per vehicle, Myers said. It could cost another $800 to transport a vehicle from an auction to a dealership. Performance Automotive has saved “probably over $500,000 in transportation alone” in 2022 because of ezcarsale.com, Myers said.

Per-vehicle gross profit for cars acquired via the site and retailed by Performance tends to be about $1,000 higher than for those purchased at auction, Myers said.

Performance Automotive travels to an interested consumer 95 percent of the time, Myers said. A lot are local, but Myers said the company doesn’t turn down vehicles that are farther away. If a vehicle seems like a great find, an employee might travel a few hours to acquire it. It’s not unlike traveling to an auction — just without auction fees, Myers said.

Depending on the make and model of a vehicle, the purchase process can be finalized in 30 to 45 minutes, he said. If an undisclosed problem is found upon inspection, Performance Automotive might still end up buying the vehicle — just for a lesser amount. The aim is to be speedy and transparent so the odds of closing the deal increase, Myers said.

“Being able to show somebody why we deducted $500 or $400 — I think that speaks volumes, right?” Myers said. “It’s not something that we just pulled out of thin air.”