I ponder, is the current stormy weather we’re having a reflection of times ahead. It was only last week when the Government announced an official UK recession, oh about the same time when this unusual weather hit us – coincidental I’m sure!
Yet the housing and secondhand car market continue to thrive in spite of this. I wonder why. Maybe it’s because we’ve known for months a recession is coming. So it’s not a surprise like in past times. People knew it was coming, much like knowing Freddy Krueger is coming for you in your dreams.
Okay, so because it’s not a surprise then, people can prepare for it and maybe not overreact. Also I’m sure other recent events have caused differences to what would usually be classified as a ‘normal recession’.
I’m no economist, but it seems clear that people will still carry on their daily life, they will still binge watch Netflix, they will still get excited for a new series of ‘I’m a Celebrity…’ (although this year it will be set in the UK), and they will still buy and sell houses and cars. Perhaps the only change in the future will be the price tags attached to them.
So if it’s just a price tag change, and I hope that’s the worst, then we’re well set to help sellers return the same money they’d expect with a traditional auction company. Why? Well simply put, because we take a modest 6% (inc. VAT) fee from the sale of the car. Other auction companies take on average 20% and some even 30%. I’ll repeat that quietly, THIRTY PERCENT.
Yeah yeah Adam but what does that really mean?
Well, I’ll tell you, let’s take an average traditional auction company that charges 6% seller and 15% buyer commission (inc. VAT).
Now if a buyer raises their hand in the auction room at a little over £26k then they will have to fork out over £30,000 at the desk (let’s hope they have quick maths). Yes the buyer pays nearly £4,000 in commission (I would repeat that quietly but I’m sure you’re getting the message) – just for buying the car!
But it doesn’t end there, oh no no no. Now let’s take the seller, the poor poor seller, the auction company takes just over £1,800 from the them, including a consignment fee that can be up to £250.
The bottom line is on a £30,000 published price sale, the auction company made nearly £6,000 in commission.
With our super low commission coupled with best in class service, we could actually sell that same car for £26,000 to a new buyer (saving them £4,000), and return the same money to the seller that they would have got via the traditional auction.
Recession proof mathematics if you ask me – the future is online – it’s as clear to me as Freddie Krueger.
Adam Purrier – Chief Petrolhead