Move and Purchase Inventory with Manheim Express

A prevailing truth for many dealers is that what sells well on one dealer’s lot might not sell on another dealership lot. Discerning automotive dealers understand that continual cycle of fresh inventory is needed, and when a dealer notices some of their vehicles aren’t selling, or that they need to acquire more inventory, flexible solutions to buy and sell inventory are vital.

Of course, every independent dealer has options when it comes to buying and selling inventory. Dealers can go to auction, use digital platforms, or even trade with the dealership down the street. However, independent dealers are often pressed for time, and may not always have the luxury of buying and selling vehicles through those avenues.

Launching later this year, Manheim Express will allow vehicle buyers and sellers access to a fast, easy, self-service method to purchase and offload inventory.

Dealers wanting to sell units will have an unmatched volume of buyers across the entire Manheim Marketplace, which is comprised of Manheim.com, OVE, ManheimExpress.com in addition to OEM-specific marketplaces. Additionally, sellers will be equipped with the information they need to evaluate their selling options after completing a few basic steps on the Manheim Express mobile app.

Scanning a vehicle’s VIN will present sellers with the unit’s estimated value based on the Manheim Market Report (MMR), vehicle history, and manufacturer information, if available.

From there, a dealer will be able to gauge how they want to retail their inventory; either by getting a Guaranteed First Bid™ (GFB), posting the vehicle in the Manheim Marketplace, ordering an inspection or consigning the unit to the closest Manheim auction location.

Selecting the option to get a GFB ensures that if a vehicle doesn’t sell for a minimum set price after being listed for two business days, Manheim will purchase the unit at the GFB price. For dealers who want to sell inventory quickly, the GFB offers dealers the opportunity to have a check in hand in two business days.

For dealers who don’t want to list across the Manheim Marketplace, there’s also the option to send inventory to the Manheim location of their choice.

Each listing gets shared across the entire Manheim Marketplace, and simplifies the process to create inventory listings. 360-degree imaging lets sellers create tagged images that show extra vehicle details. Additionally, dealers also have the opportunity to order a condition report from an independent inspector. When ordered from the Manheim Express App, an inspector will come to a dealership lot within 72 hours, making inspections easy and convenient.

Combined, the 360-degree images and inspection report give buyers a comprehensive look at vehicles available for purchase, and help to reassure buyers of a unit’s condition when buying before seeing it in-person.

Manheim Express buyers have unrivaled access to fresh inventory and local trades. To search inventory available, visit mymanheim.com/express/.

For dealers interested in selling across the Manheim Express platform, download the app from the App Store. Visit mymanheim.com/express/ for more details.

The old inventory of one dealer can be brand new inventory to another dealer. Take advantage of the simple flexibility Manheim Express presents for both buyers and sellers to list inventory right from their lots to the world’s largest wholesale marketplace.

Comparing Floor Plan Lenders

Dealer on the phone at his deskFloor planning partners are often an integral part of dealership operations. Comparing various floor plan lenders and choosing a floor plan partner can be an involved decision for a dealer. Certainly there are a number of options available for dealers to get financing. However, selecting a lender as a dealership partner involves more than just the ability for a dealer to access capital. Partnering with a lender that can not only give a dealer the required funds to purchase inventory, but can also help save dealers time and preserve cash flow should be considered in a search for floor plan lenders.

Technical Capabilities
Independent dealers are incredibly busy. At a moment’s notice, dealers should be able to check on the current status of any vehicle on their floor plan, from any device. Additionally, dealers need the capability to get a holistic view of their entire account. The ability to quickly view reports about outstanding balances, inventory types and vehicle turn times mean that dealers don’t have to be concerned about building time-consuming reports and can swiftly get back to business.

NextGear Capital dealers have 24/7 secure access to their account via Account Portal. Dashboards give dealers a high-level view of important metrics and account details. Additionally, dealers have the ability to securely look at inventory currently on their floor plan, schedule payments, view vehicle titles, account analytics and submit new inventory for financing.

Customer Service
Providing superb customer service is often a cornerstone at any dealership, and dealers often expect that same level of customer service from their floor plan lenders. Do you have a local representative in your area? Is it easy to resolve any floor planning obstacles? If your business grows significantly, will your floor plan provider be able to keep up? It is important to ensure your floor plan provider has the ability to take care of your dealership’s individual business needs in an the fast-paced dealership environment.

Dealers that choose NextGear Capital have access to a dealership partner that is dedicated to service and customer-centric solutions. Every dealer has a devoted account manager to assist with any floor planning needs. Additionally, the average time to connect to a NextGear Capital team member on the phone is 10 seconds.

Integrated Solutions
Dealers need business partners that help provide seamless solutions that can ultimately save dealers time, and preserve overall cash flow. Some dealers may prefer to use independent business partners for various tasks, but dealers should consider the integrated solutions that their floor plan lender offers.

Solutions such as Rapid Pay give dealers the ability to floor plan non-auction purchases and overnight titles with a complementary FedEx waybill. Additionally, NextGear Capital dealers have the unique ability to floor plan their inventory transportation costs thanks to a partnership with Ready Logistics.

Though selecting a floor plan provider isn’t a simple decision, having standard criteria to compare floor plan lenders should aid dealers in making a final decision.

Common Independent Dealer Floor Plan Mistakes

Dealer walking through a car lot with a tablet

Independent dealers are in control of how they use their floor plans. Compared to using cash, floor plans have the ability to help free up time and dealership resources. However, properly managing an independent dealer floor plan comes with its own set of management responsibilities. Keeping a few key components in mind can help dealers find success, and avoid the following mistakes.

Dealers Forget Floor Planning Is a Cash Flow Tool
Floor plans are meant to help dealers alleviate their cash flow needs. When inventory is purchased with cash, dealers tie up the use of their dealership savings. Without a floor plan, dealers can’t use their cash on hand for other expenses. What could those funds be doing if they weren’t tied up in vehicle inventory? Dealerships could hire more people, improve service operations, or put more cash towards dealership expansion.

Dealers Floor Plan Carelessly
Though a dealer might have access to a $300,000 line of credit, that doesn’t mean they should immediately purchase $300,000 of inventory. If a dealer purchases more inventory than what they can reasonably sell in a month, they’ve put themselves in a situation where they might not realistically be able to pay back the initial loan amount in a timely manner.

Dealers Don’t Actively Manage Their Floor Plan
Independent dealer floor plan providers monitor certain cues that may reveal that a dealer might be dealing with some issues. Those main cues are turn times and insufficient funds (NSFs).

Turn times will often signal dealership health. The faster a dealer can sell a car, the faster a floor plan loan gets repaid. Though a vehicle might just be sitting on a dealership lot, that car is still depreciating and consuming dealership funds and resources. The longer the vehicle sits, the more it will depreciate, and the more it will cause concern for a floor plan lender.

Insufficient funds, or NSFs, are a critical indicator for floor plan lenders that a dealer isn’t actively involved in managing their floor plan. It’s often a sign that there are underlying issues within a dealer’s account.

A floor plan is meant to be a tool to help dealers succeed. By actively managing a floor plan, dealers can potentially avoid these mistakes and build a thriving and profitable dealership. Have questions about floor plan management? Let us know!

New Audit Improvements Add Flexibility for Dealers

A dealer auditing a vehicleThough audits are a fundamental part of the floor planning process, they shouldn’t consume more time from a dealer than necessary. NextGear Capital’s annual dealer survey revealed that one of the biggest pain points auto dealers face in their partnership with NextGear Capital was the auditing process. Thanks to this feedback, a number of improvements were made to auditing procedures which have led to up to 80% fewer interruptions for dealers.

Streamlined Notifications
Each and every day dealers and their team members have to attend to a number of phone calls and customer inquiries, in addition to an inbox full of emails. With the improved auditing system, dealers receive consolidated audit notifications. Fewer emails and phone calls asking for reconciled units mean dealers can spend less time managing their inbox, and more time on their dealership.

Account Lock Reduction
For dealers purchasing inventory with their floor plan, account locks due to non-reconciled units can be an inconvenience. With the improved auditing process, account locks due to non-reconciled vehicles are virtually eliminated. If a unit isn’t reconciled within the allocated auditing timeline, the vehicle balance is automatically paid off via ACH.

Ability To Advise On Out Of Office Periods
Headed to auction? Going on vacation? NextGear Capital dealers now have the ability to submit requests for a preferred auditing schedule. With an accepted audit scheduling request, dealers can rest easy knowing that their inventory won’t be audited at an inconvenient time.

More Time To Reconcile Units
Extended reconciliation timelines give dealers more time to account for floor planned vehicles. More time in conjunction with fewer audit notifications, mean that dealers don’t have to feel rushed to reconcile vehicles.

These audit process improvements give NextGear Capital dealers unparalleled flexibility and control over their accounts compared to any other floor plan financing lender. Have fewer interruptions and more time for your business with NextGear Capital as your floor plan financing partner. Want to learn MORE about what we could do for your dealership? Let us know!

Managing an Auto Dealer Floor Plan Line of Credit

Managing an Auto Dealer Floor PlanFloor planning empowers independent auto dealers to simply fund and stock dealership lots with in-demand inventory. Though it’s exciting to finally be able to relieve dealership cash flow issues and purchase additional inventory, managing an auto dealer floor plan line of credit comes with its own set of responsibilities. Be prepared to manage your floor plan by considering the following tips.


Use Your Auto Dealer Floor Plan Line of Credit Responsibly
Though a dealer might be approved to utilize a $250,000 line of credit, that doesn’t mean they should immediately purchase $250,000 of vehicle inventory. Dealers that use their entire credit line to purchase vehicles are going to face a hefty bill if that inventory hasn’t sold before payoff time. Make inventory purchases at regular intervals, or when your dealership lot reaches a dealer-determined inventory threshold. That way, payments are manageably spaced.

Dealers that responsibly utilize their floor plans also have to stay on top of those manageably spaced floor plan payments. NextGear Capital dealers are are able to opt into a recurring and automated system that schedules payments with AutoPay, a feature of Account Portal.

Be Prepared for Audits
Floor planning companies conduct audits to ensure the funds given to dealers are correctly invested into vehicles for retail. Though inconvenient on occasion, audits often are a necessary piece of the floor planning process. Dealers that take the time to keep up-to-date records, organize bills of sale and hold on to repair shop receipts will frequently have an easier time managing the overall audit process. Every dealership will need to figure out a process that makes sense for their individual locations. Despite the occasional inconvenience, planning and preparation can smooth the overall audit process.

Keep Communication Lines Open
Dealership success relies on more than a line of credit. Dealers that take advantage of the partnership a floor plan financing company provides can often optimize overall dealership operations and profitability. Local representatives can provide additional insights, answer questions and can work to help dealerships manage their floor plan.

Additionally, dealers that keep in touch with their independent dealer floor plan partners are able to better communicate questions, concerns or issues they may encounter. Dealers that are proactive and honest with their floor plan lender are more likely to be in a position to ward off any potential issues.

Dealers who take these tips into consideration can ensure their floor plan is properly managed, and consequently, will likely have a seamless floor planning experience. If you have additional questions about your auto dealer floor plan line of credit, let us know and we’ll connect you with your local NextGear Capital representative.

Boost Profits & Turn Times With Floor Plan Lending

Dealer talking to a representative about floor plan lending with the aid of a tablet.Car dealers work tirelessly to protect and improve turn times and overall dealership margins. Over time, many dealers develop and implement a variety of strategies and processes to help improve turn times and maintain revenue. Though every dealer can make profitable changes to dealership operations, dealers that utilize a floor plan lending partner may find it’s much easier to improve turn times and margins compared to cash-buying dealers.

Keep Dealership Funds Flexible With A Floor Plan
Purchasing inventory with a floor plan means that dealers don’t have to use their dealership savings to purchase inventory. For dealers looking to improve margins, the up-front cost to put a floor planned vehicle on a dealer’s lot is incredibly minimal. Depending on a dealer’s contracted terms, a first fee—-a small fraction of the original vehicle purchase price—-may not be due until 30 days after the car was first purchased at auction. Since dealership savings weren’t utilized to purchase inventory, those funds can be used for other expenses and priorities which can consequently help to improve overall dealership turn times.

For example, because a dealer utilized a floor plan instead of cash to purchase inventory, they were able to make improvements to their dealership’s service department. As a result, the service department improvements decreased the amount of time spent getting vehicles customer-ready, which in turn, helped to improve overall dealership turn times.

Other Methods of Improving Turn Times
Taking advantage of a floor plan often gives dealers the additional capital and hours needed to refine processes that improve turn times.

Average dealers typically can get a car customer-ready in approximately 10 days, and online in about 13 days. Keep in mind, each day that a vehicle remains unsold, it incurs dealership costs. The top 20 percent of performing dealers can get a vehicle customer-ready typically within a four day window. While that timeline might not be realistic for all vehicles or all dealerships, the overall concept stands: the faster a dealer can get a vehicle customer-ready, the less a dealer has to spend holding on to a vehicle before it sells.

One of the most realistic ways for a dealer to retail vehicles quickly is to list inventory online, perhaps even before leaving auction. Though that timeline may not be realistic for all vehicles or dealerships, the sooner those vehicles are posted, the sooner possible customers can see available dealership inventory, which can consequently help to improve dealer turn times.

Another method to optimize a dealership’s overall speed-to-market is to evaluate current transportation options. How much time does it take to move a vehicle from auction, to a dealership lot? Despite the minimum amount of time it might take to move a vehicle from point “A” to point “B,” dealers that take advantage of services from NextGear Capital and Ready Logistics have the additional ability to floor plan transportation costs, further optimizing dealership cash flow.

For dealers looking to improve turn times and profitability, utilizing a floor plan lending partner can be an effective business strategy.

The Advantages of an Auto Dealer Line of Credit

Almost every dealer has a preferred type of capital they use when purchasing inventory. Some prefer cash, a standard bank loan, or a floor plan, and others use a mix of all three capital types. However, for dealers that don’t currently use an auto dealer line of credit, consider the advantages that a floor plan can provide.

Dealers that take advantage of an auto dealer line of credit have one of the simplest means of acquiring financing to purchase inventory, and one of the most flexible ways to free up dealership cash flow.

Typically, most dealers have a set amount of savings on hand to pay for inventory and dealership expenses. The additional flexibility a floor plan provides means that dealers don’t have to use dealership savings to purchase vehicles to sell to consumers. With an auto dealer line of credit dealers don’t have to spend those savings purchasing inventory. Since those funds aren’t put towards purchasing inventory, dealers can use that additional cash flow to focus on growing other parts of their business.

In addition, compared to using cash, using a floor plan certainly gives a dealer more options when it comes to aged and depreciating inventory. When a dealer purchases inventory with cash, that capital is tied up in the vehicle. As the vehicle depreciates, so does the dealer’s initial investment. With a floor plan, dealers can pay off the amount of the car over a longer period of time, extend a vehicle or buy down the car’s depreciation. Without a floor plan line of credit, those options aren’t necessarily available.

Beyond giving dealers extra cash flow, many floor planning companies offer a number of other services that help dealers save time and headache on administrative tasks. For instance, floor planning vehicles at auction mean that dealers typically have less paperwork to complete to make a purchase.

Additionally, Since floor planning companies work so closely with auto dealers, floor plan providers develop many solutions made specifically for dealers. Some of these solutions include state-of-the-art online and mobile account management tools, title services depending on a dealer’s state, records management and collateral protection.

Using a floor plan can be an extremely beneficial business strategy for dealers. If your dealership doesn’t currently use a floor plan, consider how one can work alongside your other methods of inventory payment to increase your dealership’s purchasing power and cash on-hand flexibility.

Growing Business with Auto Floor Plan Lending

dealer on car lot using NextGear Capital's account portal on their phone as their auto floor plan lending solutionTo build a profitable and thriving dealership, auto dealers have to utilize a number of tools. Some of these tools handle inventory management, sales and reconditioning, all necessary in daily dealership operations. However, arguably one of the most useful tools in a dealer’s “toolbox” is their auto floor plan lending solution.

For the most part, dealerships thrive based on a dealer’s ability to sell vehicles. Dealers sell vehicles, make money off the sale and use the sale proceeds to pay for dealership operating expenses and additional inventory. However, only using the funds from previous sales to purchase more inventory and cover other expenses can severely limit dealership operations and growth.

Auto floor plan lending providers give dealers a line of credit made solely to purchase vehicles from auctions and other inventory sources. If a dealer puts a vehicle purchase on their floor plan, they have a contractually determined number of days to sell the vehicle before a small fee is charged. Once the vehicle is sold, dealers pay back the original loan and any associated fees.

With auto floor plan lending, dealers are able free up their cash flow so they don’t have to use large portions of saved dealership cash to purchase vehicle inventory. Profits from vehicle sales can instead be used to grow and expand other necessary dealership operations instead of purchasing vehicles to retail.

Beyond just giving dealers needed purchasing power, auto floor plan lending companies are uniquely familiar with a dealer’s needs and often offer a variety of other dealer-specific benefits. Some of these benefits include title services—dependent on a dealer’s state—records management, collateral protection and powerful account management tools. Additional benefits include

The additional buying power and benefits a floor plan line of credit provides can be a serious game-changer for automotive dealers. Considering adding a floor plan to your dealership’s toolbox? Let us know!

Utilizing Digital Auctions for Aged Used Inventory

image of aged used inventory vehicles on dealership lotDealers understand that aged inventory can be a drag on a dealership. Not only does the inventory cost to stay on a dealership lot, but it can slow dealership cash flow. Though the goal is always to sell first to a consumer, selling some used vehicles to consumers won’t always be possible. On occasion, a dealer will have to wholesale or move an aged used inventory unit through other channels. Though many dealers can and should take vehicles to a physical auction location, taking advantage of digital auctions can be an excellent alternate route to deal with aged inventory.

First, Develop an Aged Used Inventory Strategy
Using digital auctions is a valid strategy to get rid of aged inventory. However, if your dealership doesn’t have an aged inventory exit strategy, you might want to consider developing one. Does your dealership have a plan if a vehicle hasn’t sold after the 15, 30, 45, 60 or 90 day mark? What’s your unit break even point? Every dealer eventually develops individual formulas for success when it comes to aged inventory. However, while developing your strategy, consider the variety of avenues available to get rid of aged inventory and the role they play at each stage of your aged inventory strategy.

For example, once a unit reaches 45 days on your dealership lot, you could begin posting inventory across digital auction channels and set a limit for how long you will continue to retail that particular unit.

Utilize Online Channels
Many dealers take advantage of the flexibility digital auctions offer to limit the amount of aged inventory on their lots. For example, with digital auctions dealers are able to put units up for sale without the added time and expense of transporting those units. In addition, dealers that incorporate digital auctions into their aged inventory exit strategy are able to attract more eyes to their inventory.

Cater To Your Buyer
For dealers who use digital auctions as part of an aged inventory exit strategy, consider what your potential buyers will want to see from a listing. Do you have a condition report? Vehicle images? Make your units easy to purchase. Give your buyer all the information they need to make an informed decision.

Using digital auctions in conjunction with an aged inventory strategy means that dealers have the opportunity to recoup potential losses from aged inventory.

Why Source Inventory with Auto Dealership Financing

Dealer using auto dealership financing to purchase online inventoryDealers will often say there’s nothing like being able to touch, feel or smell a car before purchasing it to retail. Though physical auction locations like Manheim meet that need, some dealers require more convenience and flexibility. For dealers, one of the most convenient ways for dealers to source inventory is to utilize digital auctions, such as OVE and Simulcast. Paired with auto dealership financing, dealers can easily source inventory quickly and conveniently.

Find Specific Inventory
Often, dealers will have specific inventory in mind that they want to purchase and retail on their lots. Though dealers can look through a local auction’s run list, a digital auction can give dealers a simpler means of searching for particular inventory across a wide number of physical auction locations. In addition, there are other filters dealers can use to find specific inventory, such as make, model and year. These additional search qualifiers make it easy for dealers to find and purchase the inventory their markets desire.

Save Time and Buy Independent of Dealership Location
Dealers that purchase inventory from digital auctions can save time by avoiding the travel time needed to visit a particular auction. Sometimes specific inventory is only available at out-of-state locations. Bidding online not only levels the field for dealers that can’t travel significant distances, but it also gives dealers the option to make purchases from the comfort of their offices.

Simplified Purchasing
When purchasing inventory online with auto dealership financing, the checkout process is further simplified. Dealers can quickly and simply purchase inventory without using their cash on hand. By using a floor plan, dealers can put their cash towards other business expenses.

Delayed Transportation Expenses
For dealers that purchase inventory online, figuring out how the purchased unit gets to your lot used to be a process disconnected from the purchase. Dealers that use NextGear Capital as an auto dealership financing provider have the added advantage of floor planning transportation costs. Our partnership with Ready Logistics gives dealers the opportunity to put the cost of transportation on hold until the vehicle is sold.

For dealers that need extra time in their day to manage operations, sourcing inventory from online auctions give dealers the flexibility and convenience to ensure their lots are fully stocked.