The Top 10 Floor Planned Vehicles During First Half of the Year

Independent dealers are facing more competition for less inventory in today’s post-pandemic wholesale marketplace. Then, when they find vehicles that meet their acquisition strategy, they are costing more than before. 

The cash flow from NextGear Capital’s floor plan financing is helping independent dealers stay competitive and act quickly to acquire the right inventory. As a result, dealer clients are securing some of the most sought-after vehicles on the market. Six of the top 10 vehicles floor planned with NextGear Capital in Q1 and Q2 2021 represent the two most popular vehicles in America: The Ford F-150 and the Chevrolet Silverado. Midsize sedans, including the Nissan Altima and Toyota Camry, ranked high, as well.

“Sourcing inventory in a tight market requires independent dealers to have a plan in place to make smart buying and pricing decisions,” said Scott Maybee, president of NextGear Capital. “Using a flexible floor planning strategy can make a dealer’s inventory work for them and stay competitive in any environment.”

The top 10 vehicles floor planned with NextGear Capital in the first half of 2021 were: 

  1. 2013 Ford F150
  2. 2014 Chevrolet Silverado 1500
  3. 2018 Ford F150
  4. 2014 Ford F150
  5. 2014 Ram 1500
  6. 2015 Chevrolet Silverado 1500
  7. 2015 Nissan Altima
  8. 2015 Chrysler 200
  9. 2016 Ford F150
  10. 2018 Toyota Camry

“The pandemic has caused consumers to reevaluate their needs when it comes to purchasing used vehicles,” said Shane Pyne, NextGear Capital industry intelligence manager. “Trucks and mid-sized sedans are dominating the list which tells us that customers are factoring in both lifestyle and budget when shopping for used vehicles.”

Shane Pyne, Intelligence Manager

The Keys to a No Fuss Title Management Process

When sourcing inventory, you need to focus on getting the best price possible and securing the vehicles your customers are looking for. While a necessary component, acquiring the titles to accompany them is often an afterthought. Title management can be a time-consuming and frustrating process for dealers, but it can be streamlined and stress free with a NextGear Capital floor plan. Here some ways your floor plan can improve your title management process:

  • Reduced Headaches – Tracking down titles after an auction sale can be a hassle, especially when you’ve purchased multiple vehicles on the same day. Fortunately, with a NextGear Capital floor plan the heavy lifting can be done for you by keeping tabs on the status and location of your titles, so you can focus on getting your inventory ready to sell.
  • Increased Security – When titles are being handled by multiple people, they can get misplaced or even end up in the wrong hands. When you have a NextGear Capital floor plan, your titles are kept securely in our title vault until they’re ready to go to their new owner so you don’t have to worry about them getting lost or mishandled.
  • Streamlined Process for Non-Auction Vehicles – In the past, it was not uncommon for dealers to have to wait days before their titles were processed and the received funding for their non-auction inventory. NextGear Capital has expedited this process by providing dealers with a prepaid FedEx Waybill inside of Account Portal so they can ship them overnight and have their funding request approved by the next day.
  • Detailed Title Information – Tracking the status of a title is one of the most time-consuming aspects of purchasing a vehicle. The newly enhanced Title page inside of Account Portal gives dealers greater visibility into the status of a title including its due date, the number of titles eligible for release, tracking information and title location so they’re always in sync with their titles.
  • Less Overhead – If you carry a large amount of inventory on your lot, you know that tracking down titles can be a full-time job and require additional staff to help oversee the process. If you have a floor plan that offers title management, you can quickly access information about your titles and release them when you’ve completed a sale from your mobile device or desktop. This saves you the expense that goes along with hiring a title clerk.

A vehicle can’t be sold without a title, so finding the right system to keep your titles organized is crucial. Fortunately, when you select a floor plan provider like NextGear Capital you have the resources available to help you manage your titles so you can focus on moving more metal.

Financing Options for Your Dealership

Operating strictly with cash can be limiting and local banks and traditional financial institutions don’t have additional resources available to help you run your business. NextGear Capital specializes in helping independent dealers succeed with floor plans that include dedicated support, tools and resources to help you run the most efficient and profitable dealership possible. Here are some things you’re missing out on without a floor plan:

Flexibility

When your cash isn’t tied up in inventory you can use your funds to:

  • Experiment with different types of vehicles to grow your client base.
  • Invest in technology such as digital retailing or market insight tools to drive more online shoppers and ensure your lot has the vehicles they want.
  • Make needed improvements to your dealership.
  • Expand your staff.
  • Cover overhead costs.
  • And much more!

Account Management

You won’t get tools to help manage your daily operations from traditional financial institutions. NextGear Capital’s Account Portal provides real-time account overviews that offer vital information such as:

  • Analytics
  • Transparent auditing details
  • Title management
  • Payment history
  • Vehicle valuations
  • Reporting
  • And much more!
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Finding The Way Forward in July

Relationships Matter

Independent dealer Edwin Smith opened Blue Sky Auto in 2014 and has been a NextGear Capital client since 2015. He started out with a modest line of credit of $25,000 and has steadily grown to $350,000.

While he says his business model hasn’t changed much over the years, his relationship with NextGear Capital and his business partner has helped him remain successful no matter what has come his way. “I had previously worked with a different floor plan company but as soon as the rep from NextGear Capital walked into my door, I immediately liked him and decided to switch to NextGear,” Smith said. “I really think that my relationships with NextGear Capital and my business partner, along with the support of my staff, have been the key to my dealership’s success over the years.”

These relationships have been especially important for Smith in 2021. Despite the economic factors all dealers have faced, as well as a personal health challenge he has had to overcome, he has leaned on both NextGear Capital and his business partner to remain successful. Whether it’s finding ways to keep from overpaying due to high inventory prices, making sure the units on his lot are the right mix for his client base or just talking through the big decisions, it all adds up to a steadily profitable and successful track record.

Stronger Together

After spending 30 years in the automotive industry, Mark Weida, owner of Street Smart Auto Brokers in Colorado Springs, Colorado, said the pandemic was unlike anything he’d ever seen. “Since we weren’t considered an essential business, we were shut down for two months which was really difficult,” he said. “When we were finally allowed to reopen, I went to great lengths to make sure my customers and staff were safe by increasing our sanitization protocols.”

Weida says that he also decided it was time to make other adjustments to his dealership. “I made some changes to my staff and hired a new service and general manager who were willing to adapt to our changing business model,” he said. “I’ve also hired more mechanics so I can get the vehicles ready to sell as quickly as possible. My goal is to have each vehicle sold within 45 days of purchase and if they don’t sell by the 60-day mark, I turn around and sell them to another dealer.”

The biggest change Weida says he’s made is to his buying strategy. His dealership specializes in mid-sized used vehicles between 2 and 10 years old. While he uses some online buying platforms, for the most part he prefers to buy his inventory in person even though it takes more effort. He takes a team of buyers out so they can work multiple auctions over a few days. Recently, he had four buyers spread out at eight auctions over three days and purchased 38 vehicles. In comparison, he used to be able to buy the same number of vehicles in one day after only attending two auctions by himself.  “I’ve never seen a market this volatile,” he said. “First, inventory prices started to creep up, then the semiconductor chip shortage happened. Suddenly we were competing with new car dealerships because they didn’t want empty lots, so they started purchasing used vehicles which further added to our inventory challenges. I’ve talked to other dealers around the country who’re paying the same price for 2016 model vehicles that they were paying for 2018 model vehicles just a year ago.”

Despite all the challenges, Weida says that things are starting to look up. His dealership recently had the best week in terms of vehicles we sold since COVID. While he used to average between 80 to 100 vehicles on his lot, he now averages about 120 so he’s still been able to increase his inventory during this time. He is also currently the President of the Colorado Independent Automobile Dealers Association (CIADA) and a member of a NIADA board and committee. “It’s nice because I get to talk to other dealers, share ideas and help each other figure out solutions to problems,” he said. “I don’t remember a time in the industry it’s been this precarious, but I think dealers who’ve been able to adapt have been able to be successful. We don’t know what tomorrow’s going to bring but we know we’re stronger together.”

NextGear Capital Team Members Embrace Inclusion Virtually

Employees finding the way forward in July

Even though most NextGear Capital team members continue to work from home, they were recently able to participate in virtual events to celebrate PRIDE and Juneteenth. The PRIDE Employee Resource Group (ERG) board members recently distributed items to members’ homes. “Knowing that PRIDE would be a virtual experience this year, we wanted to ensure that we kept the energy, excitement and inclusiveness that comes with PRIDE month,” said PRIDE co-chair Erin Kahre. “This allowed us to get creative and we decided that we would assemble and deliver PRIDE-themed swag bags for our team members at home to enjoy! We had about 120 team members sign up to receive the bags.”

After distributing the items, the ERG held a selfie contest for team members to post pictures in their PRIDE shirt. The ERG plans to be back to the Indianapolis PRIDE parade in 2022, but was so pleased that they were able to do something to show LGBTQIA+ team members that they’re important and supported.

NextGear Capital team members also celebrated Juneteenth by participating in a virtual Cox Automotive discussion, “Why Investing in Diversity & Inclusion Pays Off” with Cox Automotive’s Inventory Solutions President, Grace Huang, and Mercedes Benz USA’s Chief HR Officer, Lars Minns. They shared their experiences and the benefits they’ve seen when automotive organizations focus on being more diverse and inclusive.

5 Things You Didn’t Know About Floor Plan Lending

While many dealers have heard about floor plans, they might think that they operate in a similar style to a local lender or a traditional financial institution by simply offering lines of credit. However, floor plan lenders know that independent dealers have unique needs and have designed their floor plans with that in mind by providing additional tools and services to help support their whole business. Here are 5 things you may not know about floor plan lending:

  1. Increased Flexibility – With additional cash flow, you have the flexibility to be agile. Do you need to quickly meet the demand of your customers, or do you want to try stocking your car lot with different types of vehicles? Working with a floor plan lender provides you with collateral and market insights so you can make quick changes when needed.
  2. Financing Designed for Dealers – Traditional loans are typically structured with rigid terms and don’t take into the consideration the needs of a specific business. Floor plan lenders like NextGear Capital have created different types of term plans. Whether you’re new to the independent dealer space, specialize in carrying lower priced inventory or are looking for lower principal reduction payments, you’ll be able to select the plan that best fits your needs.
  3. Account Management – Do you get tired of spending hours tracking down your titles after an auction sale? When you choose a floor plan lender that offers products like NextGear Capital’s Account Portal, you’ll have access to tools that can help you manage different aspects of your dealership like audits and title management, saving you time so you can focus on selling more vehicles.
  4. Additional Support – Whether it’s answering questions about your account or helping you figure out the best inventory to carry to reach your target customers, floor plan lenders provide you with the additional support you need to help your dealership reach its full potential.
  5. Transparent Financing – It can be difficult at times to know what you’re being charged for when your traditional lender has hidden fees buried in complicated loan terms. Floor plan lenders like NextGear Capital know how frustrating this is and make sure fees are upfront and easy to understand, so you don’t get hit with any surprises.

Just like shopping for the right vehicle, you want to feel confident you’re selecting the right financing for your dealership. If you’re looking to add inventory to your lot or want to make upgrades to your dealership, choosing a floor plan lender versus a traditional bank provides you with the cash to do so. You’ll also have access to additional resources to help support your day-to-day needs and run your business more efficiently. With the right floor plan, you’ll have both the financial means and expert industry support to navigate through challenging times and adapt as needed. Start floor plan lending today!

Dealer Spotlight Bobby VanSickle: Embracing Floor Plans

Bobby VanSickle wasn’t initially interested in getting a floor plan when he decided to start his own independent dealership. “I worked for a franchise dealership for 21 years but I wanted more work-life balance. So, about seven years ago, I decided to take everything I had learned and apply it to operating my own dealership and that’s how AFS Ohio got its start. I had heard about floor plans when I was on the franchise side but I didn’t know how they worked for independent dealers. I really didn’t need the additional cash flow at the time and I thought that’s all they provided but it turned out I was wrong.”

VanSickle said that he was approached by somone from NextGear Capital and that’s when he started to rethink his decision about getting a floor plan. “I had worked with MAFS during my time on the franchise side and NextGear Capital had been recommended by the Ohio Auto Dealer Association (OADA) but if it hadn’t been for my Portfolio Manager, I still don’t think I would’ve signed up for one. He really showed me how much of an asset having a NextGear Capital floor plan is and how it could help me to further develop my business.”

Bobby VanSickle Dealership AFS Ohio

It didn’t take long before Bobby VanSickle realized how much more his floor plan had to offer. “It’s nice to have the additional cash flow but what I really like is the convenience and the resources available to help manage my dealership. I’ve looked into other floor plan lenders but I think that NextGear Capital has better tools, a better audit process and I prefer their term plan structure. Before I had a floor plan, I used cash to purchase all of my inventory. I kept about 20 cars on the lot and sold around 15 each month. Now that I have a floor plan, I keep around 150 on the lot and sell 50 vehicles each month.”

While being able to grow his inventory has been great, he says the biggest selling point for him is Account Portal. “I love using the Account Portal! The dashboard gives me a quick overview to see what payments I have coming up and I’m a huge fan of Self Reconciliation because it helps me keep track of the inventory I have between my two locations and I can quickly and easily clear my audits. I also love the titles page and I’m on it everyday. The main reason I floor the vehicles I purchase from auctions is because I don’t have to worry about following up to chase down my titles. I can quickly check their status in Account Portal, it’s such a timesaver and I consider it a huge asset to my business.”

When it comes to COVID-19, Bobby VanSickle says he didn’t have to change his sales model at all. “I was already purchasing about 90% of my inventory online before the pandemic started so the only major change I had to make was making sure the dealership was sanitized more frequently to ensure that our staff and customers were safe. We’ve been really fortunate because AFS has done great despite the pandemic. In fact, we were able to set some new sales records this past year.”

Despite this, VanSickle says that just like other dealerships have experienced, sourcing inventory has been challenging. “Finding inventory can be difficult and when I do find it, it’s often overpriced. I look for the most competively priced inventory whether I source it from traditonal auctions like Manheim, or from wholesalers. I’ve started using tools like vAuto’s Stockwave to help me make more informed decisions when I’m looking to purchase inventory. I’m also fortunate to have my own truck hauling company so I can transport units easier. I’ve noticed that there are less transport options out there because I think so many more dealers are having to go further away to source their inventory.”

In June, VanSickle says he’s moving into a new two million dollar location he recently purchased. “I’m excited about being able to finally own instead of renting my dealership space. I love that it’s closer to home and is going to allow me to save money and also carry more inventory. It’s also going to have a full body shop so we’ll be able to offer different service options to our customers.”

Bobby VanSickle jokes that the advice he would give to a new dealer is to get out, but then says, “Don’t jump in too quick and overextend yourself. I think it’s a good idea that new dealers have a floor plan but every dealer should use it differently depending on their cash flow and business needs. In my case, I wasn’t really looking for the additional cash flow but for the convenience and flexibility that my NextGear Capital floor plan provides. It’s crucial to figure out what your needs are and choose the best floor plan that’s going to help you meet them and succeed.”

NextGear Capital Creates Dealer Advisory Board

Kathy Ward Dealer Advisory Board

Diverse Client Group to Provide Feedback on What Independent Dealers Require To Be Successful In an Evolving Industry

Beyond simply staying connected with clients via surveys and anecdotal feedback, NextGear Capital is furthering its commitment to dealer growth and success with the creation of the DRIVE Dealer Advisory Board (“DRIVE” or “Advisory Board”). The purpose of the group is to provide a platform for open and direct dialogue between NextGear Capital leadership and dealers to help identify ways to best address their business needs and drive NextGear Capital’s future planning and investments.        

Over the past two years, informal dealer feedback contributed to many of the recent enhancements to Account Portal, NextGear Capital’s account management platform, reinforcing the value of creating of a more structured approach. The inaugural meeting took place virtually in April with NextGear Capital President Scott Maybee and members of his leadership team in attendance. Going forward, the Advisory Board will continue to meet monthly in a virtual setting.

“Our goal is to gain first-hand perspectives from this Advisory Board about what matters the most to our dealers,” explained Maybee. “Through collaborative interaction, DRIVE will help us better serve our 20,000-plus independent dealers, creating new solutions to reduce their pain points and providing a client experience that delivers value every day.”          

To obtain varied viewpoints and wide-ranging feedback, NextGear Capital selected a diverse group of dealer clients based on the following criteria: varying lines of credit; minority and female-owned dealership representation; those who are quick technology adopters, as well as slow adopters; Manheim and non-Manheim buyers; and both long-term and new NextGear Capital clients. The 10-person Advisory Board also represents a cross-section of NextGear Capital’s national footprint from Florida to California. The Advisory Board members are:

Kathy Ward Dealer Advisory Board

“I have worked in the automotive industry for 35 years and appreciate the importance of learning to grow and evolve an independent dealership,” explained Ward Motor Co.’s Kathy Ward. “It’s an honor to be part of the DRIVE Dealer Advisory Board and pay it forward by providing up-and-coming dealers with solutions to make their day-to-day operations easier, through insights and strategic planning with the other board members on how to best advance us into the new age of doing business.”

Utilizing A Floor Plan for All Your Business Needs

When you think about floor plan lenders, it’s natural to think of them as just another financial institution such as a local bank that offers additional funding. But did you know that when you select the right floor plan provider, you have access to additional tools and resources to help run your dealership more efficiently? NextGear Capital knows that independent dealers need more than additional cash flow to help optimize the success of their dealership. Here are some ways utilizing a floor plan to help streamline daily business tasks:

Account Portal – There are so many different aspects to running a dealership and that’s where Account Portal can help. This online account management platform gives you the most current information on everything from upcoming payments to the location of your titles. You can also access additional resources such as reporting, analytics, promotions and how-to videos.

Tailored Pricing Programs – Whether you’re new to the independent dealer space, specialize in lower-priced inventory or simply want more flexibility when it comes to your cash flow, NextGear Capital has a floor plan that’s right for you. From Flex Pricing to First Gear, we’ve designed different pricing programs to meet our dealer’s unique and individual needs.

Customer Centric Support – With other financial institutions, after you’re approved for a line of credit you’re probably not going to hear from them again unless there’s a problem. That’s not the case with NextGear Capital. You’ll have a dedicated Portfolio Manager who can help you strategize and find solutions to problems. You’ll also have access to our client experience team who can assist you with everything from processing your funding requests to answering questions about reporting available inside of Account Portal.

Easy Audit Reconciliation – Located inside of Account Portal on the audits page,Self Reconciliation efficiently clears audits so you don’t have to spend hours reconciling unverified units. Simply take pictures on your mobile device and clear audits in real-time. You can free up even more time by assigning the reconciliation to one of your associates with our delegation feature. 

MORE Resources – From our Collateral Protection Program which provides you with extra assurance on your inventory, to blogs, videos and industry insights on our dealer resources page, we’re constantly investing in providing you with the tools and information you need to help your dealership boom.

When you’re shopping floor plan lenders, remember to select one that’s going to be able to support all your business needs. From tools like Account Portal to flexible and customizable financing options, NextGear Capital prides itself on providing its dealers with a one-stop financing solution to help them overcome challenges and stand apart from the competition. Start utilizing a floor plan today by applying here.

NextGear Capital Unveils First Gear For New Dealers

Dealer using First Gear

“First Gear” helps meet the challenges of getting a used car dealership up and running

Getting a used car dealership off the ground can be challenging, especially in the current automotive retail and wholesale environment. In response, NextGear Capital has launched the first floor plan product in the industry designed specifically for new independent dealers, called First Gear.*

First Gear is a floor plan option that provides early access to capital that is vital to jump starting a new dealership. Independent dealers who’ve been in business for six months or less can get approved for up to a $100,000 line of credit without immediately submitting bank statements. This gives them the cash flow to purchase inventory and the flexibility to choose where to source from, while freeing up finances to grow their business. Following an introductory period, as more information is submitted, the line of credit is evaluated and adjusted, as needed.

first gear for dealers

In addition to being expensive, starting a new dealership comes with a lot of unknowns. First Gear dealers also benefit from NextGear Capital’s commitment to helping independent auto dealers thrive. Supported by the resources of Cox Automotive, a designated portfolio manager provides business analytics that can help new dealers identify inefficiencies, and gives them the information and tools they can use to make necessary adjustments, stay ahead of the curve and focus on profit and growth.

“NextGear Capital understands how hard it can be for independent dealers to secure lines of credit from traditional financing sources,” said President Scott Maybee. “As our company’s primary focus is to invest in the success of independent dealers, we are committed to delivering new solutions that help them and our industry grow even stronger.”

To learn more about NextGear Capital’s First Gear dealers floor plan program, go to www.nextgearcapital.com/floor-plan-products/first-gear

*Certain conditions apply. All rights reserved. Not available in New York or South Dakota. Advances are subject to Terms and Conditions of Dealer’s Demand Promissory Note and Loan and Security Agreement and other agreements with NextGear Capital. Advances made in California by NextGear Capital, Inc. are made pursuant to NextGear Capital’s California Finance Lender License #603G505.