There is too little management in Austria”

There is too little management in Austria”

Automotive economy:Mr. Novak, Eurotax took a detailed look at the price structure of domestic used car dealers and found that the starting price plays a key role.
Martin Novak: We have been dealing with detailed price analysis for some time because we are convinced that we can still greatly help dealers to significantly optimize their used car business and ultimately generate higher margins by accelerating their rotation of used cars.

What were significant results?
What was particularly interesting for us was how many vehicles are offered at significantly higher prices than the market. And also: Where are vehicles offered too cheaply, also taking individuality and regionality into account, because the used car business is complex and individual. What was also interesting: the differences in how dealers deal with prices and being able to really represent that. We see here that the used car inventory still has some potential, i.e. it can be managed even more actively. 

Where is the potential or where are the deficits?
The point is that 41 percent of vehicles have not had their prices adjusted for more than 90 days. That is of course a huge number. Especially when you compare it with other countries. Example Switzerland: There this number is 70 days, in Great Britain it is 50 days.
 
Is the level of suffering too low for us?
Basically, this depends on the dealer structure. Some of our units are larger than Switzerland. But it also has to do with the complexity of the matter: Who can compare their used car inventory on a daily or weekly basis - once it has reached a certain size - with other dynamic offers on the Internet? This is practically impossible. And that's exactly why we looked for a solution and developed it with the EurotaxPriceAnalyser. 
 
On average, was the individual car priced too high or too low?
The vehicles tend to be very expensive and are not adjusted for a long time, which leads to incredibly long downtimes for these vehicles in particular - sometimes well over a year. If you know that after 50 or 60 days the contribution margin starts to shrink to zero or becomes negative, then you know what happens to vehicles that sit for a year or longer.

What is the danger if entry prices are too low?
In that I am attractive and may even be able to sell quickly, but of course I have to be very careful whether I still generate a contribution margin or whether I actually do the new car business if a low offer price also leads to a lower trade-in price for the new car. I.e. High achievable prices are also important for a more voluminous new car business.

This means that the potential in terms of conscious pricing is still very large.
We have seen that there is the greatest potential in Austria because, on average, there is still too little management here. We also did another analysis in which we saw that the dealers who dealt more intensively with our tools - such as Autowert 4 or the market radar - optimized their inventory rotation and were able to achieve better profits.

Eurotax introduced many tools last year. 
The first product that we launched was Autowert 4 Online, with which we ultimately conquered the Internet world, although that is probably a bit too big a statement since we have been active on the Internet for a long time, for example with Quickcheck or MarketAnalyser. The response from retailers was extremely good. We have now been able to convert more than 60 percent of the market to the new tool within two years. This means we are ahead of plan, as we had expected a changeover time of around four years.

What exactly can Autowert 4 do?
This tool was developed for customer discussions so that the price can be presented precisely. From car value 4 we come to the market radar. The Eurotax offer course provides a basis for decision-making in the daily used car business, taking into account the daily changes in the market, so that it is even more up-to-date. And finally EurotaxVIN, an online service in Eurotax Autowert 4 that makes vehicle identification and configuration much easier. By entering the internationally standardized 17-digit vehicle identification number VIN (Vehicle Identification Number), you receive the correctly identified vehicle in one step, including all special equipment installed ex works.
 
What is the status quo at RepairEstimate?
We have invested in our Repair Estimate repair calculation, introduced new graphics and significantly expanded the data depth. Here too we went online as an option. It can be linked to car value 4. What's also interesting: With the workshop manager, we offer body software that is particularly important for small workshops. A module with which you can manage a cash register electronically and comprehensibly, so that it complies with the legal requirements. Given the cash register requirement, this is an important tool.