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Quality not quantity
Page 46
Page 47
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The agreement between Volvo Trucks and Nissan to sell Interstars and Cabstars next to heavy trucks across Europe has given the Swedes an opportunity to enter the used van market.
Words: Kevin Swallow / Images: Tom Cunningham At the IAA Hanover CV Show in 2006, Volvo Trucks and Nissan announced the latter's two 3.5-tonne light commercials, the Interstar and Cabstar, would he sold through the Swedes' established truck dealerships.
Steve Kirk, Nissan light commercial vehicle business development manager for Volvo Trucks' European division, says five UK sites will be housing new Nissan products. Scotland, North, East Anglia, West and Wales have salespeople in place, while London is recruiting. These are in addition to the 25 Nissan light CV sites, and there are plans for the combined network to grow by 50%.
"We are bringing a service package more in line with trucks than the passenger car market,says Kirk.
The Swedes are hoping to become the largest Nissan commercial product distributor in the network and the potential is there. Volvo Trucks' customer database is a good starting point — many operators run vans and trucks.
Part of developing a franchise for vans is delivering a full range of services for would-be new-purchase customers, and that includes part exchange.
"Volvo Trucks wants to be able to sell Nissan successfully as a franchise arrangement," says Peter Groome, used trucks director. -so we have to offer a full range of services to the customer. One of those is having the ability to part-exchange their existing van.
"This is where this concept [selling all makes of used vans] started out, as an avenue to sell the part exchanges [from new Nissan sales]. It then developed into the idea that we could make this stand up as a business in its own right, albeit with relatively low numbers," he says.
The used-van pilot site at Volvo Truck and Bus East Anglia is up and running. "We're using Coventry as a site for light CVs. What we recognised is having our dealers selling Nissan products is very likely to result in part exchanges. So, to support new sales, we decided rather than trade vehicles, we would go to market with a retail offer. This is where this site came from. We decided to start on a relatively small basis to give us the opportunity to retail part exchange against new Nissan sales.
"Also, we recognise it's an opportunity to sell [other brands of] light commercial vehicles as well as part of our total offer, because a lot of our [Volvo Trucks] customers run light CVs as well as heavy CVs," he says.
Initial targets are small, says used light CV and truck salesman Scott Sandford — 50-75 sales in the first year, including 20% part-exchanged from new Nissan sales. "Selling used vans is a faster-moving environment than trucks; someone will see the van, come in and want to take it straight away.
"We are trying to apply the principles of selling a truck to selling a van, the same level of preparation." he says. The key to making Volvo Trucks' move into the used van market a success isn't quantity, it's quality, believes Groome. Our aim isn't to sell 3,000 vehicles we intend to sell vans with an aftermarket package, with mechanical breakdown insurance, sell service packages, finance the vans. We're wrapping up everything as one complete package. We aren't just interested in turning over metal.
"Plus almost every one of our truck buyers especially the bigger fleets-will run a van. I think we've got a head start on some of the van franchises.
"We've seen an opportunity to differentiate the offer by offering a package that is the same as that for a premium used truck we aren't getting into a price war. If people want to buy a cheap van, there are plenty of places to go. If they want a van with a service history, and add-ons to go with it, this is the place to come. They don't have to worry if it breaks down or what to do to get it serviced. It's essentially a one-stop shop," says Groome.
To stock up the used van site. Volvo bought from the open market, with vehicles aged from 12 to 36 months seen as ideal. -We've spent 12 months researching the market to see what's happening.
"We spent a lot of time at auctions to determine our buying strategy We have specific criteria we need to meet to buy a van, so we limit what we buy," says Groome. "We need six months to understand the sort of return we're getting, and [be sure] we've got the right offer in place:. The biggest challenge, says Sandford, who will also underwrite the part exchanges, is letting people know that Volvo Trucks is now selling used vans. "We've got a website and local radio ads coming out we have to let people know we are here. Those who have come through the gate we have sold to," he says.
There are, concludes Groome, several reasons why it should work. "It's primarily to support our Nissan activities with an eye on the used market. We have a huge customer base [through Volvo], and even if only half run a van, that's more than enough for us to fulfil what we want to do.
"By not having massive ambitions, we'll achieve our objectives." •