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Monday, 15 February 2010

Find a niche then exploit it.

I've always enjoyed motorsport of any kind, Track days can provide all the fun of motor racing but without the red tape and regulations. Track days in the UK are quite popular these days. Most people experience their first track day to see how their car performs on a race circuit. A large percentage of these people then get the bug and want to start doing track days on a regular basis. 

I was one of those people. I have taken most of the performance cars that I own on a race circuit at some point. More recently I used a Lotus Elise S2 and although stunning on handling, I mean really stunning, it lacked top end grunt. I then progressed to a Subaru Impreza WRX. 

I bought the Subaru when it had already been stripped and to be fair it had a great spec. It was running 1.2 BAR on the turbo and came with a rolling road printout showing 279bhp at the wheels. I bought it and made some further mods namely Sparco steering wheel, different coil overs and full race livery. I wont mention figures here as the car as recently been sold but............
I lost money on it! let me explain. I did a track day in Anglesey (click here to see on board video) with it, the car went superbly until the last run when something went terribly wrong. It turns out I had cracked a piston. This resulted in me needing an engine rebuild costing £1500. As It happens I chose not to have the work done and instead sold the car for spares or repair. I will add, I only lost a few hundred pounds which given that it was sold as a non runner is quite impressive. Had I have not blown the engine I reckon I would have cleared a £1500 profit on that car and  I would have had some great track days in it too. 

Anyway, that was that. I was confident of making cash had I not have blown the engine but more importantly (at least to me) I had some great track time in it. So I'm keen to get another track toy, enjoy the summer at race circuits, improve it then sell it for a profit. Although the Subaru was ridiculously fast it was also ridiculously temperamental (exceptionally loud, the neighbours blind slats were twitching when it started up). It was highly tuned and had aftermarket ECU etc and was just too fickle. I wanted something more reliable and something more on a par with the track car that my cousin runs which is a Primera GT (you will see me pass the white nice sounding car in the video) So, I have just bought a Nissan Almera GTi which has already been part prepared in so far as it has been stripped, caged, race seats and harnesses etc, uprated brakes and so on. The car has the same engine as the Primera and so with a few more modifications I should be about level in terms of performance as the Primera GT, More importantly, I've picked this up at the right money, ok it isn't a Subaru but, give me a few months, you wont recognise this car and I reckon that there's at least a grand (£1000) in it!

The thing is, People are looking for cheap fun, Some buy bikes, others buy jet skis some want track cars. There are a lot of people who will build there own but trust me, please trust me, there are people out there who just want a stripped out car that sounds nice and looks the part so that they can do track days and feel like Tiff Needell. This is a niche, Ok so my last attempt lost money, not a lot I may add but that was due to engine failure. I'm confident this time and I'm gonna have a whole load of fun in it too! I'll keep you posted

Monday, 8 February 2010

One Man's rubbish is another Man's treasure.

I just thought I'd share a short story with you regarding choosing stock to sell on. This is perhaps one of the most valuable bits of information that I'll give away for free on this blog. See? I'm a nice guy! :)

typical car salesman
About 15 years ago I was living in a small village in Cheshire. I was friendly with the guy who owned the local petrol station. It was a quaint little place, flower beds near the entrance and those old pumps that were attended rather than self service. A girl would come out in all weather and "fill you up" whilst exchanging small talk. The garage had a lot of frontage and I came to an arrangement that allowed me to park up to 10 cars for sale there. I used to valet the car at home (literally minutes away) and then put them up for sale with a price on the screen, and a spec sheet in the window with my mobile number on. It was a bit "Arthur Daley" but quaint at the same time!
These were only cheap cars. Ranging in price from £500 to £2000 and most of my stock was being sourced from two independent car garages in Warrington. Initially I would cherry pick what I wanted from their part exchanges. After a couple of weeks however it was apparent to both garages (the owners were friends) that I was shifting quite a lot of motors within a short space of time. They offered to let me have ALL their part exchanges on a sale or return basis.  I was happy with that as long as the cars were clean and roadworthy and so within a few days all manner of stuff was appearing.

Now you have to remember prior to this it was MY money at risk so I would take safe bets such as Fiestas, Micras, Sierras, etc. Now however ALL the cars were coming to me without me having to pay for them until sold so there was no risk. I frowned at what cars turned up on the first delivery. A Renault 5 and a Nissan Bluebird was amongst them.
I valeted each one and put them up for sale as normal, wouldn't you know it, I sold them ALL within 72 hours. I couldn't believe it. It was a real BIG lesson for me that there are buyers for all makes of cars!

I will now trade ANY make of car. The golden rule still applies about being the cheapest out there but they do sell! There are owners clubs for all types of cars. I've sold Daewoos to people who haven't drove anything else for 10 years, Hyundai wotsits to guys who swear by them. It is actually amazing! The good thing is, not a lot of people have had the good fortune to learn the lesson that I did. They have always played with their own money and are unwilling to take a chance on the outsider so as a result you pick up the obscure stuff for buttons in the auctions. Check it out!

Sadly the little petrol station was shortly afterwards sold to property developers who built 6 huge detached properties on there. I miss that little place!

Tuesday, 2 February 2010

How to make a monkey (£500) with a bucket and sponge

Ok, For those of you who don't know, a Monkey is £500. Such terminology was made famous initially by Arthur Daley in the 1970s TV series Minder and then since by such TV characters as Del boy.
There was a dealer of used Jaguars not far from me some years ago. I absolutely adore Jaguars, I have owned so many of them and I bought one from this dealer many moons ago.

Their premises were in a small warehouse on a small and well kept industrial estate, It was big enough to hold around a dozen cars. The building was very well presented. The floor was painted In British Racing Green and the walls were cream and displayed large paintings of old racing Jaguar C types and D types in the hands of Stirling Moss at Le Mans. Old Jaguar racing flags hung from the ceiling and old tin adverts with Gulf logos and the likes were abound. Classical music played unobtrusively in the background and the whole place oozed character. 

The salesman there had a huge effect on me, I rather liked his company and got to chat with him often. I would guess at the time he was in his mid 50s. I was only 21 when I bought my first Jaguar and so I wasn't that adept at guessing the age of older folk. His name was Charles, he reminded me very much of the actor Leslie Phillips both in appearance and manner. He also had a great British accent. He smoked large fragrant cigars, always wore a great suit with an open collar shirt and silk dress scarf and was simply a perfect person to be selling used Jaguars.

Despite the cars being fully prepared for sale Charles could often be seen with a cloth and polish or leather cream casually polishing away the fingerprints from the last customer or browser. It was a great sight for a potential customer to see, Charles with his dapper looks lovingly rubbing leather cream into the doeskin interior of an XJ6. He loved his job and the customers loved him.
He could often be heard to say "A product well displayed is a product half sold" a phrase that I have adopted and used many times since. 

And that is the purpose of this post, Preparing a car PROPERLY for sale is the easiest way that you can add value. I will wager that you can bring me any car that is currently for sale privately and I can add a minimum of £500 value to it with nothing more than some cleaning materials. 

You would not believe the times that I have looked at cars for sale privately that simply haven't been prepared well. I have bought them, brought them home and days later turned a handsome profit just by cleaning it. I have already posted about a TVR that was in need of restoration, it was still no excuse for not cleaning it. 

A classic example was this 2002 Mercedes S Class 320 Cdi. I spotted this going through the auction, high miles but full history, It was dirty, the plastic cowl around the seat was broken and hanging down, the grey leather had in grained dirt all over it, the windows were filthy, the engine bay was a disgrace. As a result no one placed a bid, except me!
I paid £3000 for it, I got it home, ordered the seat cowl from Mercedes for around £40, paid my mechanic to service it for around £100 and then I set about valeting it. The car was on ebay the next week, I sold it to a German for £7500 who flew in to collect it. He was taking it back to Germany where he was then paying 2000 euros to convert it to left hand drive. He informed me that it would then be worth 25,000 euros!

You can see in the pictures the level of detailing involved, all the door edges were cleaned, all the leather was cleaned and dressed, the wood was polished, under the bonnet was degreased and dressed. All the glass was gleaming, new mats were put in. It makes a huge difference, You simply would not have believed how this car looked when I bought it. I added over £3000 in value simply by preparing the car properly.

So how should you prepare a car? 

Ok first of all I begin by power washing it all over paying particular attention to under the arches and around the suspension. Next I would lift the bonnet and spray degreaser over any soiled areas, let this soak in. mix some traffic film remover in warm water and using a microfibre cloth wipe around the door edges. Spray neat degreaser around the hinge areas if necessary. Using just a hose (not the power washer) rinse the door edges clean.  Now start the engine and whilst the car is running Power wash the whole engine and engine bay including the underside of the bonnet, rub any stubborn stains with the microfibre cloth. Try to avoid spraying directly onto the ECU and electronic ignition.  Leave the engine running for a few minutes after you have finished.

Spray some traffic film remover onto the wheels and around the lower areas of the car, cills bumpers etc. Fill a bucket with warm water and add some car shampoo and a touch of traffic film remover. I prefer Meguiars shampoo, In fact, I prefer Meguiars entire product range. I tend not to use sponges as they scratch the cars paint. Try to use either a soft car wash brush or those cool mitts that you wear on your hands, not only are these gentle on your paint they also really speed up the car wash process. Wash the roof, windows, bonnet and boot then rinse with the Power Washer. Next wash the rest of the car down to the body moudlings then rinse, finally wash the bottom of the car including bumpers and finally the wheels, rinse. 

To speed dry the car I use an autoglym blade if you have never used one you will be amazed! I finish off with a standard chamois leather. Whilst you have the chamois leather to hand do all the windows inside and out.

Remove the mats from the car, if they are in good condition then jet wash them! hang them somewhere to dry. If they are old and tired then go and get some new ones. I tend to go for the heavy duty rubber type. Have a look around the discount stores, I can usually find a full set for around £7.99 They make a huge difference. Unless I am dealing with something like a BMW or a Mercedes with factory fitted mats then I will always put new ones in. Empty any rubbish from the door bins, glove box, and centre console. Vacuum the entire car including the seats, for those hard to reach places at the sides of the seats and transmission tunnel you can either use a blow off gun if you have access to a compressor or use a damp rag. If the vehicle has fabric seats then look for any marks and stains, Dilute some traffic film remover (trust me) in some water and work in with a soft brush. Using a clean microfibre cloth in warm water rub the stain. You'll find all but the worst stains will come out. This same method can be used on leather, head linings etc. I tend to use diluted film remover on the whole of the interior, door panels, dashboard etc. For those hard to clean places such as air vents and around switchgear simply use an old toothbrush and then wipe over with the damp micro cloth. don't overlook behind the sun visors and also the accelerator, brake and clutch pedals! Don't forget that the interior includes the boot! Whilst in the boot it's always advisable to lift the spare wheel cover. If needed, remove the wheel, clean both the wheel and the area in which it sits. Pretty much everyone who looks at a car for sale for some reason looks at the spare wheel! It looks so much better if the whole area is clean and tidy. I don't dress the dashboard and other plastics after this process, it normally dries to a nice matt finish. Personally I hate glossy plastic, if you simply must use something then go for a matt finish product. Pop an air freshener in, your new mats and the inside is done!

Back outside, using a micro cloth wipe around the engine bay to remove any water spots. Apply a coat of wax to the entire body. For the sake of 15 minutes it makes a world of difference and really shouldn't be skipped. Again I highly recommend Meguiars, (see the links above) it goes on so quick and gives excellent results. If you spot any small stone chips or hairline scratches whilst waxing then use this cheat. Buy a cheap set of felt tip pens. Select a colour (doesn't matter about shade) that matches the car, colour over the scratch/chip and the lightly polish. Voila! Instant repair!
Remember to polish the chrome exhaust tip if the car has one. Using a matt finish black trim polish, treat any black trim including mirror backs and rub strips/mud flaps. Polish the head lights and rear lights. Finally, dress the tyres using a Gel, tyre spray tends to fling everywhere when the car is moving. Meguiars do a tyre gel that smells of bubble gum and lasts for weeks. I have a two inch paint brush, I squeeze a small amount onto the brush and paint around the tyre wall.

Now walk around the car with a critical eye and a micro fibre cloth in hand. Have you missed anywhere? Open the doors, open the boot, the bonnet. Everywhere you look should be spotless.
Stand back and admire, you have just made a Monkey with a bucket! 

Monday, 1 February 2010

Sourcing Stock

This article is taken from my book "The car dealers bible" that should be available in a few months

I’ve experimented with all different methods of sourcing stock over the years.

As time moves on and your friends and family know that you deal in cars you will find that you are offered cars quite often. Another great source for stock is taking part exchanges. Let’s look at some of the most common methods of finding stock and the pros and cons of each. 
I’m referring here to actual motor auctions. I’ve bought plenty of cars from auction and as long as you keep your wits about you then you can end up with some bargains. The good point about buying from auction is that all the cars have to be HPI clear or if they have insurance claim history it has to be declared. You can have the chance to inspect the cars before the auctions and even speak to some of the staff drivers about how the car runs. The downside is that your time is limited and you may miss something important. You also need to have a certain amount of self control at an auction otherwise you can easily get carried away and end up bidding at above what you were willing to pay. We’ll cover auctions in more detail later on.
Local papers
Often a great source as you can arrange to view the car, test drive it and really have a good look around the car before deciding to make an offer. The best time to buy from the newspaper / Auto Trader is when the paper is over a week old. This way, the seller will be worried that he has placed the advert and hasn’t sold the vehicle and will be questioning his / her price etc. This is a perfect opportunity to go in and “bid them in the balls”, (see car dealers’ glossary).  When ringing up to enquire never ask about a specific model.  For example, don’t ask “Is the Alfa still for sale?” Instead ask a generic question such as “Is the car still for sale” this is simply to uncover if they are a private seller or a trader. If they answer “which one?” then you can be pretty sure they are trade. You may be wasting your time going to view as they perhaps won’t let you have the car at a good enough price.
Once you’re there looking at the car you should try to ask as many questions as possible. Look at the V5 to see how long they’ve owned the car, try to not look too enthusiastic, equally so, being too critical of someone’s pride and joy won’t do you any favours either. Instead, try to be constructively critical, such as “It’s quite a clean one, it’s a pity it needs tyres shortly” This will prepare the seller for you bidding lower than the asking price. Whilst I mentioned having morals at the beginning of the book, this doesn’t count when buying a car. There is absolutely nothing wrong in trying to drive the price down as much as you can in order to make more profit for yourself. This is an art. There is no shame in it.

Local garages
I’ve dealt with some great garages in my time; I find the independent garages to be best. Sadly however sales managers move around a bit and sometimes your supply can dry up. You also can’t really cherry pick with garages; you often have to take the good the bad and the ugly.
The best thing to do is to go into your local dealers to introduce yourself. Try to dress smart casual and avoid coming across as a wide boy (or girl). Ask for the Sales Manager. Sales managers are an odd bunch. Most you will find are really friendly whilst others are obnoxious creatures who treat you with disdain. Personally I wouldn’t trade with the latter; I’d simply thank them for their time and walk out.  Introduce yourself as a trade buyer and ask if they have any “trade offs” that you could look at. They may ask what sort of stuff you buy. You could either answer in monetary terms i.e. “under £2k” or by age or type i.e. “between 5 and 10 years” or “anything small”. You are of course better to answer “I’ll consider anything if the price is ok”. They may offer you some stock to look at there and then. If so, don’t panic. Take a good look at it, ask what length of MOT it has (it will be unlikely that it has tax as garages generally cash the tax disc in), and usually they’ll tell you what price it is if you ask them something along the lines of “what does it owe you?”
If you feel you need to give a decision there on the spot and you are unsure as to the vehicles value you could always blag it and ask “what’s it booking at?” meaning what is the trade value of the car in either the Glasses or Cap price guide. (More on these later) The Sales Manager will usually have one of these available and will either toss you his copy so you can look yourself (unlikely) or he will quickly look it up and tell you. Either make a decision to buy there and then or make an excuse such as “I actually have a client looking for one of these but I need to call him to check if he was ok with an Auto/ green one/ 1600cc”  etc and you will call him later either way.
If you can develop a relationship with a good garage you will often be able to rely on their description over the telephone and this will benefit both parties as you will be able to “underwrite” a car whilst their customer is present. “Underwriting” means to agree to buy a car for an agreed amount. For instance, your garage has a 2 year old Corsa for sale; a customer comes to buy it and wants to part exchange a 7 year old Ford Focus. You may receive a phone call asking you for a price whilst the customer is still on the premises. You would be given a quick verbal appraisal report such as, length of MOT, tax, mileage, general condition and any service history. You would then agree to buy or “underwrite” the vehicle if the garage successfully completes the deal.
What you must NEVER do when dealing with a garage is
1.   Never ask for a warranty, trade cars are strictly sold as seen
2.   Never bleat about faults that you later discover on the car, See point 1
3.   Never underwrite a car then renege on the deal

More and more the internet has become a great resource for buying (and selling) cars. Ebay especially is an excellent tool in so many ways. We’ll look at this in depth shortly. The plus side to the internet is that you have access to vast amounts of vehicles especially specialist stuff. The downside is that the internet is still full of scam artists so you need to keep your wits about you.

I am forever stopping at the roadside to look at cars with a hand written “For Sale” sign in the window. This is a great way to buy cars. I remember once I was on my way to an auction with a friend and fellow trader. As I left my friends house and turned the corner I noticed a little Fiat Seicento for sale at the roadside. I stopped and looked around it and the owner came out to say hello. It was 10 years old and had just 40k miles on the clock, 9 months MOT and 3 months tax, one owner and full Fiat history. It was also really clean. The car had been a second car for his wife but he had just retired and so they no longer had a need for a second car. The price was just £150 and I managed to get it for £125 I paid him there and then and we drove it the few hundred yards back to my friends house, we took the for sale sign out of the window and then continued on to the auction. Five minutes later my friends’ phone rang; it was a guy who we both know who does engine tuning and fault diagnosis etc. He had just driven past my friends’ house and noticed the Fiat on the front. He had a client looking for one for his daughter. We sold it there and then on the phone for £500. We hadn’t even given it a wash!