Motor Finance in the UK - CarlyleFinance

When you start looking into buying cars on finance you can see that there are a number of advantages for consumers.

Credit is so widely available these days and there are so many great offers available it is not always the best choice to use your own money for a new car. Buying new cars on finance can work out to be better for your financial health than using your own savings in many cases.

Advantages of Buying Cars on Finance

Car loans are available from many different lenders from banks and financial institutes to car dealers. This gives consumers a lot of choice when it comes to taking out the right credit product for their budget and needs. This availability of car finance also makes a more competitive market for consumers. You should be able to find some great deals on car loans that makes buying cars on finance a cost effective option.

There are many advantages to buying cars on finance. If you are thinking about getting your first car or upgrading your current car to a newer model then you should consider car finance. Advantages include:

Buy the Right Car - car loans can offer a big boost to your finances. This means you could afford to buy the car you actually want without putting a strain on your finances. Buying cars on finance is the ideal option if you don't have enough savings but need a car for work or just everyday life.

Easy Borrowing - buying cars on finance is a relatively easy task. There are a wide number of products available so all you need to do is find the right option for you and then fill in the application form. In many cases you can do this online which makes things even quicker and easier. With some car loans you could apply and have the money ready to go all within just 24 hours. This is ideal if you need a new car quickly and without any hassle.

Low Monthly Repayments - if you take the time to shop around you can find car loan options that offer low monthly repayments. This is particularly true of dealer finance offers that include upfront deposits (these in turn lower monthly repayments). This can make car loans an affordable way to buy your new car by spreading the costs out over the longer term.

Get Your Dream Car - you may have always dreamt of owning a luxury big brand name car. You can finally realise your dreams if you consider buying cars on finance. Car loans can be used to boost the money you have already saved up or buy a car outright. This means you could borrow enough money to get the car of your dreams.

What gets measured gets done! Therefore it is important that the correct measures are put in place to ensure that 'what gets done' is what is desired.

In a tough market we are used to seeing the expression 'every penny is a prisoner' to manage costs, to manage sales the principle is similar 'every prospect is a profit opportunity'.

Every single sales person has to deliver, no exceptions, the challenge is to develop and stretch employees to reach the performance goals; not to lower the goals to accommodate the employee. In this respect it is vital that every key sales activity is measured and reported on, ideally on a daily basis. This should not be a simple 'gate count' there has to be supporting information; it is a discipline that keeps everyone on their toes.

Monitoring does not need to be onerous, it needs to focus on the 'vital few' areas that make a difference. Some of the areas that should be monitored:

1. Sales calls outbound - with names, numbers & outcome/next steps

2. Sales calls inbound - with names, numbers & outcome/next steps

3. Showroom visitors spoken to - with names, numbers & outcome/next steps

4. New car sales delivered - with profit figures

5. Used car sales delivered - with profit figures

6. Motor Finance sales - with details on penetration and reasons for non-sale if appropriate

7. Warranty sales - with details on penetration and reasons for non-sale if appropriate

Being successful is not luck; it is all about preparation, action and follow through. In the current car sales environment working that little bit harder and smarter will make you stand out from the crowd and gain an edge on the competition. We know you would have seen these ideas before but now is the time to make that extra effort!

Here are five thoughts on how you could up the ante in your sales focus today:

1. Close potential deals harder. Desire For Gain and Fear of Loss are terrific motivations to buy. If you offer an incentive to buy now whilst making it clear that incentive could be lost tomorrow you will find your conversion improves.

2. Contact your customer base to ask for referrals, - offer an incentive scheme for successful referrals. 'Thank you' is the biggest customer retention hook and it costs nothing - so ring every single customer who bought a car from you personally in the month, thank them, check if everything is going well with their new purchase and while you're at it, offer your services to their friends and family who may be thinking of changing their car.

3. If you can't sell to a customer, - see if someone else in your business can. Look for a reason to '2nd face' customers who are not yet buying. It is often the case that a fresh face and fresh approach can succeed. You can't sell to everyone

4. Double your focus and efforts to work with urgency and effectiveness during days 10 - 20 of the month. While the first few days of the month often have a buzz of activity that carries over from the prior month, and the final ten days of the month naturally increase in intensity, the 10-20th window are often the key to having consistently great months. So don't coast, consciously re-doubling your efforts to work every opportunity.

5. Be honest with yourself. If you find yourself lacking the passion and commitment to go the extra mile in these difficult times then perhaps car sales is not for you. If you are lacking motivation and inspiration to believe you can succeed then it's not a question of if you will fail but just a question of when.

New research suggests that nearly 30% of UK motorists are putting off car repairs in order to save money. Candidly that is a false economy, risking safety, reliability and potential economy as well.

The research by Gocompare.com surveyed 1500 motorists and created some astounding statistics:

* 62% of drivers said they would consider 'service stretching', postponing their regular service beyond the recommended mileage, with nearly 40% of those saying they would consider stretching their service by over 1,000 miles

* 17% of motorists have delayed replacing their worn out tyres

* Nearly 6% have ignored fixing problems with their brakes

* 23% of drivers who have nothing wrong with their cars at the moment said that if their car developed a problem tomorrow but they could still drive it, they would put off making the repairs for financial reasons.

Encouragingly 55% of drivers interviewed said they wouldn't go anywhere but a 'proper garage' to have their car serviced, this still leaves a very significant proportion of customers who could be contacted and helped; so:

1. Be proactive and contact previous customers with service offers, - if you don't call them someone will.

2. Offer a free winter check

3. Issue some local press releases on the risk of not having a car serviced correctly - use the facts above

4. Source a service plan option to help customers spread the cost of servicing

5. See every service customer when they collect their car and discuss their plans to change for the future - Again, talking in terms of monthly payments will make the affordability of changing a car realistic for your customer

There has been a great deal of talk about the impact of the 'scrappage scheme' wherein the government has provided grants to car buyers switching from an old car to a new greener model. With the scheme now coming to an end you could you create your own scheme for new or used cars, all focused upon minimum part-exchange allowances.

Consider this: The AA estimates that there are 4.26 million pre1996 cars on British roads, or 14 per cent of the total. Can you create a series of offers targeting this market? These could be people who come in for a service, or just through local marketing activity

5 Reasons why Your Own Scrappage Offer Could Help:

1. 28% of motorists say they would consider using an incentive scheme to scrap older cars (AA Populus survey)

2. Average new car CO2 emissions have fallen by 13 per cent since 97, so that road fund licence bills could be cheaper

3. New cars are typically more fuel efficient, safer and more reliable

4. Calculate a minimum P/X margin and then advertise the price to change as a monthly payment utilising motor finance - This will tell your audience that they can afford to change

5. Who else will offer this in your local market, - a chance to stand out

First things first, even if the phone is quieter, don't let the 'doom-mongers' get you down, remember there are buyers in market - you just have to find them and then look after them better than anyone else!

There will always be consumers in market looking to change car, the challenge is to reach out and find them and to do so more imaginatively than before and above all to take some positive action, rather than simply waiting; as US ice hockey star Wayne Gretzky so succinctly put it:

"One hundred percent of the shots you don't take don't go in"

So today, take some shots and find some customers, key sources could include:

1. Your own database or past customer records - send them a greetings card, or pick up the phone

2. Contact your motor finance provider for details of end of contract customers on PCP or leasing deals

3. Focus some of your stock and forecourt on the budget conscious, targeting customers looking to downsize for greater economy

4. Can you tie up with the local maternity hospital or primary school in some way to target customers looking for more space for a growing family

5. Keep an eye and ear open for customers who have an insurance claim, perhaps linking with local bodyshops

Finally, never forget there are always plenty of people who would simply like to change car and even now they are in market, the 'silver surfers', DINKIES (dual income no kids), those who regularly change ever three years come what may - what are you doing to reach out to them on a personal level?

Recession Busters from Carlyle Finance: No 1
5 Reasons Why Motor Finance is a Winner

The vast majority of all customers do borrow when they change car. This is true in all locations right across the country; there really are no areas where the total population does not borrow money (as a bank we see that all the time!). So seize the opportunity that is there right now.

If you have let finance slide as a marketing and sales tool, then today is the day to change things, because the reality that you can access highly competitive funds, fast underwriting with high acceptance levels is a real draw to consumers who may have used other funding options over recent years. Consider the following then ask yourself - can you compete with Motor Finance?

1. 75% of personal loans now require a minimum income, compared with 68% six months ago*

2. 47% of credit cards now requiring applicants to have (on average) an income of around £18,000 or more, while six months ago just 31% required a minimum income*

3. Excluding certain personal loans with extremely high APRs (Annual Percentage Rates), the average minimum income required for a personal loan is now just over £23,000*

4. The average rate on a £5,000 unsecured personal loan had risen by 3.4 per cent from 8.6 per cent in June 2007 to 12 per cent**

5. Alliance and Leicester are quoting 14.9% APR typical for a £4999 personal loan over 48 months, with a caveat that the rate may be higher depending on their assessment of personal circumstances and financial behaviour***

These nuggets do not include the use of home equity release schemes, or secured loan consolidation options, which have largely disappeared from the market.

If you need a new ride but don't have the funds yourself then you should consider buying a car on finance. There are many great finance deals available these days that can offer a cost effective way to buy your next car.

Car Finance

You will have plenty of choice when it comes to buying a car on finance. There are many lenders out there offering different types of finance deals. You can choose from options such as:

Dealer Finance - dealers can offer competitive rates on finance products direct from the showroom. These are provided by some of the big lenders and will offer a quick and easy way to fund your next car purchase. Products can include Hire Purchase (HP) and Personal Contract Purchase plans (PCP).

Personal Loans - Consumers could be eligible to borrow between £1,000 and £25,000 through personal loans to buy a car on finance, although this could be more difficult to obtain nowadays. These loans are offered by major lenders such as banks and building societies. When you take out a personal loan the cash will be transferred to your account. This is a good option if you need cash to buy your new car from a private seller.

Mortgage Top Up - if you have a mortgage then many lenders will offer you the opportunity to borrow some more money to extend your mortgage. This can be a good way to buy a car on finance if you are on a very tight budget. You will be paying off the money over a longer period of time. This means the monthly repayments on your mortgage will only rise by a small amount which should not strain your finances too much. However remember adding money to your mortgage can mean it takes you longer to pay this large debt off, as well as potential interest rate rises

Before You Sign

If you are considering buying a new car on finance then you do need to think carefully before you agree a deal. Taking out a credit product to buy a new car can be a big financial commitment. It is important that you have considered the following points before you buy a car on finance:

Lender Reputation - the finance market is vast and not all lenders are equal. Make sure you are dealing only with reputable lenders who can offer fair lending terms.

Repayment Schedule - check the repayment schedule carefully. Make sure you can afford the monthly repayment amounts and that they are due each month on a convenient date.

Overpayments - making overpayments can help to pay the finance deal off more quickly and reduce the amount of interest you pay. However you will have to check that overpayments are allowable under the deal. Many finance products will charge a fee for overpayments which means you will not be saving any money by paying off the deal more quickly