Car Dealership Stock Finance for a Used Vehicle Dealer in Yorkshire
£850,000 · Ongoing - 90-day per unit · 3.9% over base. An independent used car dealer in Yorkshire was turning over approximately 80--100 vehicles per month but was constrained by the number of vehicles he could hold in stock at any one time.
The Client
Independent used car dealer in Yorkshire
The Challenge
An independent used car dealer in Yorkshire was turning over approximately 80--100 vehicles per month but was constrained by the number of vehicles he could hold in stock at any one time. His personal capital limited him to 35--40 vehicles. A stocking finance (floorplan) facility would allow him to fund twice the inventory.
Our Solution
Doulton arranged a stocking finance facility where each vehicle was funded for up to 90 days from purchase, with interest accruing daily on each funded unit and the advance repaid when the vehicle was sold. The facility was secured against the vehicle titles. V5 documents were held by the lender until each unit was sold and the advance repaid.
The Outcome
Stock levels increased from an average of 38 vehicles to 72 vehicles. Monthly unit sales increased from 82 to 147 within six months. Net profit per vehicle maintained. Annual turnover increased by £1.8m. Key highlights: Stocking finance doubled inventory capacity; Unit sales grew from 82 to 147 per month within 6 months; Annual turnover increased by £1.8m - cashflow was the only.