Vans for retailers

last year was a poor one for sales of new light commercial vehicles (LCVs). According to the Society of Motor Manufacturers and Traders (SMMT), 14.3% fewer new vans were registered in the UK in 2008 than in 2007. And the slump has continued into 2009. The number of vans sold in February was down by 52.9%, SMMT reveals.

All of the major motor manufacturers are suffering losses in sales, with Mercedes being hit the hardest, showing a 61.79% loss compared with the same period last year. Market leader Ford suffered a 52.58% loss in the year to date compared with 2008.

This may mean there's a bargain to be had when buying new, but the trend is to stay cautious and explore other routes. So if you're looking to pick up new wheels for cash and carry pick-ups, or want to expand into delivery, you might be better off buying a second-hand model, or investigating a hire scheme.

One way to buy second-hand that's growing in popularity is through auction. Tim Naylor, spokesman at British Car Auctions (BCA), believes that a retailer can save between 10% and 20% when buying through auction rather than a private sale. "We have a larger volume of vans on sale every week so there's great potential to save money," asserts Naylor.

"2008 was one of the toughest years in the industry, but 2009 is looking more promising. Auction prices are up on last year, which is a key indication of demand."

For those put off buying through auction by concerns that they won't know what condition the vehicle is in until they've parted with hard-earned cash, Naylor has this reassurance: "There are ground rules when it comes to auctions. The auctioneer will announce to everyone what condition the van is in and what the warranty covers. It's all very transparent and all of the information is available for potential customers. Every legitimate auction house should also guarantee you 'good title', which assures a buyer that the vehicle for sale is legally available to be sold. If an auction house isn't offering this then avoid it."

Naylor adds that 400 vans are sold every week through the BCA, and its website - www.british-car-auctions.co.uk - is updated hourly. "With the vast quantity of vans available, there will be something for all types of buyers," he says.

For those who don't want to commit to the cost of buying outright, there's another option. Neil McCrossan, chief executive officer of Nexus Vehicle Rental, says that renting is becoming more popular among convenience store retailers.

"Rental generally fares better in a recession as people want to free up capital. In December of last year Nexus saw a 28% rise in retailers renting vans compared with the previous year," says McCrossan.


Flexible option


He believes van rental suits retailers who may only need a van two or three times a week and who don't want to make a large outlay for something that may sit idle the rest of the time.

A small van can be hired for as little as £17.70 for up to two days and special rates can be negotiated for retailers who want to hire a van for longer periods.

"A van can be hired for a 28-day plus period at a very reasonable rate," says McCrossan. "This may suit business owners who need a van on a more regular basis, but who want the flexibility to give it back at short notice. Some retailers also use this to test out a particular model before buying outright."

And if you need to make an urgent trip to the cash & carry then a van can be sourced at a few hours' notice. "We guarantee two-hour availability to all customers for regular-sized vans," says McCrossan. "Retailers need that flexibility at short notice and we can offer it to them. We also offer a drop-off and collection service so the retailer doesn't even have to pick it up from us."