Buying used vehicles is part of life for many operators, and it is something that needs to be treated with the same level of importance as purchasing new. Scania is doing its utmost to make that the case
Buying a coach isn’t always about writing six-figure cheques and visiting the factory. When procuring a used vehicle, it’s much different. But Scania’s used coach and bus arm is bidding to transfer at least some of the pleasure of buying new to secondhand purchases.
There’s a good reason for it to do that, says General Manager – Used Vehicles Steve Lambert.
“The used market has plenty of choice, so our service level has to grow for us both to retain existing customers and to attract new ones.”
Scania Great Britain placed 177 used coaches and buses in the market in 2016. That goes a long way to validating Steve and Used Sales Executive James Morgan’s opinion that it is succeeding in its key objective.
“More goes into promoting used vehicles today than ever,” says Steve. “The industry in general has come to realise that when handled incorrectly, used vehicles can pose a problem.
“But if done right – as I believe that we do – then they can complement new deliveries and not stifle them.” Keeping the used stockholding lean and fast-moving is vital, he adds.
One thing above all else is Scania’s focus with used vehicles: Quality. “We hope that an impression of quality is transmitted throughout the customer’s interaction with us.
“Buyers may spend £150,000 or more on a used coach, so we must deliver a product and a service that repays their investment.”
To begin with…
Scania’s used coach and bus stock is located at its Worksop base. At the time of writing it numbers 34 vehicles. Usually they arrive from two sources: Part-exchange, or having completed a period of contract hire or operating lease.
“When a used vehicle comes to Worksop it isn’t parked in a corner and forgotten about until a viewer visits, potentially weeks or months later,” says James.
“It’s fuelled and valeted and it enters the workshop for any issues to be dealt with, including bodywork. If a repaint will help to make it more attractive, or it needs a new tyre, then that will be taken care of.”
There is logic behind dealing with these things upon arrival, rather than waiting until the vehicle is sold.
“We try to get stock into a condition where a customer can come in and say ‘I like it. I want it next Tuesday’,” James adds. “We should be in a position to deliver on that, unless the vehicle has only just arrived and we are still working on it.”
While Scania doesn’t go overboard with lower-value arrivals – at the time that routeone visited, there was a 1998 Irizar Century in stock that, while tidy and ready to go, had not received major attention – higher-value examples are brought up to as close to as-new condition as possible.
Many customers come to Worksop with a good idea of what they are looking at, and there are two reasons for that.
Scania advertises used stock, but it also has an app that takes information on each vehicle from its website. Both online sources are kept up-to-date in real time. Would-be buyers can access a host of data and pictures on what Steve calls “a modern-day stock list.”
Supporting each other
Initial enquiries are usually handled by the operator’s Regional Sales Manager.
James and Steve act as support, although they do deal with operators directly, particularly when a potential buyer wants to see a vehicle in the metal before deciding whether or not to proceed.
“If it’s not as described on the app or the website then we’re wasting everyone’s time,” says James.
“Nowadays, thanks to picture-sharing websites such as Flickr, customers know a lot before they make contact. If we do our job correctly, they should be able to come here, examine vehicles and see that they are exactly as we have described them.”
‘Examine’ is a literal term. Worksop has extensive workshop space, and James and Steve encourage visitors to take advantage of it.
“Whether the customer is spending £8,000 or £180,000, we have the facilities and the tools to allow them to check a coach or bus over and ensure that it is to the right standard,” says Steve.
The app, the website, or printed advertising is usually the beginning of the buyer’s interaction with Scania, but both men are keen that the initial impression of quality continues when the potential purchaser visits Worksop.
“It says ‘Scania’ above the door and Scania is a strong brand. We don’t just sell used Scania coaches and buses, but we are representing Scania Great Britain. Stock is presented correctly and all visitors are made to feel welcome,” says Steve.
Adding value
Also based at Worksop is Scania Finance advisor Bob Winfield. Subject to terms, the dealership can offer operating leases on its used coaches and buses, where the operator pays a set monthly figure for an agreed period for use of the vehicle.
“It is operating lease, not contract hire; there is no service agreement on used stock,” says James. “Customers who take a used vehicle on an operating lease run it for the agreed period. At the end of that, they then have various options.”
“In the past with used coaches and buses there was only one option: Buy it,” says James. “Now, the process is much more flexible.”
Bob’s presence at Worksop is invaluable, Steve adds. Sometimes an enquiry can be turned into how much the operator wants to spend per month.
Any part-exchange will be taken into account, and Scania will come back with a choice of vehicles available within the specified maximum outlay.
Following that route can have unexpected benefits for the buyer, he continues. “Sometimes they end up looking at coaches that they otherwise wouldn’t because they thought that they wouldn’t be able to afford them.
“On a number of occasions we have turned the deal around and come at it from the other direction. Some buyers have already figured this method out, but for others it is an attractive proposition.”
Looking to the future
Also appealing is Scania’s method of constructing operating leases. Lease periods are not necessarily measured in year-long chunks; instead, they are tailored to suit individual requirements, with an option to extend upon expiry.
“We can do a one-, two- or three-year operating lease, but it doesn’t have to be like that,” says James.
“An operator may have a contract that expires at the end of September 2019, for example. We can tailor the agreement to suit that, but if the work continues, it can be extended at a later date.”
The increasing popularity of operating leases on new and secondhand purchases from Scania, and contract hire on new vehicles, has enhanced its used arm’s ability to make arrangements for second lives well in advance.
“When a customer signs for a new vehicle we immediately know when the part-exchange will come in,” says Steve.
“We may know that a three-year-old, 53-seat OmniExpress will arrive in July. That allows us to work with customers who want that model of coach. In one example, we had nothing in stock to the specification that a customer wanted, but we knew when one would arrive. In the meantime, we set up a similar vehicle on operating lease for the intervening period.”
Scania has used this ability to its advantage with a batch of mid-life double-decker buses leaving London service. Even before the first arrived at Worksop, many had been accounted for; some will never even make the trip north, instead going to their next operator directly.
Its varied methods of dealing with used stock are an indication of how increasingly sophisticated the secondhand market is becoming, but for Scania, it boils down to one word: Quality.
