Car dealers can find the best stock at the best price by being able to navigate both online and physical car auctions. Though the principles are the same, there are specific differences between them.
Here, we outline some of the differences between online and physical auctions and offer expert tips for online car auctions. For specific advice for physical auctions, read our article: Tips for Buying Stock at Physical Car Auctions.
Online car auctions are usually cheaper than physical car auctions because there are fewer fees.
Physical auctions have entrance fees for each auction.
Online auctions typically require either:
A key limitation of some online auctions is that you won’t be able to check the cars over – the listings won’t tell you everything so there is more risk involved. However, some auction platforms may offer the opportunity to inspect the vehicles in person before the auction begins. This is often done at a designated inspection location or the seller’s location.
You also won’t be able to network with other attendees and gauge the market, but most dealers will have done thorough research ahead of time.
There are several ways of checking you are working with a reputable auction site, from getting advice from your peers to verifying with registered bodies.
Reputable auctions sites are likely to be members of a recognised industry body, such as the National Association of Motor Auctions (NAMA). NAMA members are required to follow a comprehensive Code of Practice to support both buyers and sellers.
When considering a new auction house, check if the auction site complies with relevant laws and regulations governing vehicle sales in the UK – i.e. consumer protection laws, data privacy etc.
Word of mouth among car dealers can help you identify which are the best and most reputable auction houses. You should also research online reviews from both buyers and sellers who have used the auction site to ensure the quality. Check ratings on Trustpilot if it’s an online auction you aren’t familiar with. Trustpilot has an auto auctions list that you can filter by location.
Research is invaluable for understanding the market. Essential research includes looking at both the vehicles you are considering bidding on and the online sites themselves. Make sure to check rates, policies, public reviews and the overall inventory to get a good understanding.
Along with the descriptions, review any images for anything that hasn’t been mentioned – such as watermarks on seats, stained windows or flooring. Pay close attention to minor details. Double check the VIN on the windshield to ensure it matches the listing.
Note the make and model of the vehicles you want to bid for. Set a maximum bid for each. You’ll also want to set a budget limit for all your purchases.
Online car auctions are run in a few different ways. Some operate via an online bidding system in the style of eBay. Others have a live auctioneer who carries out the bidding via audio/video. Some online car auctions use a hybrid with a timed event that transitions to a live event with an auctioneer.
Make sure you know how the auction will be run so you don’t miss a bidding opportunity for the vehicle you want.
In some cases, auctions may have a “reserve price” – a minimum price the seller is willing to accept. If this isn’t met, the vehicle won’t be sold.
Once you have done your preparation, you can await the auction itself, which will be a staged process. The stages of an online car auctions can be briefly summarised as:
We recommend starting with the following online car auction sites:
We provide instant funding for vehicles purchased through both physical and online auctions. We work closely with many vendors across the UK and can help you fund your forecourt.
