Motor Trader The award-winning and longest running UK magazine for car retailing professionals. Your first stop for News, Jobs and Reports for the motor industry.
Motor Trader talks to Peter Vardy, CEO of the eponymous group, on his plans for 2021
Peter Vardy, the Scottish family-run retail group, began 2021 on a high, reporting a 14.8% rise in pre-tax profits in 2019 to £6.3m on turnover up 0.5% to £471.2m. In results filed at Companies House it said its CarStore businesses offered the highest profit margins across its dealerships.
The company also continued to invest in digital software, working closely with sister company Silver Bullet. Getting ahead of the game when it comes to digital sales, it set a goal to retail 50% of annual sales with its e-commerce channel by 2025.
The used business and digital platform were areas that Peter Vardy targeted early with Carshop and Silver Bullet. More recently it launched its Carz used car supermarket to six new locations across Scotland. On this, Peter Vardy, CEO of Peter Vardy, said: “We have been running a dedicated used car supermarket since 2013 called CarStore. It has been successful and so that is the pilot for our new model as a division. We can do the same just a little bit bigger.
“What has changed is the percentage of cars sold through our ‘ECommerce’ showroom, now sitting at 42% and our home delivery team now take care of 25% of all vehicles sold. The demand for used cars and the timing of our switch is of course fortunate, but I cannot say I planned that, but it is helped for sure. We just need to keep finding stock now.”
One possible source for that stock is the Group’s new sales service, GoodByeCar. The platform allows customers to sell their old cars to Peter Vardy through an online portal. It also includes and appraisal service that is currently available at Peter Vardy locations in Aberdeen, Dundee, Edinburgh, Lanarkshire, and Glasgow and will soon be available in Ayr, Stirling and Inverness as the service is rolled out.
Vardy said: “We have high hopes that we can buy a third of what we need. It is tricky now as everyone is competing in the same space, but we believed we have a few USPs that we bring to the guest, and we know we can improve our marketing effectiveness and conversion rates, so we are pleased so far. But again, I believe it can grow.”
Derek Lyon, remarketing director at Peter Vardy Group added: “The demand for pre-owned cars has never been stronger. Recent figures show that people are taking official warnings about public transport seriously and want their own wheels.
“It is a great time to sell, and the Peter Vardy Group undertakes to find customers the fairest price, fast. Not only that, if we cannot beat any like-for-like appraisal quote, we will give you £500 in cash.
“Trying to sell a car privately can be a long and stressful situation with a number of potential pitfalls. GoodByeCar will offer a valuation quote which is guaranteed for seven days, removing the hassle, and making the transaction as straightforward as possible.”
New beginnings
As Vardy expands its CARZ network, it has also ended its relationship with Vauxhall after 15 years. Its six Vauxhall showrooms will become new CARZ supermarkets.
On this move, Vardy said: “We watched the trends with dedicated used car businesses here in the UK and in the USA and two years ago we made the decision to focus on a digital and physically blended used car supermarket business model. It excites me, I enjoy it, we have strength there and I think we can improve a whole lot more, which energises the team.
“Vauxhall was an amazing brand and I’m proud that the team finished as the number one retailer for the brand until the final day. We have huge respect for the brand and team in Vauxhall and I will always be grateful for the opportunity they gave me to start Peter Vardy.”
Sporting markets
The Group has made a number of marketing deals in Scottish sport recently, including Principle Partner with Scottish Rugby and official car partner of the Scottish Professional Football Association.
It will be the new front of shirt sponsor for the Scotland national rugby team in a four-year deal commencing in the summer of 2021. The new partnership begins this summer when the 2021/22 season team kit, designed by Macron, is launched. It will be the first to feature Peter Vardy Group’s name and logo.
Peter Vardy Group will also be the back of shirt sponsor for Scotland 7s from the 2021/22 season and the broad ranging deal also encompasses becoming the Edinburgh Rugby car partner, with branding also included on the capital pro-team kit.
The company has previously been Scottish Rugby’s car partner between 2014-2017.
Vardy said: “As a Scottish family business we are very proud to be the Principal Partner of Scottish Rugby.
“We have long been keen supporters of Scottish Rugby, both commercially and as fans and I believe we share similar values. We have built our business on passion, ambition, courage, and we see that lived out by these fantastic athletes every time they pull on the blue jersey. We are incredibly proud that our brand will be recognised with our national rugby team.
“Commercially, of course, it is a fantastic opportunity to promote our brands across the UK and globally; over eight million people watched the recent Scotland versus England game – that level of exposure is massive for us.
“Coming off the back of some exceptional performances from Scotland in the Guinness Six Nations, we are really excited about what the future holds for Scottish Rugby and now as Principal Partner we look forward to working together.”
There has been a trend of automotive retail businesses partnering with sports teams and competitions in 2021, with Cazoo taking the front spot on the Welsh National rugby team’s kit and more recently Bristol Street Motors sponsoring the W Series motorsport championship.
On this, Vardy said: “It looks like we have jumped on the band wagon doesn’t it. It has not happened exactly like that, we have had some of these relationships for a long time and we were asked if we wanted to get more involved when the opportunities came up, and we said yes, a while ago and they have come through this year. We are super proud of them, and they are great organisations that fit with our brand nicely.”
Reopening and looking forward
Vardy was positive about the Group’s start to the year and was optimistic, yet cautious of the challenges to come in H2.
He concluded: “The premium brands have had a record H1 as have our other businesses in the automotive space. The transition from Vauxhall to CARZ has been successful too and used car volumes are therefore at record levels as are margins. The second half I understand will see a lack of new cars until Q4 so we are in for more of the same on used car stock and prices whilst we will see some good months in aftersales.
“The complexity is around the isolation rules and ensuring we have enough people in the business to deliver the right service and performance and making sure we are recruiting to expand the talent in our team in the right places as the business changes shape. We, like most folks, are trying to implement change and deliver a result and care for the team. Keeping people physically healthy and mentally health is on our minds all the time now, and I hope we deliver for our team.”