Used car dealers adapt '136' strategy to keep their business going

PETALING JAYA: Used car dealers are adopting the "136" quick sales strategy to keep their business moving amid aggressive promotions by their counterparts in the new car market.
According to a report in China Press today, dealers in new cars, who saw a dip in their sales figures in the first half of the year, have stepped up their promotion campaigns in the recent months.
This has affected the used car industry, forcing dealers to change their sales tactics.
The report said many of them are able to maintain their sales figures with the "136" strategy.
Federation of Motor and Credit Company Associations of Malaysia president Datuk Tony Khor disclosed that sales of new cars for the first six months of this year had dropped by 16.9%, prompting dealers to step up their promotions.
"This had put pressure on used car dealers and those who adopted the '136' strategy have managed to keep their sales volume intact," he said.
Explaining "136", he said the strategy requires a car dealer to sell the used vehicles within a month of acquiring them even if the profit margin is small.
"If the dealer only manages to dispose off the cars between three and six months, he usually would not make any money. But he still has to sell them even if he suffers a small loss.
"By the sixth month, the dealer has to off-load the vehicles by all means to cut losses. This is also to reduce the stockpile."
Khor told the daily this when asked to comment on reports that some used car dealers are lamenting poor sales and may have to close shop if the used car market does not improve soon enough.
He said not every used car dealer sees strong sales when the market is up; similarly there are dealers who maintain good sales even during bad times.
"It all depends on how you adapt to the situation," he said, stressing that the "136" strategy is what some used car dealers come up with to stay afloat when the going gets very tough.