Every vehicle has a wholesale price that can be transacted upon.
This process involves a seller and a buyer arriving at a transaction price for a vehicle. In the industry, we call it “Price Discovery.” It turns cash into a wholesale vehicle.
It is different than appraising or putting a valuation on a vehicle. A valuation is a comparison to similar assets in the market. Auto dealers turn to the guide books, and valuation tools, when they need help valuing a vehicle. It’s the # we arrive at when we look at market reports and go with our “gut”. These tools set our expectations for a future wholesale transaction based on past market data.
The appraisal of a vehicle is the opinion on what price the unit should bring in a robust market. Only inserting the vehicle into a wholesale market can actualize the valuation put on the vehicle.
You currently “guess” first, then “know”.
But what if “price discovery” for any wholesale vehicle was on demand, as easy as watching a movie on Netflix. The wholesale automotive industry would move rapidly to the commoditization of the VIN.
Take any VIN, enter its mileage and condition, and instantly know the market relevant wholesale price or its spot commodity value. A price to turn a vehicle into cash or to be used to arbitrage the market to a higher price. The wholesale price discovery is known, on demand.
Would that change how you buy and sell wholesale vehicles?
The first step towards a more efficient marketplace, and ultimately the commoditization of the VIN, has been taken. This is Accu-Trade.
To be continued…