Sourcing is where margins are won or lost. Buy the right stock at the right money and it sells itself; buy poorly and it sits on the forecourt absorbing cost. This guide covers the main channels UK dealers use, what each is good for, and how to buy to demand rather than to availability.
The Main Sourcing Channels
- Physical auctions — volume and speed, but you bid fast and buy largely as-seen
- Online auctions — wider choice and convenience, with condition reports instead of a hands-on look
- Trade-to-trade — buying from other dealers; quick but margins are tighter
- Part-exchanges — stock that comes to you through sales; cheap to acquire if appraised well
- Direct from the public — "we buy any car" style buying and private purchases can offer the best margins
- Fleet, lease and manufacturer returns — consistent, well-documented stock in volume
| Channel | Margin potential | Risk | Volume | |
|---|---|---|---|---|
| Physical auction | Medium | Higher (as-seen) | High | |
| Online auction | Medium | Medium | High | |
| Trade-to-trade | Lower | Lower | Medium | |
| Part-exchange | High | Low | Steady | |
| Direct from public | High | Medium | Variable |
Physical auction
- Channel
- Medium
- Margin potential
- Higher (as-seen)
- Risk
- High
Online auction
- Channel
- Medium
- Margin potential
- Medium
- Risk
- High
Trade-to-trade
- Channel
- Lower
- Margin potential
- Lower
- Risk
- Medium
Part-exchange
- Channel
- High
- Margin potential
- Low
- Risk
- Steady
Direct from public
- Channel
- High
- Margin potential
- Medium
- Risk
- Variable
Buy to Demand, Not to Availability
The most common sourcing mistake is buying a car because it is cheap rather than because it sells. Use your own sales data and live market demand to decide what to stock: which makes, models, price bands and specs turn fastest in your area. Stock that matches real local demand sells quickly; bargains nobody wants are expensive to hold.
Use listing views and enquiry data to source stock buyers are actually searching for.
Appraise Before You Buy
Pre-purchase appraisal checklist
6 items
Frequently Asked Questions
Frequently Asked Questions
Related reading
Related: how to price used cars, how to sell cars faster, and managing part-exchanges.
