LAS VEGAS — Among the many challenges facing independent dealers in today's automotive landscape, the two that Kathy Decker cited as most pressing were the availability of capital and being able to access retail financing.

The group vice president of Manheim Financial Services talked with Auto Remarketing on Tuesday at the National Independent Automobile Dealers Association Convention and Expo about these challenges — among others — and what MAFS is doing to help independents as they press forward in an often difficult and constantly evolving marketplace.

One way that MAFS has been able to assist dealers is through its partnerships with Finance Express and the Credit Union Direct Lending program, which have allowed MAFS dealers to establish strong lending relationship with state and local lenders.

This can be often be challenging for independents, as they don't have an OEM backing them up as franchise dealers do, Decker noted.

"An independent has to stand on their own, so they have to establish their own reputations with banks," she shared.

But if a dealer has a strong relationship with a local bank, he can direct customers to the lender for retail financing on the purchase and is more likely to keep that particular deal intact.

"It's really important to keep retail financing together," Decker stressed. "It's important to keep that transaction together."

Continuing on, floor plan financing can also be a major challenge for independent dealers, as well as finding the right inventory in the wholesale market.

Decker said that at MAFS, "we give our dealers a lot of buying power" not just for purchasing inventory at Manheim facilities, but through its lending at other auctions, as well.

MAFS offers its services at 140 independent auctions, as well as all the Brasher's and ADESA auctions, plus via online and in-lane Manheim sales.

Essentially, this gives dealers greater flexibility to go "wherever they can to find the inventory they need," Decker stated.

Moving on, Decker also shared some insight on what independent dealers must do to adapt to an ever-changing wholesale arena.

"I think a lot of that centers around access to inventory," she noted. "A lot of dealers are expanding (inventory sourcing). They're more confident with buying online."

She added: "There's a lot of different marketplaces … where (dealers) are spreading themselves out a little more because they're trying to find the right inventory."

And in midst of more dealers moving online for their buying needs, MAFS plans to roll out a new program in the next few weeks that can allow its dealers a sneak peak at inventory on Manheim's OVE.com.  She said it essentially will give MAFS dealers a "first look at the inventory before other non-MAFS dealers get to see it."

Education

Looking at retail lending in more detail, Decker noted that a big part of improving the relationship building between lenders and independents is education.

"A lot of is just education. For the dealer, how do you put a good package together? … For the lender, how to understand the independent," she said.

For example, there may be an independent that may sell just 25 vehicles a month, but "they're a strong dealer and they should be a good customer for the bank."

That's where education comes in.

On the flip side, it is vital for independents to know "how do you present yourself to these banks," Decker noted.

Floor Plan Financing

Next up, Decker talked more about floor plan financing, an area she believes is "loosening up," though acknowledging MAFS has tended to be more on the conservative side.

That said, MAFS has been putting an emphasis on increasing lines of credit for dealers who are heavy users of its services.

"We've been doing a lot of that this spring," she shared, later adding: "We've got requests for new credit every day. We're approving new-credit availability of $8 million to $10 million a week."