These days, dealers and consignors have an abundance of choices of how to transact in wholesale, thanks to auction companies like Manheim and ADESA and independent auctions who provide a blend of digital and brick-and-mortar, plus a host of standalone online providers and marketplaces.

One of the advantages for independent auctions, in particular, says Independent Auction Group executive director Lynn Weaver, is the flexibility of not being tied into a specific platform for online sales.

“The independents have always embraced technology and the changing technology. And it’s been a fantastic opportunity because we’ve been able to piggyback on OVE; we’ve been able to piggyback on SmartAuction. And the technology that these companies have developed and promoted and advertised have brought the independent community right along with them,” Weaver said in a June phone interview.

“The independents have the opportunity to use every available portal that’s out there, so we have the opportunity to put the most eyes on every single vehicle that goes into the digital environment,” he said.

And often, it’s about blending that digital environment with the physical.

“It’s not about technology or brick-and-mortar. It’s about technology and brick-and-mortar. That’s just today’s world,” said Pierre Pons, who is president of TPC Management Co. and the chief executive of ServNet Auction Group. “And it’s not just auctions or remarketing. It’s everywhere. It’s Target stores. It’s Walmart stores. It’s a combination of brick-and-mortar facilities and what they can bring to the process, the efficiencies and other aspects. And applying technology to it.”

Pons said “there’s certainly a place” for app-based online wholesale. But there’s a lot more to the process of selling cars wholesale.

“No. 1, land. These are still 3,000-pound pieces of metal that take a 10-by-20-foot space to park and marshal, transport and do something with,” Pons said.

Physical auctions tend to have the massive acreage needed for parking vehicles. And it’s not just the land itself, he says.

“You can call a realtor if you want land, if you just want some green pastures. But land that you can park cars on is something very special in the United States. Land that you can park cars on is zoning, because cars drip fluids,  and there’s environmental concerns … you can’t just go park 400 cars out in a field somewhere,” Pons said.

“So, the investment in land that you can park cars on is massive within the auction community,” he added, along with things like managing storm water and special zoning and coding.

Over at KAR Global, the company made a change on Aug. 1 that could end up being mutually beneficial to both its ADESA physical auctions and TradeRev online auction platform.

The sales teams for those business units are now aligned.

“Up until now, I would tell you that ADESA and TradeRev have, for the most part, operated as independent offerings, almost independent companies, and you could say in fact they were actually competing with each other to some extent,” chief executive officer Jim Hallett said during the second-quarter earnings call in August, according to a transcript of the call posted to the KAR website. “In some cases, you had two different salespeople on two different days calling on the same dealer, offering a different value proposition, one on TradeRev and perhaps one on physical auctions.”

In aligning those sales forces, Hallett said KAR’s focus is on dealer consignment and winning that consignment no matter the channel.

“We want to be able to offer the dealer a digital offering on TradeRev, but we also know that not every dealer is going to take that offering. We want to be able to offer that dealer the opportunity to sell the car in a physical auction and allow the dealer to make the choice of use one channel, use the other channel, or perhaps use both channels and maybe one channel for certain cars and another channel for other cars,” Hallett said during the earnings call.

During a follow-up phone interview, Hallett said that when a salesperson now speaks to a dealer about his or her consignment, the salesperson explains the options of selling in the physical lanes with ADESA and online with TradeRev, speaking to the “benefits and economics” of each one and asking the dealer how he or she would like to sell: physical, digital or both.

“We’re going to market with a unified approach,” Hallett said.

A “unified approach” may be a fitting descriptor for how auto auctions at large, be they corporately or independently owned, are balancing their brick-and-mortar operations with online commerce.

Meeting the customer needs, regardless, requires an investment in technology.

At a Cox Automotive event in June, president Sandy Schwartz shared a story with a group of reporters about how when he took the helm at Manheim in 2011, Cox Enterprises chairman Jim Kennedy asked him to evaluate, over a three-month period, whether the auction chain was an entity Cox should keep or sell.

“I went in, and I came back to him two months later, and I said: ‘This is a great business. And it’ll be a great business for a long time. But we need to invest $300 million (over) the next three years in technology,’” Schwartz said.

He added: “And I think anybody would tell you — not only our business, but our competitor’s business — the auction business is still a good, strong business for many years to come. It’s going to change, but it is.”

As Manheim president Grace Huang said in an August interview, the mission is to continue serving their customers “in the way they want to be served” and building solutions that allow for greater convenience and efficiency, be they investments in on-the-lot technologies like LotVision or data/insight-focused technologies in investment in the front office.

“We’re also continuing to look forward into the future into what the auction industry can become. And we have an amazing footprint as an industry,” Huang said. “We know that even as transportation changes, vehicles, whether they’re driving themselves or shared in a pool, or however they come to us, they still need a place to park at night;  they still need to get cleaned;  they still need to be reconditioned.”

And who better than an auto auction to provide those services?

Part I can be found here.