Mark Lindstrom, owner of Darlington Auto Brokers, wasn’t pleased with the body work that another business had performed on one of his vehicles.
So, he took the vehicle to Manheim Darlington’s new Retail Solutions center early last week to have paint and body work done on the truck.
Lindstrom was able to pick it up the morning of May 26, the same day he spoke to Auto Remarketing about being the first to utilize the facility, which held its grand opening the night before.
Manheim had announced at the NADA Convention and Expo in April that it would be adding Retail Solutions facilities in this South Carolina town, plus locations in the Detroit, Houston, St. Louis and Orlando, Fla., markets.
The Darlington location joins Manheim’s existing Retail Solutions facilities in Denver and Chicago. Manheim Detroit will open a Retail Solutions facility in July, while Manheim Orlando, Manheim Houston and Manheim St. Louis are currently conducting testing with a few clients.
In a nutshell, these facilities are designed to take care of essentially everything a dealer would need to have done to a wholesale used-car purchase post-sale to make it ready for the retail front-line — the idea being, you bring it to one place rather than hauling the vehicle around to different vendors for different tasks.
Manheim Darlington's Retail Solutions center
Or if a dealer only needs one or two items taken care of, he or she can choose the a la carte route, as well.
It takes much of what Manheim is offering on the wholesale side and provides it to dealers as a resource for retail preparation. The thinking is, dealers can put more focus on their retail customer and their employees rather than spending so much time getting the car ready for the front line.
For Lindstrom, the advantage to utilizing the facility is “the quality of the workmanship” and convenience of a one-stop shop.
That’s part of what Shane O’Dell emphasized when he spoke with Auto Remarketing during the Darlington facility’s grand opening last week.
“We’ve set it up so that you can buy things a la carte. So, if you are looking for Manheim to acquire cars for you, we can offer you that service,” said O’Dell, senior vice president for Manheim Vehicle Solutions. “If you’re looking for Manheim and (its) Inventory Solutions to do retail inspections and retail reconditioning, we can do that for you.
“If you’re looking for us just to merchandise the cars and get it up to an Autotrader.com before it gets back to your lot, we can do that, as well. And then, of course, transport that car back to your front line,” he said. “You can buy those as individual services or you can buy the entire conveyor belt of services, if you will.”
What needs Manheim saw in market
One of the reasons behind the Retail Solutions program, in general, is the increase in inventory in recent years that has required an extra set of hands for retail prep on “overflow volume,” O’Dell said.
Another key factor has been the surge in recalls, which “tends to put burden on the back shops to (handle) that.” At the same time, dealers still need those shops to handle prep work on the new and used cars they’re selling, so offering Retail Solutions acts as a supplement, O’Dell explained.
“Then, I would say the third thing is, you’ve got companies that are popping up saying, ‘I don’t know if I want to build a multi-million-dollar facility where I’ve got all that back-shop operation. I really want to focus on the consumer, the customer. And I want someone else, like Manheim and the Inventory Solutions team, to do all that back-shop (work),’” O’Dell said.
He said Manheim has 18 active clients signed on to Retail Solutions. This group includes independent dealers, franchised dealerships and major dealer clients, he said.
“And even a couple of them that were that third model, if you will, that are doing a little bit more digitally … than maybe what we’ve seen traditionally in this type of space,” O’Dell said. “The good thing for us is, we’ve really seen adoption from multiple customer segments … we’ve seen it (from) independent, franchised, those major dealers and some of those up-starts, if you will.”
Chicago, Denver, Detroit, Houston, Orlando, St. Louis.
These, of course, are large metropolitan markets.
Which begs an obvious question, something that Grace Huang, Manheim’s senior vice president of inventory solutions, acknowledged during the NADA press conference when the five new locations were announced.
“And most people ask, ‘Why Darlington? Where is Darlington?’ Well it’s in South Carolina, and why we’re adding Darlington is (because) a client asked us to,” Huang said. “It gets us closer to their client base and allows a greater flexibility.”
And while Darlington might be the outlier in terms of population, the selection of the small South Carolina town make logistical sense from a geographic standpoint and getting cars to clients in the area.
“First of all, we’re so centrally located on (Interstate) 95 — which is, what, the busiest highway on the East Coast — and I-20. So it’s a perfect location as far as transportation logistics go,” said Manheim Darlington general manager Danny Brawn. “You can easily get in, you can easily get out.”
The company also owns a railhead five miles from the auction, Brawn said, making it even simpler for transporting cars via truck or rail. The auction also has plenty of space, he said, as it rests on 125 acres.
Plus, he said, there are four off-site storage facilities that have yet to be used.
How Retail Solutions process works
During the on-site interview, Brawn explained the steps a car would go through at the auction’s Retail Solutions facility.
First, the car is checked out of Manheim Darlington’s wholesale operations, and checked into Retail Solutions.
The car undergoes a 200-plus-point initial retail mechanical and condition inspection, which “is as thorough as you possibly can get,” Brawn said.
The vehicle moves to a holding area while any necessary parts are ordered, and then heads to the paint and body shop. It then runs to the detail department (which is actually at Darlington’s auction facility) for retail detailing, then moves back to the Retail Solutions facility where any necessary parts are added.
Once the estimate is finished and the dealer has signed off, the vehicle goes through the imaging booth to generate high-definition photographs. Those pictures are uploaded to Autotrader, Kelley Blue Book and the dealer’s website, should the dealer request that.
The next stop is the merchandizing area, which is the final stop before storage or transport via Ready Logistics.
“Merchandizing consists of window stickers, customer care packages — just like at a hotel, you walk in, you have a chocolate on the pillow … that’s what we’re trying to provide for the retail seller,” Brawn said.
Should the dealer need to store the vehicle, there are long- and short-term storage options available.
And it’s not just available on vehicles that dealers buy at the auction, Brawn said. They can utilize it for trade-ins and lease returns, for example, that arrive on a dealer’s lot and need retail prep.
“If a client wants it, we’re going to find a way to do it,” Brawn said. “The only thing I don’t see us doing is servicing vehicles for the public … but if a client needs us to handle their lease returns, we’ll make it happen, for sure.”
More details on operations
Right now, Manheim Darlington has two clients that have signed on to use the Retail Solutions facility. It is currently servicing vehicles for one of those, a Manheim spokesperson said. A third contract is pending. The auction eventually plans to open the Retail Solutions facility to all dealer customers.
Brawn said he expects the center will be able to process roughly 250 cars per week.
If a client were to go through all of the steps of the center, it takes seven to 10 days to complete the process (prior to delivery).
Manheim invested $1.5 million over the last four months in the Darlington Retail Solutions facility, O’Dell said during the grand opening ceremony.
The company announced at NADA it was investing a total of $5 million for the five new centers. Discussions on Darlington began a year ago and they broke ground on the facility in late 2015.
Additional photos of the Retail Solutions facility can be found on Auto Remarketing's Facebook page.