LEASING companies cannot have failed to see a shift in the market place in personal leasing arrangements. A few years ago a definite increase in Employee Car Ownership Schemes was responsible.
This time it seems the car for the school-run, the car for doing the shopping, and the car for occasional business use are also being funded away from traditional outright purchase, bank loans or hire purchase agreements.
We’ve seen a distinct change in the market place. It’s no longer ex-company car drivers looking for a different way of going about their busy, high mileage jobs. Today’s customers are more regular consumers. They are moving from old cars to new. And tending towards lower mileage, fuel-efficient and environmentally friendly vehicles.
I think some of this new-found popularity is due to ‘pub-talk’ – not new products that push the popularity of various funding methods.
The attraction of a PCP or PCH
Friends or colleagues can easily explain the flexibility to buy the car at a price written in to the contract. Or, simply arrange for the car be picked up and taken away at the end of the contract. It seems to take people’s interest. This is a simple way of explaining the benefits of a Personal Contract Purchase (or PCP).
In the same vein, someone else may mention that they have found a deal which is the same price as that given to a large fleet. All they have to do is just add the VAT and include Road Fund Licence, delivery and a predicted mileage to get their monthly lease rental.
All that’s required is to insure the car and pay for fuel. After two or three years the car is returned and they will simply start again. That friend has just sold the concept of Personal Contract Hire (PCH) to everybody they know. This word of mouth is having a big impact in the market-place
The move away from car ownership
The public catch on to ideas through many outlets. And one common theme rang true during the onset of the economic downturn. Selling a used car was tough. It wasn’t worth what had been budgeted for; and often significantly less than any outstanding finance left on the vehicle. A lot of individuals got hit by the market last year and are continuing to do so.
To many, leasing on a personal basis was an alien concept. The general mood has always been to ‘own’ the car. Nowadays customers are more flexible. They are open to ideas and products which may protect them in the future and offer great value for money – whether they choose to own the vehicle or not.
So are you missing out? Is it time for you to consider leasing?
If so, do this: forget about interest rates, trade-ins and balloon payments. Instead, work out a monthly budget and see where that gets you. Let your business car leasing contact know what you can afford and see what you can get for your money – you might be surprised.
Further information
Anthony K Associates were established in 1995 and are franchisees of Network Vehicles (part of LeasePlan), acting as a car leasing broker for several FN 50 blue-chip funding companies to businesses and individuals throughout the UK. Click here to visit the website www.anthonyk.co.uk
For more on personal leases, read our Advice Centre article What is a personal lease?
You might also find useful our Special Report entitled Try leasing to ease your credit lines
Showing posts with label Contract Hire. Show all posts
Showing posts with label Contract Hire. Show all posts
Monday, 13 July 2009
Friday, 27 March 2009
Weekly Rant!
Well this week lots more happenings - Alliance Leicester A.K.A Abbey National A.K.A Santander have withdrawn their funding of several smaller Contract Hire companies.
What does this mean to us, you and your customers? It means lots of leasing firms not in the Fleet News Top 10 are having to restrict the amount of business they write. Meaning there is market share that needs filling, often to customers who have moved away from dealing direct with the main players.
The benefits of using a trusted leasing broker are really coming to fruition. Hundreds of deals, plenty of funders and the tightening of credit are all adding up to desperate sellers, misinformation and untold delays in paperwork and delivery. Fear not - we see it daily, and our customers know what is happening every step of the way.
Payment and credit wrangles between dealers and funders could mean that the 'cheapest' deal may not be achievable - clients need the options and updates to make informed decisions.
So what next......? Well it seems doing a good job is back to being as important as price, the slight detail of service had slipped from the minds of many for 9 months or so and the horror stories have come out. What's great now is that customers are asking questions - such as "where is the finance to be placed" and "which dealer are you using", consciousness is back in the market and we look forward to taking on the bedroom brokers and doorstep financiers. Same deals, proper company part of the BVRLA
The used car market has recovered for 4 straight months, meaning that residual value calculations could help stabilise or even reduce rentals. On top of that the 'should we buy used' conversations have dried up! Look at the MPG's, the Co2's and the Whole Life Costs and new cars still stack up!
Coming up.........
Vehicle Tracking - your customers can save £'000's on fuel, productivity and duty of care. It's a big deal and not just for courier companies. Our partnership with the UK's leading tracking provider, Navman is in it's fruition - watch this space!
Special Deals to follow and plenty to be done - of course only with our best suppliers and upfront, honest service ;)
All The Very Best for a Great Weekend,
keep an eye on www.anthonyk.co.uk for more great deals and news
What does this mean to us, you and your customers? It means lots of leasing firms not in the Fleet News Top 10 are having to restrict the amount of business they write. Meaning there is market share that needs filling, often to customers who have moved away from dealing direct with the main players.
The benefits of using a trusted leasing broker are really coming to fruition. Hundreds of deals, plenty of funders and the tightening of credit are all adding up to desperate sellers, misinformation and untold delays in paperwork and delivery. Fear not - we see it daily, and our customers know what is happening every step of the way.
Payment and credit wrangles between dealers and funders could mean that the 'cheapest' deal may not be achievable - clients need the options and updates to make informed decisions.
So what next......? Well it seems doing a good job is back to being as important as price, the slight detail of service had slipped from the minds of many for 9 months or so and the horror stories have come out. What's great now is that customers are asking questions - such as "where is the finance to be placed" and "which dealer are you using", consciousness is back in the market and we look forward to taking on the bedroom brokers and doorstep financiers. Same deals, proper company part of the BVRLA
The used car market has recovered for 4 straight months, meaning that residual value calculations could help stabilise or even reduce rentals. On top of that the 'should we buy used' conversations have dried up! Look at the MPG's, the Co2's and the Whole Life Costs and new cars still stack up!
Coming up.........
Vehicle Tracking - your customers can save £'000's on fuel, productivity and duty of care. It's a big deal and not just for courier companies. Our partnership with the UK's leading tracking provider, Navman is in it's fruition - watch this space!
Special Deals to follow and plenty to be done - of course only with our best suppliers and upfront, honest service ;)
All The Very Best for a Great Weekend,
keep an eye on www.anthonyk.co.uk for more great deals and news
Thursday, 27 November 2008
Sole Supply and Why It Pays To Use a Broker
News emerged today that Alphabet leasing are changing their business plan for 2009, resulting in them pitching for less business and honoring existing contracts only. The reasons behind this include access to funding and an almost certain price increase full story
Existing clients may now be inclined to to shop the market and see just how competitive current suppliers really are. We've noticed increased price sensitivity in the market which is opening up the medium to larger fleets to be more receptive to our message. "We shop the market whilst you benefit from sole supply service".
Rates are changing on a daily basis for some funders, some (to remain nameless) are literally pricing themselves out of the market for new business whilst passing increasing prices on to existing clients. If you know anyone who could benefit from a market analysis from Anthony K we'll happily show them comparative figures from our broad range of finance partners to demonstrate the savings which can be made using a reputable broker (like us!)
Existing clients may now be inclined to to shop the market and see just how competitive current suppliers really are. We've noticed increased price sensitivity in the market which is opening up the medium to larger fleets to be more receptive to our message. "We shop the market whilst you benefit from sole supply service".
Rates are changing on a daily basis for some funders, some (to remain nameless) are literally pricing themselves out of the market for new business whilst passing increasing prices on to existing clients. If you know anyone who could benefit from a market analysis from Anthony K we'll happily show them comparative figures from our broad range of finance partners to demonstrate the savings which can be made using a reputable broker (like us!)
Tuesday, 25 November 2008
SME's Turn to Leasing In Uncertain Times
Once again the Fleet News is banging the leasing drum as fleets purchasing their vehicles suffer from decreasing resale values.
6 months ago we carried out a Whole Life Cost analysis of a Contract Hire v's Outright Purchase on a standard fleet car , 22,000 miles/year over 3 years.
Without getting too technical (leave that to the accountants) we concluded that Contract Hire - in this particular case was just in favour by a few pounds. The same analysis today suggests leasing is £2000 better, due mainly to the losses made at disposal.
So, leasing in a downturn:
6 months ago we carried out a Whole Life Cost analysis of a Contract Hire v's Outright Purchase on a standard fleet car , 22,000 miles/year over 3 years.
Without getting too technical (leave that to the accountants) we concluded that Contract Hire - in this particular case was just in favour by a few pounds. The same analysis today suggests leasing is £2000 better, due mainly to the losses made at disposal.
So, leasing in a downturn:
- Low Deposit, typically 3 payments
- Set monthly payments ease cashflow
- Set maintenance budgets - avoid future rises
- Pass the risk to a 3rd party - why worry about resale values?
- Fabulous deals available due to attractive discounts to firms like us
- Brokers like us to seek out the deal for you
If your business requires the professional advice that can save £2000 on just 1 fleet car, feel free to give me a call on 0161 655 3200.
Tuesday, 18 November 2008
Fleet News 50
Apologies for being a little late with this one, however last week the highly anticipated Fleet News 50 landed on my desk.
Interesting reading all round, with a few articles regarding the way forward for businesses to deal with reputable, professional brokers (like ourselves) to get the best rates and service from an industry which is changing daily
However back to the main topic of the publication it was great to see that Anthony K Associates deal with all 5 of the Top 5 leasing companies (in terms of fleet size). A further 7 funding partners are in the Top 30 allowing us to use the largest and most competitive funding for fleets of any size
Interesting reading all round, with a few articles regarding the way forward for businesses to deal with reputable, professional brokers (like ourselves) to get the best rates and service from an industry which is changing daily
However back to the main topic of the publication it was great to see that Anthony K Associates deal with all 5 of the Top 5 leasing companies (in terms of fleet size). A further 7 funding partners are in the Top 30 allowing us to use the largest and most competitive funding for fleets of any size
Wednesday, 28 November 2007
Contract Hire v's Leasing
I am currently looking at the replacement van for a very good plumber I know from Rochdale Lacrosse Club. As a small business he has been effectively 'blinded by science' when it comes to the information he requires to do the best for his business.
Effectively the question was "Are you quoting a Contract Hire or a Lease?"
Answer:
Contract Hire - is just that, a hire/rental of a vehicle. 50% of company cars are funded in this way. At the end of the contract the vehicle return to the hire company.
A Lease - The vehicle is, in effect owned by the person paying the bills! At the end the vehicle becomes your liability with a possibe one-off 'balloon' payment to pay. Mainly vans are funded this way.
For this client, it is in his best interest to Contract Hire, he can budget his payments and has no responsibility for the van at the end of the contract. He has better things to do than start selling one van to pay for the next!
There are so many options available that you really should speak to an impartial expert. This becomes difficult when nearly every 'expert' has their own specialism in which they make money!
Effectively the question was "Are you quoting a Contract Hire or a Lease?"
Answer:
Contract Hire - is just that, a hire/rental of a vehicle. 50% of company cars are funded in this way. At the end of the contract the vehicle return to the hire company.
A Lease - The vehicle is, in effect owned by the person paying the bills! At the end the vehicle becomes your liability with a possibe one-off 'balloon' payment to pay. Mainly vans are funded this way.
For this client, it is in his best interest to Contract Hire, he can budget his payments and has no responsibility for the van at the end of the contract. He has better things to do than start selling one van to pay for the next!
There are so many options available that you really should speak to an impartial expert. This becomes difficult when nearly every 'expert' has their own specialism in which they make money!
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