Innovation and dealer
penetration high on Carlyle Finance’s agenda, reports Antonio
Fabrizio.
Go deeper with GlobalData
Fresh from winning a ‘motor
finance company of the year’ award last month, Carlyle Finance told
Motor Finance it is “not resting on its laurels” but is
investing heavily in innovation.
The firm, which specialises in
dealer finance, has shown a strong resilience during the recession
– it said it actually managed to grow to “record levels” last
year.
Indeed, new business volumes
increased by 61% over 2008 and tight control on bad debt has
ensured a reduction of 41% in bad debt ratio, CEO Mark Standish
said.
Total outstandings are now close to
£400m (33% up over last year), and return on capital is above 30%,
Standish added.
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By GlobalDataBehind this performance, according
to Standish, there has been no one single factor, but rather a
combination of elements, which have included innovation, focus on
dealer relationships, a strong team and the support of a healthy
parent company.
The lessor – which was acquired by
South Africa’s car finance specialist WesBank back in 2006 – said
its parent company has been providing “significant financial
support”.
Standish said: “There is a strong
working relation between the Carlyle team and our South African
parents.
“When WesBank acquired Carlyle, the
strength of the leadership team and its vision for the future were
major reasons behind the investment decision.
“The same leadership remains in
place today and with the financial support and backing of our
parent we have been encouraged and empowered to invest,” he
added.
Carlyle – which has been in the UK
motor finance market for around 40 years – defines itself as
‘dealer dedicated’, meaning it works exclusively through motor
dealers and brokers who deal with motor dealers. The business is
split between new cars (10%), used cars (80%) and new and used
light commercial vehicles (the remaining 10%).
The company has established
relationships with some 2,500 dealerships across the UK, including
national and regional dealers groups, car supermarkets and
independent dealers. It said it has grown its presence in the AM100
– the largest 100 UK automotive retail groups by turnover – from
one relationship in 2007 to 16 relationships in 2010.
“Over the years, this focus has
created a large number of outstanding relationships with our
dealers, many have worked with us over an extended period,”
Standish said.
Brokers also form an important part of the Carlyle
portfolio.
Standish said: “We believe there
are good opportunities to work with the right brokers to provide
additional geographic coverage and also to leverage the
relationships that they have in place.”
Carlyle is also investing heavily
in innovation. The company is about to launch a new website as part
of an internet strategy aimed at offering “a new level of support
and innovation” for its dealership base.
Additionally, it recently launched
a website (www.carloanadviser.com) aimed at consumers. The website
targets people who are researching their future new or used car
purchase on-line, and who often are unaware of the “benefits and
added consumer protection offered by asset finance when compared to
a personal loan”.
Standish said this is “the first
phase of new web-based technology being developed by Carlyle
Finance to ensure consumers are fully aware and in control of their
finance choices”.
Product innovation has recently
included the launch of programmes to meet market needs, from
payment holidays to deferred start dates for repayments. These have
included an HP payment holiday scheme, a deferred residual value
product, and a product called LateStart, which gives customers a
two-month payment holiday immediately after purchase.
“These newer products occupy only a
small space in terms of our total sales, but what they do achieve
is great positive perceptions,” said Standish.
Standish’s final strategic focus
has been on his team. Carlyle currently employs 129 staff across
its business, and is increasing its national accounts team to
support the major retail customers – the most recent appointment
was Dan Cholewinski as national account manager earlier this
month.
Standish is confident this proactive and innovation-led approach
will help the firm continue to flourish and grasp the opportunities
ahead.
