Car dealer glossary

Aged stock

Cars that have been in stock longer than you'd like, often 60 or 90 days. Aged stock ties up cash and usually needs a price change or a different channel to sell.

Autotrader Connect

Autotrader's programme for approved third-party software. Systems in the programme can work with a dealer's Autotrader account, such as publishing and updating adverts. See Autotrader integration.

BCA

British Car Auctions, one of the UK's main vehicle auction groups, where many independent dealers buy stock. See BCA integration.

Consumer Rights Act 2015

The law that sets out buyers' rights when they buy a car from a dealer. Cars must be of satisfactory quality, fit for purpose and as described, and buyers have a short-term right to reject a faulty car within 30 days.

Days to sell

An estimate of how long a car is likely to take to sell at its current price. Dealers use it to decide what to buy and when to reprice.

Dealer management system (DMS)

Software that runs a dealership's day-to-day work in one place: stock, adverts, enquiries, invoicing and profit. See The DealerPal DMS.

FCA authorisation

Dealers who introduce customers to car finance need to be authorised by the Financial Conduct Authority for credit broking, or act as an appointed representative of a firm that is.

Finance calculator

A tool on a dealer website that shows the monthly cost of a car and lets buyers change the deposit, term and mileage. See Website finance.

Margin

The difference between what you paid for a car, including prep costs, and what you sold it for. Profit per car is the margin after every cost is counted. See Profit tracking.

MOT history

The record of a car's past MOT tests, including results, mileage and advisories, held by the DVSA and available from the number plate.

Part-exchange

When a buyer trades in their current car as part of the payment for the one they're buying. The dealer values it and takes it off the price.

Prep costs

What it costs to get a car ready to sell after you buy it, such as servicing, valeting, repairs and an MOT. They need tracking against the car to know its real margin.

Representative APR

The APR that at least 51% of customers are expected to get. UK finance adverts that quote costs need to show it in a representative example.

Retail Rating

Autotrader's score showing how in demand a car is in the retail market, used to judge how quickly it should sell.

Sale or return

An arrangement where a dealer sells a car on someone else's behalf and only pays them once it sells, returning it if it doesn't.

Stock feed

An automatic link that sends your stock, prices and photos from one system to another, such as from your DMS to your website or a marketplace. See Website stock feed.

Stock turn

How quickly stock sells and is replaced. Faster stock turn means cash is tied up in each car for less time.

V5C

The vehicle registration certificate, or logbook, showing a car's registered keeper. Dealers notify the DVLA when they buy and sell a car.

VAT margin scheme

An HMRC scheme for second-hand goods, including used cars, where VAT is paid on your margin rather than the full selling price. Invoices under the scheme don't show VAT separately, and you must keep stock records for each car. See Invoicing.

Vehicle history check

A check against a car's registration for outstanding finance, insurance write-offs and theft records before you buy or sell it.

Vehicle registration mark (VRM)

The number plate. Entering it lets a DMS look up a car's make, model, spec and MOT history instead of typing them in. See Stock management.

Choosing a system? Read the best DMS for UK independent dealers.