Stoneacre, the 29-site new and used car dealer group, has launched Stoneacre Financial Services in partnership with Marsh Finance.
Stoneacre Financial Services will offer subprime car finance to both online customers and those who have been turned down at one of their 29 nationwide locations.
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The group, which has brokered subprime finance since 2007, will be lending its own money, a decision which Mark Zavagno, head of digital sales at Stoneacre, has attributed to 18 months’ growth in finance applications through its forecourts and the groups’ increased web presence. Stoneacre will continue to act as an intermediary for both prime and subprime finance from other lenders. The venture will also allow Stoneacre to offer subprime van finance.
Although it has not been unknown for dealers and lenders to operate business models in which risk and reward is shared by both parties, it is by no means widespread. One managing director at an independent finance provider commented in reaction to the move taken by Stoneacre and Marsh that they were "discussing seriously" similar structures with dealer partners, but that it was worth bearing in mind the needs of any dealer transitioning from income on a commission to a profit-share basis.
Marsh, the Rochdale-based finance and portfolio management house, has worked with Stoneacre since before the credit crisis, with the group being one of the first to use the company’s scorecards to speed up the grading of its lending quality.
Steve Reynolds, group F&I manager at Stoneacre, said the two companies had developed a scorecard "which will enable us tounderwrite deeper than ever, it’s fantastic news for customers who’ve previously been unable to obtain car finance from a franchised retailer."
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By GlobalDataZavagno explained the partnership provided Stoneacre with "the flexibility to make our own lending decisions and enables us to adapt as and when we need to in order to meet the ever-changing needs of our customers".
Andrew Marsh, managing director of Marsh Finance, said the company was "delighted to partner with Stoneacre for its white-labelled financial services business", particularly because the group had "always been innovative in its business approach and were quick to recognise the opportunities offered by adopting our outsourced, turnkey services solution."
Marsh added Stoneacre was now "able to exploit new niche opportunities for selling more cars with the added bonus of generating an additional income stream", and able to use his company’s "skills, knowledge, expertise and risk management with none of the start-up cost. It’s an exciting time for them and also for Marsh."
Stoneacre and Marsh were each commended by industry peers at Frontline Solutions’ third annual F&I Conference and Awards dinner in Milton Keynes in October 2012 for their work in finance. Reynolds collected the F&I Innovation Award on behalf of Stoneacre while Zavagno picked up the Near to Sub Prime Introducer of the Year Award and Marsh Facilities Management was named Product / Service Provider of the Year.
richard.brown@timetric.com
