Manheim Auctions

Topics: Automobile, Strategic management, Auction Pages: 6 (2124 words) Published: August 20, 2010
Data Management & IT-LB5002.|
Assignment 3|
IMRAN FAREETH.K (12449635)|
James Cook University, Singapore.

1. Describe Manheim’s business, information and organizational strategies. Business strategy:
Auction is a very social event with a culture of its own. Manheim is the largest wholesale automobile auction company in the world. He is using up various modes like Manheim online, Auto connect, etc. to sell the used cars and his main focus initially on US market and later on UK. Manheim business strategy is auctioning, reconditioning and processing the used vehicles by getting a fee for various processes and thereby revenue generated. They entered with Japanese automobiles as it has improved quality. They focused mainly on dealers as they are their customers. They notify the dealers about forthcoming auction including details of used cars. Before auctioning, inspection will be carried out. Once the cars are ready, auctioneers will bid until final price is reached. Once a final bid is accepted, the car becomes the property of dealer which is then sold for customers or public. Information strategy:

Manheim’s information system is excellent for implementing its business plan through various means. Initially he used a physical means for auctioning by using special sites. But later on as the technology grows he tried to implement many systems like auction vision, Manheim online and other services like MMR, auto connect, tracker plus and leasing plus with the help of a third party developer so as to compete more efficiently with its competitors. Manheim also uses Extranet to link with their suppliers, customers or other firms to share common goals. Organizational strategy:

According to the vision statement as the world’s largest auction house, Manheim sells millions of used cars to the customers by using many systems which is technically more advanced so as to serve well. In olden days when an automobile reached 50,000 miles rebuilding of engine was required. So the demand for used car was very low. Later on as the technology grows there is no need of even tune up until 100,000 miles reached. So there is lot of craze on used car and this is the main reason that boosts up Manheim to become a top used car seller. Manheim’s main focus is to reduce/avoid the competition by extending sales through internet and by adding values to its customers and suppliers. Moreover he delivered the sold car to the dealer’s lot within the specified period of time.

2. Describe the Manheim value chain. Who are Manheim’s customers and how does it add value to each of these customers? Manheim initially sold the used cars by physical means and then it became advanced by selling through auction vision. After that it has developed a web site MOL with the support of a third party developer ICI to improve the sales in convenient way so that the customers get out better benefits and process would become easy. Thus its value chain holds well by adding more customer benefits. Manheim’s customers are the dealers of used cars. Manheim act as an intermediate as he got supply from other special suppliers and then he sold out to the dealers who are the customers which is further sold out to the public. Manheim also adds value to each of these customers by implementing special softwares like Auto connect, Tracker plus and Leasing plus so as to compete its other competitors more effectively.

3. What are Manheim’s core competencies? Have these changed with the introduction of MOL? The main reason for Manheim being a successful and number one company is that they are the part of a globally well reputed privately owned Cox Enterprises. Though there are many other competitors, Manheim enjoyed a first mover advantage. Manheim being the first to start the business, initially he used auction sites to sell the cars where customers directly come for face to face auction. After that he sold through the...
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