Here's one that is moving into the internet
Auto Network USA
anwk.com
OTC BB: ANWK
Fiscal Year End: 3/31/98
Shares Outstanding: 17,766,667
Public Float: 8.5 million
Assets: $6.9 million (approx)
Revenues: (3/31) 1999(est): $125 million
(3/31) 2000(est): $240 million
Auto Network USA (AUTONET) is the fastest growing publicly-held wholesaler of used late model and luxury automobiles in the country. The Company is capitalizing on the billion-dollar wholesale market by focusing operations in strategic segments of the country.
AUTONET's strategy is to gain market share in key urban areas by acquiring and consolidating the independent automobile wholesaling companies. This strategy will provide the Company with access to a large and growing volume of high-quality late model and luxury automobiles. It will also allow AUTONET to take advantage of geographical disparities in the real and published value of cars.
The wholesale used car business involves acquiring used vehicles, typically from new car dealers as trade-ins, and reselling them at a profit to the used car retail industry. Currently, much of this is done through used car auctions, prohibiting the new-car dealers from adequately managing cash flow for its used car inventory and from forecasting the resale value of its trade-ins. AUTONET alleviates this problem for the new-car dealer by offering a wholesale bid before the trade-in is purchased. This method allows the new-car dealer to properly negotiate the price of a trade-in based on a fixed resell price.
This also provides the new-car dealer with the ability to quickly turn a traded-in car into cash, enabling the dealer to manage its cash flow.
Through its affiliates, Pinnacle Dealer Services, Inc., AUTONET plans to provide dealers a unique financing alternative that will supplement or replace the dealer's existing financing programs for vehicles purchased from AUTONET. The specific target market for that will promote additional sales.
Established in 1997, the Company achieved sales of over 30 million in the first six months and is profitable. AUTONET is currently expanding from the original location in Scottsdale, Arizona to other urban locations. On June 1, 1998 an Albuquerque office was opened, adding $1.5 million in sales and $10,000 in pre-tax profit for the month. AUTONET has targeted five cities for possible expansion in the remainder of 1998, and expects to open one or two additional cities in the next 60 days.
The used car market in the U.S. is a $360 billion industry. More than 40 million used vehicles were sold in 1996, representing about 73% of all vehicles sold. Increasingly, consumers are purchasing used automobiles because of the higher prices of new cars as well as improved quality, durability and better manufacturer's warranties.
AUTONET currently has 22 independent brokers acquiring and selling quality used vehicles from its facilities in Scottsdale and Albuquerque. The average wholesale value of each vehicle is $14,000 as compared to the industry average of less than $9,000. The Company currently generates $8.5 million in sales per month.
A highly fragmented system of local independent wholesalers coupled with an increase in the expanding fleet of used automobiles has created an opportunity for AUTONET.
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