Turning the auction block on dealers
Haggling for a car online prevents the feared gender war, writes Kate Jones.
Shoshi Vorchheimer saw a business opportunity when a female friend recounted her discomfort while shopping for cars. It was a familiar tale - woman goes to dealership, woman feels inferior.
"Here we are, working women contributing to the household income, our money's as good as anybody else's, and you still hear of this happening," Ms Vorchheimer says. "The whole notion seemed ridiculous."
And so, like the genesis of many businesses, Ms Vorchheimer's frustration fuelled her inspiration.
Dutch Auction Auto aims to help women, and some men for that matter, navigate the male-dominated world of car buying.
Dutch Auction Auto operates solely online and while dealers list cars on the site, there is no face time between salespeople and buyers, except when it comes time to pick up the car.
Ms Vorchheimer says this has made many clients breath easier.
"The dealer and buyer remain anonymous until the end of the auction," she says.
Ms Vorchheimer isn't the only one trying to make the automotive industry more female-friendly.
In 2000, Juliet Potter launched AutoChic, a car site that advises women on how to buy a vehicle.
And last year car dealer AP Eagers, which employs about 3000 people in dealerships across the country, ran job ads calling for female workers in an effort to redress its 80-20 male-skewed workforce ratio.
Each of these has established their business on the notion that women are just as involved as men when it comes to making a decision to buy a car.
According to AutoChic's research, women now buy more than 60 per cent of all new cars and have the final say in 85 per cent of all new car-buying decisions. Yet, AutoChic's data shows 89 per cent of women still report a negative experience in their dealings with the car industry.
"I remember going into a dealership with my kids and the salesmen would look with horror at the children," Ms Vorchheimer says.
"It was just such an awkward situation. There had to be an easier way. I wanted to take gender out of the equation."
She runs her website on the side while juggling her full-time job as a secondary school English teacher and role as a mother to four children aged under 13.
It was while she was on maternity leave last year that Ms Vorchheimer began developing Dutch Auction Auto. She began by getting car dealers across Australia on board with her 'Dutch' - or reverse - auction concept.
In such an auction, buyers nominate their starting price and sellers bid against each other to beat that price. The seller with the lowest price wins the auction.
"We have an advantage in that people who come to our site already know what they want," she says. "The reverse auction is a new concept, but we've already had a fantastic result."
Ms Vorchheimer says getting the car dealers on board was a lengthy process, but once the first dealer signed up others were keen to be involved. At last count 320 dealerships were listed.
Securing funding was even harder. "The hardest thing was going to the banks," Ms Vorchheimer says. "When you get turned away it's easy to feel despondent, but you've just got to keep going."
The site launched in December last year. To her surprise, a BMW was the first car to go under the hammer. She had expected her target demographic to buy mid-priced cars, not luxury labels.
Since going live, the website has made some minor tweaks. The site now advises buyers to kick off the auction with a price 10 per cent below the recommended retail price.
This had to happen, says Vorchheimer, to prevent buyers listing ridiculous prices.
The site demands a deposit from buyers to ensure they are committed. This protects the dealers from time wasters and guarantees the site deals with genuine buyers.
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