Sold not settled: the quiet cost on your stocking line

Ask a dealer FD where the money leaks on the stocking line and the honest answer is usually "cars we sold and forgot to settle". Not fraud, not a system failure, just a gap between two processes that were never joined up.

How it happens

A car is sold. Sales admin invoices it, the customer pays or the finance company pays, the car is handed over, and the DMS marks it delivered. Somewhere in that sequence the funder should be told to settle the stocking advance on that VIN. If that step is a person sending a settlement request, it happens when the person remembers. If it is Friday afternoon and three cars went out, one of them is missed.

The funder does not know the car has gone. It keeps charging daily interest on the advance until the settlement arrives. The next statement shows the car as still funded, and if nobody reconciles the statement line by line, it shows on the one after that too.

What it costs

Take an advance of £18,000 at a stocking rate of 9 per cent. That is about £4.40 a day. One car missed for a month is £135. Not much. Five cars a month, each missed for three weeks, across a group of four sites, is over £6,000 a year of interest on cars you no longer own, plus the curtailment charges that often kick in at 90 or 120 days if the car sits long enough.

The bigger cost is at audit. A manufacturer stock audit or a funder field check that finds funded units not on site is not a conversation about interest; it is a conversation about the facility.

Control one: settle from the delivery, not from memory

Make the settlement request part of the delivery paperwork, so a car cannot be handed over without it. Most DMS systems can produce a daily "delivered yesterday" list; someone should be comparing it with the settlements sent, every day, and it should take five minutes.

Control two: reconcile the statement to the stock list every month

Whatever the daily control misses, the monthly reconciliation catches, provided it is done unit by unit rather than by agreeing the total. Every statement line matched to the stock list by VIN. Every line that matches a delivered car, or matches nothing at all, is a settlement to chase today.

That is exactly what the sold-not-settled bucket in Forecourt’s Manufacturer rec is: the statement matched to the stock list, with the units the funder is still charging for that you cannot show listed first, and the total at the top as your exposure.