UK online used car platform Cazoo has announced a strategic shift towards a pure-play automotive marketplace business model.
The move is set to capitalise on the company’s e-commerce technology platform and £100m investment in the Cazoo brand.
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Cazoo has explored strategic options, concluding that the marketplace model aligns best with the company’s strengths and stakeholder interests.
The transition will provide car dealers in the UK’s fragmented used car market with an online platform to reach the one million consumers who visit Cazoo’s website each month.
The company has sold 160,000 cars online since 2019.
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The transition to the new model comes after the company restructured its capital structure and appointed a new board of directors on 6 December 2023.
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By GlobalDataCazoo CEO Paul Whitehead said: “Transitioning Cazoo to a pure-play automotive marketplace business model leverages our key advantages: the nationally recognised and trusted Cazoo brand and the Cazoo e-commerce technology platform.
“We have built a data-driven business for buying and selling cars and having sold close to 160,000 cars we have demonstrated that there is robust demand for online transactions in the automotive market.
“Our transition means we can now offer the UK’s 13,000 car dealers the chance to put their forecourt stock in front of the one million potential customers on average who visit the Cazoo website every month. The UK used car market represents a significant opportunity for Cazoo, with approximately seven million transactions annually, worth an estimated £100bn.”
Cazoo’s marketplace model will support a range of business interactions, including full online transactions between consumers and car dealers.
The retailer plans to utilise its extensive customer and data resources, such as the 185,000 valuations it provides monthly, to offer dealers valuable insights and support their sales and sourcing efforts.
Cazoo will begin unwinding its inventory through retail and wholesale channels from 6 March 2024.
Operational changes will align with the new marketplace focus, including exiting fulfilment operations and reducing headcount to concentrate on e-commerce technology, data, branding and digital marketing.
The company’s board continues to review strategic initiatives and focus on fulfilling Cazoo’s liquidity requirements.
