CarMax 2005 Annual Report Download - page 10

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OUR BUSINESS IS NOT UNLIKE AN ICEBERG. OUR UNIQUE CONSUMER OFFER IS WHAT DRAWS
CUSTOMERS TO OUR STORES; IT IS WHAT CAN BE SEEN “ABOVE THE WATERLINE.” HOWEVER,
OUR KEY PROCESSES AND SYSTEMS “BELOW THE WATERLINE” ARE WHAT MAKE OUR BUSINESS
SUCCESSFUL.
4
UNIQUE
CONSUMER
OFFER
LOW, NO-HAGGLE PRICES
■We offer our best price up front and never haggle on
any element of the sales transaction.
■The price of the vehicle is competitively low and clearly
posted on the car, in the store, and on carmax.com.
■The price of the extended service plan is competitive
and fixed, based primarily on the repair record of similar
vehicles and the length of coverage.
■The price of the financing is competitive and no-haggle
and is based on the finance company’s assessment of
credit risk. Customers see each finance offer as it is
made directly from the finance company and may
choose among competing offers.
■The price offered on a “trade-in” is a written cash offer,
based on the wholesale value of the vehicle, and our
offer is good whether the customer buys from us
or not.The offer is good for 7 days or 300 miles.
BROAD SELECTION
■The average CarMax superstore has between 300 and
400 vehicles for sale, compared with approximately
90 used vehicles at the average new car dealer.
■Our primary focus is vehicles that are 1 to 6 years
old, with fewer than 60,000 miles. For the most
cost-conscious consumer, we also offer older, higher
mileage ValuMax®cars that meet our same quality
standards.ValuMax vehicles comprise approximately
15% of our inventory.
■Each store’s inventory is tailored to the buying
preferences of the consumers in that store’s trade area.
THE CARMAX OFFER IS STRUCTURED AROUND OUR CORE EQUITIES — THOSE THINGS WE OFFER
CUSTOMERS THAT, TAKEN TOGETHER, MAKE US UNIQUE IN AUTO RETAILING.
3
STORE MANAGEMENT TEAMS
8
CARMAX 2005