Take a quick look around your dealership. Look long and hard at both your lot and your showroom. Do this and you will quickly see where much of your investment lies…in your pre-owned inventory. If you are willing to invest a significant amount of time and money into your pre-owned vehicles, then the best thing you could do for your dealership is research what kind of cars you are stocking, what the market says about these cars and where you are getting them.
First, what kind of inventory are you stocking? Having looked at the data using tools like AAX and vAuto, I have come to a conclusion. Dealerships will very quickly find themselves in a bind when their pre-owned departments are stocked too heavily with late model vehicles. It’s important to have a healthy balance. I have seen far too many stores with late model vehicles making up 50% or more of their inventories this increases turn rate and the amount you are spending in marketing.
So what does the market say? The table below shows us a breakdown of VDPs (VDPs showing in 10,000 units) in relation to each calendar year.
As you can see, the late models have lower amounts of VDPs as compared to vehicles in the mid-2000 range. The lower VDPs indicate lower internet traffic on those cars which leads to a longer turn time. Now I understand that you need to have some of these late models for your CPO programs and to use them as switch cars.
I’m simply suggesting that you work on a balance. If you are able to stock more of the mid-2000 vehicles, you will increase the traffic to your inventory on the lot and online. And remember, make sure your website is easy to use and optimized. You can read why that online experience is so important and how to improve it here.
How do you acquire more of the mid-2000 vehicles?
Do whatever you can to acquire mid-2000 vehicles this way. You may have to bite the bullet and spend more for the car than what your pricing tool says you should. If you are acquiring a cialis professional online large amount of late models as trades, I would suggest a strong exit strategy for these cars. Give them 30-45 days on your lot and then send them to auction.
This means that you must do your homework. Go through the pre-auction reports, pick out the vehicles you’re interested in and then get there early and scout them out. Have a solid game plan lined up for your day and know that you may have to stretch your price range in order to get these cars as well. I will admit, it’s very easy to buy late model vehicles at auction because they aren’t as desirable to customers, but stick to game plan.
Trust me, it’s worth the investment, the data doesn’t lie. Building up an inventory of mid-2000 vehicles will increase traffic to your website and your lot. This results into more personal contact with customers which as we all know, leads to more sales.
Written by Bryan Jennings