Lotlinx recently announced its inaugural Quarterly Vincensus Report. Len Short, the Executive Chairman of LotLinx, will join us on today’s episode of Driving Solutions to discuss the report and its findings.
Key Takeaways
1. The Vincensus report, a practical tool based on an extensive VIN dataset that Lotlinx has been meticulously compiling for over 15 years, tracks every car as it crosses every lot. This dataset includes various circumstances affecting sales, such as weather. The report is designed to equip dealers with valuable insights and competitive intelligence on market dynamics, days to sale, markdown paces, and other factors. Its aim is to empower dealers to understand how the market affects their brands and compare their performance.
2. A significant finding of the report is the impact of carryover inventory on sales and profitability. Carryover occurs when inventory remains unsold beyond a certain period (30 days for new cars). Short highlighted that a 5X increase in days to sale is observed once inventory crosses the carryover threshold, drastically affecting gross profits. Managing carryover rates is crucial for maintaining a profitable dealership.
3. The report reveals that over 50% of VINs receive no views, emphasizing the importance of shopping activity in driving sales. Dealers often price cars too high initially and then overreact with deep discounts. Short stressed the need for better balance in pricing strategies and the necessity for vehicles to be actively shopped to avoid prolonged inventory and subsequent markdowns.
4. Moreover, the report provides detailed insights into how different brands perform regarding inventory markdowns. For example, Stellantis and Dodge dealers are experiencing frequent and deep discounting to move inventory, with multiple markdowns often required before a sale. This trend is seen across various brands and regions, highlighting the need for dealers to adjust their strategies based on brand-specific and regional data.
5. Overall, Short underscored the potential for dealers to significantly increase their profitability by leveraging real-time data to make strategic decisions. Despite the availability of valuable data, only a small percentage of dealers (12%) claim to effectively use it. The interview highlighted the need for dealers to benchmark their performance against national averages and take corrective actions based on real-time insights. Lotlinx aims to provide tools and support to help dealers of all sizes, especially independent operators, to harness the power of data and gain a competitive edge in the market.
"Our latest project is a game-changer in the industry, offering unparalleled solutions to complex problems." – Len Short
