Building Used Car Profits with Dale Pollak

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Building Used Car Profits with Dale Pollak

Dealerships with strong used-car operations share two things in common. They’ve reduced the cost of acquiring inventory cars and recondition them faster.

“Margin compression in used-car operations means dealers must disrupt old practices that result in high vehicle-acquisition costs and slow time-to-market speed,” says pre-owned vehicle expert Ed French of AutoProfit. “There’s no other way to really succeed in used cars these days.”

A way to cut acquisition costs, pare back on reconditioning and improve inventory quality is to rely on internal sources. That includes programs that encourage service-department customers to sell or trade in their vehicles.

“Those opportunities should account for 60% of inventory, with private party and auction units making up 40%,” says French, a former Buick dealer and a board member of TruWorth Auto, a used-car superstore in Indianapolis.

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