Did you know that the used car department is the biggest opportunity for you to increase profitability? There is an art to managing used cars and NCM Institute has some tips to help you achieve best results in this department.
It starts with understanding what your best inventory is. Do you know which have been the fast turning cars at your store? Identify these cars and develop a core inventory. What are the best sources for these units? First – check the back door. Are you currently wholesaling core inventory? Don’t forget to look at the service drive! Another good way to source these units is through direct mail to target current customers who drive core inventory. It provides a great opportunity to invite them in for a service offer or special sale. Additionally, develop a network of other dealerships you will buy from.
Ask yourself how you can do a better job managing aging inventory and wholesale. It’s known that grosses decline with the age of the car, so be proactive and manage units as they age in order to increase their chances for retail sale and avoid wholesale loss. It’s important to remember that studies show the highest gross peaks at 21 days.
The good news is that one of these techniques are expensive to implement and you increase units, gross, and wholesale at the same time. Follow these tips and take your used car department to the next level of profitability by taking time to manage your core inventory.