The other 20, 30 or 50 (or more) customers that the sales managers cannot come to an agreement within the box, are going to walk anyways if the trade evaluation isn’t even close.Ĭonsumers, salespeople and business development personnel have been using technology to gather vehicle details and prepare estimates, but it all has to be finalized by the Used Car Manager. At the point that a deal is solid, then the Used Car Manager can get involved in order to finalize a vehicle’s value with the Sales Managers.
Carmanager free#
Using technology that can empower other people to be able to perform the initial vehicle appraisal would free up the Used Car Manager to perform more brain heavy tasks. The most time-intensive and least profitable use of time for the Used Car Manager is evaluating potential customer trades as 75% of these evaluations don’t end up in a sale. Technology may be able to do those things. Most of them wish there were a way to clone themselves or literally add more hours onto the day. As a result, these individuals need to spend nearly every waking hour working. The Used Car Manager’s position is extremely demanding. They are in and out of meetings with dealership management, they are going to and from auctions, they are dealing with wholesalers, they are evaluating trade vehicles and adjusting inventory prices on an almost constant basis. This individual has an encyclopedias worth of knowledge in their heads about profit/loss margins of every vehicle on the lot – a figure that can change at the drop of a hat in the automotive market. Paul Stowe is the former director of retail operations at NCM and recently retired after nearly 50 years in the automotive business.If you aren’t responsible for vehicle inventory management, you may think it is an easy concept, but it is a stressful and labor-intensive endeavor normally bestowed upon one person: The Used Car Manager.
Note: This post appeared on an NCM Associates blog in July 2014. There is too much missed profit opportunity, let alone the impact of adding new customers to your owner base. Ask your manager to give you a plan to increase used unit volume profitably beginning right now. Get it in writing. Understand and clear the air on these misconceptions, if they apply. Buy it right or understand the impact on potential grosses, salability, and aging of your used vehicle dollar investment in other words, your true return on investment of your dollars, Mr./Ms. A used-vehicle trade acquisition is an investment decision.
Why in the world would you destroy your acquisition disciplines, bumping used trade-in inventory values and not reduce new-car gross to its true transaction value?)Ī new-car deal is a new-car deal, albeit an OEM incentivized transaction. If not, what have you just done to the integrity of your pricing model and your used unit gross potential? (Most OEM incentive money is being paid on new-car sales. Question: Have you ever put more money into a trade to make a new car deal? If so, of course you reduced the new car gross - right? “If I price to market, my grosses are too low.” What makes you think you are smarter than the market which dictates the cost and sales price of inventory? What is your acquisition plan? What do you buy each week to inventory? “I cannot find the ‘right cars’ and when I do, they are too expensive.”Ĭome on! The vehicles are out there! You might have to work every day to source them.
Do you understand that if you turn your inventory more efficiently, your volume will increase? Our Benchmark metrics validate that a 45-day turn is very common, regardless of franchise. Should your dealer give you more dollars to invest unwisely? Just a hint: great operators do believe a 30-day (or faster) turn is attainable. If you have an aging issue right now - why? You might, but first, do you understand and practice an aggressive “turn” mentality? If not, you are five years behind in your skill set. “I need more inventory to sell more cars.” My responses should help you combat these misunderstandings that are prevalent in our industry today, and they’ll also help you have the conversation that will turn this thinking around. What follows are some common reasons we hear during our dealership consulting engagements.
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