Used Car Management
Used Car Manager, Let's set the ground rules, you have to have lots of
courage. Okay got experience and courage you're ready. The best
position to be in is to have an inventory that after pack(s),
certification, and recon you're in wholesale book, good luck with that!
Okay since that is not going to happen the majority of the time, don't
worry. Banks are buying up to 140% for good customers and down payment
has always and will always be your way to proper structure and profit.
MMR look outs! always click on the MMR link to see what makes up the
average you are looking at before you bid at the block, why? Here's an
example you may be looking at Mustangs, but if you drill down you may
find that the average is higher because there was a lot of high
performance Stang's mixed in with the base model. Or if you're looking
at SUV's that come with entertainment packages, the one base model that
comes across the block is going to sell at a higher price because of the
MMR average raised by the Tech package vehicles. So always drill down
and evaluate what is bringing the average up or down.
Train your salespeople to walk around trades with the customer, never
put down a trade instead always support the customer decision to trade.
You can look at the trade and if it has 65,000 miles you can say, great
timing values really start to drop in this millage range, trading while
the value is high is great timing. Let your customer know that trading
value will never be better than it is today. Keep in mind regardless of
miles this is always true.
Turn is very important, are you turning your inventory 6 times per year,
9 times, well the goal would be 18 times per year! How's this going to
happen? First be sure your service manager is on board with this goal
and realize turning your inventory has everything to do with getting
your cars reconditioned and out on the front line FAST!
Now make sure your inventory is looking good, have the porter armor-all
the tires once a week, make sure the stickers are on and don't look all
battered. The front line is the most expensive real estate in the
dealership, this is where you get to market to drive by traffic. We all
know that pre-owned cars are most sold on the Internet now, but let's
not discount the effect of a great drive by presentation. Your entire
front line should be $12,999 and below, as many below $12,999 as
possible. Label your windshields in the same place for each car so they
look uniform. If you have two cars of the same but 2 or 3 years apart,
price the oldest one and put the year on the newer one. At the driveway
entrances (hot spots) put those specialty cars or aged units to move
them, and finally no two of the same colors next to each other. Having
a perfect front line in price and windshield presentation is going to
achieve that high turn you are striving to achieve.
Finding inventory at the auction you can sell for $12,999 and below is
what everyone is looking for, so AS ALWAYS the best used car is one you
trade for at the dealership. What does this mean? Appraise a car for
what it's worth and sell it for what it's worth, this has nothing to do
with Kelly Blue Book. If you have to step up to have that car for your
front line, well then step up, your not going to get another chance to
fill the shelf.
Internet advertising, advertising code says what you advertise cars for
on line is the same as what you price them at in your dealership, why
not? Hoping for that one home run? Having that mentality is going to
hurt your sales and you won't reach your objective. Price the cars the
same, have a retail price and a Sales price that has enough profit and
THEN develop your salespeople to pitch your value pricing philosophy
(but make sure they are value priced and competitive in the market.
Always attend the sales meetings and reinforce that you will always make
car deals if there is a trade and very rarely will you miss one, however
it is a two way street. Let your salespeople know that if you're going
to step up, they have to step up and sell them. Point blank tell your
salespeople that you'll step up, but it's two way street and they have
to sell them.
These articles are not meant to teach, but instead to review what we do
daily.