Four Steps to Used-Car Success
The used-car marketplace continues to evolve at an unprecedented pace.
Strategies that worked years – or even months – ago may no longer be relevant, resulting in many dealers feeling that they are in a perpetual state of ‘catch up’ as it relates to the most effective approaches to used car inventory, pricing, marketing and merchandising.
Here are four key steps that used-car dealers can implement to expand sourcing, decrease time to market, improve inventory-aging controls, maximize online merchandising efforts, and gain market share with powerful inventory analytics and guidance.
Increase used car turn, sales and profitability.
Balance Your Inventory
Dealerslink members have the ability to efficiently balance their used car inventory through our industry-leading Dealership Analytics.
Examine Your Pricing Structure
An informed pricing strategy – one that is based on real-time data from your local market and not speculation – will increase turn and profit.
Review Merchandising and Marketing
The following of six straightforward guidelines for the merchandising and marketing of each vehicle in your inventory is critical to used car success.
An exclusive program that focuses on education and accountability with experienced industry leaders who truly understand the path to success.
Balance Your Inventory
A. Liquidate extra and aged inventory
B. Liquidate Slow Turning Units
C. Acquire New Fast Turning Units. Target 80% Cost To Market
The Dealerslink Stocking Report analyzes the sales history of both your dealership and your local market to generate an ideal inventory unit mix report. You’ll have the confidence of knowing which type of vehicles to add to your inventory to meet your sales goals, and which type you should unload.
Our Velocity Report identifies the vehicles with the highest potential in your local market. Knowing which vehicles are likely to be fast vs. slow movers will lead to more informed inventory decisions.
These analytics, coupled with buying your inventory on our marketplace, ensure that you’ll fill your inventory with retail-ready vehicles without paying fees and on the backend. You also won’t pay sell or transport fees, leaving you room for a far higher gross per unit.
Examine Your Pricing Structure
Price % of market or chosen book value.
The Dealerslink Retail Pricing Tool allows you to see the age and velocity of each vehicle, and instantly see the ‘sweet spot’ for any unit. In turn, you’re able to price in-demand vehicles higher and slower-moving units more aggressively. This insight will lead to appropriate pricing for all vehicles, utilizing the structure laid out in the infographic above, all while increasing traffic to your showroom and ultimately, maximizing gross profit.
Review Vehicle Merchandising and Marketing
The six key guidelines in a used car merchandising and marketing program.
- “If it’s not listed, it’s not for sale.” All vehicles should be priced and have photos posted within 72 hours.
- Photo Count and Quality: In an earlier blog post series, we discussed how photos often create the first impression of your dealership. Each unit should have a minimum of 24 photos and follow the guidelines laid out in this blog series.
- Branded Overlays: When marketing individual vehicles on 3rd party sites, it’s important to brand your dealership, as well. Our inventory merchandising tools turn the previous arduous process of adding custom text and a dealership-branded overlay for individual photos into a seamless process, enabling you to upload hundreds of branded photos at once.
- Accurate Descriptions: Posting inaccurate vehicle listings will lead to consumer frustration and risk negatively impacting your brand. Advanced OEM data helps generate a complete and accurate description for each vehicle added to your inventory.
- Analyze VDP/SRP Performance: Using analytics from dealership and 3rd party websites, dealers can monitor VDP activity on any given unit in their inventory. If a car has been in stock for 30 days with no clicks, it is time to make an adjustment on the units to get some more views. Our performance managers can help you analyze this data to help make the most informed decisions on merchandising your vehicles.
- 3rd Party Marketing Spend Review: Digital marketing should not be a “set it and forget it” exercise. Reviewing your spend – and ROI – with all third party sites should be a regular and ongoing process.
The DealerLink Inventory Snapshot tool leaves no room for error. You’ll always know which vehicles are missing pricing details, photos, descriptions or included options. Furthermore, you’ll always know exactly when and where your inventory is being marketed online.
Advanced Management Training
The fourth and final step to used car success available to Dealerslink members is signing up for our Advanced Management Training.
This exclusive program focuses on education and accountability with our experienced industry leaders who truly understand the path to success.
Advanced Management Training will hone in on needs within your business, allowing you to set measurable goals, identify barriers to success, and arrive at a vision for success that is specific to your dealership.