By Steve Miner
In today’s highly competitive used car market it is still possible to achieve both a good gross and a good turn. Used car dealers who only focus on one or the other are leaving a lot of potential money on the table.
Retail Performance Management incorporates the practices of the Best of the Best in automotive to maximize BOTH gross and turn. The top retailers in automotive focus on 4 key areas to maximize gross and turn every month.
• Visibility: This means having the ability to quickly go from a 30,000 foot view to a very granular level in the blink of an eye. Whether benchmarking and manging performance at the group level or managing at a single store it is essential to have deep visibility into areas like Appraisal Closing and missed trade opportunities, Inventory Aging, Value Pricing, Stocking and Online Performance.
Finally, you need to have the sales data that allows the Group level Executive, Store GM or Dealer Principal to see gross profits, turns and opportunities across all stores with a focus on their Retail Sales Efficiency (sales within 60 days).
• Best Mix: The top retailers combine the power and visibility of their historical Dealership DNA with the top Market performers to determine the Best Mix of inventory for their unique store. Then they execute highly innovative practices to source that inventory.
• Value Pricing: Rather than “starting every car at 96% of market,” these retailers have adopted a value pricing mindset to maximize the gross potential of EVERY car. This means leveraging the tools at their disposal to determine the difference between the high margin and low margin cars on their lot, and pricing them accordingly.
• Online Merchandising: With 50 million vehicles ads online at any one time the need to stand out from the crowd has never been greater. This requires utilizing content that resonates and is highly relevant to the buyer. Sell the value of the vehicle in your ad.