With a new car SAAR predicted of approximately 11.4 this year, many dealers are looking at an increase in new vehicles of around 10%. There are and will always be exceptions, but things are showing that they are trending up for the year. That leaves used cars. The one inventory you can control and don’t depend on the factory to regulate you with incentives, lease programs and dealer cash. There is no limit to how many used cars you can sell, the only limit is your people, their ability and your inventory.
Every dealership is different and there’s is no exception when it comes to used car inventory. You need to know what is being sold in the greatest number in a 10- to 12-mile radius around your dealership and pick out the opportunity cars and segments that you can do the best with. A BMW dealer probably doesn’t need to go bananas buying Ford F-150 trucks to stock on his used car lot (even though that is typically one of the top 5 used vehicles in every market), but he can look for sedans, compact cars, SUVs – vehicles that have a history of being a good retailable piece at his store. Likewise, a Ford dealer probably doesn’t need to order pre-owned BMW’s by the truckload, as there are other models that he can turn the fastest.
There are only a certain number of parking spaces on your used car lot. Some dealers have more than others, but everyone has a certain limit of what they can keep in house. The vehicles you park in those spaces need to be researched and need to be confirmed as the most possible best retailable pieces you can stock, otherwise you just put a player on your roster that is not going to contribute.
John Paul Strong
John Paul Strong combines his two decades of automotive marketing experience with a team of more than 140 professionals as owner and CEO of Strong Automotive.