For the last couple of months, we’ve been testing my soon-to-be-released software, UpYourGross. I cannot tell you how exciting this product is. It’s simple; it improves turn, gross, and ROI; it reduces wholesales losses; it creates accountability, and it will be priced very inexpensively.
One of the things I’ve noticed with some of the testing dealers is that once in a while they will actually make a little bit of gross on a unit that’s over 60 days old. Maybe you’ve experienced that same thing.
Even though a little gross was made, the ROI went deep into the tank. But it’s important for naysayers like myself to remember that bills get paid by accumulating gross profit regardless of when it’s generated. It’s not a good business plan or a great bet to think it’s going to happen very often, but I get it.
Since I’m in the question-asking mood, what if that same unit had been priced the same way on day 30 rather than after 60?
Would you have sold it faster?
Would you have had a better ROI?
Better yet, could you have sold it and reinvested the money and doubled the gross on two units vs. one?
Used cars don’t age on day 61. They age on day one because someone isn’t paying attention. All of a sudden, day 61 rolls around and panic sets in.
One of the drills I like to do in my workshop is to ask managers to describe their oldest unit in stock.
After they tell me all about it, I ask them, “In your professional opinion, why do you think you haven’t sold that unit?” With very few exceptions, whatever they say was there on day one. The one undeniable fact about the automobile business is that price sells cars.
If you priced your most problematic cars more aggressively in the first 30 days, then you would increase your odds of making a lot more money.
Stop betting on lucky. Start betting on smart. That’s all I’m gonna say, Tommy Gibbs