Fire Yourself

From time to time I hear dealers complain that they got killed when they followed the recommendations from their software vendor about what they should buy. Maybe their interpretation of a recommendation was construed to mean you “must buy.” Or you “absolutely must buy.”

Their conclusion is bolstered by thinking that if they don’t buy these recommended units that the competition will gobble them up and they will be left out in the cold. They have surmised that this is “the answer,” and the only answer to improving their used car business.

Years ago I taught a workshop titled, “When Common Sense Meets Technology.” That’s a very appropriate title when it comes to managing your used car inventory.

For some, it’s a natural instinct that when they make a mistake on inventory they want to blame someone or something, so the easy target these days is the software provider.

See if this sounds familiar. Let’s say you’re a Ford dealer (Located right beside a Honda and Toyota dealer,) and you look at the data in your market and there is a high demand/low day’s supply for Honda Accords and Toyota Camrys. You take the recommendation (advice) and run out and buy 10 Accords and 10 Camrys. They sit and sit.

You have concluded the data was all wrong and that there was no way you could be competitive because those Honda and Toyota dealers have a certified program.

You dump the cars in the wholesale market and lose a bunch of money, swear off the software and go back to doing it the old fashioned way. And, you fire the software company and hire a new one.

As I often hear young people say “Really?” The software did
not go out and buy the cars. You are the one who loaded yourself up with too many units and paid too much.

Wouldn’t it have been smarter to test the water with onezies and twozies? How could you not see the writing on the wall?

Isn’t it logical that if you buy some high demand/short-supply units you’re going to have to pay a premium for them?

Wouldn’t it stand to reason if you’re going to go head to head with a certified program that you would have to have a price advantage?

Wouldn’t it also stand to reason that a certain percentage of the Honda and Toyota dealer’s core cars would have been traded?

And doesn’t it stand to reason they would have a little advantage cost-wise when trading for inventory? Logic would say they have an advantage you will not have.

In your mind, the data killed you. No, you killed yourself. But, you need to blame someone, so you blame the software company and fire them.

I’ll tell you what. If that had been me, I would have been thinking of firing myself. That’s all I’m gonna say, Tommy Gibbs