Every week several people contact me about volume and gross. No one will disagree that we need to be focused on inventory turn, and no one will disagree that we still have to generate X dollars in total gross to pay the bills.
There is often a disconnect between the desired goals and the skill level of those who have been put in charge of obtaining the volume and the gross.
I could go on and on about this skill level, but let me give you just one key point that goes into play when trying to determine what’s what. Are you ready? Are you really ready?
It’s “knowing what you deserve” for any given car or truck on your lot. It’s part understanding the data and part common sense. It’s really that simple.
Knowing what you deserve means having a true understanding of the market and the unit you’re staring at. It’s having the “cojones” to ask what you deserve for a given unit. And, it’s also knowing what not to ask and when to fish or cut bait.
Here are 5 more thoughts to help you:
1. Redundant Training- It ain’t redundant until you’re perfect. You ain’t perfect. If your sales staff isn’t polished enough to be able to justify the price then you are not going to get the desired gross. It’s just that simple. Get busy training and you’ll get more gross. (If you have a bunch of knuckleheads working with you then all the training in the world isn’t going to make a difference.) At the very least, you should have a lot walk once a week with all managers and all sales people. The more your people know about your inventory, the more your gross goes up.
2. Ask For More On The Right Units– There are some that you need to start way high. Some very low. Once in a while you gotta “ask for it all.” Since the beginning of this business, high average gross profit has been achieved by hitting a home run once in a while. You can’t hit it if you don’t take a full swing. If it’s a low mileage, really nice car you deserve more money for it. You don’t deserve more money for an edgy one and you have to be smart enough to know which is which. And without a doubt you have every right to ask more money for a certified car. But that doesn’t mean you sit on the “more money” pricing forever. Change the pricing daily.
3. Not selling in Today’s Market-Your most profitable car is a 20-day car. If you are retailing a lot of cars at the 30, 45, 60 plus day mark, you don’t have a chance. Speed wins; the lack of speed kills. Why don’t you try charting those units that you sell at 45 days and beyond to see what they are doing to your average gross profit? In the movie “A Few Good Men,” Jack Nicholson might have been talking about you. You can’t handle the truth.
4. Lack of quantity and quality of photos -stop reading this. Go look at the used cars on your website. Now go look at texasdirectauto.com. If yours don’t look as good as theirs then you don’t have a chance. Don’t have a photo booth? Want your cars to look really cool. Check this out.
5. No Early Warning Radar-You’re asleep at the wheel. You have to be able to spot a problem child on day one, not day 44 or day 59. Every one of your aged units has a story to go with it. That story started back on day one. You have to be smart enough to have an “Early Warning Radar” system in your arsenal. Fix your Radar system and your grosses will improve. I invented “Early Warning Radar.” You should steal it and use it.
You get what you deserve, when you do the work to deserve what you get. That’s all I’m gonna say, Tommy Gibbs