Most folks in the auto industry believe that "tax season" is over for them. Yes, there are a few more shoppers in the market now than at the end of 2023, but the peak is now past us. Hopefully, you got a boost in sales during this period. If you didn't, it is time to evaluate why. If you DID get that boost, what do we do now to get our share of the shoppers still in the market?
It comes back to process. It's easy to say but sometimes hard to execute. Some don't even know what processes to examine. Let's discuss the three areas that are critical to used car departments in ANY economic climate to get results.
The first area is speed to market. If I were to ask 50 dealers what "LotReady" means to them, I would guess 49 of the 50 would tell me the same answer. It would be, "Out front on the lot and ready to go." That would be the answer because it's all we have ever been told/taught. While that speed is important, it differs from the LotReady statistic I am referring to here. The LotReady time that is even more important in 2024 is the speed of our virtual market. How fast can we get the unit priced, a FULL description, and a complete photo set done? All indications tell us that a vehicle can get SRPs/VDPs and leads if these three things are completed. The faster we get this done, the better chance of getting a lead sooner in the life of that unit. This increases our chances of making a sale and boosts our overall efficiency and productivity.
Next is our lead management. This paragraph could take up 1,000 words on its own, but I will do my best to keep it short. If your lead management is up to par, you will save all the work you have done in the area I spoke about in the first paragraph. In my experience with Lotpop and talking to dealers, many need to learn the actual performance of their lead management. Most track a closing percentage and leave it there. In today's world, this is extremely troubling and short-sighted.
Lastly is inventory management. It may seem odd to have this last, but it is here for a reason. Only some stores have a used car manager overseeing acquisition from the auction and/or off-street buying. They often have inventory dropped into the inventory management tool and are responsible for finding a way to sell it. Let's not get this twisted, though. This area is extremely important, but I placed it here simply because the processes above need to be in place before we can truly evaluate the performance of the vehicles we carry. Inventory management is also a profound topic and has plenty of variables to consider. That said, we can lessen the number of variables if processes 1 and 2 are solid.
All indications for 2024 point to a challenging used car year, so to get the market share you are looking for, these processes have never been more important to our dealership and, more importantly, to our employees trying to make a living.
-Jeremy Zarfos
Performance Engineer