Dealers need to react quickly to a changing market

With more emphasis being placed on how car dealers present their cars, more of them are taking the option of dedicating a specific resource to ensure that stock is on display to the highest standards and as quickly as possible.

The optimum profitability for used cars is in their first 30 days and after that measures are usually undertaken to look at reducing the price to make the car more competitive and give the dealer a better chance of selling. If, however the car has been in stock for 30 days but only actually displayed and marketed for half that time then dealers are simply not giving themselves the best opportunity to sell the cars profitably.

Of course car buyers who are canny – and who can track specific cars on the net to see if they can gamble that a car won’t sell before it is reduced – can take advantage of this policy. However when the market has a sudden reaction as it is having now, the picture can be very confusing.

For example if a sales manager is very experienced and skilful in managing their stock and keeps up close and personal with all the market fluctuations, they will always price their cars accordingly. On the other hand those that are slow to react will not take the necessary pricing actions until often it is too late. As a result they are forced to distress sell their ageing cars because they have not been competitively priced to how the market currently views them.

This is why many car buyers will look at particular models of similar age spec and mileage and often see a massive spread of price which is confusing and makes a customer sceptical about whether he is buying a popular model or not.

In the current climate cars with a unique selling point are more sought after than ever and are still being premium priced because of that uniqueness whereas basic spec cars which can easily be replaced are only being sold if they are priced competitively as there are many about and dealers can easily replace this kind of ex-rental stock quickly.
The dealers who continue to do well in a market which has had a sudden downturn have done so by sticking to the basics of treating every customer as if they were the last and ensuring that all the disciplines for maximising success in selling cars are being adhered to.

Although getting a good deal is always a priority for car buyers they stand a far better chance of getting a great overall experience if they deal with people who are professional and are making money at what they do,

Subscribe to Motor Trade Insider by Email