Leaving Money on the Table: 4 Ways Your Dealership's Revenue is Declining
With the economy continuing to grow and car sales doing well, many dealerships are riding high and focusing on moving cars. Unfortunately, many dealership managers focus too much on just selling cars, and they miss the key opportunities to maximize revenue per vehicle and gain real competitive advantage with superior merchandising, bundling, and positioning strategies. are deprived of are
Frankly, new car dealerships won't survive long just by selling cars. The market is becoming more competitive and online car sales companies, OEM subscription services and other disruptive factors will continue to erode margins. To stay competitive and see continued growth, dealerships must find ways to stand out from the pack and generate more revenue per car sold. In this post, you'll find 5 powerful techniques to do just that.
1) Offer F&I products online. In today's digital first world, virtually all retail sales are happening online and that includes automotive F&I products. Your dealership website should be equipped to sell popular F&I products online, including useful information about each product, the ability to contact a salesperson, and the ability to pay online. Keep in mind that mobile compatibility is also key to all the above features.
2) Follow up on unsold F&I product after the sale. Customers often dismiss F&I products as a knee-jerk reaction during the sales process. These same customers actually want some of these products once they own the car, feel the pride of ownership and are not in a high-pressure sales environment. Following up after the sale to offer additional products can be a powerful source of additional profit for each new vehicle sold and is a highly effective business process to develop for your dealership. If you're not following up, you're leaving money on the table!
3) Preloading low-cost items to stand out from the competition. Realistically, new car dealers are basically selling the same basic product, and thus a compelling "why buy from us?" It takes hard work to prepare. Story to tell customers. A great addition to this story is preloading affordable features like the dealer-owned prepaid maintenance and engine for life program. Offering these extras helps in sales initially and helps maintain service and makes more money in the long run.
4) Selling parts online. Many dealerships focus their online marketing efforts solely on selling cars. Your dealership's website should also have useful content and information about your parts and service department and should sell general parts online through an e-commerce feature. Modern website software makes incorporating e-commerce much easier than in the past, and selling parts online will give your dealership a long-term e-commerce mindset in addition to generating short-term income from online sales. Adoption will help.