5 Costly Mistakes Australian Car Dealers Make in 2022

16 Feb 2022 Helpful Tips


Running a Car Dealership is no easy task. Let’s face it, we all make mistakes. But in the Australian Automotive Industry, making even the smallest mistake can have a massive impact on sales and reputation.

We get it, there are always going to be mistakes made along the way, but what will determine your dealerships success is the way you plan and minimise the effects that those mistakes have on your dealership.

Here are 5 Costly Mistakes Australian Car Dealers Make in 2022 and How your Dealership can avoid them.

1. Overpaying for Car Stock

We understand that used car prices are soaring right now, but that doesn’t mean that you should overpay or get into a bidding war. The problem with overpaying for stock is it limits your profit margins when you go to sell it later.

To minimise your risk of overpaying for stock it is recommended that you use car valuation tools to assist with the process. Understand how much that particular car model is selling for, the resale value and how much profit you can make. If it doesn’t make sense from a financial position, then just walk away. You would rather not have stock then buy stock that will result in a loss for your dealership.

Top analysts are predicting used car prices will start to subdue in mid 2022, however this is all dependent upon economic conditions and new car supplies.

Related Article: 5 Challenges Facing Australian Motor Dealers in 2022.

2. Not Reporting on Vehicle Advertising

Advertising is an essential and expensive task for all motor dealers. The biggest mistake many Australian motor dealers make is not reporting on their vehicle advertising spend.

It’s no secret that Vehicle Advertising prices are rising, with that being said you need to make sure you are getting an the best return on your investment from advertisers or there is no point sending your vehicles to them.

To avoid overspending on advertising, dealers must frequently report on their advertising spend. Look at how many leads are being generated and at what cost. Most importantly look at how many leads went on to convert into a sale. If a lead doesn’t convert into a sale, it’s basically worthless.

The benefit of frequently reporting on your advertising spend is you can stop sending vehicles to advertisers who don’t provide a return.

Related Article: How Motor Dealerships Can Improve Reporting.

3. Hiring the Wrong Staff

Every business at some point makes the mistake of hiring the wrong staff member. It’s okay for your dealership to make a poor hiring decision, but what makes it so costly is when businesses don’t get rid of them fast enough. In a B2C sales environment having the wrong sales staff can cost you thousands in lost sales per week.

Before hiring a sales staff, make sure they get the appropriate training and understand what you are selling. Set some goals and KPIs for staff to meet and have them go through a probation period. If the results aren’t what you are looking for, make the change quickly and move on. The last thing you want is to have someone bringing down the rest of the team.

Related Article: 5 Qualities of Highly Successful Motor Dealers.

4. Not having a Dealer Website

92% of Australian Car Buyers use the internet to look for a car instead of attending a dealership. To put this into context this is a 50% growth on 2019s numbers. To put it simply if your Dealership doesn’t have a Dealership Website, you are losing thousands of potential sales.

A dealership website gives potential customers the ability to learn about your dealership and see what cars you are selling without having to attend the dealership in person. The data shows that customers prefer to find their next car online instead of walking around dealership after dealership. To be successful in 2022 your dealership needs to have a website.

To find out more about EasyCars Dealer Websites click here.

5. Managing the dealership manually

It’s almost impossible to manage a dealership manually and be successful. As a motor dealer you have a thousand different things to do every day. Doing tasks manually not only wastes valuable time but it increases the risk of costly errors.

A Dealer Management System like EasyCars automates many tasks of running a motor dealership – giving you more time to focus on increasing sales.

EasyCars automates essential daily tasks such as stock management, advertising, government compliance, accounting, and reporting in one central easy to use application.

Final Word,

Every business makes mistakes. What makes a business successful is the way they learn and grow from their mistakes. The 5 mistakes mentioned above are frequently experienced by many Australian motor dealers and can be easily avoided by the solutions mentioned.

To read more blog posts like this click here.

About EasyCars

EasyCars by Jeal is an Australian Motor Industry Specific, web-based Dealer Management System that automates all the everyday tasks of running a motor dealership.

EasyCars includes all the features needed to manage your dealership seamlessly. Get stock management, automated advertising, government compliance, Facebook Automotive Inventory Ads, Reviews Management, Integrated Accounting and Business Reporting all in the one central application.

With over 38 years of experience creating solutions for Australian motor dealers we understand your vision and our software is completely customisable to your dealership’s unique preferences.

For a no-obligation free demo of EasyCars, call us today on 1300 473 744 or submit the form below.

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