Have you noticed your Dealership’s expenses are going through the roof? With inflation rising and costs escalating, it has never been more important for small businesses to limit operational expenses.
With that being said, it’s not just external factors that may be driving your costs up, it could be YOU…
Here are 5 Common Ways YOU could be costing your dealership thousands every year.
1. You are Not Reporting on Vehicle Advertising ROI
Vehicle Advertising is a necessary but expensive task for all Motor Dealerships. If you do not report on your vehicle advertising closely, you could be costing your dealership thousands every year without realising.
Think about it, you probably have your favorite advertisers that you send all your vehicles to, but without reporting, how would you know if they are providing a return on your investment? Having month after month of no return on your investment will start to add up and will eat into your dealership’s profits.
To avoid running into this issue, it is important that you frequently report on your vehicle advertising ROI. You need to measure leads generated by each individual advertiser that you send to and but more importantly the number of leads that convert. At the end of the day, if a lead doesn’t convert into a full paying customer, you lose your investment. Accurately reporting on your advertising ROI will save your dealership thousands every year.
2. Not Researching the Market
The Automotive Industry is an ever-changing industry. One of the biggest mistakes that so many dealerships make is not frequently researching what is happening in the Industry.
The problem with not staying on top of new developments in the Automotive Industry is things may change without you realising. For example, during Covid used car prices skyrocketed on the back of increased customer demand, if you were not on top of what was happening in the industry, you may not have updated your vehicle pricing to closer reflect the new industry standard.
It is important that your dealership keeps on top of what is happening in the industry and adapts to any changes. Failing to do so could cost you thousands.
3. Getting into Bidding Wars for Vehicles
We get it! Sourcing used cars to sell at your dealership is a difficult task, but that doesn’t mean that you should overspend to get them. Many dealerships make the mistake of getting into bidding wars to acquire cars, and with prices reducing, you may result in a loss if you pay too much for a car that you are intending to sell.
Before you attend a vehicle auction or look to buy a used car to sell, make sure you understand the industry standard pricing. Once you know what the vehicle is worth and what you can sell it for in the current market, set yourself a price point and stick to it. If the bidding goes beyond your price point, walk away, there will always be another deal. You would rather not have a car to sell than sell a car for a loss!
Related Article: How Australian Motor Dealers Can Get More Vehicle Stock in 2022.
4. You are Not Tracking Performance Metrics
They key to having a successful dealership is having good staff that produce results. Another common mistake that so many used car dealerships make is not tracking staff performance.
The problem with not tracking your staff performance is you won’t know if they are providing a return on your investment or not. Let’s face it, staff are expensive, as a dealership principal, you want to make sure your staff are selling to meet your business’ quoter.
Tracking performance metrics will keep you on top of who is selling and who is not. For those that are unable to achieve set business goals, you will have the ability to move them on and limit the impacts on your dealership.
5. You are Completing Daily Tasks Manually
There’s no other way of saying this, if you are still completing tasks manually, you are costing your dealership thousands every year!
Completing manual tasks will take you away from your primary goal of buying and selling cars. Even though it may not be numerical loss, you lose time and in the automotive industry, time is money.
To maximise performance, it is important that your dealership automates as many daily tasks as possible. There are solutions available like an industry specific dealer management system (DMS) that can automate many daily dealership tasks like stock management, vehicle advertising and reporting.
The benefit of automating your daily tasks through technology is you will get more time to focus on closing sales and growing the dealership.
Related Article: Tasks Motor Dealers MUST Automate in 2022.
Reducing costs is essential for running a business. it’s not just external factors that’s driving your costs up, you play a role in determining your costs. The 5 ways presented are common ways you could be costing your dealership thousands every year.
We hope you enjoyed reading this article. To read more articles like this, please visit the EasyCars latest news page here.
EasyCars by Jeal is an Australian, web-based, dealer management system that automates the buying and selling of motor vehicles. Using the latest technologies, EasyCars removes frustrations experienced at the dealership and opens your doors for greater growth.
EasyCars features include Simple Stock Management, Automated Advertising, Integrated Accounting, Government Compliance, Business Reporting, Facebook Automotive Inventory Ads, Reviews Management, Dealership Websites and more.
To learn more about EasyCars Dealer Management System or to arrange a no-obligation free demo, contact us today on 1300 473 744 or submit the form below.