Running a Motor Dealership is difficult at the best of times. With costs rising, stock shortages continuing and inflation hitting unprecedented heights, it safe to say it has never been harder to operate a Car Dealership.
Fortunately, there are strategies that your Dealership can use to keep your head above water and continue to generate vehicle sales.
Here’s How Dealerships Can Remain Successful During an Economic Downturn.
1. Minimise Costs
It may seem obvious, but this point cannot be overstated! The only way to remain successful during an economic downturn is to minimise your dealerships costs where possible. Your dealership needs to have and maintain the right amount of funds that allow you to trade now and into the future.
Get together with your accountant or bookkeeper and highlight your expenses. Once you understand your expenses, look for ways that you can minimise them and yes, there are ways of doing so.
Check out one of our recent pieces that highlights some of the expenses your dealership can reduce easily.
Related Article: Expenses Car Dealers Can Reduce Easily in 2022.
2. Research the Market
To remain successful during a weak economy It is so important that your dealership constantly researches current market conditions. The reason being is customers’ spending habits will change when the economy changes. For example, with inflation rising, customers may not be able to access the sorts of money they previously could to buy a car. As such, if your vehicles are priced the same as they were in a good economy, you will struggle to find buyers to sell your cars to.
Go online and research what is currently happening in the Automotive industry. See how much buyers are spending on vehicles and how much they may be able to access from different finance options.
Adaptation is the key to running a successful business. In a weakened economy it is no important that your dealership adapts your offering to reflect what is the current normal.
Think about it, in the heights of Covid lockdowns, dealers needed to adapt the way they sell. The only way that you could sell was remotely via online channels. Operating in a weakened economy is no different. As we mentioned in the point above, you need to understand the market and what the “new” normal is, when you do, you need to adapt your offering to better suit what customers need and can afford. The better your dealership adapts, the more successful you will be.
4. Implement New Processes
To be successful during a downturn, you don’t just need to adapt the way you sell, you also need to adapt the way you do things internally. The way that dealers operated 3 years ago is much different to the way they operate today. Your dealership needs to implement new processes that allow you to operate more efficiently and more cost-effective.
To achieve growth during a downturn, you need to focus all your efforts on leveraging growth. Your dealership cannot afford to get caught up performing simple, mundane tasks that can be avoided with the right solutions.
Implementing solutions like a DMS will give your dealership the ability to streamline and automate many daily management tasks like Advertising, Reporting and Stock Control. The biggest benefit of using a DMS is it will reduce your expenditure and give you more time to focus on creating growth.
Related Article: What Tasks Can You Automate Using a Dealer Management System.
5. Get Creative
The key to being successful in the Automotive industry is to stand out from the competition. This point might be the most significant! To capture customer attention during a downturn, you need to get creative and offer customers something that they cannot get elsewhere.
It is important to keep on top of what your competition is doing so that you can adapt your services and offering to give customers something better. The better your offer is for customers, the more customers you will acquire!
To achieve success during a market downturn you need to maintain focus and adapt to the current environment. The 5 strategies presented are a few good ways your dealership can maintain and grow sales during a weakened economy.
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.