The trading in of potential retail stock can have a significant impact on the profitability of your dealership. A retail trade in is a vehicle that you would want on your used vehicle floor.
If it’s a potential retail trade-in, then you need to ensure that your trade-in price is competitive and that you look at the whole deal in terms of potential profitability versus the used vehicle and new vehicle department trying to maximise their individual GPs on the deal. Your sales person needs to negotiate the deal securing the trade-in versus just selling the car. Your sales person needs negotiation skills and not just sales skills.
The person who prices the trade-in needs to be highly skilled and knowledgeable about the market. The used car market is dynamic and the more skilled your used car pricing person, the more likely you are to get good stock. How skilled is your “pricing person”?
Find out why you missed out on retail trade-ins on which you were working? Where did it go and why? Discuss trade-in values offered with your pricing person to understand why a vehicle has been priced at a certain value and make sure that you are happy with the reasoning. Use this information to try and ensure your “process” improves and that you are more successful in securing retail trade-ins going forward.
Measure your trade-in and lost trade-in stats? Look at them by sales person, by model. What are your expectations and how successful are you compared to your expectations? Include retail trade-in’s as part of your sales person’s commission scheme. This will certainly assist in ensuring that the sales team is part of your trade-in strategy.
Dealerfloor (dealerfloor.co.za) and I will be publishing regular articles on dealership efficiency. I am really looking forward to sharing ideas with you. Join the conversation by sending a WhatsApp to 082-776-1887 to be added to our group.
- Donald Christy
JLR reports growing demand for plug-in hybrid models, with global retail sales for the first half of the financial year up 29% compared to the prior year, as more customers use the technology as a stepping stone towards battery electric vehicles (BEV).
Zero Carbon Charge (CHARGE) called on the Minister of Finance, Enoch Godongwana, to announce measures in his Medium-Term Budget Policy Statement (MTBPS) to ensure that a transition to Electric Vehicles (EVs) will result in the reduction of carbon emissions in the country.
The ratio of used to new vehicles financed increased in the second quarter of this year, indicating a growing consumer preference for used vehicles, according to TransUnion South Africa.
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A light on my car’s dashboard came on, and instead of fixing the problem, I waited for the bulb to burn out. Crisis solved.
Jarod Kintz
“Transformation in the motor industry is deeply complex, requiring innovative approaches to meet evolving standards and customer expectations,” says Craig Absalom, co-founder of The Cadet.
Heinie Boshoff’s (main photo) automotive career turned a full circle when he became the co-owner and a director of the Benba Motor Group in the Western Cape a couple of years ago. And he has never looked back after taking an opportunity presented to him after school and making the most of it.
Here are a few basic ideas that should have a positive impact on gross profit (GP). Most of you are familiar with them but knowing them does not mean they are effectively applied. These are areas that I believe should form part of your daily, weekly or monthly reviews.
