Leaving Cash on the Table: Five Ways Your Dealership Is Losing Out on Sales
Car sales are strong and the economy is still booming, so many dealerships are doing well and concentrating on selling automobiles. Unfortunately, a lot of dealership managers are too preoccupied with just selling vehicles, which is preventing them from taking advantage of crucial chances to increase income per vehicle and create a true competitive advantage through advanced positioning, bundling, and selling techniques.
To be honest, new vehicle dealerships won’t last very long if they exclusively sell automobiles. The market is getting excessively competitive, and margins will continue to decline due to external pressure from OEM subscription services, online auto retailers, and other disruptive elements. Dealerships need to differentiate themselves from the competition and increase their revenue per vehicle sold if they want to expand and remain competitive. This post contains five effective methods for achieving that exact goal.
#1) Provide online F&I products. Automotive F&I products are among the many retail sales that have moved online in today’s digitally-first society. The popular F&I products should be sold online by your dealership, and the website should have all the necessary features, such as helpful product information, a salesperson contact form, and an online payment option. Remember that having all of the aforementioned features work on mobile devices is equally essential.
#2) Conduct a follow-up on unsold F&I products after the sale. As a reflexive move, customers frequently deny F&I products throughout the sales process. When these same clients take ownership of the car, feel a sense of pride in their possessions, and are not subjected to a high-pressure sales environment, they might genuinely want some of these things. It’s a very effective business procedure to build for your dealership to follow up with customers to offer other products after the sale. This can be a significant source of additional profit for each new car sold. You’re throwing money away if you don’t follow up!
Step #3: To differentiate yourself from the competition, preload inexpensive items. Since new car dealers essentially provide the same basic product, they need to put a lot of effort into creating an engaging “Why buy from us?” narrative for their clients. Preloading low-cost features like dealer-owned prepaid maintenance and engine-for-life packages is a fantastic way to add to this tale. In addition to increasing customer retention and generating more revenue over time, providing these extra things aids in the first sale.
#4) Online Parts Sales Too many dealerships concentrate all of their internet marketing efforts on auto sales. In addition to providing helpful content and details about your parts and services division, your dealership’s website ought to include an online store where customers may purchase popular parts. In addition to bringing in money in the short term from online sales, starting with online part sales will assist your dealership in adopting a long-term e-commerce philosophy. Modern website software makes incorporating e-commerce much easier than it has been in the past.
The fifth strategy is to train service advisors to increase upselling and decrease orders for single-line repairs. Service advisers should be trained to be salespeople, and management should view the service department as a profit center! Nowadays, a lot of dealerships let clients go with only a single repair order, sometimes even without providing them with any additional services. Developing a positive customer relationship team dynamic and requiring your staff to conduct an active walkaround and multi-point inspection on each car that comes in should be part of your mandated management strategy to increase revenue from your parts and service division.
With these five tactics in place, your dealership ought to be in a better position to increase revenue, foster expansion, and gain a competitive edge with each and every client who enters. Even if you’re moving cars, your dealership will eventually struggle to stay open if you miss out on these profit-making chances because you just aren’t making enough money for each vehicle.
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