Adam Tobias

Company: DealerCue

Adam Tobias Blog
Total Posts: 5    

Adam Tobias

DealerCue

Aug 8, 2019

7 Tips for Increasing Used Car Margins

With new car sales down for the first half of 2019, the used car market is definitely driving current growth in automotive. An abundant supply of newer models, an exploding customer base and less volatility -- these factors should make selling used vehicles an easy path to profit. 

But is it really? 

For independent dealers, that may not necessarily be the case. Smaller players don’t have the infrastructure and resources of franchised new car dealerships or national companies like Carvana and CarMax. 

Running a small business also presents a different set of challenges. Profits on used cars -- in real dollars, not percentages -- are generally smaller than those on new vehicles. Extra expenses can have a sobering impact on the bottom line.

The solution is to improve profit margins. Improved profit margins mean more money in your pocket. More money means more funds to grow your business, more time to do things you love and less worry about making ends meet.

To achieve better profit margins for used cars, you need to deploy a two-pronged effort: Increasing sales and reducing costs. Here are seven tips to improve profit margins and grow your dealer business:

Tip #1: Update your Sales Strategy

When the Road to the Sale (RTTS) 10-step process was conceived, the internet was in its infancy and dealerships were the gatekeepers of vehicle information. 

Fast forward to 2019, and car buyers have evolved dramatically. The most significant changes are in their shopping behavior:

  • Smart buyers. Consumers are smarter due to the easy availability of information online. Dealers need to serve as consultants, not salespeople. 

  • Transparency. Buyers expect transparency, especially when it comes to pricing. Provide vital information sooner rather than waiting for the end of the conversation.

  • Competitive pricing. Real-time pricing is critical in an age where mobile phones enable instant comparison shopping. Ensure that your prices are comparable to what’s available in your neighborhood.

  • Better buying experience. Buyers want to reduce the amount of time spent at a dealership. Minimize the time a buyer has to spend at your dealership by providing more information online and streamlining applications.

It’s not enough to keep up with these changes, but to factor them into your sales strategy. Learn more about how to leverage modern buyer behaviors to grow sales.

Tip #2: Choose the Right Vehicles for Your Market

In an ideal world, every vehicle sells quickly at an optimal profit margin. In the real world, that’s not often the case.

Smart dealers use data to determine which vehicles to stock. You need more than just a “gut feeling” in today’s market. Use your real-time market data tool to answers the following questions:

  • 1. What are the top-selling vehicles in your metropolitan area? 

  • 2. Which models have sold the best for your dealership?

  • 3. Which vehicles are in low supply compared to demand?

Find out how the right data can help you make informed decisions on which vehicles to pick, increasing the likelihood of faster, more profitable sales.

Tip #3: Improve Your Website

Today’s car buyer kicks off shopping research online, making a user-friendly website imperative. Your website is your online storefront and it has one mission: Getting customers to your dealership.

The best independent dealership websites have three key elements, each one addressing a specific buyer’s issue:

  • What is your solution to a customer’s problem? You need a clearly stated value proposition. 

  • Why should customers trust you to solve their problem? Supply them with testimonials and social proof. 

  • What should a customer do to get the problem solved? Provide a clear call to action. 

Read on about how to build or improve your dealership website.

Tip #4: Improve Reconditioning Practices

Auto reconditioning is essential to transform weary-looking trade-ins into vehicles that customers want to drive. In addition to giving a used vehicle a new lease on life, reconditioned vehicles move off the lot faster (there’s nothing like that new-car aroma!) and allow you to issue warranties and certifications– items that only increase customer trust. 

Some reconditioning best practices include:

  • 1. Non-OEM Parts. Reduce inefficiencies by using quality, non-OEM parts. Make sure, however, that these don’t disqualify vehicles from any certification programs.
  • 2. Fast Turnaround. Complete reconditioning within 3-4 days of acquiring a vehicle to reduce turn rates and increase gross profit.
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  • 3. Ready to Sell. Acquire vehicles that require less work. Their faster turn rates can offset the cars that need the extra work.

4. Reconditioning Team. Have separate teams for reconditioning and customer orders to eliminate conflict.

5. Recondition for wholesale. Dealers are more likely to buy a vehicle in terrific shape, just like retail customers. 

Although it is a sound investment, reconditioning costs need to be closely monitored because they can quickly add up. Understand how to assess what reconditioning practices make sense or not in order to protect your profit margins.

Tip #5: Avoid Third Party Lead Providers

Have you ever felt like third party sites are stealing your money and your customers? That’s because third Party sites aren’t lead generators. They’re lead pirates. 

Dealers around the country have a ton of complaints about third party services, including:

  • 1. Low quality of leads

  • 2. High cost of business, with rates increase by as much as 20% annually

  • 3. Your listings are buried under sponsored posts

  • 4. Competitors are advertised on your listing 

I know what you’re thinking: “But I don’t know where else to get leads.” Luckily, there are now online marketing services that more accurately target in-market customers and send them directly to your website, not to a third party. Plus, you also only pay for the buyers that visit your site.  

Learn more about DealerCue’s instant advertising tool, AdCue.

Tip #6: Optimize Marketing Spend

An independent dealer’s marketing spend is limited—especially compared to an OEM—so it’s critical to ensure that your dollars are going to services that actually drive sales. 

In advertising speak, ‘optimizing’ means constant removal of tactics that don’t work in favor of those that do. Some ways to optimize your ads:

  • Target the right audience. Cast too wide a net and you’re wasting money on people who are unlikely to buy. Determine your right audience and platform to focus your efforts and increase your conversions.

  • Customize your message. You lose buyers when you blast a generic message that is irrelevant to them. Find out how personalized ads improve your chances of attracting the right customer at the right time. 

  • Ensure your programmatic ad tool is pulling the right data. Programmatic is never a set-and-forget routine. Your programmatic tool should pull not just inventory but also real-time and third party data to determine ad placement and frequency. 

Tip #7: Improve Inventory Turn Rate

All dealers know that aging inventory gets costlier by the day. It hogs space that could be used for fresher, more profitable vehicles, not to mention the costly upkeep of cars on the lot. 

If inventory gets too old, you’re stuck making a hard decision: drop the price and hold out for a retail customer, or cut your losses at the wholesale auction. While inevitable, dealers want to avoid these scenarios at all costs.

Keep your inventory turning at a healthy rate:

  • 1. Ensure your inventory is true to your niche. Dealerships today are not the shopping mall of choices they used to be. Determine your niche, stock up on the vehicles that embody that niche, and target the specific in-market audience that is looking for them.

  • 2. Update prices regularly. Our study of 40,000 dealership sites found out that turn rates can increase by 33% if prices are updated regularly. Vehicle marketplace algorithms favor updated listings over old ones. 

  • 3. Make your prices easy to find on your site. Buyers who land on your site will bounce off if they can’t find prices easily or if they’re asked for an email address to get this information.

Find out how to improve inventory turn rates with these actionable tactics.

Improving Used Car Profit Margins: Always a Work In Progress

Improving profit margins is a marathon, not a sprint. Apply these tips to improve your key performance indicators over time and consistently hit your monthly, quarterly, and yearly goals. 

For example, in working towards Tip #3—improving your website—create a goal to grow web traffic and increase the number of contact forms filled.

To achieve Tip #7—improve inventory turn rate—make it your goal to lower your inventory turn rate to 30 days.

With resolve and savvy, any independent dealer can improve their margins and compete with the big guys. Let us know in the comments if you have any other tips to share. 

Adam Tobias

DealerCue

COO

Helping Dealers maximize performance by leveraging data.

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Adam Tobias

DealerCue

Jul 7, 2018

AutoCheck vs. Carfax: Which Vehicle History Tool is Right for Your Dealership

For good or bad, most car buyers today refuse to take a car dealer at their word, especially when it comes to buying a used car. Vehicle history reports are virtually non-negotiable in today’s world of ultra-transparent deals. Which leaves dealers with a sticky question: Should they choose Carfax or Autocheck?

Carfax and Autocheck are two of the most popular vehicle history reports on the market. They have won over as many raving fans as naysayers. Is one really better than the other?

We’ll let you decide. Let’s look at the pros and cons of Carfax vs. Autocheck so you can choose which one is right for your dealership.

Carfax

Founded in 1984, Carfax is the original used vehicle history report. As the first tool on the market, they have a number of key advantages, such as…

Pro: Name Recognition

Carfax is by far the most well-known vehicle history tool by consumers. Most of us remember the Super Bowl commercial with the fox teaching us to say, “Show me the Carfax”.

In fact, when we look at Google Trends, we can see just how dominant Carfax is over Autocheck. This chart shows the relative number of Google searches for each term over the last year.


 

Clearly, this gives dealers an advantage when making a sale. They don’t need to explain Carfax. In fact, customers might ask for it outright. Which means the second advantage to Carfax is…

Pro: Higher Consumer Trust

Customers simply trust a Carfax report over basically anything else. Is Carfax actually more trustworthy? Not necessarily. In fact, many dealers think Autocheck is more accurate, but essentially they provide the same information.

Still, anything that makes a customer more comfortable with their purchase is a big plus.

Pro: Open Recall and Guaranteed Buyback

Carfax has a few features that Autocheck doesn’t, namely open recalls and a guaranteed buyback program. Open recall is a service for dealers to announce vehicle recalls. Tools like VinCue also offer this service, so not every dealer needs this functionality built into their vehicle history tool.

The Guaranteed Buyback program is Carfax’s return policy. If they made a mistake on a vehicle history report, they will buy your vehicle back from you. This adds another level of trust for consumers, but as you can imagine, proving a mistake is extremely difficult. Buybacks rarely happen, but it’s nice to know there’s the option.

Con: Expensive

Carfax is able to charge a premium thanks to their name recognition and consumer trust levels. Many dealers are willing to pay the price, which can be several times more expensive than Autocheck.

Carfax is fairly tight-lipped about their wholesale prices, but on the consumer side, they charge $39.99 for 1 report and $99.99 for 6 reports. Autocheck gives you 300 reports for $99.99.

This is certainly a disadvantage, but it doesn’t mean the price isn’t worth it for some dealers. Having Carfax on your lot can certainly make sales easier, but it’s probably not a definitive factor.

AutoCheck

AutoCheck might be less well known, but it doesn’t mean it’s not a great product. AutoCheck comes with a number of advantages, including…

Pro: Owned by Experian

AutoCheck is owned by Experian, the international credit report company. This is not a dinky, third-rate service. AutoCheck is backed by a world-class company with experience in this type of reporting.

Some of AutoCheck’s features are clearly inspired by their parent company. One of their unique features is…

Pro: AutoCheck Score

The patented AutoCheck Score is a number between 70 and 90 that gives you a quick idea of a vehicle’s history. An AutoCheck Score is affected by accidents, mileage, damage, and whether the vehicle was ever stolen, repossessed, or used as a police car or taxi.

The AutoCheck Score is like a credit score for cars. The higher the score, the better shape the vehicle is in. It also tells you how similar vehicles scored in comparison.

Along with providing top-of-the-line history reports, the AutoCheck Score is a pretty cool feature. The best part of AutoCheck is that you get all of this for an incredible price.

Pro: Low Cost

Like we mentioned above, AutoCheck can be several times cheaper than Carfax. Even at retail price, you can get 300 AutoCheck reports for the same price as 6 Carfax reports.

If you’re willing to forego the name recognition, choosing AutoCheck is a no-brainer from a price standpoint. But of course, name recognition cannot be fully discounted, which is leads us to our con for Autocheck.

Con: Lack of Name Recognition

Choosing AutoCheck over Carfax will not tank your sales. In fact, if you train your sales people correctly, it might have no effect at all. But AutoCheck is certainly a harder path to take. Your salespeople will have to educate customers on the value of AutoCheck.

The lack of name recognition also leads to lower brand trust. Again though, good sales people should be able to overcome this by educating customers.

In short, the lack of name recognition can be mitigated, but could become a burden without the proper sales training.

The Verdict: Carfax vs. AutoCheck

The jury is still out on the better vehicle history tool, and honestly, a decision might never be made. Which tool you use depends on the way you run your dealership.

First, let’s state the most important fact: When it comes to vehicle history reports, Carfax and AutoCheck are equals. They both do a really good job, which just a few features on either side to differentiate them. On quality, we’ll call this debate a wash.

Carfax wins handily in the court of public opinion. It has a massive lead in consumer recognition and brand trust. Carfax has done a much better job marketing, plus they have been around longer than AutoCheck. The advantage here is that salespeople don’t need to educate consumers on Carfax. They know what it is and trust it. It’s one less thing dealerships have to worry about.

However, all that name recognition comes at a price– a big one. Carfax is several times more expensive than Autocheck, and it’s debatable what value you’re really getting. Good salespeople can overcome objections about AutoCheck fairly easily. Plus, as an Experian company, they definitely carry some clout.

If you have the money to spend and want to give your salespeople the easiest path to a sale, then Carfax might be the tool for you. However, if you want to save big money and trust your salespeople to do a good job, then Autocheck is a no-brainer.

Both Carfax and AutoCheck sync up with your VinCue account, giving you vehicle history information right inside your appraisal tool. With that in mind, you really can’t go wrong choosing either report.

Adam Tobias

DealerCue

COO

Helping Dealers maximize performance by leveraging data.

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Adam Tobias

DealerCue

Jun 6, 2018

VinCue vs. Laser Appraiser: Comparing Dealer Tools

We all try to deliver the ultimate car buying experience to our customers. In a word-of-mouth industry like auto sales, these “magic” moments are as important as ever.

The problem is, customers are less impressed by our “tricks” than they used to be. Back in the day, a dealer could do a customer a favor by dropping the price or throwing in extra financing. Today, though, the best deal is simply expected. Customers have perfect insight into local market prices. They know if your offer is really a “deal” or not.

This new reality means dealers have to be more precise when it comes to controlling costs. We have less wiggle room on margins. Dealers have to be on-point with every vehicle they buy and sell, which means we need better data to make decisions.

There are many tools on the market that help dealers make better decisions. Two of the most popular tools are Laser Appraiser and VinCue. Let’s look at each tool to see what they offer to dealers.

What is Laser Appraiser?

Laser Appraiser is a pricing and appraisal app became popular for their mobile VIN scanner. The VIN scanner made it really simple to get price guide valuations for any vehicle. Laser Appraiser has since built out their service offerings.

How it works:

  1. The app lets you scan the VIN barcode usually located on the driver’s door.
  2. When the VIN is detected, the app will display detailed information about the make, model and trim-level of the vehicle, as well as a options to adjust, like mileage.
  3. When the variables are dialed in, the app will display price information from industry sources like KBBCars.comBlack Book, and more.

The Laser Appraiser mobile app is designed to give you key information on the go. You can make quicker, more accurate appraisals and win better deals for your dealership.

The desktop version, Dealer Studio, adds more features for dealers, including real-time market reports.

laser appraiser screenshot

What is VinCue?

VinCue is a pricing and appraisal tool for new and used cars markets. VinCue helps you develop an inventory and pricing strategy based on hyper-local market data and trim-level insights. See what competitors are stocking, how they’re pricing, and how fast customers are buying.

Like Laser Appraiser, VinCue comes with a VIN scanner. However, VinCue’s mobile app does much more. You have access to all of VinCue’s market and appraisal data wherever you go. The VinCue mobile app is great to have at auctions or out on the lot.

vincue mobile app

The DealerCue Suite

DealerCue offers a few multiple tools that integrate seamlessly with VinCue. All of these tools actually live inside VinCue, so it’s hard to tell where one tool ends and the other begins.

  • RevCue – Inventory management and websites
  • BidCue – Intelligent auction sourcing
  • AdCue – Online Ad management

These tools expand VinCue’s capabilities to cover the most important aspects of dealership management.

Laser Appraiser vs. VinCue

In general, Laser Appraiser is a “lite” version pricing and appraisal tool. While cheaper than VinCue, dealers get limited insight and functionality with Laser Appraiser, plus quite a bit of stock data you can find elsewhere.

Let’s look at key features of each tool more closely and see how they compare.

Also see VinCue comparisons with vAuto and Autoniq

VinCue vs. Laser Appraiser

Real-Time Market Data

Laser Appraiser only shows you market reports on its desktop client, Dealer Studio.

Dealer Studio works in alongside with the mobile app and offers extended features:

  • In-depth valuation tools
  • Market reports
  • Auction sources and run lists
  • Integration for inventory management solutions.

When you scan a vehicle with the app, Dealer Studio can plot its price on a chart with the prices of other similar vehicles. It’s very useful when adjusting the prices taken from your favourite industry guide.

The market shortage report will show you how the sales performance of different vehicles. You can identify quick sellers and fill your inventory with vehicles in high demand.

A big drawback to Laser Appraiser is you can’t use these extended features on your mobile phone or tablet, making them useless if you’re in the field.

Real-time market data is where VinCue really delivers

VinCue offers a ton of information about local, regional, and national car markets. You can find virtually any data and examine it from any angle:

  • Market day’s supply
  • Average days on market
  • Brand days on market
  • Market share and national sales
  • Shortage reports
  • Number of competing vehicles in your local area
  • Individual prices listed by your competitors
  • Average time on the lot

The best part is that VinCue market data is available on all devices. Regardless if you’re on mobile or desktop, you get access to all of the tools and information that’s available. A knowledgeable manager can use this data to sculpt a winning strategy for their dealership:  what cars to stock, how to appraise, what prices to list.

Appraisals

With VinCue, appraisals are computed using real-time market data.

The tool will intelligently compare all similar vehicles and calculate a true market value. You can input mileage, reconditioning costs and desired profit margin and VinCue will give you a wholesale appraised value.

With Laser Appraiser, the mobile VIN scanner will give you appraisal data from the price books like KBB and NADA. The in-depth valuation tools are only available only on the desktop version, Dealer Studio. Dealer Studio collects market data and compiles a few useful reports. However, you still don’t get the same level of detail provided by VinCue.

Vehicle Sourcing

Laser Appraiser displays auction information from Manheim, Adesa, and Auction Edge. The vehicle shortage report will help you stock up the right vehicles, but you cannot actually place bids inside Laser Appraiser.

DealerCue auction tool, BidCue, offers vehicle sourcing and bidding in the largest auctions in the country. BidCue actually lives inside the VinCue app and lets you use VinCue data to make better sourcing decision based on real-time market pricing.

Additionally BidCue offers multiple reports:

  • Local supply and demand
  • Competing dealerships
  • Average days to turn
  • Price history
  • Sales volume of particular vehicles

You can buy vehicles directly in the BidCue app, making the sourcing process even easier.

Inventory management

Laser Appraiser offers integration with 3rd party inventory management solutions like Dealertrack and First Look. This means you will need an account with one of these tools to manage your inventory.

DealerCue has RevCue, a website and inventory management tool that lives inside VinCue. It tracks and reports on your dealerships activities:

  • Sales
  • Turn rates
  • Pricing age
  • Inventory age

RevCue also grades your sales and inventory performance. For example, it will tell you how you stack up to local competition on sales of SUVs. You can set up RevCue to receive alerts when vehicles have stale pricing, or if a car has been sitting on your lot for too long. RevCue ensures your website is always updated and manages your listings simultaneously.

Bottom line

It’s hard to compare Laser Appraiser and VinCue. In many ways, they are on two different levels. Laser Appraiser does well for the price, but many dealers find that it isn’t enough. From mobile capabilities to detailed market data, VinCue is a notch above in almost every aspect.

The most exciting thing about DealerCue is the regular addition of new tools. AdCue, the newest tool in the fleet, is a game changer for automotive marketing and integrates seamlessly with VinCue. This is another point for VinCue, especially for dealers who run ads. 
You now have the details on VinCue vs. Laser Appraiser, but don’t take our word for it. Schedule a demo of VinCue and see for yourself.

Adam Tobias

DealerCue

COO

Helping Dealers maximize performance by leveraging data.

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Adam Tobias

DealerCue

Jun 6, 2018

Introducing AdCue: A Better, More Affordable Way to Market Your Inventory

AdCue uses real-time market data to deliver highly targeted ads and send customers directly to your website.

DealerCue, the creators of VinCue pricing and appraisal software, has just launched their newest tool for auto dealers called AdCue. AdCue is a programmatic ad tool that gives small and mid-size dealers a better, more affordable way to market their inventory.

Currently, most advertising is done on 3rd party auto retail sites, where small and mid-size dealers are forced to compete against large dealerships. Dealers have little control over the placement and effectiveness of their ads.

DealerCue hopes to change that with AdCue. Using machine learning algorithms, AdCue finds and engages the best audiences for each campaign. Instead of competing with other dealers on 3rd party sites, AdCue publishes directly to the ad exchange. This means ads are placed on any website visited by the target customer.

Best of all, AdCue is free to use. Dealers only pay for the customers that land on their website. AdCue also pulls in real-time market data from VinCue to determine exactly how much a dealer should spend on promoting a car.

“We wanted to create an easier way for dealers to market their cars, and do it for a lot less,” said DealerCue COO Adam Tobias. “AdCue gives small and mid-size dealers to more control over their advertising.”

AdCue is easy to setup and use. Simply connect your website inventory and AdCue will auto-generate dynamic, engaging content for your ads. AdCue is also a great option for those “problem vehicles” that aren’t selling fast enough.

“We hope AdCue gives dealers another shot at retail before resorting to wholesale,” said Tobias.

AdCue is available now. It can be accessed through an existing VinCue account or as a separate tool. For more information, go to DealerCue.com

Adam Tobias

DealerCue

COO

Helping Dealers maximize performance by leveraging data.

565

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Adam Tobias

DealerCue

Jun 6, 2018

Used Car Sales Stalled Out? 3 Most Common Problems

The auto industry is more competitive than ever, and depending on your market, you might feel like you’re keeping pace or falling behind. Used car sales is especially challenging. Customers are more educated (and more picky) than ever, and tightening margins put a pressure on your sales team to turn more vehicles.

Many dealers are struggling to maintain consistent used car sales. Even if you’re content with your sales today, there is always room for improvement tomorrow. In this article, we’re going to look at the three main causes of stalling used car sales and how to address them.

Why Used Car Sales Have Stalled

The Internet allows anyone to find information about anything. This means that customers don’t rely on sales people for basic information like pricing and inventory. They can view their entire market with just a few clicks of the mouse. When a they drive onto your dealership, they know what car they are looking for and how much they can bargain for it.

To stay competitive in the information age, dealers need to stop thinking like dealers all together. It’s time for dealers to think like customers. This means making decisions based on market demand, not “instinct” or what the pricing books tell you to do.

The old way of thinking like a dealer causes three main problems:

  1. Setting uncompetitive prices
  2. Appraising cars inaccurately
  3. Stocking the wrong vehicles

Setting uncompetitive prices

Price transparency in the market is both a blessing and a curse. Regardless of your stance, it creates a better experience for the customer and it’s not going away. By embracing price transparency and adjusting your pricing strategy to match, you will earn more deals and more loyalty from the community.

cars.com

Online car buying platforms like Cars.com give customers complete transparency into their local market

Relying on pricing books is not enough to remain competitive today. To have the best price consistently, you have to keep a close eye on the local car market. You need to be all over your competitors and their inventory– the vehicles they stock, the prices they set, and how fast they’re moving.

The lowest price is not always the determining factor in a sale. More important is providing the best value for the price. Keeping an eye on local market pricing will help you do this.

For example, say Jennifer comes to buy a used Honda Civic. She tells you that ABC Used Cars down the road sells the same model and year for $250 cheaper. Plus, their vehicle is in the exact color she wants.

Without knowing ABC’s inventory, you might feel pressure to drop your price to get the deal. But since you’ve done your research, you know that your Civic has 10,000 fewer miles and does not have a ripped seat cushion. You can win Jennifer as a customer by offering a better value, not just by offering the lowest price.

Inaccurate Car Appraisals

Customer trade-ins are a major source of business for independent dealerships. A trade-in represents two chances to make a deal: one when you buy their old vehicle and one when you offer them a new (or used) car. Without accurately appraising their current vehicle, you can easily lose out on both deals.

Say Kevin wants to trade in his RAM pickup truck. He has done his research and asks $12,000, but you appraise his truck at $10,000 because KBB said its retail value was only $13,000.

Kevin is not impressed and goes to ABC Used Cars. They use live market data to determine a $15,000 retail value and factor in $1,000 for reconditioning. They appraise Kevin’s RAM at $11,500. Kevin and ABC Used Cars shake hands and you out lose two deals.

What happened? Because you didn’t use local market data, you low-balled Kevin and forced him to look elsewhere.

Just like football is called “A game of inches”, the auto industry has become “a game of percentage points”. The margin of error has shrunk. You need to be spot-on with your appraisals or risk losing out to the dealer next door.

Stocking the wrong vehicles

No matter how accurate your pricing and appraisal, it will be hard to sell vehicles without the right mix of inventory. Stocking the right vehicles is more than just filling your lot with the the most popular models (If that were the case, everyone would stock up on F150s). You also need to look at supply and demand in your local market.

Vincue live market data metrics

VinCue shows give you a market metric “odometer” for every vehicle on the market

There are several metrics to consider when choosing your inventory:

    • Average Turn Rate: How quickly does a vehicle turn in your market? The ideal turn rate is around 30 days.
    • Market Volume: How many identical vehicles have sold in the past week, month, or quarter?
    • Market Supply: How many identical vehicles are currently available in your local market?
    • Market Days Supply: Market Day Supply is an aggregate metric that tells you how many days of inventory are available in your market, based on daily sales. For example, if there are 100 identical vehicles in your market, and they sell at an average of 2 vehicles per day, then the market day supply is 50 days.

By looking at the Market Day Supply, you can quickly analyze its potential of a vehicle. When the MDS is too high (over 100 days), it tells you the market for that vehicle is too saturated or moving too slowly. If the MDS is too low (under 50), it’s typically an indicator of low supply for that vehicle. While low supply is not bad in the short term, you certainly don’t want to base your inventory around a vehicle that is discontinued.

Vincue market day supply metrics

National market day supply rates for brands. Source: VinCue

When choosing which vehicles to stock, a good strategy is to choose vehicles with a Market Day Supply between 50-100. If priced competitively, you can be confident the vehicle will move quickly.

Using Live Market Data to Drive Sales

The auto industry has changed. Today customers can search their entire market for the perfect car at the perfect price without ever stepping foot on your lot. To keep used car sales moving, you need to have the right data.

The 3 most common issues with used car sales are uncompetitive pricing, inaccurate appraisals, and stocking the wrong vehicles. With live market data, these problems disappear.

Live market data tells you which cars are currently being sold and at what price. You get real-time information and competitor analysis to help you accurately appraise trade-ins. You know which cars to stock and approximately how long it will take to move them. This information helps you plan ahead for even bigger profits down the road.

Live market pricing and appraisal tools like VinCue can help you increase used car sales and your profits per sale. 

See how VinCue compares to other popular tools on the market like vAuto and Autoniq

Adam Tobias

DealerCue

COO

Adam Tobias is CEO of DealerCue, a software company that creates data-driven tools for dealerships. DealerCue's fleet includes VinCue, BidCue, and RevCue.

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