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From: Jared Hamilton
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Bryant Gibby

Bryant Gibby Used car manager

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Etch alternatives

     We have always had etch (ATP, VTR, etc) as a pre-loaded back-end product the entire 10 years that I have worked at this store.  We haven't really had any issues selling the product and usually have around an 80% penetration between new and used.

 

     You would think with the success that we continue to have with etch, we wouldn't consider making a change. We are though! We are having more and more customers question what it is lately and they seem to be way more educated about it.  We figured we could get ahead of the curve a little bit and replace our etch with something a little less common.

 

     After looking in to it for a while, we have decided that pre-paid key replacement program would be our best bet. We aren't willing to drop the etch yet though. It is still really profitable and it is too risky to give up that guaranteed back-end money. So, we have decided to test the waters for a while to see if our customers respond positively toward it.

 

     I decided to throw this post out there to see what other people's opinions are regarding etch. I assume most dealerships either currently offer the product or have offered it in the past. Have you guys had much success with etch? Do you still use it? If you don't use etch, what is a viable alternative? Let me know your thoughts...

Chris Costner
Bryant, we have used an etch product for the past ten years and run close to a 70% penetration with that product. Granted the gross margin isn't as big as other backend products, but we don't see it going anywhere. As far as an alternative to etch I cannot say. I can say we implemented an "aftermarket sales" department which has increased gross across the board for both new and used departments.
William Bryant
I absolutely LOVE key replacement and sold a ton of it as a finance manager. If questions come up it's a lot easier to overcome since it's something of unique value the customer can comprehend. But I have noticed several dealerships moving to a package of products with a short warranty period, which allows the F&I guy to upsell to a 5yr or so warranty which has proven good for the backend as well. IAS (American Financial) seems to be the company setting this up for them. I'm sure it will be a tough decision either way to make the transition when something has worked so well for so long. Let us know how it goes!

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