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Proactive auto inventory management is essential for used car dealers. Enact these simple tips to ensure you have what your customers are looking for.
Managing inventory at a previously-owned car dealership has always been tricky. You never know what might show up on your lot or at auction on any given day. Having the right cars at the right time requires research, understanding and anticipating customer needs, and getting the best value for your dollar. And we can’t ignore the fact that the COVID-19 pandemic has added to the challenges of auto inventory management and changed the way we do business. It’s safe to assume we will have fewer in-person interactions, more virtual auctions, and fluctuating demand for years.
The good news is that the demand—fluctuating or not—is still out there. With new cars getting increasingly expensive, people turn to used cars as they continue to avoid public transportation in favor of independent modes of travel. That’s why it’s perhaps more important now than ever that you stay on top of your auto inventory management.
Easy enough, right? Here’s a little guidance on keeping your inventory up to date and in demand.
Find out how your auto inventory management can keep your lot stocked and ready to meet the needs of your customers.
1. Expand your reach
Perhaps the most straightforward auto inventory management tip is to look for used cars beyond your usual borders. Expanding used car searches by even a few miles can yield significant results. Obviously, it still has to be worth your while in terms of travel and getting the car to your lot, but spending a little extra to find those high-demand vehicles will likely pay off in the long run.
2. Leverage your CRM
Just because a customer isn’t actively on the market to sell doesn’t mean they won’t be interested in the right trade-in deal. If you’ve kept good tabs on your customers and leads in an automotive CRM like AutoRaptor, you can use this information to help you find high-demand vehicles and offer a trade-in. You might be surprised at how many people will take you up on a deal, especially if you can add significant value at little-to-no cost for your dealership.
3. Double down on virtual auctions
Sure, you’d prefer to go to auctions in person and visually inspect vehicles before you bid on them. But that’s not always possible. For better or worse, the pandemic expedited a technological revolution that was already in motion for the used car business. Discounting virtual auctions is no longer an option. In fact, it could be a valuable way to increase your territory in looking for vehicles.
A few words of note: Make sure you’re working with reputable auction houses, just as you would for a traditional auction. If you don’t participate in the auction yourself, send a seasoned representative in your place, someone who knows the market, knows what’s hot in your area, and what reasonable prices are. These considerations are even more critical for virtual auctions and will help ensure that you’re getting the best vehicles for the best prices.
4. Get the word out
Relying primarily on auctions and trade-ins may have been sustainable ways to handle your auto inventory management. Still, this may be an excellent time to use some other traditional methods, namely, advertising.
Direct mailers and email campaigns are excellent ways to reach people, the latter being preferable since you can better measure your success. Boosting your social media presence can also help you engage with people who want to sell, especially on sites like Facebook that promote discussions and may even have groups you can join to network with potential sellers. (Note: Make sure your dealership website is updated, usable, and detailed!)
The best advertising, of course, is word-of-mouth. How do you get people talking about you? Give them incentives. Whether it be free services, discounts, or other referral bonuses, incentives are a sure-fire way to help you chip away at the crowd until you find the people who have what you’re looking for. Offer irresistible deals to those willing to make a trade-in as well, so anyone on the fence will be likely to lean your way.
6. Hire an inventory manager
If auto inventory management is taking up too much of your time, it may be worth the investment to get someone who is solely dedicated to the job. Having an inventory manager frees you up to focus on other important aspects of your business while still allowing you to maintain the freshest, most attractive lot of pre-owned vehicles to meet the needs of your diverse customer base.
In a time of contactless auto sales, virtual auctions, and an ever-shifting approach to buying and selling cars, auto inventory management can be a tremendous asset to your business.
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