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AUTOMOTIVE ADVERTISING & MARKETING

Automotive Advertising and Marketing

Top 10 Reasons Car Dealers Need Automotive Advertising and Marketing

Why do car dealers need automotive advertising and marketing agencies? That can be answered by one question: does your automotive dealership have a definite plan for prosperity, or does it seem like it’s always looking at short-term goals to get the most out of today? It’s easy to just roll along planning everything month-by-month, but […]

Automotive Trends

Automotive Trends Shifting to Leasing and Long-Term Loans

The latest automotive trends present a good-news, bad-news scenario to the country’s automotive dealers. New data released by JD Power, the nation’s leading independent research company, will open some eyes. The good news is that retail leasing is at record levels. In February, 26.5 percent of all transactions were leases. That’s better than the previous […]

Automotive TV Advertising

TV Automotive Advertising is Worth the Investment

TV Automotive Advertising is something every car dealer should consider. There is simply no better way to reach a large number of people in a short time. Think about it … when was the last time you knew of someone who didn’t have at least one TV in their home? That means there’s almost no […]

Radio Automotive Advertising

Radio Automotive Advertising: Affordable for All Dealerships

Radio Automotive Advertising has been a highly desirable method of advertising for our country’s car dealerships for many years. The same will be true well into the future. There are many reasons of this, not the least of which is allowing a dealer to go after a targeted audience. This eliminates much of the waste, […]

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Post-Pandemic Dealer Gross Profits are Down – But They Don’t Have to Stay There!
March 13, 2024

It is no secret that dealer gross profits per vehicle are down sharply in the post-COVID automotive world. According to a recent article in Automotive News, gross profits of the six largest publicly traded dealership groups plunged significantly from Q4 2022 to Q4 2023. One of them was actually down 35% per vehicle!

The article explains: High interest rates, more expensive vehicles and a steadier post-pandemic supply chain continue to soften demand and bring it closer to pre-pandemic levels. Still, new-car buying has remained strong overall …

This means that, while sales volume is similar, overall bottom lines are lower for many dealers due to the reduced gross profits. What about your dealership?

Being Realistic
It’s time to turn the page! The time for dealers to simply be order takers for people willing to pay MSRP for a vehicle (and in some cases more) has passed and dealers have to work hard once again to achieve acceptable gross profits.

Selling a high volume of cars doesn’t control gross profits, no matter how much you wish this was the case. Correct processes and menu pricing – and strict adherence to them – do!

What kind of processes?
∙ Slow down the transaction! Your sales staff has to once again sell the customer on the features and benefits of every new and pre-owned vehicle on your lot.

∙ Your salespeople and managers should devalue the customers’ trade-in value (politely, of course) as much as possible. After all, if the customer expects you to lower your price, shouldn’t you be able to do the same on their trade? Remember, you’ll have to fix it up, put your name on it and resell it to someone else with all the tenacity you would a brand-new car. So make sure you buy it right … because the profit is made when you buy it, not when you sell it!

∙ To that end, management should be ready and willing to leave the desk and do thorough walk-arounds on each trade to ensure the best outcome for the dealership.

The Cure for Low Gross Profits
If you are like a lot of dealers these days, you could use some good news. Here it is: while you may not have the capability to achieve profit margins similar to those you enjoyed during the pandemic, they could likely be improved. JKR’s clients enjoy the benefit of attracting not only more customers, but better ones, too!

If meeting and exceeding your sales goals (and increasing gross profits at the same time) sounds great to you, you need to call us. Don’t settle for reduced gross profits when help is out there to get you closer to where you’d like to be.

Want to know how we do it? Reach out to Senior Partner Richard Brauns (407) 701-4233 or Partner/Vice President Jon Albert (407) 718-2494 today.

JKR Automotive Advertising: We Move Cars.

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