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Automotive Marketing Improvement

Automotive Marketing Improvement Makes The Difference

Some car dealers struggle to make automotive marketing improvements. Recent reports indicate that 2013 was the automotive industry’s best year since 2007, yet many dealerships still lack foot traffic. They know it only too well … and it gets reinforced each day by their sales staffs, who lack morale because there are a only a scant few […]

Kia Advertising

Kia Advertising: JKR Advertising Re-Signs Williams Kia

JKR Advertising & Marketing, the nation’s premier Kia advertising agency, is excited to announce it has re-signed Williams Kia of Traverse City, MI to its long list of Kia dealership clients. Williams Kia is part of the Williams Auto Group, which also includes Chevrolet and Honda stores located in Traverse City, MI. Established in 1990, the Williams […]

Automotive Advertising Agencies

Automotive Advertising Agencies Essential for Dealer Success

Car dealers who don’t use automotive advertising agencies may try to save a buck by managing their own marketing campaigns. On the surface this may appear to be a wise decision, but upon further examination this is costing them customers and wasting their valuable time! If you do your own automotive advertising, ask yourself some questions before […]

Pandora Radio Advertising

Pandora Radio Advertising Signs In-Car Ad Partnerships

There is an alternative radio advertising opportunity available, one that indeed bears watching in the coming years. Some dealerships already use it on a local level; others have not embraced Pandora Radio Advertising. On a national level, however, they are already a major player. Internet radio powerhouse Pandora, the country’s leading online radio service, has announced […]

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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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