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Free Automotive SEO Tools

Automotive SEO tools (Search Engine Optimization) increase a car dealerships website ranking on Google, Yahoo & Bing results page. It involves using a variety of valuable automotive SEO tools used by experienced Internet marketing professionals to ensure their clients websites are at the top of a search engine results page. Many automotive dealerships might not be […]

2014 Electric Kia Soul

2014 Electric Kia Soul Coming Soon

There has been much speculation among those in automotive marketing centering on when Kia would offer the 2014 Electric Soul in the United States. For a long time, it has not been a question of “if” but “when,” and now we have much more clarity. This week, Kia Motors confirmed that an all-electric version of the […]

2014 Cadillac CTS is Motor Trend Car of the Year

2014 Cadillac CTS is Motor Trend Car of the Year

The experts have spoken, and the redesigned 2014 Cadillac CTS is Motor Trend Car of the Year. Cadillac dealers and automotive advertising firms who service them are rejoicing. Eligibility Requirements To be eligible for the Car of the Year achievement, a vehicle must be completely new or substantially upgraded. Once a car’s eligibility is verified, it is put […]

Google Hummingbird

Google Hummingbird Algorithm Takes Flight

When something as significant as the Google Hummingbird algorithm takes flight, it’s worth taking a few moments to find out how this change will affect your website and Search Engine Optimization. What’s an algorithm? What is a search algorithm, you ask? (Don’t worry; a lot of people are asking the same question.) When someone conducts […]

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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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