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AUTOMOTIVE ADVERTISING & MARKETING

Christy Roman Selected to Speak at Major Conference

Christy Roman Selected to Speak at Major Conference

Christy Roman, founder of Women in Automotive and president of NOW Digital, will speak at the inaugural Agent2021 Conference in Miami on January 24. Held at Miami’s Hard Rock Stadium, this first-of-its-kind conference brings together agents and business owners in four major industries – real estate, automotive, insurance and travel – showing them innovative ways […]

Nielsen Stats Support Radio Advertising

Nielsen Stats Support Radio Advertising

Some recent Nielsen stats show that, despite the recent advancements in technology, AM/FM radio continues to have a huge impact on the lives of almost everyone in this great country of ours. Culled from the Second-Quarter Nielsen Total Audience Report, here are some of the most interesting stats that are of interest to an automobile […]

JKR 2017 Holiday Party Benefits “Baby DJ” Program

JKR 2017 Holiday Party Benefits “Baby DJ” Program

The JKR 2017 Holiday Party was held on Friday, December 15. The highlight of the event was, in short, the generosity of the JKR staff, as it collected 136 toys for the “Baby DJ” program. Ownership of JKR also will present a check to the organization when the toys are picked up this week. […]

Kia to Run 2018 Super Bowl Ad

Kia to Run 2018 Super Bowl Ad

The 2018 Super Bowl will be similar to the past eight in at least one way: Kia will be unveiling an advertising campaign during it. Many are already wondering who will be the star in this year’s ads, following in the footsteps of VIPs such as Christopher Walken, Pierce Brosnan – and Melissa McCarthy, whose […]

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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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