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New Website Feature

JKR Introduces New Website Feature

There is a new Website feature on our Internet site, www.jkradvertising.com. It is a special “press” section which will contain JKR-specific content ranging from new hires to any references of JKR (the company itself) making the news. In the coming days you’ll see a number of articles appearing in this section, both old and new. […]

High April New Car Sales

Industry Boasts High April New Car Sales; What About You?

The preliminary numbers are out, and the forecast calls for high April new car sales. According to this article from Automotive News, new vehicle sales in the United States will finish at their highest April level in 10 years. Further, projections show the best four-month start overall since way back in 2001. Major prognosticators speculate […]

JKR Partners Visit Pandora

JKR Partners Visit Pandora New York Headquarters

JKR Advertising & Marketing is the top Tier III (local/dealer) automotive advertising agency in the United States for Pandora Internet Radio ad placement. We are a big believer in Pandora for two reasons: first, it is the top Internet Radio source; and second, Pandora offers the unique ability to target more specifically than analog radio […]

Proactive Advertising

Proactive Advertising Ensures Happier Tomorrows

Proactive advertising makes all the difference in the world. When you’re running your monthly advertisements – regardless of which media options you choose – you never really know for sure who happens to be in the market for a vehicle at that particular time. Wouldn’t it be great if you could just target the people […]

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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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