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Local TV Automotive Advertising

Local TV Automotive Advertising Boosts Internet Presence

Car dealerships benefit greatly from local TV automotive advertising, and please don’t let anyone tell you otherwise. Not only does it positively affect a dealer’s foot traffic and bottom line in ways you immediately think about (reach and frequency), it also has a wonderful impact on something a little more “hidden.” In today’s blog, we’re […]

Early 2015 Car Sales

Early 2015 Car Sales are Up. How about Your Store?

Early 2015 car sales numbers are up even more than anticipated, despite some of the most frigid temperatures on record in some parts of the country. If you want to read more about this current upward trend in new-car sales, check out this article from Automotive News. It should provide you with a little bit of […]

Gabus Automotive Group

JKR Adds a Pair of Gabus Automotive Group Dealerships

JKR is pleased to announce that it has added a pair of new Gabus Automotive Group clients to its roster. The agreements with KIA of Des Moines and Toyota of Des Moines (both part of the Gabus Automotive Group) are especially significant as they are the first to add JKR’s new digital marketing service, NOW […]

Automotive Advertising Campaign Basics

Automotive Advertising Campaign Basics

What goes into an automotive advertising campaign? There are some essentials. First, you need a message … but not just any message. It must be something your customers will not only pay attention to, but also remember – so that they will want to buy your cars, come to your dealership for service, and so […]

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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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