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JKR Promotes Phillip Blevins

JKR Promotes Phillip Blevins

JKR Advertising & Marketing announced the promotion of Phillip Blevins to Media Coordinator. The appointment was made by JKR Managing Partner Jeff Johnson. “After doing such an outstanding job in his previous position, it became apparent that Phillip was ready for more responsibility,” Johnson said. “He has already begun positively impacting our clients in his new […]

Radio and TV Power

Radio and TV Power Will Last Forever

Radio and TV Power will last forever … no matter how big the digital advertising avalanche becomes. You see, the Internet is a fantastic resource for a car shopper to use when they’ve made up their minds to buy a car and are ready to do some serious research. But for them to get to […]

No Waste

No Waste in Advertising is Possible with JKR

Do you wish there was no waste in your automotive advertising? Sadly, many of today’s automotive dealers feel like legendary retailer John Wanamaker did many years ago when he said, “Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.” Here’s the thing: it doesn’t have to be […]

Emotional Automotive Advertising

Emotional Automotive Advertising Can Be Very Effective

Emotional automotive advertising: how does it work? If you paid close attention to the commercial breaks during this year’s Super Bowl, you may have noticed how many advertisements tried to play upon your emotions. One that comes quickly to mind is the Nissan advertisement called “With Dad” that featured the familiar ballad Cats in the […]

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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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