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AUTOMOTIVE ADVERTISING & MARKETING

Push Pull Advertising

You Need the Right Mix of Push and Pull Advertising

Push and pull advertising are essential to automotive advertising success for a car dealership. Today, more than ever, this is the case. Before the dawn of Internet advertising, an automobile dealer ran his ads and then waited for prospective buyers to come to his dealership. Today, however, the automotive landscape has changed significantly. Before they […]

Me Too Dealership

A “Me Too Dealership” Achieves Only Mediocre Results

Don’t let your dealership become a “me too dealership.” If you don’t know what we mean by that, a “me too dealership” is one that looks at what everyone else is doing and tries to emulate it. If one dealership says they have the best prices, the “me too dealership” responds with something similar in […]

We Post Every Month

At JKR, We Post Every Month for Many Reasons

At JKR Automotive Advertising, we post every month. Your first reaction, if you don’t know about posting reports, might be “big deal.” Actually, you’d be absolutely correct, because it is a big deal! They are similar to audits for radio and TV stations, to ensure each of our clients received what they ordered. Not every […]

Radio Advertising Works

Radio Advertising Works for Many Reasons

One of the biggest reasons why radio advertising works so well is its portability. You can do just about anything or go almost anywhere, and a radio can go with you. It certainly isn’t limited to just your car and home. You can work out listening to the radio. You can shop while listening, too; […]

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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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