FLADCO News

We’ve all heard the adage that half the money spent on advertising is wasted, but no one knows which half it is. For automotive dealers trying to move specific inventory, that 50% figure is unfortunately too optimistic.

Dealerships always strive to get customers into showrooms. As 2020 models pour onto lots, Automotive News reports than many dealers are struggling with an overhang of 2019 models to clear out, so getting that foot traffic is more important than ever.

Keeping an eye on mundane aspects of your expenses is time-consuming and irritating. It’s hard to know you’re getting the best price, and when comparing parts like fasteners, often separated in price by pennies, it can feel meaningless.

It’s anything but.

With margins shrinking or even disappearing on vehicle sales, you need to find profit wherever you can to help your dealership thrive. One surprising spot to generate profits is in the small supplies your repair shops use.

As prices for new and used vehicles keep rising, finding innovative financing solutions for customers is critical to closing more deals. And as auto loan terms continue to set records, longer loan terms are becoming commonplace.

Forbes reported last week that the average new car dealer operated at a financial loss in 2018. Dealers lost an average of $735 on each new car sold as competitive pricing ate away margins.

Fears of a recession continue to loom and the latest salvos in the ongoing trade war involve increase tariffs on products that include light vehicles and auto repair parts. As new vehicle sales slow, many dealers are turning to the service department to keep revenue flowing.

Customers have never had more ways to contact dealerships. Between landlines, cellphones, email and the web, capturing customer information can feel overwhelming. Leveraging all the information you can is a big way of turning leads into closed sales, so you want to capture every detail possible with your customer interactions.

Last week, we told you about the RoadVantage collection of F&I products and a few of the reasons it’s the fastest-growing F&I provider in the country – and why it keeps earning Diamond Dealers’ Choice Awards year after year. The biggest one is that dealers and their customers love RoadVantage. Taking a closer look explains why.

U.S. auto sales have declined for seven straight months and Moody’s is predicting continued declines through 2020. Unless you’re selling one of the handful of growing brands, you’re seeing less foot traffic and lower sales. Maintaining profitability with fewer customers and lower sales means you’ll have to convert more opportunities – and do so more profitably – in the F&I office.