The used car market has forever changed since the pandemic began. Problems acquiring quality inventory in the past were only intensified when things like stimulus checks and unused vacation money were left unspent, especially with year-over-year (YOY) new car production at an all-time low. As people seek to spend their money, quality used cars are top of mind for those in the market.
This increase in demand for quality used cars presents a unique opportunity for used car dealers to take hold of, as long as they have a plan to find the right inventory for their market, for the right price.
The three major challenges dealers face when it comes to retaining quality used car inventory are:
- Knowing the right time to acquire the right vehicles in the right quantity
- Insufficient data on used car vehicle performance
- Constant market change on inventory needs
These challenges car dealers face were only intensified by COVID restrictions, such as in-person events being canceled and less face time with other dealers and wholesale sellers.
While dealerships are still facing pandemic-related challenges, the solution, like in many other industries, lies in technology. Adapting with technological improvements will improve the way dealers buy and move inventory as a whole.
Find out how these challenges affect buying and turning quality used car inventory and how improving your approach can increase your dealership sales YOY.
Acquiring the Right Vehicles at the Right Time
Unfortunately, used vehicle inventory management is often one of many hats worn by someone in your dealership. This makes it difficult for whoever's in charge to make acquiring quality used car inventory their sole focus.
A few warning signs you aren’t bringing in the right inventory at the right time are:
- Understocking fast-moving vehicles
- Overstocking common vehicles or vehicles people aren’t buying
- A lack of incremental growth
Breaking even or paying more for less shows the right inventory isn’t coming onto your lot. Quality used vehicle inventory management isn’t a guessing game; it’s imperative that your strategies are backed by market data and analysis.
Part of market data lies in finding out how the market is changing. Sometimes, it doesn’t matter what sold well last year. Keeping up with the demand of the market is imperative to acquiring the right inventory.
Global production of new cars fell 21% in the first 10 months of 2020, making used cars even more valuable. The pandemic’s impact on raw materials, shipping, and microchips has created huge shortages in the new car supply chain.
Record demand for used cars is causing wholesale prices to skyrocket, and dealerships that aren’t keeping up with the changes are left lacking both new and used cars. Without data and real-time information to anticipate these changes, your dealership may be left with a shortage.
Insufficient Data on Used Car Vehicle Performance
The culmination of defining market changes and knowing what vehicles to acquire lies in having the right data. A key challenge for many dealerships is working from insufficient data on which cars are performing well in your area and the market at large.
A quality used car inventory begins and ends with data. When your processes are handled manually, the market data you use is most likely already out of date.
Gain real-time insights on in-demand used cars before your competitors by relying on expert opinions and data-backed insights.
The Solution: Marrying Data with Experience
One thing many dealers don’t have to sacrifice is time. While in-person trade shows, guesstimate trade-ins, and trade offers have been commonplace in the industry, there’s an opportunity to automate these traditional processes that are likely costing you time and money.
As a dealer, your buying priorities likely lie in one or multiple of three core areas:
- Getting a car from the selling block to your sales lot quickly
- Cheap inventory
- A convenient buying process
By utilizing an online instant trade platform, you’re able to automate your inventory acquiring process and let the experts provide you with unparalleled convenience.
Keep your inventory stocked automatically by setting your preferences online, including the cars you want on your lot and the price you want to buy them for.
Never worry about your lot inventory again. Combine industry knowledge with innovative solutions to put the “quality” back into your used inventory. Using the right online tool, buy, sell, and group-trade your pre-owned inventory instantly and add to your bottom line.
Looking for more specifics on how to enhance your used inventory acquisition process? Download our free guide, 7 Tips for Finding Quality Used Inventory, today!