Aged inventory is something that most independent dealers are experiencing in the current market. It can throw a real wrench in your business if you let it. As a solution-oriented business, we want to keep you encouraged. We want our dealers to know that for every problem they face, there is an answer to help ensure their continued progress and success.
There are some simple, yet effective measures you can take to move aged inventory out the door. The first is value-based pricing. Competitive market rates mixed with a shortage of newer vehicles have put used-car dealers in a sweet spot. Despite this, it’s important to remember that everyone is looking for a good value.
Value-based pricing consists of setting a price based on the vehicle’s perceived value to the customer. Take a good look at your aged inventory, and then put yourself into the shoes of the customers coming through your door. Most often, potential buyers will buy your car if they are certain the price reflects the true value they will receive from the car.
The second tip to consider is the positioning of aged inventory. Research shows that positioning is key to an effective product strategy. Buyers are drawn to what they see, and the order in which they see it. Most of the stores we visit daily (Target, Sam’s Club, etc.) have positioned their inventory intentionally.
Consider the checkout line at the grocery, and how gum, candy, and other snacks are always present. It’s the store’s hope that you (or your children) will spot the snacks on your way out the door and make a purchase. Take a good look at your lot. Are there areas where you can place your aged inventory so that it will be more enticing to prospective buyers?
Some dealerships utilize lifts, or position cars diagonally, starting with the ones they want to sell the quickest. It’s easy to move aged inventory to the back because your focus has shifted, but if you really want to get things moving, positioning is key!
The last thing you may want to consider is creating sales incentives for aged inventory. You know your salespeople better than anyone because you see them every day of the week. Selling aged inventory can be trying, but with an extra bonus attached, salespeople might be inclined to put forth special effort. Think about a structured incentive program for your aged inventory. Would a bonus, or some other type of incentive be more effective?
In review, we know that aged inventory is a touchy subject, but we also know that there are solutions! Value-based pricing, product positioning, and sales incentives are a few ways that you can get aged inventory off your lot, and out of your mind!
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