Data and reporting have become increasingly important when it comes to running a successful business of any kind. Developing metrics at your independent dealership is crucial. Simply put, these numbers help you track your progress. They give you direct insight into what is working, and what isn’t. By analyzing this information, you will then be able to make informed decisions about how to reach your goals.
Inventory Turn Rate is defined as the ratio of available inventory to monthly sales. This is a good metric to track because it can help you better understand how you compare with high-performing, average, or underperforming dealerships.
On average, top performers turn their inventory every 20 days. To achieve this, all areas of your dealership need to be focused and work efficiently. Time is money in this circumstance, but the reward is worth the work. Quick inventory turns enhance the high-gross potential linked to new inventory and boost sales in other dealership divisions.
Monthly Site Traffic is one of the best displays of your dealership’s reputation. If people are constantly hearing about your business, they are likely to check out your webpage. If you are moving inventory in and out quickly, prospective buyers will want to stay updated on what you have. They might even be inclined to call in and establish an ongoing relationship with you to ensure they get exactly what they are in search of.
Google Analytics is a great way to not only track your monthly site traffic but also determine the traffic sources. Where is the traffic coming from? Is it social media? Maybe people are finding your website from an email campaign you sent out, or from targeted ads. This is helpful because it lets you know if you need to increase your advertising budget or ramp up your social media presence.
High-performing dealerships monitor Cost to Market, with the goal being minimizing costs to facilitate faster inventory acquisition, and ultimately deliver maximum return on interest.
Cost to market identifies the retail value of a vehicle in comparison to the total investment in the vehicle. The total investment includes acquisition cost, servicing, and transport costs. When looking at this metric, you will be able to identify if there are certain patterns that are increasing your cost to market. Are there areas where you can cut costs? Perhaps consider ways to transport vehicles more efficiently.
Remember, the goal of tracking these metrics is to make your independent dealership more successful. The numbers fit together like puzzle pieces, ultimately helping you determine ways to cut costs and increase sales revenue. Ask yourself, what metrics are you tracking?
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