At ReconVelocity we know that the faster you can get a car front line ready the more profit you can bring to the bottom line. We created the Speed TIPS to share with you some of the best practices and tips to help you reduce your TTL Time To Line.
Increase Your Speed To Market by Eliminating Make-Ready Bottlenecks
Traffic jams, government paperwork, bathroom drains, make-ready departments; no matter what the bottleneck, it can cost you and your dealership time and money. Time and money are two things that everyone wants to hold on to, so speed to market is critical for used car margins.
So, how do we identify and measure bottlenecks in our recon process? By far the most important number we look at is the deviation in our process. This tells us the variability in our make-ready department. Said another way, how streamline is your process.
3 Ways Improving Communication Improves Your Recon Process
“The single biggest problem with communication is the illusion that it has taken place.” – George Bernard Shaw
Communication is vital to the success of any business. All too often, used car dealers recognize that a pivotal piece of communication had not been relayed to the proper department after the damage is already done.
Imagine if you had a car sitting on your lot for 3 weeks and no one knew it was there until someone decided to finally ask the question, “What’s going on with that red Toyota out there?” What usually happens next is a lot of finger-pointing about who was responsible for that car. Meanwhile, your dealership is losing money. $40 a day.
We see this happen all the time in the pre-owned automotive retail industry. In truth, it all comes down to the systems we have in place (or lack thereof).
Accelerate Profits With ReconVelocity In Your Toolkit
Speed and efficiency is the name of the game when it comes to buying, reconditioning, and selling used cars. The faster you move a car from acquisition to market, the more profit you stand to earn.
How ReconVelocity Helps Your Dealership Adapt to Market Changes
The automotive retail industry experiences various ebbs and flows. Responding to these changes quickly and effectively can either shift profits in your favor or encumber your business.
5 Keys to Effective Workflow Meetings
If you and your dealership are serious about controlling your pre-owned margins then having workflow meetings are critical.
We have participated in a variety of workflow meetings. Over the years, we have witnessed many different styles and agendas. Some work better than others, so we compiled a list of the best practices to incorporate into your dealership’s leadership. Below are 5 keys to effective workflow meetings to get you and your team working toward a common goal: increased profitability.
3 External Forces Impacting Your Used Car Recon Department
Change is inevitable. As with any industry, there are certain underlying forces behind the need to change and adapt. The used car retail industry is no exception. Those that are the front-runners for change will position themselves for long-term success, while those that are hesitant may find themselves in an unfavorable situation.
Below are the 3 forces behind the need to streamline your used car recon process and turn your vehicles faster.
Making Sense of Recon Costs, Estimates, Overages and Underages
If you are not comparing your estimated costs with your actual costs, then one could say you don’t care about improving your recon process. And if you are not working to improve your recon process by reducing ADR, then one could say you don’t care about profits.
You would be hard-pressed to find a dealer operating in our industry that doesn’t estimate their monthly expenditures and holding costs. Comparing your estimated recon to your actual recon will help you understand and control your costs. Improving your process based on this comparison will help you maximize your used car profits.
Why Holding Cost is the Most Important Factor in Used Car Profits
For most dealerships, used vehicles remain the true profit center. Yet, a lot of times we mistake generating gross for generating profit. While generating gross most certainly is the star, how that money flows through to the bottom line is one of the most fundamentally misunderstood mechanisms in the business. And it all starts with holding cost.
Holding cost is how much per unit it takes to hold and maintain your inventory. Generally, you would take your fixed expenses plus your gross floor plan expense and add them together. Some dealers like to add in personal (lot porters, etc), but for the sake of this discussion, we will just talk about floorplan and fixed expenses.