Inventory acquisition challenges were a huge headache last year. And, as luck would have it, they are a pain in the neck this year. Unfortunately, this industry-wide problem is still having a profound impact on profitability. And while some dealers are choosing to “wait it out,” smart dealers are finding strategic ways to succeed now. We’ve pooled the data from the past eighteen months that looked at best practices from thriving dealerships and practical solutions for inventory challenges. The resulting five operations strategies will help you and your entire operation overcome your inventory obstacles and supply chain challenges before it’s too late.
Operational Strategy 1 – Aim for Departmental Cooperation
Your target? Tear down the traditional silos creating division, confusion, and disconnection! Your best tools for this strategy are going to be communication and data to spot opportunities, target trade-ins, and acquire vehicles. Ask yourself, are you potentially missing opportunities because you’re not collaborating across teams? 33% of thriving dealerships use cross-departmental data to spot opportunities.
Operational Strategy 2 – Adjust Your Processes
It’s time to make a plan. Inventory acquisition goals need to be tied to details about pay structure and approaching customers. Rethink your current pay structure and set new, and exciting, goals around bonuses to help drive acquisitions for all team members who play a role in the process.
According to research from Cox Automotive, 50% of thriving dealers utilize activity tracking for customer web and search history.
Operational Strategy 3 – Create Useful Reports and Measure Analytics
The information you’re tracking can help your dealership succeed. According to research from Cox Automotive, 50% of thriving dealers utilize activity tracking for customer web and search history. Don’t just rely on your gut—use data to determine which used vehicles are in high demand. Then, share the data with your team to be on the lookout for these cars when they come across your service lane.
Operational Strategy 4 – Time to Team Up!
In addition to the very frustrating and very real issue of inventory shortages plaguing your business, you still have to deal with…well, your business. Retail automotive often faces more than one challenge at a time (like keeping your top talent and fighting the data war). So, your best bet is to partner with a provider who has your back. If you’re going to improve your numbers, make sure you’re working with an expert who can help you optimize your reporting and get to know your technology inside and out.
Operational Strategy 5 – Think Big(ger)
A simple shift in approach may not hit the mark. To overcome the challenge of inventory shortages, you’ll need to get your marketing, sales, service, and operations in sync. Cox Automotive delivers first-party transactional data from Autotrader and Kelley Blue Book allowing you to connect workflows across all departments. This dealership-wide approach ensures your entire business is protected from this—and the next—challenge.
To learn more about these strategies and other tips for acquiring inventory, check out our guide, “Operational Solutions for Inventory Challenges.”