Why You're Losing Money On Reconditioning
Here are a few of the most common issues we see with dealerships reconditioning process.
- You're taking on problem cars. When you have gaps in your used car inventory it's easy to feel like you should be taking whatever you can get. Sure the car may have problems but you can just recondition it, right? This is a bad idea. Not only does it clog up the reconditioning pipeline, slowing down the process and losing you money in that way, in a lot of cases these problem cars never even make it to market.
- You don't have an exit plan for each car. It's not always easy to assess a car's market appeal, especially with trade-ins, so many dealers don't even try. It's important that you spend some time each day assessing new units to determine whether they are a better fit for retail or wholesale. This will ease some of the burden on your reconditioning process.
- You aren't cutting costs. Reconditioning costs can have a big impact on a car's profit potential so you need to minimize these costs where possible. A good start would be making sure you aren't performing any unnecessary work. Ask yourself if the car you're reconditioning really needs that extra body work or top of the line OEM parts. When the estimate for a reconditioning job is so high it moves a car out of the realm of profitability, just move it to wholesale instead of throwing your money away.
- You aren't streamlining. An inefficient reconditioning process is probably the leading cause of lost money. As you know used cars depreciate every single day. A rough estimate is that a used car loses about 17% of its value over the course of a year. Given that the average used car sells for $19,000 that's almost 10 dollars a day. Now apply that to every used car in your inventory and look at the scary number. That's how much you're losing every day that your cars aren't ready for sale.
Streamlining Your Used Car Reconditioning Process
It's easy to be all doom and gloom and tell you exactly what's wrong with your process, what's hard is coming up with a fix. With ReconTRAC we believe we've done just that. We work with dealerships to create streamlined and efficient used car reconditioning workflows that can reduce time to market by up to 50 percent.
The ReconTRAC program provides an automated low-cost tracking with real-time reporting that allows you to track and optimize your entire reconditioning process, removing the mystery and allowing you to see what's working and what's not.
Now that you know what we can do for you, here's what you can do for us. Just contact us at Green Cloud today for a free demonstration of our powerful ReconTRAC software.