As the Greek philosopher Heraclitus said, “The only constant in life is change.” People who work in the auto industry know this is more than just a catchy quote. The auto market experiences seasonal dips and surges and it is also affected by a number of outside forces. The economy affects how much people are willing to spend, environmental issues make buyers more critical of emissions and mileage and industry trends can all cause a downturn that seems to come out of nowhere.
So what can dealers do to be prepared for a downturn in business no matter what’s causing it?
Making wise investments means more than just buying the best IT equipment or using services from the best providers. It means making investments while times are good that will pay off when things get sluggish. Investments in upgrading facilities, improving your website and creating easier ways for customers to connect with you will make you more accessible and a better option overall even during an economic downturn. In other words, spend for the long term.
Diversify Your Inventory AND Your Services
Carrying too much inventory is a concern for all dealerships, so keep an active eye on your inventory even when sales are brisk. If you carry a fleet of rentals, ensure the cars are well maintained and in regular demand. Also consider your leasing program and amp up your marketing if needed. Leasing a car today means you can count on a customer in 12 or 24 months.
As you diversify your inventory, make sure you’re doing the same for the services you offer. In addition to leasing, there are general car services – from routine oil changes to more complex repairs. Operating an on-site service center means you can maintain your own fleet more efficiently, offer incentives to new buyers and attract customers even if they didn’t purchase their vehicle from you.
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Check Your Pricing Against the Competition
Even if you think your pricing is competitive, double check it anyway. These days there are a number of programs that let dealers check and tweak their pricing based on local or national averages so don’t think you can set a price in April and have it be competitive come May. Be vigilant about looking at local pricing and deals to ensure you’re giving your customers the best bang for their buck.
Make it All About the Customer
If the only thing you’re offering customers is stale coffee and a TV set airing game shows, you’re actively hurting your own business. These days customers post online about their experiences just about everywhere – especially places where they end up waiting around.
Give your customers something positive to talk about by enhancing their experience from the drinks you offer to what you can offer to those waiting for their car to be serviced. Make sure your service center is on time with appointments and familiar with the schedule. Customers want to know their business is appreciated and if they’ve taken the time to set up an appointment for a specific service, they don’t want to be kept waiting while your team scrambles to figure out what needs to be done.
Invest in a good hot beverage machine to give customers greater choice and include cold drinks and small snacks. Offer free wi-fi and a luxurious place to sit and before you know it, they’ll be tweeting about the awesome service even before they get their car back.
Be Open to Change
Finally, it’s important to remember that change drives growth. Dealers who want to operate like it’s 1987 simply can’t remain competitive in the 21st Century. Online marketing, enhancing customer incentives, better communication and approaching sales from a new perspective are the only ways you’ll stay ahead of the curve. So if the thought of changes and new technology make you nervous, it’s time to jump into the deep end. Get familiar with new technology – both hardware and software – to take the mystery out of the process. Not only will you be able to improve your sales and reputation, you’ll find plenty of ways these changes can make your dealership more efficient, more effect and ultimately, more successful.