The profit mentor.
Many years ago when I was the sales manager at Al Maroone Ford in Buffalo I got a surprise visit from the owners son, Mike Maroone, who would later go on to help found Autonation. He looked around my office for a moment then asked;
“Hey, Kevin would you like a 5% raise?”
I shot out of my chair and practically yelled, “YES SIR!”
He smiled and said “Great, it’s simple, just ask $100 more for every car you sell and you’ll have given yourself a 5% raise.” then he walked away.
For some reason when an owner would say stuff like that it never felt the same as a boost in salary. Of course he was right, at any time I had the power to give myself a raise. We started asking $100 more for the car, we appraised $100 less on trades and we asked $100 more in finance reserve. In the end, the team earned more than a 22% raise that year. That little question, became a calling for my team.
One of the flaws with having a wholesale row is that we tend to send cars there before we even process the car fully. Sometimes we don’t even load them into our appraisal software to see if there is money left on the table.
I here the line all the time “Junk is Junk.” This statement needs to be banished from your management vocabulary.
In the used car world, no two cars are ever worth the same amount, especially sub $1,000 cars.
Lets switch your paradigm..
If you think you have a $500 car, you will always be right.
Let’s face it, we believe in ourselves. We’re our own biggest fan. So lets take the ME out of the equation. The only way to truly be sure what we think is true is to verify using our tool set. So why not book out every car? I mean EVERY car, even basic junk. If you treat a $500 car like it’s a $999 car, do you think you’ll get it? Of course you will. Just by asking you will get a lot more than $500.
If you can sell a $500 car for $700, that’s a 40% profit. There are very few places in a car dealership where you can get a 40% margin.
Spring Market Sub $2,000 Wholesale Strategy.
- Appraise your “Junk is Junk” cars as if they are worth at least $500 more.
- Basic clean up of every junk car, not a full detail.
- Process wholesale cars digitally before you put them in the wholesale row.
- Be confident with your new value and the wholesalers will pay more.
- Track how many times you were able to get $100 or more for your sub $1000 cars.
- List the cars early on sites like auctionsimplified.com so wholesalers can bid and buy without having to take them to auction.
So what are you waiting for, give yourself a raise.