Basic Factors That Can Make or Break Used Car Dealership Success

Drawing customers to your used car dealership used car dealership successand keeping them engaged relies on a number of factors. How effective were your marketing efforts? What inventory do you have in stock? Is the vehicle priced appropriately for the buyer? Beyond these few questions, there are often overlooked factors that go beyond your dealership’s vehicle purchasing experience that may be preventing you from leaving a positive impression on customers and hurting your chances at growing your customer base.

Keep your inventory aligned with the wants and needs of the market
Stocking the inventory your market wants is a somewhat-invisible, but important component of used car dealership success. Staying in tune with what your customers are purchasing allows a dealer to pivot inventory quickly and seamlessly, and ensure that your lot is stocked with the vehicles your customers are looking to buy. If you don’t have the right vehicles to capture your customer’s interest, they are likely to move on to another used car dealership. The different wants and needs of your market will dictate the way your dealership spends its time and resources on inventory.

Minimize hand-offs to multiple staff members
Potential buyers don’t like to repeat themselves to multiple staff members. In addition, it can be frustrating or confusing for a potential buyer to get passed around from department to department. Take note of your current sales process. How many times is a customer passed from one department to another? Can you reduce that number? A customer most likely won’t notice if they stick with one or two different staff members. However, if they get shuffled around to more it is possible that they’ll get frustrated with the sales process and possibly leave.

Keep your dealership presentable
Ensuring that your dealership is clean and presentable can change a customer’s entire perception of your dealership. While it is perhaps a small and basic part of running a dealership, it can set the tone and leave a lasting impression on customers. A customer won’t notice a clean office or clean inventory, but they will notice an unkempt office and muddy vehicles. Clean cars with fresh interiors will always leave a good impression. In addition, visible pricing and a well lit lot ensures that customers can easily navigate your dealership and their potential vehicle options within their price range.

These overlooked, yet noticeable, components of a dealership can make or break a customer’s perception of your lot, and could potentially be the difference between a one-time customer or a repeat customer.

Tax Time Dealer Inventory Tips from Joe Lescota

While consumers are eagerly awaiting tax refunds, dealers are watching wholesale prices and preparing for one of their busiest seasons. In a recent conversation with Joe Lescota, NIADA director of dealer development, actions dealers should consider taking during tax season were highlighted. Additionally, Lescota identified the three biggest challenges independent dealers face, the importance of analyzing what dealer inventory sells and leveraging available training and resources. Access the full conversation and a summary of the topics covered below.

The three big challenges all independent dealers face
When asked about the biggest challenges independent dealers face, Lescota was quick to cite three issues he frequently sees with dealers: dealers not putting enough strategy behind their marketing and promotional efforts; inconsistent processes and procedures that make for unproductive employees and cause significant capital and legal issues; and dealer inventory management issues such as knowing how much inventory to have, when to buy inventory and how to price dealer inventory – all common, but expensive, problems to have.

Tax season has shifted
In the last three years the days to release tax returns or refunds has been extended. This delay in tax return refunds has caused disappointment for a number of dealers who do not see the profits they anticipated during what they perceived as tax time. Lescota recommends dealers take initiative to adjust to the new tax season and shift inventory purchasing strategies accordingly.

Buy early, do the math and buy smart
Wholesale prices go up as tax season approaches. Buying early will give dealers a competitive edge; however, it’s important to know individual markets, research pricing and take the whole vehicle into consideration. Dealers also need to keep their holding costs per day in mind when purchasing inventory.

Training and Resources are Available
Lescota also highlighted the importance of using the resources and training materials available from state independent dealer associations and the National Independent Automobile Dealers Association. Programs like the Certified Master Dealer Class can help a dealership become more profitable if the time is taken to learn and understand best practices.

Staying Committed to Community Throughout 2016

At NextGear Capital, 2016 brought a continued focus on serving not only our clients but also the communities in which our team members live and work. Led by Patty Turner, Senior Director of Corporate Administration, the Community Relations team thrived on not only sponsoring events financially, but by staying committed to community and volunteering our time. Because of this, 2016 was a record breaking year of fundraising and volunteering for NextGear Capital. Each month, team members at the corporate office, as well as in the field, had an array of volunteer and fundraising opportunities in which they would choose to participate to give back to their communities.

Quarter one started the year out strong with a Cox committed to communityAutomotive initiative, ‘No Excuses’. Every year, Cox Automotive and its brands dedicate time in March giving back to the community – no excuses. NextGear Capital alone was able to serve 80 unique organizations nationwide. In March alone 336 team members volunteered by donating 48 pints of blood to the American Red Cross, making 50 blankets for Project Linus, hand-making 278 dog and cat toys for the Humane Society for Hamilton County, packing 10,000 meals for Stop Hunger Now, and sorting approximately 9,400lbs of nonperishable food items for Gleaners Food Bank of Indiana. Field team members were able to put together 7 team-building volunteer events across the nation, from serving at the Houston Food Bank to the Ronald McDonald House here in Indy, they made no excuses to find time to volunteer together.

committed to community

The biggest fundraiser from the first quarter was the Polar Plunge, which team members participated in on behalf of the Special Olympics. Over $3,600 was raised and 11 NextGear Capital team members plunged into the freezing 10°F water of Eagle Creek Reservoir on March 5. Finishing the quarter with 2,230 hours volunteered among 371 volunteers was nothing short of impressive. With both corporate and field team members committing to their community, a total of 359 unique events were supported throughout the three month span.

Quarter two had a lot to live up to and it did not disappoint. With over 1,700 volunteer hours recorded, 272 NextGear Capital team members participated in 260 volunteer opportunities. committed to communityNextGear Capital team members worked together to raise $5,215 for the 2016 Tour de Cure, a series of funds-raising cycling events held in forty states nationwide to benefit the American Diabetes Association. Although not an actual race, the bicycle ride raises funds for diabetes research. Additionally, NextGear Capital participated in Cox Automotive’s initiative ‘Drive Away Hunger’. NextGear Capital team members donated 12,766 pounds of nonperishable food items, producing 12.8% of Cox Automotive’s total donation goal. NextGear Capital field team members were able to raise an astonishing 3,280 pounds of the committed to communitydonated total, 797 of which were donated at Manheim auctions. The bulk of the donations came from the Great Lakes, South West, North Florida, Mid-Atlantic and North Central regions; making it clear the field team members were truly dedicated to driving away hunger. The NextGear Capital Canada office raised 260 pounds and the UK office was able to pile an impressive 679 pounds, donating their nonperishables to the Mississauga Food Bank and West Cheshire Food Bank, respectively. The 4.2 tons of nonperishable goods collected at the corporate office were donated directly to Gleaners Food Bank of Indiana.

committed to community

To round out the quarter, NextGear Capital played an active role in the Circle City Indiana Pride Parade. Participating for the second year in a row, team members fought the sweltering heat and marched with a multitude of motivators. Approximately 75 team members showed up in support of the LGBTQ community to celebrate diversity.

Momentum did not falter as the year progressed. committed to communityQuarter three introduced not only a new season, but new volunteers, as well. In early July, the NextGear Capital interns banded together to put on a sort of garage sale, dubbed the “Swag Sale”. They asked NextGear Capital team members to dig deep into the back of their closets to find gently used, pre-loved NextGear Capital gear that they no longer wore, as well as prompting those in leadership positions to donate new swag. By the end of the day, the formerly saturated room was depleted. The interns viewed the experience as nothing short of a success, especially after they learned Cox Automotive was providing a generous matching gift, raising the total to $9,270 for Big Brothers Big Sisters of Central Indiana.

committed to communityAnother success story lies within NextGear Capital’s participation in the Cox Automotive national partnership with St. Jude Children’s Research Hospital. NextGear Capital’s corporate team, as well as Autotrader, Manheim Indy and vAuto teamed up to be the Flagship sponsor for the annual St. Jude Walk/Run to End Childhood Cancer. The Cox Automotive brands were named the Grand Marshall and led all 600 participants in the walk through downtown Indianapolis. The team worked diligently, and came in first place in overall top fundraising teams. NextGear Capital field team members did an incredible job representing in their respective territories, as well. Across the country, team members got together in their regions and participated in the walk with other Cox Automotive brands. Team members from Indianapolis to Los Angeles helped fundraise, as well as walk to support the end of childhood cancer.

woof itFinishing up the year, quarter four had a lot to live up to. While the year was coming to an end, community relations did not, and has not, slowed down. To start off the final quarter, NextGear Capital partnered closely with the Humane Society for Hamilton County, launching a six week fundraising and volunteering campaign for the shelter. Naming every Wednesday “Woof It Wednesday”, volunteer opportunities and fundraising events were held weekly. Throughout the duration of the campaign, there was a coin war continuously running. In-house volunteer opportunities such as cage blanket making and dog toy making, and external volunteer opportunities such as spending an afternoon at the Humane Society for Hamilton County volunteering, were all a part of the campaign. With fundraising and volunteerism combined, NextGear Capital was not only a presenting sponsor of Woof It & Hoof It, but was able to make a total value impact of over $11,000.

Additionally, NextGear Capital team members have chartered a chapter of Cox Automotive’s initiative, Women With Drive. Women With Drive, originally launched in April 2015 as a Cox Automotive initiative, was developed to reach three main goals: to support community outreach to address the unique needs of women, to establish a forum for networking and sharing ideas related to personal and professional development, and to empower women across Cox Automotive and the automotive industry at large. Women with Drive creates a community focused on the personal and professional development of women at all levels within Cox Automotive.

team standing

Women With Drive held a two week supply drive with proceeds benefitting Girls Inc., a local nonprofit organization that focuses on instilling confidence in girls. Since 1945, Girls Inc. has focused on responding to the changing needs of girls in their communities. Our field team members truly outdid themselves in the fourth quarter, as well.

 One of their most notable efforts was supporting the Red Cross in their efforts to aid those affected by the Louisiana flooding. Field team members took it upon themselves to help raise funds and collect desperately needed items to donate to those affected by the devastating and widespread flooding. The North Central region donated approximately $1,340 directly to the American Red Cross, while the South Central region made donations directly to the flood victims. Truckloads of clothes and Wal-Mart gift cards have been driven to Baton Rouge weekly for the past few months. The South Central region is still making trips to help those affected by the devastation. To wrap up the year, NextGear Capital team members adopted ‘Angels’ in support of The Salvation Army’s annual holiday fundraiser, “Angel Tree” program. NextGear Capital team members understand that every holiday season there are children whose families are struggling financially and cannot afford the expenses associated with buying gifts for their children. To help support these children and their families, team members rallied to support 23 ‘angels’. Raising approximately $200 per child, team members went all out to make this Christmas one to remember for the children. The Business Assurance and Advisory Services team also held a team-building volunteer activity at the annual Angel Tree distribution day, where they helped distribute gifts to the parents of the children enrolled in the program.

I’m so proud of all of the NextGear Capital team members who went above and beyond this year to support so many great organizations in our community. Because of their hard work and commitment, NextGear Capital was able to have a record-breaking year in both fundraising and volunteering and we look forward to continuing our impact in 2017.” -Patty Turner, Senior Director of Corporate Administration.

NextGear Capital takes pride in promoting volunteerism and fundraisings opportunities to our team members, but it is also everyday habits that truly make a difference in the community. Playing an active role in organizations such as the Indiana Chamber of Commerce, the Indianapolis Chamber of Commerce, the OneZone Chamber of Commerce, the Indy Rainbow Chamber of Commerce and the Carmel Green Initiative allows NextGear Capital to consistently aid and assist the local economy in any way that it can. Giving back isn’t just about donating time or money, it means giving back to our earth as well. The OneZone Chamber of Commerce recently announced NextGear Capital as the winner of the annual Green Award for sustainable efforts in Carmel, Indiana. NextGear Capital has pledged to become a zero waste-to-landfill organization by December 2017. Being at an 84 percent diversion rate, meaning 84 percent of all waste is either composted or recycled, NextGear Capital is confident in our ability to attain this goal.

Monthly rotating trips to the Ronald McDonald House of Indiana, Gleaners Food Bank, and the John H. Boner Community Center allow team members to take time from their busy schedules and focus on helping others struggling within their community. Instead of zip-lining or participating in a thrilling activity, team members in the field are replacing these common teambuilding activities with a group volunteer project at their quarterly region meetings. NextGear Capital strives daily to find new opportunities in which it can become further involved in our local community. Looking forward to a strong 2017, NextGear Capital is planning now to make it the best yet!

Seasonal Wholesale Prices Drive Dealers to Stock Up

NextGear Capital and Manheim Offerings Compel Clients to Maximize Floor Plan Purchasing Power

Savvy dealers tracking seasonal wholesale prices and readying for buyers who use their tax returns to purchase vehicles are stocking up on inventory now. To do so, many are turning to NextGear Capital and Manheim to maximize their floor plan purchasing power.

According to Cox Automotive Chief Economist Tom Webb, the Manheim Index — which tracks monthly wholesale prices back to 1997 — reveals a “seasonal pattern with low points in October and November and price increases in January before peaking in April.”

Dealers utilizing a NextGear Capital line of credit can purchase inventory and take advantage of the extended terms. The flexible repayment period enables clients to make vehicle payments later, maintain cash reserves and purchase stock before seasonal price increases occur.

To ease dealers’ concerns about buying too early, Joe Lescota, director of dealer development, National Independent Automobile Dealers Association, suggests, “Dealers can take advantage of floor plan services, such as NextGear Capital, to prepare for the busier time of the year, as well as seek alliances with those who can help them make better buying decisions.”

Lescota, drawing on his 25+ years of industry experience, encourages dealers to learn about pricing in their individual markets before purchasing vehicles, in anticipation of tax season or any time of the year. “Resources — such as vAuto, Polk Reports and Autotrader – can identify which units turn in the shortest period of time in their area, as well as which flooring units have the highest gross earning potential.”

Manheim also provides acquisition resources to help dealers improve vehicle procurement and identify optimal stock to offer on their lots. Its team of professional buyers enable clients to maximize value during every step of the car buying process – from development of a tailored purchasing plan to vehicle acquisition to management of back-end processes after stock is obtained. These services enhance dealers’ productivity and free up their time to concentrate on customer-facing activities, while reducing risk and costs associated with in-house acquisitions, such as travel and staffing.

Developing An Exit Strategy for Aged Used Inventory

Aged used inventoryAfter buying a vehicle at auction, do you ever think to yourself, “What am I going to do with this unit if it doesn’t sell fast enough?” If you don’t, you might be hurting your own chances at profitability.

Holding on to aged used inventory can tie up your cash flow because you are holding on to a depreciating asset. Disposing of an older vehicle can help to free up the cash flow you need to purchase a unit more likely to sell. Associating an aged used inventory exit strategy to each unit mitigates against aged inventory and helps to create an efficient ecosystem that allows you to maximize dealership profitability.

While every exit strategy will differ from dealer to dealer, the three following questions are designed to help guide your thinking when developing your own aged inventory exit strategy.

Do you have a strategy for different inventory age points?
Developing a process or an exit strategy for vehicles at 15, 30, 45 and 60 days gives you a solid idea of what to do at any point in a vehicle’s lifecycle on your lot. For example, for a unit at 30 days part of your plan could be to detail some of your 30 day inventory, relocate units to another part of your lot and reevaluate your pricing.

What is your unit breakeven point?
Every dealer needs to decide for themselves what each unit’s breakeven point is. While holding on to inventory for 60 days is a typical industry standard, often by the time you get to that 60 day point, your unit could be on the edge of a profit or loss. A comprehensive exit strategy gives an overall structure to your inventory, but also allows for flexibility if needed.

Where can you dispose of aged inventory?
Keep note of the different places you source your inventory and the different places you can also get rid of aged used inventory. Some solid places to dispose of inventory includes auctions, exchanging inventory with your local network, Craigslist, Ebay, AutoTrader, Cars.com, OVE, and SmartAuction. If you can also match your inventory to the sources that would be most likely to give you the best price for your units, you’ll put yourself in a better position to get rid of your aged inventory.

Developing an exit strategy for aged used inventory won’t be a simple task. However, the sooner a plan is developed for your aged inventory, the sooner you can free up capital and start improving your profitability.

Three Floor Plan Finance Formulas Every Dealer Should Know

Owning and operating a profitable dealership withfloor plan finance formulas
efficient cash flow all comes down to balancing that cash flow with current inventory. So how do you make sure you are balancing that money and inventory effectively? Knowing the answers to the following three floor plan finance formulas and balancing those numbers with current inventory month to month will help ensure your dealership is effectively managing your current inventory and cash flow. Take a look at these formulas, and see how your dealership lines up.

How much inventory should a dealer stock?
The answer to this question varies based on realistic, monthly desired sales numbers and turn times for units. For example, let’s say a dealer wanted to sell 60 units per month. Assuming the average turn time for vehicles on a dealer’s lot is 40 days, a dealer would turn their lot 9 times over the course of 12 months. This floor plan finance formula is essentially the following: monthly desired sales divided by how many times a lot is turned per year, multiplied by the number of months in a year.

Monthly Desired Sales 60
Months in the Year X 12
Total Yearly Lot Turn (Assuming a 40 day average turn time) ÷ 9
Optimal Inventory Stocking Number = 80 Units

 

In this situation, the dealer would need to stock 80 units based on 60 desired sales per month and a 40 day average turn time.

Let’s try another example. This time, instead of an average lot turn time of 40 days, the dealer turns his lot only 6 times a year, or has an average lot turn time of 60 days. For simplicity, the same number of monthly desired sales will be used. The only change has been the total yearly lot turn.

Monthly Desired Sales 60
Months in the Year X 12
Total Yearly Lot Turn (Assuming a 60 day average turn time) ÷ 6
Optimal Inventory Stocking Number = 120 Units

 

With an average 60 day lot turn, the dealer would need to stock 120 units.

How many sales should a dealer be making based on the units they have in stock
Knowing the target sales number a dealership should be working towards based on current inventory can help determine if a dealer is overstocked, or if the number of desired sales per month is realistic. Let’s say a dealer has 108 units in stock. Again, let’s assume a unit turn time of approximately 40 days, or a total lot turn over of 9 times over the course of 12 months. To figure out the number of desired sales, multiply the number of units in stock by 9, then divide that sum by the number of months in a year.

Units in Stock 108
Total Yearly Lot Turn (Assuming a 40 day average turn time) X 9
Months in the Year ÷ 12
Optimal Number of Sales Per Month = 81 Sales

 

Based on the total number of units this particular dealer has in stock, they should be aiming to make 81 vehicle sales per month.

Let’s try this formula again with a 60 day average turn time and the same number of units in stock. To figure out the number of desired sales, multiply the number of units in stock by 6 (to account for the 60 day average turn time), then divide that sum by the number of months in a year.

Units in Stock 108
Total Yearly Lot Turn (Assuming a 60 day average turn time) X 6
Months in the Year ÷ 12
Optimal Number of Sales Per Month = 54 Sales

 

With 108 units in current inventory and a 60 day average lot turn time, this dealer should aim to make 54 sales per month.

What is the unit holding cost per day?
Every day that a unit sits on a lot, it costs a dealer money. Figuring out the holding cost per day allows dealers to determine what units need to be turned quickly, what units are able to sit for a while, or what units a dealer might need to consider selling at auction. This floor plan finance formula will require a dealer to have a good handle on total dealership expenses and inventory for the entire month. First, a dealer would need to figure out their monthly holding cost. To figure this out, a dealer would subtract their monthly selling expenses from their total expenses for the month. A dealer’s monthly selling expenses are variable monthly expenses that are not charged to the customer. These monthly selling expenses include items such as commissions, advertising, salaries, demo expenses and fuel. Let’s say a dealer’s total monthly expenses are $148,485, and their monthly selling expenses are $57,437.

Total Monthly Expenses $148,485
Monthly Selling Expenses – $57,437
Monthly Holding Cost = $91,048

 

Dealers can determine the monthly holding cost per unit once the monthly holding cost is figured out. The monthly holding cost per unit is found by dividing the monthly holding cost by the number of retail units in stock for the month. Let’s say this month a dealer had 85 units in stock.

Monthly Holding Cost $91,048
Units In Stock This Month ÷ 85 Units
Monthly Holding Cost Per Unit = $1071.15

 

Once the monthly holding cost per unit is figured out, it’s pretty simple to determine the holding cost per unit per day by dividing the monthly holding cost per unit by the number of selling days in a particular month. Selling days are the days that the dealership is open and available to make a sale. For example, let’s say that for a particular month there are 24 selling days available.

Monthly Holding Cost Per Unit $1071.15
Selling Days Available ÷ 24 Units
Holding Cost Per Unit Per Day = $44.63

 

The holding cost per unit per day is a useful metric that can help a dealer keep their inventory balanced as well as determine how quickly a dealer might need to turn a unit.

Why do these formulas matter, and what does turn time have to do with anything?
These floor plan finance formulas incorporated with a dealer’s turn time can help to make or break a dealership’s profitability.

Let’s say a dealer makes a profit of $3000 per car sold. If this dealer’s holding cost per day per unit is $44.63 and their turn time to sell a car is 60 days, they will spend $2677 of their profit holding on to a non-selling car.

What if a competing dealer’s turn time is 40 days? If everything else stays the same—the dealer’s $3000 profit per car and the cost per day per unit remains $44.63—but only the turn time changes, the competing dealer will only spend $1785 out of $3000 to sell the same unit.

A longer turn time for inventory eats into a dealer’s cash flow. A general rule of thumb is that once a unit moves past the 60 day point dealers should start thinking about what might become frozen capital, or a non-adequate return on investment. While every individual dealer will have to decide on their optimal turn time, break even point and subsequent exit strategy for inventory that isn’t sold within a desirable time period.

In any case, the math doesn’t lie. Quicker turn times not only increase profitability, but also help to keep cash flowing.

How does your dealership line up?
Using these floor plan finance formulas, you can gain a better understanding of the monthly balance of your inventory and cash flow. Are the dealership’s sales goals realistic? Is the lot overstocked? Is the holding cost per unit per day reasonable? Working through these floor plan finance formulas periodically and monitoring these three metrics is essential to ensuring the overall balance of inventory and cash flow in your dealership.

 

NextGear Capital Recognizes Auction Partners

NextGear Capital, a Cox Automotive brand, presented its fourth annual Auction Partners Awards Wednesday night at the Red Rock Casino and Resort in Las Vegas as part of the 2016 National Automobile Auction Association (NAAA) Convention. The awards spotlight independently owned auto auction leaders in the industry and recognize their years of dedicated service to growing and supporting the overall industry and their communities.

Randy Dohse, NextGear Capital’s senior vice president of operations, welcomed award winners, their guests, and others from throughout the auction industry for an evening reception.
“These auctions serve as examples for others in the industry to follow,” said Dohse. “As partners in their business, NextGear Capital has seen firsthand their commitment not only to superior customer service but their dedication to best practices and community.”

Three auction partners were honored with the Operational Excellence award, which is given to auctions that demonstrate excellent efficiency, top sales retention, overall operational performance and the most effective response to the needs of NextGear Capital.

NextGear Capital also presented a Remarketing Excellence award to the auction that demonstrated the highest percentage of sales recovered based on percentage of valuation of each vehicle and the best sales follow-up (efficient timing on getting proceeds of sales to NextGear Capital).

The 2016 Auction Partner Award winners are:

  • Operational Excellence: West Michigan Auto Auction – Wayland, MI
  • Operational Excellence: San Antonio Auto Auction – San Antonio, TX
  • Operational Excellence: Houston’s 1st Choice Auto Auction – Houston, TX
  • Remarketing Excellence: Carolina Auto Auction – Williamston, SC

How an Auto Dealer Can Encourage Customers to Re-Purchase

If you’ve had a good experience shopping How Auto Dealers Can Encourage Customers to Re-Purchasesomewhere, you are more likely to go shop there again. According to an Autotrader study titled, “Decisions, Decisions: What Drives Shopping Choices for Vehicle Re-Purchasers,” new and used re-purchasers were 46 percent and 30 percent more likely to choose to purchase from an auto dealer where they previously had a good experience. Developing a smooth and cohesive purchasing experience is essential for all customers, but how can you encourage potential
re-purchasers to visit your dealership when they are ready to buy again?

Keep Track of Former Customers
Tracking time since a previous purchase, the type of vehicle bought, and service activity, allows an auto dealer to gain insight on a customer’s future potential purchase decision. Linking those data points to an after-purchase experience survey can help you gain a better understanding of the experience a customer had during their buying process. The next time that customer steps foot into your dealership their second purchasing experience should be at least the same, if not better, than the last time they purchased.

Keep Former Customers Informed on Available Inventory
The Autotrader study notes that “new car buyers are nearly twice as likely to re-purchase the same make as used car buyers.” The study also notes that “most re-purchasers consider another make/model other than the vehicle they purchase. Nearly half of new re-purchasers and over half of used re-purchasers buy an entirely different make and model from the vehicle they are replacing.”  Reach out strategically to former customers when the timing is right with available inventory that not only lines up with their previous purchase, but also includes other desirable makes and models.

A customer’s individual experience with a particular vehicle will determine whether or not they will decide to re-purchase a vehicle of the same make. If they decide to re-purchase from the same make, be prepared to offer detailed information on the benefits of the newer models. If they decide to purchase another make or model, figure out, either in person or online, what qualities they liked and disliked about their previous vehicle and align those qualities with current inventory. 

Make Financing and Negotiating Easy
The time spent at the dealership and negotiating a price are often cited as the most frustrating part of the vehicle buying process. If customers experienced a smooth process of financing and negotiating the first time they bought from an auto dealer, they would expect a similar or better purchasing experience their second time buying at that dealership. Implementing transparent pricing and financing practices and allowing customers to start the financing and negotiation part of the process online or in-store, according to their preference, is one step towards improving the purchasing experience.

Consistently earning the business of former customers takes time, effort and hard work. However, that effort will be well worth it when your dealership is a former customer’s first choice when it comes to buying another vehicle. 

Knowing Your Market Is Key to Stocking The Right Inventory

It’s easy to buy inventory. With enough credit, a dealer could fill his whole lot with vehicles. However, buying the right inventory that will sell is harder than just buying inventory. Being aware of the needs, trends and desires of your market will help you to not just stock inventory, but will help you stock the right inventory.

Know Your Market Knowing your market is key to stocking the right inventory The key to stocking the right inventory is knowing your market. What types of vehicles are potential customers in your community looking for? Are most customers primarily first time walk-ins or are they doing research online first? When was the last time they purchased a vehicle? When it comes to stocking inventory, half of the battle is knowing the answers to some of these questions. Why stock a limited edition SUV if 85 percent of your customers are looking for a mid-size sedan? Gather, and accurately record, data from customers through surveys, website analytics, or even by asking leading questions during the sales process. Compiling this data will paint a picture of who your customers are and what they are looking for, in both a dealership and a new vehicle.

Check and see if the data gathered from customer surveys lines up with sales records and current inventory. If there are gaps, there should be opportunity to pivot inventory and meet the needs of customers that may fit within those gaps.

Use Your Resources At Auction
Keeping your market product and price preferences in mind is essential when trying to determine what vehicles you should purchase from an auction. Pricing tools are a great resource to help you make an informed decision on whether you should purchase a particular auction vehicle. Value lookup on the myNextGear app and the Manheim Market Report (MMR) are excellent resources to learn more about the potential vehicle you are buying at an auction, and what fair prices are for those vehicles. These tools use data gathered from others who have purchased similar vehicles in the same condition. Using these resources, and keeping in mind the markup price your market is able to bear, will help you determine if a particular vehicle is a good fit for your inventory.

Stocking The Right Inventory
Balancing inventory with the wants and needs of potential customers hinges on a dealer’s ability to stay in tune with the market. Learning the market and stocking the right inventory puts dealers on the right track to profit and better meet the needs of customers.

The Humane Society for Hamilton County: NextGear Capital’s Impact

NextGear Capital’s Community Relations Team Holds Two Month Fundraising and Volunteer Campaign for the Humane Society for Hamilton County

NextGear Capital is no stranger to the Humane Society for Hamilton County. Whether it’s volunteering at the corporate office by making dog and cat blankets or toys from donated t-shirts, volunteering out-of-house at the Humane Society itself, or raising funds for the variety of programs the organization provides to the animals in their care, NextGear Capital has always been supportive of the Humane Society for Hamilton County.

Founded in 1984, the Humane Society for Hamilton County has an open-admission policy and a no-kill philosophy. More than 3,000 animals cross their threshold each year. Despite that inception rate, the Humane Society has maintained a 98 percent placement rate over the last three years, more than doubling the average U.S. placement rate of 39 percent. The Humane Society’s tagline “Love & Let Live” speaks to the shelter’s no-kill philosophy of giving every adoptable animal who can be saved, treated, or rehabilitated, a second chance at life.

The Humane Society for Hamilton County holds an annual festival called Woofstock, which raises funds for both the shelter and their Survivor Program. This day-long festival boasts food trucks, adult beverages, live entertainment and interactive activities for both kids and canines. All of these activities are preceded with a walk entitled “Woof It & Hoof It,” in which all funds benefit the shelter’s Survivor Program. The Survivor Program was established to raise funds to provide lifesaving medical treatment or emergency care to animals in need. Dogs and cats arrive at the shelter with life-threatening injuries and illness, like those with hit-by-car injuries, heartworm diseases, mange, chronic illness, or victims of abuse, and need special medical care to survive.

NextGear Capital team members help out at the Humane Society for Hamilton CountyNextGear Capital team members have participated in the annual walk since 2014. When the Community Relations team learned there was an opportunity for NextGear Capital to be the 2016 title sponsor, plans were quickly put into motion to not only sponsor “Woof It & Hoof It,” but make sure that team members had the opportunity to give back in a variety of creative ways. For two months, Wednesdays became “Woof It Wednesdays,” with weekly volunteer and fundraising events. Male team members were pitted against female team members to encourage competition and help increase the potential impact for the Humane Society.

NextGear Capital pooled resources from a number of departments to help make the most effective campaign to date. The competitive nature of NextGear Capital team members produced over $2,500, 40 blankets for dog and cat cages, 74 dog toys as well as 65 towels donated during a week-long towel drive – all to benefit the Humane Society. All in all, NextGear Capital team members volunteered a total of 136 hours of their time. Last minute, a member of the men’s team made a very large financial donation, bringing the men’s team from 450 points behind, to 50 points ahead. Thus the 2016 Woof It & Hoof It Trophy was awarded to the men’s team.

NextGear Capital team members present donations to the Humane Society of Hamilton County

NextGear Capital donates animal blankets to the Humane Society of Hamilton County

Team members across all departments had a blast participating in volunteer events, fundraising initiatives, and Woofstock itself. Nearly two dozen NextGear Capital team members, family and friends, enjoyed parading their pooches around and representing the company in their snazzy green volunteer shirts.

NextGear Capital stands by its core value of commitment to community, and is looking forward to a continued partnership with the Humane Society for Hamilton County.