Out-of-stock situations in car dealerships create disappointment in customers and losses in sales. As per Mark Gilbert Scottsdale AZ, proper inventory management is important to avoid such issues. Car dealerships that still conduct manual inventory checks may experience inefficiency in inventory management processes, and hence using modern software and tools for the process has become important. The Covid-19 pandemic especially forced dealerships to replace manual inventory management processes with new-age software.
Mark Gilbert Scottsdale AZ briefly talks about car dealership inventory management
Maintaining an optimal level of inventory helps dealerships control costs associated with storage, insurance, and financing. Excessive inventory can tie up significant amounts of capital, while insufficient inventory may result in lost sales opportunities. Dealerships need to have the right mix of vehicles in stock to meet customer demand. A well-managed inventory helps ensure that popular models are available when customers are ready to make a purchase, which ultimately goes a long way in improving customer satisfaction and loyalty. The automotive industry often experiences seasonal fluctuations and promotional events. Proper inventory management also allows dealerships to anticipate and prepare for these changes, and make sure they have the right vehicles in stock to capitalize on seasonal demand or promotions.
Strategic management and optimization of a car dealership’s inventory can help them to effectively meet customer needs, lower expenses and boost revenues. As a dealer, one must have a good understanding of the cars in their inventory for proper inventory management, as well as to increase the likelihood of making a sale. Most dealerships have up to four different categories of vehicles in their inventory, which includes:
- New vehicles: These vehicles are the ones that have never been owned or driven and typically have a high demand.
- Used vehicles: Such cars have been previously owned and driven, but still do have high value despite some wear a tear.
- Certified pre-owned vehicles: These are pre-owned cars that have been inspected and certified by the manufacturer to meet a certain quality standard before they are resold.
- Trade-ins: These are the cars brought in by customers to cover part of the purchase price of a new or used car.
Most of the modern inventory management software allows dealers to enter specific details of the inventory, including status, VIN, make, model and asking price, to help dealers manage their inventory efficiently.
A huge aspect of proper inventory management for auto dealerships hinges on following the best practices in regard to keeping the inventory appealing to the target customer base. Mark Gilbert Scottsdale AZ says, keeping the inventory well-maintained, relevant and interesting significantly increases the odds of a dealership in attracting the right customers and making a sale. Auto dealers need to focus on identifying the target market of their dealership, so as to get an idea about what price point their shoppers are willing to consider. This would ultimately help them to decide which vehicles to bring onto their lot. Diversifying the inventory by stocking a variety of models and makes is also important as doing so would allow the dealership to magnetize a wider range of customers.