August 18, 2016 by: Joseph Robinson
Speed to Market is quickly becoming the hottest buzzword in the automotive world, and for good reason. When you purchase a vehicle, you are making an investment in your business. The smartest investments allow you to capitalize quickly and yield a high return. So, how do you do this with your inventory?
Using a combination of process and technology will allow you to merchandise and market vehicles as quickly as possible. First, we’ll discuss why Speed to Market is important and talk about tips for how to improve your current operational process. In our next blog, we’ll touch on how you can take advantage of new and existing technology to accelerate your time to market.
To maximize your Return on investment (ROI), you must get your vehicles online quickly. As a dealership, you are likely very familiar with floor-planning your inventory. You are probably equally aware that your ROI, the amount of return you see relative to the investment’s cost, decreases each day you have a vehicle on your lot. Because of this, it is imperative that you get your vehicles online and in front of the right audience as soon as possible.
Merchandising your inventory quickly will help it get the attention it deserves. It’s no secret that most car shoppers today are browsing online before they head to a dealership. A staggering one third of all online car shopping occurs while your dealership is closed. Moreover, listings with multiple custom photos get 305% more views than those with only stock images¹. This is a key indicator that having fully merchandised vehicles will draw more attention from potential customers.
Getting a vehicle ready for sale is an area where most dealers can improve. What can you do to adjust? Let’s start with process. In the United States, the top performing dealerships are able to recondition 85% of their inventory less than 24 hours after receiving it. However, the average time to recondition a vehicle is 7-10 days². This suggests that the average dealer has a lot of room for improvement to speed up the reconditioning process. Though it may seem like a daunting task, we suggest beginning by measuring the average time it takes for your dealership to receive and recondition a vehicle. Once you start measuring your reconditioning process, tweak your methods to decide what works and what doesn’t, making incremental improvements along the way.
Maximize efficiency by reallocating tasks to more quickly merchandise and distribute your vehicles. In a study conducted by Homenet, we’ve found that 89% of dealerships use mobile devices to conduct business each day³. With new mobile platforms data collection, VIN decoding, photo and video capture are easier and faster than ever. Introducing this element of data collection into your reconditioning process (or very shortly thereafter) can help to reduce the amount of time for your vehicles to appear online and merchandised.
Stay tuned for our next blog, which will focus on how you can better utilize technology to increase your speed to market. In the meantime, you can get a head start by looking at some of Homenet’s current product offerings and how they can make your life easier here.
1. Online Merchandising in a Multi-Device World, AutoTrader 2015
2. Front End Fundamentals, Cox Automotive 2014
3. Merchandising Effectiveness Dealer Survey, Homenet Automotive, 2015
Joseph Robinson is a Manager in Homenet’s Account Management Department where he oversees the on-boarding of all Retail and Major Accounts. In his free time he enjoys traveling, running 5ks and spending too much money on music gear. You can contact him by emailing Joseph.Robinson@HomenetAuto.com or connecting with him on LinkedIn.