Automotive Inventory Management · Car Inventory

Why Is Automotive Inventory Management All-Imperative?

From the opening of a grand automobile showroom to the automotive marketing, the auto dealers spend huge bucks. The million dollar investment makes them quite conscious about the ROI as the monthly bill checks they sign are near or less equivalent to the profit margins.

They always keep an eye over the expenses made like:

  • Are we getting the enough leads from the 3rd party website?
  • Couldn’t we found another supplier that makes the supply at low rates?
  • Is it worth to keep this much number of employees?
  • And, more.

But, there is one important question that’s less often asked or come up in the mind of auto dealers that is- “The amount spend on new vehicle inventory order is worth the millions?”

automotive inventory management

The surprising fact- Without looking at the new car inventory or sales trend, the dealers keep on ordering the cars, which results into wrong cars are ordered and creates a mess in the end. Moreover, no one is ready to take the accountability for the decisions.

What’s next?  The automotive inventory management needs dealers attention.

According to a research study, “When the inventory of 100 dealers offering the same brand of vehicles in the USA is examined, 60% of them had new cars older than 3 months in the stock.”

It signifies efficient inventory management is a must to increase the bottom lines, reduce the expenses, bring advantageous opportunities in used vehicle departments and turn floor plan expense into profits, otherwise the vehicles keep on stocking.

Here, we have come up with the two things which if implemented well, the automotive inventory management would auto-scale:

  • Modernize the inventory with cutting-edge technology

In the digital age, most of the car dealers have adopted numerous auto dealer solutions to propel the growth. The inventory management is one of them, but only a few of them use it as a tool to make the price or stocking decisions. Identifying the current market opportunities are important in deciding what to keep stock of in the inventory or not.

  • Maintain an equilibrium between expense and inventory turns

Keeping a fine balance between the bucks spent over sales manager pay plans and the inventory would ramp up the profits. See how? When you keep the portion of sales manager income variant as per the inventory management, you would surprise to see how quickly no car older than 6 months would remain or the inventory gets piled up with the cars that are not in the demand.


When the customers are spending hours before making an investment of thousands of dollars in the automobile you are selling, then why don’t being a car dealer, you can spend a few minutes in the efficient inventory management that can turn the table upside down. Also, the technology usage help in gaining better insights into what competitors are selling and watch the performance metrics.


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