Car Inventory · Dealer Solutions

What Are The Indicators That Signal Used Vehicle Inventory Pricing Decisions Need Changes?

Moving used vehicle inventory has become a hard nut to crack for the auto dealers. Many times, the dealers found searching the answer of a single question- How used vehicle operations can be taken to the next level and gain optimal ROI?

Inevitably, the best dealers make all the efforts that include flawless inventory management, digital marketing, responsive website development and pretty more. Yet, they fail to climb up the success ladder. Why is it so?


The reason behind is the auto dealers forget the fundamentals, which is the baseline condition to move the used vehicle inventory and maximize the profitability. Again, it poses a question before the dealers that is- What is the basic thing not recalled?

It’s none other than vehicle pricing. Yes, the dealers less often think about the need to change the vehicle pricing according to various conditions and situations, which becomes the top reason of lagging behind.

As a corrective measure, here we have enlisted the five indicators which vividly hint the dealer to change the used vehicle price to go beyond and hit the mark:

  • Market Supply And Demand- Maintain A Win-Win Ratio!

Analyzing the sales and the supply of the similar types of the vehicles in the market, the dealers can identify which type of vehicles they can buy in the lot and keep on the floor. It better hints how much competition the vehicles are facing in the market and based on which prices can be set.

For instance: The vehicles with high market days supply indicates that the vehicle is in-demand and high price can be set by the dealer to acquire good profits.

  • Intelligently Decide The Cost To Market

In the used car inventory, the cars bought even at the wholesale price is proving to be expensive to the auto dealers and impacts the bottom line. As the car reconditioning and making it perfect to market in retail eats up a good amount of dollars, which in turn hurts the dealer’s profitability.

It’s advisable to the dealers that they should maintain 15% of the profit after spending 85% of the dollars in acquiring and reconditioning of the cars so that the ROI remains intact. The price must be set smartly.

  • Check If The Inventory Is Aging

The integral part of the automotive inventory management is the auto dealers need to monitor the inventory after every 30 days to keep the inventory moving with smart merchandising decisions. If the slow-moving inventory vehicles are found, then the dealer needs to reconsider the pricing decision to sell them quickly and improve the inventory turn.

  • Keep Competitive Price To Market The Vehicle

After maintaining the best cost to market price, the dealers have to analyze the similar vehicle’s cost in the market before putting any price label on the vehicles. Offering the same vehicle at the lesser price as opposed to other vehicle’s price in the market helps in capturing customer’s attention and speed up the sale. Also, the price can be further adjusted, if no improvement is found in the sales.

  • Set Ideal Discounts On The Vehicles

When the discount is offered on the vehicle, certainly all the calculations must be done in the background to maintain the profitability.

Price to market = Price displayed + dealership expense + other cost + discount

This way by modifying the price, catching more eyeballs becomes easy and the bottom line of the dealer won’t get hurt. But, a fine balance must be maintained so that the price should appear competitive and discounts eye-catchy to the end-customers.

Engineering numerous car dealer solutions is not a roadmap to keep the inventory moving and multiply the profits. Instead, there are some basic elements like- intelligently changing the vehicle price that is compulsory in accomplishing the goals.


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