The 2013 Automotive Management Used Car Market Conference reported that the price of two-and-a-half to five-year-old used cars had risen by more than 20 percent in the previous four years, making this an attractive product category for car dealers. To succeed, dealers must maintain competitive prices and retain sufficient stock to meet consumer demand.
Build and Refresh Stock
One way to increase used car sales is to ensure you have enough inventory of used cars on hand to meet demand. Offering new car buyers a good trade-in price for their old vehicle can help dealers build used car stocks. However, Automotive News also recommends keeping used car stock fresh to maintain customer interest. Sending unsold used cars to auction after 60 days helps keep stock fresh and reduces inventory costs. Dealers with multiple outlets can exchange stock to keep each outlet’s used car inventory fresh.
Keep Prices Affordable
Although headline prices of used cars are lower than equivalent new cars, dealers and manufacturers may offer payment plans that represent a low monthly outlay to the consumer. To increase sales of used cars, dealers must ensure that prices are affordable and represent value for money. Offering used car customers a minimum trade-in value may make prices more affordable.
Offer Quality Used Cars
Consumers want peace of mind when they buy a used car. Offering comprehensive checks and extended warranties can help to build customer confidence. Manufacturers such as Ford offer approved used cars through the Ford Direct program, for example, which gives consumers the same level of service and support as new car buyers. Independent dealers must aim to offer the same level of confidence in their used cars.
Promote Used Cars
Keeping customers and prospects informed of used car stocks can help increase sales. For example, emailing or texting details of new stock that matches individual customers’ preferences can encourage them to visit the dealership or make an offer. A special used car event, such as a bargain price weekend, also helps to build dealership traffic. Dealership websites should feature comprehensive details and photographs of used cars in stock. A 2013 survey by online car dealer Edmunds.com found that website visitors were most interested in pricing information, photographs and reviews.
Build Commitment to Used Car Sales
Dealerships that have traditionally focused on new car sales can build a profitable used car business by focusing on the right stock at the right price, according to AM Online. However, success requires strong management, a commitment to the used car market and a remuneration package that rewards the sales team for increasing used car sales.