How to Fix Your Dealership’s Inventory Management Problems

March 25th, 2016 by
The car-buying process has evolved, but while many customers have changed the way they shop for cars, a lot of dealerships have yet to catch up. Many dealers still use outdated, outmoded inventory management techniques, and that can make or break your bottom line.
At MAXDigital, we provide cutting edge inventory management software to car dealers. Our definition of inventory management is making sure you have the right vehicle at the right time with the right price.
Keep reading to learn about three ways MAXDigital can solve your inventory management woes.
 

Stock the Right Cars to Offer Customers Quality and Value

 
Today’s consumers are looking for a transparent, consistent, and simple car buying experience. The way you stock your inventory now might not allow for that.
Cars are unique in the retail space for the nearly limitless options available to customers. Countless models come in different colors, different body styles, different trims, and so on. How do you know which cars to have on your lot? You might stock the model a customer is interested in, but if a competing dealership across town has the same model with the color and engine option they want, you’re going to lose that sale.
Your existing inventory management system isn’t helping you fix that, but MAXDigital can. Our FirstLook platform analyzes data from your market to tell you exactly which cars are in demand at any given moment. We can also look at your own historical data to tell you what models you have proven success selling.
Our system will make your dealership more effective. If a customer submits a lead on one of your cars, you’ll be able to respond with absolute certainty about where it is and what condition it’s in.
FirstLook can also eliminate latency. You don’t want to be in a situation where you just got the exact car someone wants on a trade-in but it takes a week to put it in your system. Or worse, when a customer asks about a car that’s been sold but is still listed on your website. We make it easy to get cars into your system as soon as you acquire them, and we get them out of your system as soon as their sold.
 

Set Transparent Prices with MAXDigital’s Acquisition and Pricing Tools

 
When a customer is browsing your inventory, they expect to see the price of each car. If they ask about it, it should be obvious where that price comes from.
The value of data can’t be underestimated in the digital age of car-buying. Our FirstLook platform comes with powerful tools that help you appraise and price your inventory. FirstLook is your best friend when you’re trying to close a trade-in while maintaining a high gross profit. It’s also there when you want to decide how much to put into reconditioning the vehicle and when you’re setting a fair market value to offer the next owner.
Our inventory management system makes use of real-time market and wholesale data from a comprehensive and reliable data set so that you know exactly how much to charge for a given vehicle. We not only take into account local prices, but regional prices as well. It’s important to realize that a customer who will drive 25 miles for a good deal would drive 250 miles for a great deal. With FirstLook, you can find that sweet spot that makes the deal great for both of you.
It’s important that this data is real-time because it isn’t just about offering the right car at the right price. Timing is everything, too, and auto dealers have to be sensitive to how long a car is on their lot. You’ll know exactly when it’s better to wholesale a trade-in instead of leaving it in your inventory where it’s just taking up space.
 

With Great Inventory Management Comes Great Merchandising

 
Selling cars based on price alone isn’t enough anymore. You also have to demonstrate your inventory’s value to your customers, and you can’t do that if you settle for generic vehicle detail pages (VDPs).
“Is this car right for me?”
“Am I buying a lemon?”
“Why is this car better than the other one?”
“Is this a fair price?”
“Why should I buy from this dealer?”
These are the questions your consumers are asking, and it’s these questions that a VDP should answer. There’s no point telling people a car is blue if you put pictures of it on the page. Instead tell them what features and options packages come in the car. You should give as detailed a vehicle history report as you can manage. Make sure everything worth knowing about a vehicle is listed online because that’s where consumers are making their decisions, not in your showroom.
It’s because of this that upgrading your inventory management system is only the start of adapting to the digital age. You also have to change the way you market to consumers. We know how to help you there too.
Give your customer the information that provides the vehicle's value at every stage of the sales process, including in the showroom, and highlight the reasons you bought that car. You priced it based on its value, now defend that price.
We encourage you to schedule a demo with us to see how our full suite of software works together for you. If you need to start somewhere, remember: right car, right time, right price.