Car dealerships provide an important service to consumers. They simplify the process of buying and selling cars; assist with financing paperwork and regulatory requirements; and offer repair and maintenance services.
However, they also have significant costs for showrooms and lots, staffing, inventory holding, and m방문운전연수 arketing. Improving operational excellence and moving to a customer-based view for marketing will help them compete effectively in the new retail landscape.
Sales
The sales department of a car dealership provides a vital link between vehicle manufacturers and consumers. The sales department’s revenue depends on the sale of new and used vehicles, service and parts. Dealerships may also sell other automotive-related goods and services, such as financing and insurance contracts. Dealerships can be stand-alone businesses or part of larger automaker dealership chains. Automakers typically set sales, service and parts standards for their dealers.
In some larger dealerships, the sales department consists of a number of people. A Business Development Center (BDC) representative is often the first person a customer will speak with, and is responsible for answering basic questions about vehicles and scheduling appointments to see them in the showroom. Some BDC representatives work with customers in advance of their visits to help them prepare, including researching specific models and arranging for test drives.
Car salespeople are well-versed in the technical aspects of different vehicles, and know how to “read” a prospective customer’s emotions so they can tailor their pitch to match. In addition, savvy dealerships offer regular training to ensure their staff is on top of their game.방문운전연수
A general manager oversees the entire dealership operation, ensuring that staff members are working efficiently and meeting sales goals. The manager’s duties include hiring and training employees, developing marketing strategies and analyzing data and trends to determine what cars will most appeal to the local market.
Finance
The finance department is where a car dealer draws up sales contracts, arranges financing for new and used vehicles and sells additional products, like warranty and insurance packages. It’s also where a dealer makes its real money. Most dealerships make more from their finance departments than they do from the sale of the cars themselves.
Both independent and franchise dealers — dealers that work directly with a specific manufacturer — offer in-house financing. This is usually done through a captive finance company that works for the dealer and manufacturer. It’s worth comparing the dealer’s in-house offers to those from outside lenders to see if they can beat what you can get elsewhere.
Dealerships can offer a wide range of credit terms, including annual percentage rates (APR) and length of loan or lease. These are negotiable, as are the down payment and monthly payments. Be prepared to walk away from the deal if you can’t agree to terms that are fair.
Be sure to review the terms carefully and understand all fees involved. Some charges may appear hidden in the fine print and not be immediately obvious. For example, some dealers will charge to etch the vehicle’s VIN on its windows. A simple VIN etching kit can be bought for less than $100, so ask the dealer to reveal this fee before agreeing to it.
Service
The service department is a profit center that contributes to the dealership as a whole in three ways: 1. retail sales 2. internal sales 3. warranty sales. A dealer’s service department must strive to maximize these revenue opportunities. The service department must also provide the best customer experience possible to drive brand loyalty and retention. Using customer-centric business practices and technology is one way to do this.
Increasing the number of service specials and offering loaner vehicles are other ways to increase customer satisfaction. Additionally, a dealer service advisor should be knowledgeable of what services are needed for each vehicle type to help customers make better decisions regarding maintenance and repair schedules.
A factory-trained technician is another advantage that a dealership offers over independent mechanics or specialized franchise tire, lube, and air conditioning shops. Dealership technicians earn and maintain their certifications from the manufacturer of each vehicle they work on, which means they know the car inside and out. These technicians must also attend continuing education courses to stay abreast of the latest repairs and diagnostic techniques.
Managing capacity and balancing the types of labor required to complete service orders is essential to dealership success in the service department. Research shows that consumers who spend 2.5 hours or less at the dealership for service are more likely to return for future repairs. In addition, the dealership must be honest about how long it will take to perform a service order and give consumers regular progress updates to keep them engaged.
Parts
The parts department, often the most profitable part of a car dealership, must be able to access inventory quickly due to the time-sensitive requirements of customers. This means that it must be able to sell and ship out fast-moving items, such as wiper blades, batteries and lighting components. Parts departments that fail to manage this will struggle to stay ahead of the competition.
One of the best ways to increase parts department sales is to offer branded products in consumer packaging at competitive prices. These can be easy to stock, and can help generate a significant amount of incremental parts revenue. Other strategies include partnering with the service department to sell parts to customers, and offering aftermarket accessories, such as wheels and tires.
Parts departments must also be able to manage their inventory, which requires the ability to read and understand management reports. They should be able to identify slow-moving and obsolete parts and take action to clean them up. This is typically done by running a parts-only inventory report that shows part numbers and dollar amounts that have not sold in ranges of months, such as zero to three, four to six, seven to 12 or more than 12 months.
Parts departments should also take steps to reduce theft, including limiting access to bins to only parts department employees and using cameras. They should also have an outside firm perform a parts inventory physical each year.