An ounce of performance is worth a pound of promises

To be a successful dealer in the good time is hard enough, so when the economic belt gets tightens a notch it time to remember that the business basics are even more important

Motor vehicle dealers should consider the following:

1. Reduce floor plan expenses were possible (reduce your interest bill) and improve inventory management (effective stock turn is the key);
2. Manage your long term debt i.e. capital loans, rentals and mortgages;
3. Focus on cash balances – cash is king;
4. Remodel / re-gear your business to extract maximum profitability from each of your departments;
5. Improve sales efficiency for probable lower floor traffic – need to seek business – do not wait for customers to approach you;
6. Focus on more profitable business (some clients cost the business money don’t be scared to say no);
7. Lookout for OEM flexibility and take maximum advantage of programmes which will help dealer profitability;
8. Trade-in and sell at realistic prices;
9. Build and rebuild good relationships with your OEM’s, financial partners, suppliers, etc.
10. Train and re-train your staff to become more effective, pro-active in seeking business;

Issued by NADA 18 January 2016