Can car dealers build around a new QB?
Let's use this NFL draft analogy with thinking differently about your used car retail operations.
When the NFL drafts their top player, the quarterback, they do so for his talent and skillset, of course, but they also try to match those skillsets to the current team's dynamic. Especially if they are already having success. However, if there is a need for a change and they need to think differently, or if they just need a QB, they will go out and find the best available QB to draft. Then they will build the team and scheme around them.
We are in much of the same paradigm in the used car market now. If you have been successful and you can continue to draft top talent (your current used car mix) that keeps your success going, that’s great. However, if you see a shift in your business around demand, and availability of used inventory that is not allowing you to stock the same inventory mix, then you have to take what the market gives you. Just like an NFL team would do, you then build a strategy around that new set (the QB).
Finding the best mix for you is all about working with your inventory tools and partners to have the most current data and understanding of your market. Once you build the best mix available by using those tools and acquire that inventory, you ensure retail success by becoming a best-in-class retailer for that unique mix. There are many ways to do that including a robust Omni-Channel experience, a strategically targeted Digital Advertising program, a robust in-store process that fosters consultative transparency, becoming a buyer-centric Car Buying Outlet, etc.
The bottom line is the Manheim Index is at an all-time high and is expected to continue to rise at some level through Tax Season 2022. However, there are some quality deals in the acquisition market if you take a surgical approach using your inventory tools and partners. Yes, it may require you to think differently about your used car inventory mix, but as an NFL team, your next step is to build a strategy around your new mix (QB). One example of inventory mix opportunities is in the middle graph below between the two index graphs. There are many others. Can you think differently about your retail offering and use this current market to win?
