Increase your Turn Rate and Profit Margins with AMP Remarketing
In the past year, there’s been a shifting focus from new vehicle sales to used vehicle sales, primarily due to consumer demands. At an average price of nearly $37,000, new vehicles simply don’t fit within consumer budgets as much as they used to. The growing appeal for pre-owned vehicles is so great, dealers have been shifting their inventory more in favor of used-vehicle sales which carry greater profit margins.
With the used-vehicle market firing on all cylinders, dealers are fiercely competing to secure prime inventory they can price right for their consumer demographic. In order to successfully capitalize on maintaining higher margins with a less than 45 days on average turn rate, dealers need to explore efficiencies on how to acquire quality inventory for retail. One particularly important area that has a major impact on profit potential is the reconditioning process. At an average of 10-12 days, the reconditioning process can be long and costly, slowing down the time it takes to get your vehicle to the front line which reduces front end profit.
AMP Remarketing is changing the dynamics of dealer inventory acquisition by giving dealers the opportunity to connect reconditioning cost management with days inventory management via a digital platform offering only Frontline and CPO Ready units. CPO programs are great for the used-car space. New data from J.D. Power shows higher average profits and faster turn rates for CPO vehicles consistently over the past two years.
Dealers have been selling more CPO cars because customers are willing to pay about $3,000 more for a CPO vehicle than for the same vehicle without certification according to a study by Cox Industries. Consumers see the value in the certification process, extra warranty and financing that the captives put out there. CPO programs also give dealerships the chance to build loyalty with consumers. By treating a CPO vehicle owner like a new vehicle owner, dealers develop consumer trust ensuring they come back to the selling dealer for service as opposed to going to a service station down the street. CPO vehicles build customer trust, insuring repeat business as well as referrals!