Creating a Reconditioning Strategy Focused on Quality

We have experienced downturns in the automotive industry before, and dealers are reacting as they normally do. Which, time has shown, isn’t always the right reaction — or in some cases is too much a little too late.

In times of uncertainty, dealers naturally begin pulling back, and there is a shift toward cutting whatever resources can be spared. The problem with the “I need to cut” mindset in reconditioning is almost the same as when it comes to rehabbing a house. When you cut corners, the quality of your work goes down, and your chances of making a profit can decrease. Lots of dealers can get so caught up in the pennies that they end up losing dollars.

Spending the right money on the right car for the right reason is different. That’s called working a plan, and when properly executed, reconditioning is not an expense — it’s an advantage that will make you more money.

I always remind myself that, in times like these, all I can do is focus on what I can control. I can focus on my current inventory and processes, and I can evaluate what does and does not work when it comes to keeping my dealership profitable.

To help you get started along those lines, here are three quick tips for a reconditioning strategy focused on quality in the current industry climate:

1. Make sure you have an updated reconditioning process, allowing you to spend strategically for the best chance at selling a car for a profit. For example, putting on new tires may seem like money you don’t want to spend, but it can make all the difference to a car shopper looking to get the most value for their dollar.
2. Use this opportunity to assess the quality of work provided by your reconditioning vendors. Are you spending money on their services because their work makes you money?
3. Examine everyone who provides service at any point in your reconditioning process, and determine the necessity and quality of their work. Keep all parties engaged and accountable by providing clear expectations and being upfront with timelines.

Over the last few years, we have seen sales opportunities drop to two or maybe three per car. In a tough economy, we may only have one shot to win the sale. Making informed, well-planned reconditioning decisions will be the key to finding success and getting your store back to profitability. Never be afraid to spend money wisely.