Let's face it. The pandemic caught us all by surprise and it will take years to determine the full impact. What we know, right now, is that COVID-19 hit the automotive industry hard with shutdowns across the board, from assembly lines to auctions to dealerships and retailers throughout the U.S.
They say that "necessity is the mother of invention" and even though many tools existed before the pandemic to help dealers sell cars, progressive dealers reinvented ways to use these tools to offset loss while giving car buyers a great experience in the process.
We've learned valuable lessons in the wake of COVID-19. From my perspective, here are the top five.
1) The auto industry is resilient, but we're still susceptible to pandemics and other major economic issues.
Our industry continues to rely on traditional business practices – in particular, our sales and inventory acquisition processes – which make us less resilient. A major resurgence of COVID-19 or some other economic downfall could turn an already-unstable market on its head. We've come a long way since the mid-90s when the automotive Internet emerged, but we still have far to go.
2) The importance of used vehicle inventory when new car supply chains are blocked.
Before COVID, a dealership's used car department was always a major profit center. In the wake of the pandemic, we learned just how valuable it is especially when new car assembly plants are closed. The dealerships that survived and thrived since March optimized their ability to tap into alternative inventory channels, starting with private sellers.
3) Our vulnerability when it comes to traditional auctions.
Traditional auctions are largely inefficient even in the best of times. Reconditioning costs, transportation costs, auction fees, and geographic constraints have long put downward pressure on dealer profits. During the pandemic, traditional auctions went dark. We are vulnerable if we continue to rely on this channel, particularly when buying the right inventory at the right price from the right markets is mission critical.
4) Technology has never been more important for daily business operations.
Dealers who sold more cars during the pandemic than they did before fully embraced technology as the best way of doing business. Those who provided services like virtual trade appraisals, electronic signatures, digital vehicle walk-arounds, and at-home test drives and deliveries won – and won big! Better yet, they gave their customers the best buying experience.
5) The fundamental need to bridge the gap between dealers and private party inventory.
When COVID-19 hit in March of this year, there were 3.4 million vehicles in inventory. Today, that number has dropped to around 2.2 million. The bottom line? Dealers need inventory more than ever. The highest volume, most in-demand vehicles are currently owned by private parties, yet no one has been able to truly infiltrate this marketplace until now.
Change is hard. I get it. Losing business is hard, too. You can do the work that's required to change your business or you can keep doing business the way you've always done and lose sales.
Better yet, call me at (480) 702-1010 or email me at email@example.com to schedule a demo. I'll show you how to (1) offer your customers the best inventory by tapping into the private party market easily, quickly, and affordably and (2) buy the right cars at the right price from the right markets.