Measure the Right thing

Your monthly numbers don’t tell the story. Yes, they tell you how many new and used cars you sold – and you can calculate your front and back end gross. But, it doesn’t tell you how you are performing within the potential the market will bare.

Why is that important?  Riding high in a strong market can obscure your actual performance.  I often hammer the concept of ‘market share’ and I will do it once more.

Let’s say that in a 15 mile radius of your store, every month 1,500 new cars are sold and 1,500 used cars are sold (2007 model year and newer).  In this imaginary world, your monthly numbers would tell you all you need to know.  In April you sold 200 = 6.66% market share. In May you sold 220 = 7.33% market share, etc.  But in the REAL WORLD, the number of cars sold in that 15 mile radius of your store is NOT the SAME each and every month.  In the REAL WORLD you sold 200 in April and there were 2,000 cars sold = 10% market share and in May there were 3,000 cars sold and you sold 220 = 7.33% market share.  If you had gotten your April market share (10%) in May, you would have sold 10% of 3,000 = 300 cars!

It’s time to measure the REAL performance of your store.  Subscribe to Auto Count (or Cross Sell) now and start measuring how you actually are performing in your market. Then you can go back to your months with the best market shares and actually analyse what you did or did not do to achieve those highs and lows instead of having the real picture obscured by your volumes those months.

Every dealer I work with is surprised by which months in the past turned out to be their best performing even though their volume might have been so-so.  In other words, they were able to see which months they got the most out of what the market had to offer and then were able to determine which things got them there and which things may have given them the illusion of success during an up tick in the market that they didn’t take full advantage.

If you need some assistance in putting together a spread sheet and graphs, let me know and i can send you some templates.

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About dealerite/in association with AP Level 4

National affiliations of professionals who are engaged in changing the culture of the automobile retail business. Associated with AP Level 4 and Edifice Group. These companies are bringing sustainable marketing which has proven quantifiable improvements in a dealer's market share performance
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