Inventory Data: The Secret Weapon of Successful Dealerships
VinCue is a real-time market intelligence tool that helps dealers make better decisions about pricing and car appraisals. It can also help you better understand your inventory. When connected to your DMS, VinCue turns your inventory data into valuable insights for running your dealership.
If you’re new to VinCue, the amount of information it provides can be overwhelming, but even seasoned users can get lost. With so much data available in VinCue, it can be hard to know where to start.
In this article, we’re going to look at three ways you can get the most out of your vehicle inventory data:
- Make better sourcing decisions
- Find your most valuable vehicles
- Monitor your dealership health
This guide is designed for VinCue users, but even non-users will find it valuable. The principles for running a successful dealership are the same, no matter what market intelligence tool you use.
VinCue’s appraisal tool is a powerful feature that helps dealers accurately price a trade-in or vehicle at auction. But how do dealers know if they need that vehicle? That’s where inventory data becomes critical.
Dealers need to know how many vehicles they have in stock and which models are overstocked or understocked based on demand. Dealers can find this information in VinCue:
- Click on My Dealership
- Click on Used Vehicles in the top navigation bar
- Click on Stocking
(Note: There is also a quick view of this information on the My Dealership Dashboard)
In the dashboard above, dealers can see their inventory broken down by vehicle class. The bar graph at the top shows how many vehicles the dealership has in stock compared to how many they have sold in the past 30 days. Then there is a detailed breakdown of each category below.
For example, we can see that this dealership sold four compact cars last month and has seven in stock, which means the dealership is well-stocked. However, they are short two midsize vehicles because they only have five in stock but sold seven last month.
With this information in hand, dealers can make smarter decisions about which vehicles to buy. When they are ready to source, they can click on a category, view the most popular models, and even bid on them through VinCue.
Competitor Inventory Data
VinCue also lets dealers see what their local competitors are stocking. In a competitive market, it’s important to differentiate from other dealers in the area. This means looking for niches that are underserved in your market.
In VinCue, dealers can view any dealership and see a detailed breakdown of their inventory:
Dealers can also look at their competitor’s recent sales, pricing, and inventory age. This will give them valuable information on how to stand out in the eyes of customers.
To view competitor data, simply search for the name of the dealership in the VinCue Search Bar.
Local Sales Trends
Finally, dealers can look at local and regional sales trends to make inventory decisions. To find this information:
- Click National Markets in the sidebar menu
- Click your region on the map of the United States
- Click Inventory
In this view, dealers will see where there are shortages of new and used vehicles, as well as the best-priced vehicles. Dealers can also look at Market Day Supply and Brand Days on Market for models in their area.
With these local sales trends, combined with competitor inventory combined, dealers can find the gaps in the market that translate into big wins for the dealership.
This information changes monthly– even weekly– so the dealers who stay up on the most current data will see the biggest difference in their sourcing.
Find Your Most Valuable Vehicles
Not every vehicle is created equal when it comes to sales. Some cars more valuable to a dealership than others.
Dealers want to identify their cash crops: the vehicles that are most profitable for their dealership. VinCue provides two metrics that help dealers identify those vehicles: Market Demand and Your Best Selling Vehicles
We talked about market demand in the previous section, but let’s take a closer look. Market demand tells us which vehicles sell best in a given area. Dealers can find this information in VinCue by:
- Clicking National Markets in the sidebar menu
- Choosing your region on the map of the United States
- Clicking Sales
Here, dealers will find the top-selling vehicles in their metro, plus a breakdown of brand market share, top-selling dealerships, and new vs. used vehicle sales.
Dealers want to stock on popular vehicles, but that doesn’t always mean they should stock the most popular. The most popular vehicles (The Ford F-150, for example) are also the most competitive. That’s why it’s important to look at your own best selling vehicles as well.
Your Best Selling Vehicles
Market demand alone isn’t enough to make informed inventory decisions. Dealers should turn back to their own inventory data to see which vehicles are their best-sellers. Dealers can find this by:
- Clicking on My Dealership in the sidebar menu
- Clicking on Sales
In this view, dealers can see their top-selling vehicles, weekly sales numbers, and sales by brand market share.
The most valuable vehicles are those with the best combination of market demand and high sales. A third metric, gross margin, is also important. Once you identify your most valuable vehicles, you can double down on your niche. Stock more of your most valuable vehicles and market them more aggressively through online ads.
Revenue and profit are valuable metrics, but they aren’t the most important when it comes to dealership health. In fact, these metrics can be downright misleading if a dealer isn’t careful.
Revenue and profit are the results of the underlying health of a dealership. If the dealership is healthy, then revenue and profit will be strong. If the dealership is not, then those metrics will suffer.
VinCue has three features to help dealers keep a close eye on their company’s health:
- Inventory turn rate
- Pricing alerts
- Dealership report card
Inventory Turn Rate
Inventory turn rate is one of the most important indicators of a dealership’s health. Turn rate is the number of days a vehicle sits on your lot before being sold. Dealers want to keep their inventory as fresh as possible, which means keeping their inventory turn rate low. The ideal turn rate is 30 days.
Dealers can find their inventory turn rate on My Dealership dashboard in VinCue (along with average price age):
Dealers can also see the age of individual vehicles:
- Click on My Dealership
- Choose Used Vehicles or New Vehicles
If a dealer’s inventory turn rate is too long, it means that something is not right with the business model. Either your prices are too high, your salespeople aren’t closing deals, your marketing is off, or you’re not stocking the right vehicles.
Since inventory turn rates are measured every month, dealers have the chance to correct the issue before it’s too late.
Thanks to the internet, customers can see the prices of every vehicle in their area. If your listings are considerably higher than your competitors, a customer is going to shop around for a better deal.
With VinCue pricing alerts, dealers are notified when their competitors are offering lower prices:
Pricing alerts are found directly on the My Dealership dashboard, and dealers can also be alerted via email.
Dealership Report Card
With so much data available, it’s sometimes nice to get a quick snapshot of your dealership’s health. With the VinCue Report Card, dealers get grades on important metrics:
- New Market Share. Brand share per market, overall and per model.
- Used Market Share. Overall market share by segment.
- New Vehicle Price Ranking. Lowest advertised models and trim levels.
- New Vehicle Price Age. How long vehicles stay at the same price.
- Used Vehicle Price Age. Same as above.
- Used Inventory Quality. The level of market demand for your used inventory.
- Missed Deals. The number of customers you lose to other dealers.
You can find your report card on the righthand side of the VinCue homepage. Dealers can also see a quick glance at their grade in the header.
Dealers shouldn’t wait until the end of the quarter to check their dealership’s health. Inventory data lets us check it daily so you can correct problems as soon as they arise. No dealership is perfect, but the dealers who actively improve will be more successful in the long run.
Getting the Most Out of Inventory Data
Inventory data tells us way more than just how many vehicles we have on the lot. When closely analyzed, dealers can find golden nuggets of information that will help them source better vehicles, sell them more quickly, and make more money off each sale.
VinCue is just one of the many appraisal tools on the market, but it has the most comprehensive data at the best price for dealers. Sign up for a free demo and get the most out of your inventory data.