Car dealers are preparing for these changes in 2020
In order to prepare for future trends in the auto industry, we must first look at recent buying trends from the past several years. Since the average transaction price of a new car eclipses $38,000, consumer habits are changing. Even though the economy is doing well, many people are balking at the idea of paying $550.00 or more every month for the privilege of owning a new car. Dealers are finding they have to offer deep discounts and other incentives to get vehicles off the lot.
On the other hand, used cars are less expensive options, and the average price has not risen at the same pace as that of new vehicles. The result is a growing number of consumers opting for a pre-owned vehicle. To help keep car dealership cash flow high, many dealers are offering an inventory of certified pre-owned vehicles on their lot. From an accounting standpoint, the additional profit made on used car sales should balance out the expenses incurred due to discounts on new cars.
What to watch for
Extrapolating from past trends, we can assume that the average car price will continue to rise and affordability will continue to drop. Dealers will need to be more savvy than ever regarding ways to bring in clientele and move inventory. The keyword for the future in auto sales is “customization”. This includes fine-tuning advertising through customer data collection to ensure the right message reaches the right audience.
Another very important part of customizing the car-buying experience is providing and understanding technology. Consumers are looking for a vehicle that has all of the features they want, and studies show one of the most important features is technology. Sales people will need special training in order to provide their customers with tech assistance during and after the sale of the car.
Navigating your financial path
These changing trends make it more vital than ever that auto dealerships partner with an excellent car dealership accounting firm. Bookkeeping for car dealerships is a highly specialized field and requires an expert who has experience in this area.
At GYL, we have specialists on staff with in depth knowledge of dealership bookkeeping management. We can provide vital services that will help guide our clients toward future profitability, such as cash flow analysis, financial reports, tax services, and the tools to forecast future financial trends. Call or set up a free consultation online today, and find out how we can help keep your dealership on track.