Are Certified Pre-owned Sales Worth the Investment for Dealerships?

by Automobile Technologies, Inc.

December 2, 1927 might not jump out to most auto dealership managers as having any significance, but that was the date the first Model A went on sale, replacing a model that had gone virtually unchanged since 1908- the model T. One might argue, then, that December 2, 1927 is also the date that gave people their first reason to trade in their old car 1910 Ford T on a new one  1931 Model A,

and giving birth to a new institution: the used car lot.

In 1927 there was no such thing as a certified pre-owned car. In fact, that concept didn’t arrive until sometime in the 1990’s. During that time, dealerships had the same obstacles to completing a used car deal as the local mom and pop car lot: establishing trust.

Today, the CPO market is a robust component of many dealerships’ used car programs. It adds a layer of credibility to any car deal, one that the local used car lots cannot offer, but this competitive advantage does come at a cost.

 

Higher implied costs before the front line

A factory CPO certification tacks on additional costs to a qualified vehicle raising the vehicle invoice price, and reconditioning costs, all of which can quickly put the squeeze on the final vehicle gross profit.

Used car management must determine in every instance whether the Cost-to-Market and Price-to-Market ratios leave enough room in the final deal for CPO units to achieve their desired profit and ROI objectives.

 

Higher yields at the lot as a whole

Market research firms indicate that CPO sales can drive a 6.1 percent increase in the value of used vehicles retailed by franchised dealers. So simply having CPO cars as part of the mix can help drive sales of non-CPO cars on the same lot.

Manheim Chief economist, Thomas Webb, reports that CPO sales were up 12.3 percent in 2017, and used vehicle profits are on the rise, as well as higher sales per store with stabilizations in used car margins.

 

Improving margins begins at purchase

Dealers must keep a watchful eye on cycle time for every CPO vehicle.  The minute the vehicle is acquired, the clock starts ticking. Every day the vehicle spends in reconditioning cuts into vehicle turn time to sale.

Most dealers set their goal at a 45 day average sales window, but the real shock to some dealers comes when they realize that the 45 days begins at vehicle acquisition. Vehicle inspection, reconditioning, and certification can easily eat up inventory holding time, long before the unit hits the front line, which makes prioritizing these areas even more important.

 

Remove bottlenecks – raise profit

NADA statistics show average vehicle holding cost can be as much as $50/day. Time lost prior to frontline has a huge impact on vehicle gross profit. Dealerships need to look for operational changes to speed up or even automate the remarketing process.

For the savvy dealership looking to shave a few remarketing days off of each vehicle, we offer the following suggestions:

  • Revisit the delivery process from acquisition through frontline. Are there any bottlenecks that can slow the process?
  • Review your paperwork procedure. Eliminate paperwork wherever possible. This will lead to increased efficiencies. A thorough review of your paperwork processing will be time well spent.
  • Modernize your inventory management process. It is surprising in this age of handheld technology, that dealerships still rely on whiteboards and paper documents to keep track of units from auction to front line. Whiteboards take time and resources to maintain. Whiteboards cannot alert you about bottlenecks and missed deadlines unless you are standing right in front of them. Software solutions like ReconMonitor will alert your team, leading to lower reconditioning cycle time and control the end-to-end process.

 

Conclusion

Certified Pre-owned vehicles can offer the used car dealership a boost in sales, a boost in margins, and a boost in used car purchase trust, but the process must be tightly controlled, constantly scrutinized and continually refined.

Too Busy to Grow Your PDR Business?

Is your PDR operation too busy to grow?

Many a business owner has fallen into this trap- assuming that a busy business is a growing business. We all know that busy is better than slow when it comes to business, but is your daily grind actually keeping you from growing? If you are saying to yourself that “you are too busy to read this now” then you definitely need to read this. Increased activity does not equal growth, but increased revenue does.

Seek out and destroy the bottlenecks

If you are like most shops, you only get paid for billable hours. Any time spent on anything other than flattening dents is not making you money, unless that activity is somehow sales generating activity. But businesses can’t be run without office time, accounting time and paperwork time, all of which can keep any business owner busy.

Bottlenecks are also hidden sources of wasted time. For example if your PDR tools are unorganized and you constantly walk around looking for a misplaced tool, wasted time starts to pile up fast especially when looked at cumulatively. If it takes you an extra thirty minutes of tool searching per job, it can really add up in a week month or year. Where are the other bottlenecks in your auto reconditioning business?

Here are a few common sources of cumulative wasted time:

  • Travel time
  • Job Assignments (for multiple technicians)
  • Documentation
  • Invoicing
  • Insurance or customer data submissions

Travel time- As a mobile business, travel time is inevitable. Bouncing from dealership to body shop can really eat into productivity hours, and thus hold you back from growth. The key to reducing wasted trips is as simple as a more efficient scheduling system.

Knowing how long each job will likely take will allow you to plot the route for your day more efficiently. Think strategically and set a goal to shave as much travel time as possible each day and the time savings will open up more opportunities for revenue.

Job Assignments- Let’s say you have grown your business to put a few employees out on the street for your business. That’s fantastic, but how are you scheduling who works on what job, and how do you keep tabs on all of the assignments? If “spreadsheet” is your answer, it’s time for you to consider an upgrade, but we’ll get to that in a moment.

Documentation- When you arrive at an assignment, what is your intake process? Are you taking digital photos but filling out paper forms which have to get data entered in at the end of the day or week? You have a bottleneck on your hands. But there are digital solutions to help you. We will cover that in a moment as well.

Invoicing– That which does not get billed does not get paid, right? But when you are running dozens of a cars through your business each week, the invoicing (and sometime the tracking down of payments) can quickly spiral out of control. So what do you do? Can you afford to hire a bookkeeper? Or is that just another revenue-grabbing business expense that you can avoid? Don’t worry there are alternatives.

Insurance or customer data submissions- If you are working with multiple body shops who are servicing multiple insurance carriers, each carrier has their own process for submitting the workflow documentation so that the shop can get paid (and thus pay you). And it is only going to get worse as Insurance companies replace field adjusters with their photos process, much like Liberty Mutual is doing now. More photos will be needed, more shops will need you to do it for them, and more of your repair time will be spent helping them pay you.

 

There is a solution!

If you have read this far, you are probably a bit stressed out realizing where all your profitable time is being spent. The good news is we have a solution for you. A quality PDR management tool can automate most if not all of the time wasters listed above.  

A quality Paintless Dent Repair management tool like the one we offer here at AutoMobile Technologies (ReconPro), will allow you to organize your customers, make and manage technician assignments, document the before, during and after repair, generate and deliver an invoice while syncing with your accounting software, and transmit all this documentation with electronic signatures all right from any mobile device.

A quality PDR tool will pay for itself the very same day you begin to use it, and can help usher your business into the next phase of profitability and growth.

 

Want to give one a test drive? Click the button below to get started.

 

SCHEDULE A DEMO NOW

AutoMobile Technologies Changes the Game with the Launch of Repair360

October 17, 2017 – Automobile Technologies (AMT) has officially launched Repair360™, a free mobile invoice app designed to help solo and smaller auto repair and reconditioning businesses manage customers and workflows digitally. Built on the same robust platform as their flagship ReconPro™ software, Repair360 mobile app includes essential tools for managing customer and vehicle records, performing inspections with photo and video integration, creating work orders, obtaining approvals, generating invoices and recording payments on any supported mobile device.  The app is completely free for a single user, with a modest monthly fee for an expanded version including team management and accounting integration. 

Repair360 Inspection ScreenEvery automotive repair and reconditioning business should be able to digitally manage customers, estimates, work orders, invoicing and payments” says Paul Maximov, Founder and President of AMT, “This eliminates paper, reduces errors, and allows them more freedom to focus on the customers and the work that generates revenue for the business. While other companies may charge for similar software, we believe these are essential tools that should be available to all for free, forever, in the interest of improved business operations, customer experience, and to generally raise the bar for the Automotive Industry.

The Repair360 app is available for free download for IOS devices via the App Store, and for Android devices via Google Play Store. Users who set up Repair360 Free have the option to upgrade to the paid version as needed.

About AutoMobile Technologies:
AMT offers a modular cloud platform with mobile apps for estimating, invoicing, vendor monitoring and repair tracking.  AMT’s premium software editions, InspectionNotes, ReconMonitor, and ReconPRO were developed to monitor cycle time and manage any inspection, reconditioning or repair process.  

 

Repair360 Video:  https://www.youtube.com/watch?v=fPadMaAFWZ8

Repair360 Website: https://repair360.com

AutoMobile Technologies Website: https://amt.company

For more information: sales@automobiletechnologies.com  888-600-6898

InspectionNotes Mobile App adds Ford CPO Inspection Checklist to Online Library

September 18th, 2017 – Automobile Technologies (AMT) announces InspectionNotes™ mobile inspection app has added the Ford OEM Certified Pre-Owned Inspection Checklist to their online forms library. InspectionNotes was developed for mobile vehicle inspections and condition reports to be performed from a tablet or smartphone. Inspectors perform a multi-point inspection, record answers to questions on a mobile device, and transmit answers to a cloud based dashboard or via API to websites and third party software systems.  An Inspector can add pictures, video, and digital signatures as part of the inspection process, and print inspection forms on-the-spot or emailed as PDF’s.  Additionally, users can configure responses within the form to trigger additional steps as needed. InspectionNotes contains common OEM inspection forms plus a custom online forms builder for users to identically match  any paper inspection forms they are using.  InspectionNotes also enforces a consistent process to ensure all information is collected accurately every time and maintained in history.   

“Our goal is to offer a user-friendly, mobile app, combined with the most advanced cloud software technology, to meet the demands of the automotive industry” says Mike Fischer, Executive Vice President.  “A huge goal for automotive dealerships is to offer excellent value with Certified Pre-Owned vehicles.  InspectionNotes hits the mark with its easy to use comprehensive solution by offering an efficient way to provide transparency and accuracy in the CPO process.”

 

About AutoMobile Technologies:
AMT offers a modular cloud platform with mobile apps for estimating, invoicing, vendor monitoring and repair tracking.  AMT’s software editions, InspectionNotes, ReconMonitor, and ReconPro were developed to monitor cycle time and manage any inspection, reconditioning or repair process.  

 

FORD CPO Mobile Checklist Video:   https://youtu.be/DIE-BAgpxPk

For more information: sales@automobiletechnologies.com  888-600-6898

Release Notes ReconPro for iOS v.2.6.4

New Functionality

  • Created the ability to set a Default Picture Source (either camera or library)

Bug fixes

  • Not showing question answer image in preview
  • Question answer service not updating amount after edit
  • Fixed wrong warning pop-up when saving inspection with invalid VIN

Release Notes ReconPro for iOS v.2.6.2

** Will be Available In iTunes on 1/2/15

New Functionality

Updated the page layout for the iOS client, we added an icon for the action button instead of displaying the words action.

Bug fixes

Fix incorrect RO shown for SRs
Fix small letters are used for RO and Stock
Fix RO cut for SR details
Fix issues with search by scanned VIN in Car History
Fix issue with save PO
Fix app crash with empty question sections
Fix issue with copying matrix service with copy matrix services in WO
Fixed issue with Empty customer info
PocketJet Issues with 2.6
Fixed endless SRs loading, fixed
The virtual keyboard is blocking the button “Done” in the notes, fixed
App does not ask user to turn camera ON, fixed
Fix issue price matrix without panels in calculation script
Fix issue search bar and the entire screen are distorted
Icons overlap text, fixed
Invoice issue, fixed

Release Notes ReconPro for iOS v.2.6.1

New Functionality

  • In regular version we’ve added a save button to the last page of the wizard

Bug fixes

  • Added Vehicle Parts to Invoice Template #8

  • Resolved AirPrint Local Issue Invoice Template #60

  • Resolved Issue with Clocking Out of Timesheets

  • Resolved Issue with iPad app Photos

  • Resolved Issue with Tech Splits

  • Added Price Breakdown for Multiple Vehicles on an Invoice

  • Resolved issue with Print Template when you have multiple addresses for the same company

  • Resolved issue with having to select technician split before proceeding with work order.

  • Resolved issue with Car History locking up when switching from local to web

 

ReconPro 1.6 is here!

AutoMobile Technologies is happy to introduce the release of ReconPro version 1.6.  Based upon feedback from our customers we’ve made some improvements that we feel confident will save you time and make you even more productive.  A host of communications improvements include paging improvements, ability to send messages in background mode and adding email addresses via Contact.   Navigation and search functionality has been enhanced as well as client filtering and selection mode. New security features SSL web services, ability to show last logged user and blocking work order creation for estimates sent to another device.  Work Order improvements consist of a new “Pending” status and adding service advisors.  Sub-items support, car history and manual camera scan – the list goes on and on.  For a full list of the features and benefits contact us here.

You can download it from iTunes here

Technician Users

Want to make your tech’s lives easier? Why not give them access to view their work orders, invoices, and Commission Statements?

Here’s a video that outlines some of the capabilities.