What are some options to ensure a 60 day turn?

There is one used car mgr. & two sales mgrs. The u.c.m. is in control of aquisition and w/s, but it's being suggested that all 3 mgrs. participate in a +60 day penalty. I have been charged with drafting a plan. Thanks in advance for the input.

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Comment by Dale Pollak on May 28, 2010 at 2:46pm
All,

Thank you for your support of vAuto. In reality, however, I believe that fast and proper turn will ultimately only be achieved through the strategy of Velocity Management. As many of you know, velocity is the set of conditions (paint to pixels) that if in place, will allow a dealership to achieve fast turn with profitability. In other words, fast turn itself is not the path to profitability, but rather it needs to be done in such a way so as to allow for total gross to far exceed that of traditionally managed dealerships. To this extent, success comes through a proper strategy well executed, and that means a combination of people, process and tools.

Now with respect to the specific question, as I understand it… The responsibility of fast turn belongs not to the just UCM/WS manager, but rather to every manager in the dealership, yes even including those in fixed ops. Everyone should share in the pain or gain associated with inventory turn. Also, remember that if any properly reconditioned vehicle can’t be retailed in 30-40 days, it can only mean one of two things. Either the manager didn’t know how to price it, or they weren’t prepared to price it as it needed to be. This is the retail reality of the internet era. I hope this helps.

Thanks

Dale Pollak
Comment by A Jay Gould on May 28, 2010 at 10:52am
I pushed the add button too fast- all used cars pay plans must include wholesale loss. I hear all the comments about turning the inventory at least monthly, and personally I think that is a minimum standard in todays market but I prefer to use dollar turns to measure this-don't get caught in the unit trap. If you have ,as an example $2M in used vehicle inventory and a history of sales monthly,at cost, of say $1.2M, you will have a difficult time with reducing your inventories age until the two numbers mirror each other. Its also possible with the new tools available to you to maintain current volume with less than a months dollar supply BUT it requires that inventory management be elevated to the same level of importance as gross and volume IF not higher. Proper mix ,model and price along with aged inventory control will ,despite what your team tells you, grow your volume.
Comment by A Jay Gould on May 28, 2010 at 10:41am
First YOU must make sure that everyone understands that you are committed to a 60 day and out turn. Secondly, give yourself about 90 days to achieve this goal and lock yourself into this plan the last thing you want is a firesale. When we did this,many years ago, way before V auto and all the other tools out there it took 90 days to work out the kinks. For instance, what if you have a deal pending on a unit that would be over 60 days before it is finalized, we verified the reality of the deal and allowed this to happen, however, if the deal later failed to materialize the unit was cut back to $1.00 and the loss charged to whsle,naturally when sold it was credited back to the same account. This quickly stopped any game playing
Comment by Bill Green on May 28, 2010 at 10:21am
I would agree that vAuto would afford a tool to facilitate getting better turns that 60 day. We are turning on an average 12-15 annual turns a year with stocking about 200 vehicles at all times. VAuto has made a huge difference in how we approach this issue, and has at the same time given our VP of Inventory a way to monitor and manage daily.
Comment by David Ruggles on May 27, 2010 at 11:45pm
vAuto!

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