If your lot holds 100 used cars and you sell 100 cars in a month, conventional wisdom says, “great job, you turned over your entire inventory.” But in an era with so much valuable data available, dealers have to take a deeper look at their potential.
At DealerSocket, we don’t just look at the speed and frequency of inventory turnover. We look at Profit Per Day, a simple calculation that looks at the profit a dealer makes on a car, divided by the number of days it took to sell.
Why Profit Per Day?
The most valuable asset at your dealership is not the car you’re selling, it’s the parking space where the car is sitting. Profit per day is important because it allows you to truly analyze how much value you are getting out of each space. If your profit per day is lower than expected, you can adjust your aging strategy.
What is the Optimal Profit Per Day Goal?
Based on what we see with our most successful dealers, $100 is a really good profit per day. That number may vary from dealer to dealer, but $100 is a good goal.
To hear Sr. Customer Success Manager Erik Post and National Director of Customer Success Jeff Landwehr discuss profit per day and important elements of a good aging strategy, listen to the DealerSocket podcast.
To hear the entire conversation, check out the DealerSocket podcast.