The probable Impacts of Deprecation Rates on Old Car Sales in 2017
The depreciation rates for used vehicles escalated beyond the project ted rate of 15% in 2016. The projection for this year suggests that the same rate may touch 18% and 20% or more for used trucks and cars, respectively. These depreciation rates have a serious impact on your overall profit margin. Therefore, you much be well aware of this during the evaluation of the reconditioning processes for a used vehicle.
Why do the vehicles depreciate?
The volume of used cars available on the market has increased steadily over the last few years. This increasing volume has a direct impact on the value of a dealership’s stock of used vehicles as well as the prices that the consumers are ready to pay for those vehicles. A higher volume of used cars opens up plenty of options for the prospective buyers. As a result, it may be important for you to offer more lucrative financial benefits to clear your inventory for old cars. This will definitely eat away your profit margin, particularly for the vehicles that have spent a lot of time in getting reconditioned before hitting the lot.
Why is the Reconditioning Process Important?
In the market for old vehicles, there is no dearth of cars that are certified as newer, pre-owned, under warranty, lower mileage, or off-lease maturities. As the market gets even more competitive with the influx of more used trucks and cars of higher quality, your stock of used cars is bound to lose its value. Therefore, it is of prime importance for you to ensure that your recently purchased stock of old cars keep flowing seamlessly through the process of reconditioning. By doing this, you can avoid getting stuck with a depreciating vehicle that continuously reduces your profit margin.
How can you benefit from Simple Recon?
There are many different things that you may do to improve the efficiency of your reconditioning process. However, in terms of streamlining the process, the most important task for you is to carry out an accurate evaluation of the existing processes. By deep diving into the process and thoroughly evaluating the available data, you will surely find out many gray areas that can be improved significantly. This is the most important step towards building a highly efficient reconditioning process.
Processing of the enormous amount of data related to the reconditioning process can be an uphill task. Dealerships using Simple Recon find it much easier to track their entire process of recondition. This gives them a thorough understanding of different loopholes within the process. It also empowers the departments with the correct tools to push the vehicles amongst each other, with minimum involvement of the management. This will free-up your managers to concentrate on other important jobs.
Get in touch with us today to schedule your live demonstration session or sign up for a free trial.