Are we about to see a replay of the Great Recession? Some auto retail leaders expect a downturn in sales this year and many dealers are experiencing it right now.
While no one has a crystal ball, it’s clear that many showrooms are not as active as they were last year.
When the auto retail market softens, leaders don’t panic…they get lean.
In times of uncertainty, dealers should work to steady the ship. Flat sales are inevitable and downturns are part of the auto retail cycle. Recognizing this keeps you out of denial and away from panic mode.
Keeping your eye on trends and data is key. Don’t rely solely on the factory to deliver trends. They look at things on a grand scale and your store is one of many they report on.
Exploring national trends is helpful but there’s nothing like taking a closer look at your store’s performance.
Do your own expense analysis.
It’s a good time to look at your operation and determine where specific expenses might be trimmed. Identify and “consciously cut” in places that will still keep operations humming while improving your store’s performance.
Here at Kruse Control, we’ve found that especially in good times, financial trends don’t get as much attention as they should. Everybody has excess expenses when things are great. Who cares, right? Frankly, you should.
As a former executive manager who’s run many dealerships, some very large volume stores, I’ve witnessed over and over that it’s too easy to let things go. I’ve found hundreds of thousands of dollars wasted by dealerships over the years simply because times were good.
I’ve seen a lot wasted when times were tough, too. There’s really never a good reason to be lackadaisical about profit.
Isn’t it just better to track expenses and respect the process, no matter what state the economy is in?
When you have a plan in place, regardless of the economy, there’s no panic involved.
Are slowing sales a struggle? You bet, but when there’s been a consistent process to review and adjust expenses, it softens the struggle.
Mindset plays a big part here too. If you’re positive and your team is positive, chances are better that you’ll continue to roll with the punches and have a good year. But if you’re sitting in your office with a dark cloud above your head everyday, worrying about what’s coming next, you’ll create a self-fulfilling prophecy.
Bottom line? Respect your process. Develop a plan to get lean…and don’t panic.