Lotlinx Industry Survey On Inventory Carryover & Markdown Strategies Reveals Major Disconnects And Challenges Faced By Dealers For Modern Retailing
Many Dealers Still Leveraging Markdowns Even Though Majority Don't See Traffic Increasing To VDPs
DETROIT, Sept. 17, 2024 /PRNewswire/ -- Lotlinx, the auto industry's leading VIN-specific data company for dealership inventory management, announced today results of its latest industry survey, which took the pulse of today's auto retailers in understanding how they are managing inventory carryover strategies, and where they are seeing the greatest challenge with markdowns as it relates to aging inventory. Click here to see the full survey results infographic.
The success of today's modern auto dealership hinges significantly on its ability to manage inventory effectively. This task is fraught with challenges that can directly impact profitability, customer satisfaction, and overall operational efficiency. Despite the availability of advanced technological solutions, many dealerships are still challenged by outdated inventory risk practices that exacerbate their struggles. One of the most pressing issues is the failure to properly manage inventory carryover risk levels, coupled with an underutilization of sophisticated technologies like artificial intelligence (AI) that are available to modernize these new inventory strategies.
Lotlinx commissioned an online survey and presented it to more than 2,500 dealers across the U.S. during August. Below are key findings from the data:
According to the survey results, the majority of dealers see the greatest inventory challenges because of difficulty in moving older models (56%), followed by limited dealership space and increased holding costs.
The majority of dealers (18%) manage inventory carryover with price markdowns, dealer trades, and extended warranty offers, followed by 16% conducting aggressive marketing campaigns. In fact, 40% said they execute price markdowns on a weekly basis. However, many dealers see great challenges with markdowns, and more than half (53%) said they receive pressure from manufactures, 52% said competitive market pressures, and 43% said brand devaluation.
The effectiveness of markdowns may be misleading since roughly a third of dealers said markdowns spur an increase in VDP views only 25% of the time, and 19% of dealers said it never spurs an increase in VDP views for a specific vehicle.
There is also a disconnect in dealers' perceptions of the effectiveness of AI on inventory carryover risk and markdown strategies, and the way dealers are currently leveraging tools such as AI. The survey showed that only 9% of dealers are leveraging AI to better manage markdowns, but nearly half of dealers (46%) say AI will impact their business the most for inventory management in the coming years.
"The challenges faced by today's auto dealers in managing inventory carryover risk levels are compounded by outdated practices and underutilization of advanced technology," said Jason Knight, CEO of Lotlinx. "By embracing AI and other sophisticated tools, dealerships can completely modernize their inventory strategies, reduce risks, and enhance profitability. The journey toward modernizing inventory management may be complex, but the rewards of increased efficiency, reduced costs, and improved customer satisfaction make it a worthwhile endeavor. As the industry continues to evolve, dealerships that adapt and innovate will be best positioned to thrive in the dynamic world of automotive retail."
Click here to see the full infographic and for more information, please visit www.lotlinx.com.
About Lotlinx
Founded in 2012 and based out in Peterborough, New Hampshire, Lotlinx is the automotive industry leader in VIN-specific data solutions for inventory risk management. The Lotlinx platform provides automobile dealers and manufacturers with enhanced operational control over their retail business. Leveraging state-of-the-art real-time data and machine learning technology, Lotlinx provides a precision retailing solution that enables dealers to automatically adapt to market dynamics, mitigating inventory risk through VIN-specific strategies. To learn more about Lotlinx, please visit www.lotlinx.com.
For more information
John Sternal
Merit Mile
561-362-8888 – office
954-592-1201 – mobile
[email protected]
SOURCE LotLinx, Inc.
WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?
Newsrooms &
Influencers
Digital Media
Outlets
Journalists
Opted In
Share this article