Analytics For Car Dealers: What Should You Be Tracking?

To improve your processes and grow your revenue, you first need a clear picture of how your car dealership is performing. Because data never lies, dealers are adopting analytical tools and business intelligence platforms to gain a competitive advantage. This post will unpack what car dealer analytics are, how they benefit dealerships and what you should be tracking. 

What are car dealer analytics?

With a recent slump in auto sales, car dealerships are embracing data to cut costs and improve revenue.

Car dealer analytics reorganises business data into accurate and actionable dealership information. With easy access to the inner workings of your dealership, such as sales performance and revenue per vehicle, you’re better positioned to develop and achieve meaningful long-term goals. 

Consider sales rep productivity. Who on your sales team sells the most cars? Who sells the least? Car dealer analytics offers a granular view of your sales team’s performance, which can then be used to inform training and boost revenue. 

Imagine a Volkswagen dealership in Sydney that’s run by an owner named Sam. After looking at the numbers, Sam discovers that only 10% of her car-buying customers secure financing with her dealership. Armed with this information, she sets a goal to increase this number to 40% within two years. To get there, she sets sales-related KPIs for her finance teams. 

With car dealer analytics, Sam can measure how successful her plan is. After a year, she might tweak the targets or offers depending on the results she’s getting. By tracking her progress, Sam removes the guesswork from her decision-making process — giving her a strong base to improve the performance of her finance team while increasing dealership profitability.

Why you should use business intelligence software for your car dealer analytics

Many dealerships track and analyse their data using whiteboards and spreadsheets. But this is inefficient and increases the risk of error, as your data is spread over different files. It’s like having each of your puzzle pieces in separate filing cabinets. To construct a true picture, you need everything in one place.  

You can gain far greater insights by using business intelligence tools that are designed for the automotive industry. A business intelligence tool like SalesLogs stores data for multiple departments in one place. This means all internal stakeholders have access to the same data, insights and visualisations. You can also control who has access to which data through multi-level permissions.

What should you be tracking?

As analytics can maximise your profits by improving processes, every aspect of your business can benefit from dealer analytics. With so much to track, here are four of the most impactful ways that analytics can boost your revenue: 

1. Dealership, Team and Individual KPIs: Knowing how your dealership is performing is the first step to improving it. Use KPIs to measure the success of your dealership and internal stakeholders. By tracking their performance, you can recognise and address shortfalls.  
2. Inventory Turn Rate: This compares your monthly sales with the in-stock inventory. Fast turnover is a sign of an efficient dealership where departments work well together. Increasing your inventory turn rate is one of the fastest ways to increase revenue, while dealerships with a high turn rate use this data to monitor the health of their processes. 
3. Cost to Market: Especially when selling used cars, your inventory is an investment that incurs costs ranging from acquisition and transportation to reconditioning. Measuring these costs against each car's retail value is key in finding ways to maximise profit. 
4. Price to Market: Tracking price to market helps you adjust how much you sell your cars for within your market. When demand is high, your price to market should also increase. With this data, you’ll know the best time to sell to get the highest possible price.  
   
   

Improving your dealership with car dealer analytics 

Car dealer analytics play a vital role in improving dealership efficiency and raising profits. Automotive business intelligence solutions, like SalesLogs, are ideal choices for running your dealership analytics. 

SalesLogs has been developed with direct input from dealerships. Over 1,000 dealerships have used analytical tools to innovate how they do business. 

Key features include: 

• A centralised platform that collects the data from all your departments 
• SalesLogs DataGrid is built for fast responses and easy data analysis and visualisation
• KPI dashboards to track your team’s performance
• Live data feeds to measure your operational efficiency
• Multi-level permissions to control who sees your data and at what point 

Contact us for a free demo to see what SalesLogs can do for your business.