How Automotive Accessories Can Drastically Increase Car Dealership Profits
95% of car dealerships sales are missing out on one of the most profitable and rising markets. Are you one of them? If you’re not adding considerable effort into selling auto accessories alongside your vehicles, you are part of the 95%. The other 5% is benefitting from the 40-billion-dollar automotive accessories industry almost single-handedly. Would you love a share of that enormous pie? First, you need to understand the auto accessories marketplace.
The Marketplace: Understanding Millennial Buyers and Car Dealership Sales
Market research reveals an interesting fact; the vast majority of today’s big spenders are millennials. Millennials refer to the generation that is nearing their 30’s, or newly turned 30. They have entered the buying world and turned markets upside down with their unusual spending behaviors - for example, they’re far more likely to spend their money on luxuries, like coffee than any previous generation was. Household items, like fabric softener, are facing major setbacks as millennials simply don’t purchase these items. The good news for the car dealership sales? Millennials love accessorizing!
Marketing to the millennial generation is the ultimate ticket to bigger, better, more profitable car dealership sales. That’s because they’re far more likely to part with their hard-earned cash. The car accessories industry is booming at exactly the right time - because as millennials enter the markets as the primary spenders, the technology industry is turning an exciting corner. We’re seeing far more innovative inventions that simplify life and boost your public image.
Personalization, environmentally friendly, and auto-synching are some of the buzz words that excite millennials. Is it worth creating a whole new products line in your car dealerships sale line, which aims to essentially upsell and existing sale? Considering the car accessories industry is worth over 40 Billion dollars and automotive dealerships are only seeing around 5% of those sales - you can consider this an untapped goldmine in the car dealerships sales industry that’s waiting to be explored.
The Statistics: Auto Parts Profitability and Auto Dealership Sales
Bosak Motors accessories says that approximately a fifth of all of their new Chrysler, Dodge, Jeep and Ram vehicle sales generate an extra $20,000 to $25,000 to its service department's gross profits each month, while it simultaneously boosts car dealership sales. Can any car dealership afford to miss out on those numbers?
The greater majority of dealerships - around 95% of them - are missing out on one of the most lucrative possibilities that require little extra work. Those possibilities are the ones surrounding auto accessory sales. Here’s another interesting fact - did you know that around 90% of car accessory sales take place within 3 months of a new auto purchase? People, especially millennials, want to personalize their brand-new ride. It only makes sense that the reliable salesman that sourced and sold them their vehicle also supplies that vehicle with aftermarket accessories. It sends car dealerships sales through the roof. The possibility of selling accessories is hottest at the time of purchasing the vehicle. Another added bonus? There’s no extra marketing expenditure - you’re appealing to existing clients and getting them to spend more money.
How steep is your competition against other car accessories sold at dealerships? Another great point is illuminated through a study called Inside The Buyer’s Mind “Only 43 percent of new-car buyers recalled a conversation about accessories on the showroom floor." That means very few car dealership salespeople are actually discussion car accessories at the time of the sale.
The only curveball that has been experienced by car dealerships selling accessories is the false perception people have that they can source their accessories cheaper, elsewhere. But, it is necessary to have the conversation at the time of the sale and discuss the prices. The buyer then has the opportunity to source alternative pricing, and generally, within 90 days, they return to the original dealership for the items that were initially discussed. This false perception around pricing is also easily remedied over time if you work it into your existing selling strategy.
How to Implement Accessory Sales
We get it. The sales guys that handle the car dealerships sales want to close the deals and move onto the next one - keeping their commission rates high. Then there’s also the mindset aspect. It’s easy for employees to fall into a comfort zone in which they enter their work environment and perform the same duties day in and day out. Getting them to change their mindset can be challenging.
Adding accessories to your car dealership sales is an opportunity for your sales teams to increase their commissions. Nothing motivates a change of tactics as fast as a financial incentive. Explain the value of vehicle personalization to your teams and expressly tell them what they can expect to earn in their own pockets.
Adding car accessories sales to your existing dealership sales business model will require a few changes, but when you partner with an expert, it’s effortless. A service provider should handle all of your distribution, meaning it’s simply a matter of placing an order. You'll also want to partner with a professional company that has years of experience and is, therefore, able to offer ongoing support in terms of knowing what to order. We watch consumer trends to ensure we are meeting the needs of the market. We can predict what will sell particularly well in a given market. Our job is to help you make your auto accessory sales successful and highly profitable because that’s in our best interest, too.
The Benefits of Selling Car Accessories
The term value-added service is particularly pertinent. When you offer your buyers more support and more options, you’re adding value to their experience with your car dealership sales service. People love choices, even if they don’t necessarily decide to add extras onto their sale - the opportunity to do so leaves a distinct and positive association to your company, in their minds. The value of nurturing a relationship long after the business transaction is concluded has also become one of the top ways successful businessmen gain new business. In a car dealership, that lucrative aftermarket sales and the ongoing relationship starts with one conversation - and it needs to communicate the fact that you are available to offer your assistance again.