The Powersports industry has always been a specialty industry. Historically, it was much more specialized, and it was smaller than it is today. The market is growing, and the industry is evolving, but the trade-in process is still one that’s smaller and less understood. With so much competition coming to the foreground in the dealership arena, brands are trying to figure out how to keep their trade process profitable and how to improve it in any way that they can.
Staying ahead of the competition starts by analyzing the current trade process and the trade cycle. Even if it’s not broken, you can still identify at least a few inefficiencies if you take the time to look closely.
Are you valuing trades effectively?
The only way that you can stay on top is to be the best at the trade game. That means making sure that you provide your customers with the best trade values, but still make sure that you’ve got room to gain a little profit. After all, the whole benefit of your used inventory is that you have total control over pricing from start to finish, including trade valuing.
Are you taking in things that aren't worth the money?
Speaking of value, don’t be that dealer—don't just take anything that comes your way without discretion. You need to have some discretion in your trades to know that they’re going to be worth the money. It doesn’t make sense to take things that aren’t profitable, and you should never take a trade that is going to cost you money.
What are the current market trends?
You (or your trade appraisal team) need to stay on top of current used market trends. This includes knowing what’s hot, what’s selling, and how much you can get for various units in your dealership. You can’t succeed if you don’t know how, and part of the solution is knowing the industry.
Does your pricing fit?
Finally, you have to look at the unit, the market, and all of the other variables combined. Does the pricing that you’ve chosen fit the situation? Does it make sense to the buyer and still give them a little room to feel like they might get a deal? Does it garner a profit for your dealership? Are you going to get what you’re asking out of the unit?
These elements are going to give you the answers that you need to get your pricing in line and stay ahead of the competition when it comes to Powersports trades.