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Buying into a dealership has its pros and cons, one particular advantage is that you already have a brand.  Operating a franchise does mean help with starting up, and there’s less chance of failure, but it also requires deep pockets and a willingness to do things a certain way.

If your dealership is struggling to make money, consider these techniques to help pull in a profit.

1.         Increase Margins

You may make a lot of sales and wonder why you’re not rolling in it, but big sales don’t necessarily equate to a big profit. If your profit margin isn’t wide enough, you may see yourself just breaking even, or worse – making a loss. Set aside some time to figure out your current margins and where it would be appropriate to increase prices.

2.         Reduce Staff Turnover

Every time a member of staff leaves your employment, you need to find someone to replace them, and every time you employ someone new, you have to train them. Training new members of staff is waste of valuable resources, because it essentially means paying two people to do one job until the new staff member is able to do it alone. Treat your staff well and they’ll wish to remain in your employment, meaning you can forgo additional training expenses.

3.         Attract Top Performers

It’s important to hire competent people right from the start, and to train them to do things correctly and efficiently. Be sure to hire the best you can and get the most out of your staff, as this will lead to excellent customer service, and happy customers are likely to spend more. Think of hiring good staff as a good investment, even if it means you have to pay them an above average wage – you’ll see your investment returned when customers spend more than they usually would.

4.         Reduce Costs

When times are hard, your first impulse may be to cut staff hours, but this can be a self-fulfilling prophecy, leading to poor customer service and reduced sales. However, reducing costs in other ways is definitely something you should look into. Consider running your business from a home office, or incorporating energy saving methods into your operating procedures. Don’t just try to boost profits through increased revenue alone – reducing your expenses simultaneously is an often overlooked way of helping to increase profits.

5.         Make it Easier for Customers to Spend Money

A key tactic for increasing revenue is to enable your customers to spend their money with ease. Place items strategically so they’re more likely to be picked up and ensure smooth checkout procedures with highly trained staff. Make shopping an easy and pleasant experience for your customers and they’re likely to spend more.

All of these techniques work in harmony to bring in more sales, lower costs, and increase margins. If you incorporate all of these methods into your dealership’s operations, you’re sure you to see a notable increase in profits.

Bill Weston writes on a number of motor related subjects including how to increase profit from your car dealership and gap car insurance