5 Ways Auto Dealerships Can Overcome Inventory Shortages

Tips for Effective Merchandising of Your Automotive Inventory

U.S. auto sales are finally anticipated to recover after the volatility of 2020, when the industry grappled with various issues stemming from the Covid-19 pandemic. Consumer demand, driven by stimulus checks and tax refunds, has steadily risen throughout the year causing increased automotive inventory shortages.

However, new-vehicle inventory has continued to lag due to a computer chip shortage, as well as the slow increase in car production after the pandemic shut down auto factories around the world, including those for General Motors, Ford, and Chrysler.

While the supply chain is still lagging behind, auto sales are on the rise. This means that dealerships stand to elevate their profits by leveraging increased demand against lower supply. 

However, in order for your dealership to be prepared for car-buying season, you’ll need to forecast the ways you can overcome inventory shortages. Here, we’ll cover five ways to ensure you’re merchandising effectively to overcome vehicle-supply deficiencies and meet customer demand.


1. Make sure your inventory is clean and presentable.

It’s no secret that a clean, presentable pre-owned vehicle will sell faster than an unappealing one. To easily boost your inventory’s chances of selling, make use of your lot attendants. Have them regularly monitor your on-the-lot inventory and inform management of any issues with the physical appearance of your vehicles. Whether it’s damage, poor aesthetics (dirt, grime, etc.), or a flat tire, make certain that all vehicles are in prime condition and any problems are immediately fixed.

This is especially important when you consider the fact that “walking in” is still the most common way buyers initially interact with dealers. The image your dealership initially projects is crucial to influencing a buyer’s decision to come onto your lot—or steer clear. 


2. Rotate your inventory often.

In this same line of thinking, you want to avoid “the same old, same old” when it comes to the outside perspective of your dealership. Keep things fresh to lure in potential buyers, whether the inventory you’re spotlighting is brand-new or used.

Rotate your inventory: 

  • On the lot
  • In the showroom
  • By the roadside
3. Make sure new and used inventory is accessible on the lot.

When a prospective buyer enters your lot, the inventory most likely to catch their attention is not only well displayed, but well merchandised with easily accessible information. Whether a used or new car, make sure to merchandise all of your inventory so that the vehicle information is clearly accessible, including:

  • Basic make and model information
  • Trim level
  • Special equipped features

Vehicles that lack this clearly accessible information are more likely to feel “hidden” and be overlooked by would-be buyers. By making sure all of your new and used inventory is accessible on the lot, you make the buying process as easy as possible for your customers, and in so doing increase the chances of a sale.


4. Complete your inventory’s PDIs (pre-delivery inspections).

Immediately boost your customers’ confidence and peace of mind when it comes to your inventory by completing—and advertising (see Tip #3)—your inventory’s PDIs. 

Unfortunately, only 9 percent of consumers report having a “high level of trust” in car dealerships. For this reason, it is vital you instill as much trust and hard facts regarding your inventory as possible. Completing PDIs on the vehicles, wherein the engine, interior and exterior, underside, and road worthiness are rigorously examined, will go far in boosting consumers’ confidence in your dealership. 


5. Continue investing in digital merchandising.

The relationship between the online shopping experience and vehicle purchase is increasingly important in 2021. Recent studies show the huge impact digital merchandising has on a dealership’s vehicle sales:

  • Shoppers who are just moderately engaged on a dealership’s website are still 50% more likely to purchase
  • A whopping 95% of U.S. used-car purchases begin online
  • Twice as many consumers begin their car research online vs. at a dealer

To leverage would-be buyers’ preference of online shopping, it is absolutely recommended that dealers continue to invest in digital merchandising, which should allow customers to:

  • Search for specific vehicles and prices on their website
  • Schedule test drives 
  • Schedule service appointments
  • Calculate pricing on specific vehicles, including taxes, financing, etc.
  • Ask for more info

Digital merchandising not only makes the shopping experience easier for customers, but improves the relationship between car dealers and their would-be buyers. Edifice makes digital merchandising easy for dealerships, so you can more easily engage with your customers and improve your vehicle and service sales.

Learn more about how Edifice guarantees dealerships a 4X ROI in gross profits, and schedule your free 15-minute demo today.


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