When it comes to car dealerships, preparing and dealing with market slumps are a normal part of the day to day running, but sadly that fact alone doesn't soften the significant impact they can have on the profitability of your firm. We've taken a look at some of the ways in which you can defend your car dealership in the face of market lows to ensure you remain on top in the long term.
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One of the most important factors to consider when attempting to slump-proof your business is insurance and government legislation. When customers are few and far between it can be tempting to be more relaxed about your admin, but staying on top of paperwork could help you protect your business should the worst happen.
Combined motor trade insurance is ideal for ensuring your business is covered against a wide range of possible issues that could otherwise spell the end of your company should they occur during market downtime. Policies can include cover for material damage, business interruption, public liability and professional indemnity.
It's also vital to stay on top of government legislation to make sure you're ahead of the game when the market begins to pick up. Changes affecting the sector such as the introduction of gender pay gap reporting, the living wage increase and the apprenticeship levy could all have an impact on the success of your business if not taken into account.
Social media and other online services are becoming an increasingly important factor in the success of car dealerships, and harnessing these tools during a market slump could help some dealers to keep their business afloat. Even when the market has turned, social media provides dealers with a simple method of actively communicating with potential customers and a direct method of communicating with those overtly seeking a new vehicle.
Social media expert Andrew Lloyd Gordon suggests social media is also an effective method of ensuring your dealership stands out from the crowd, which is particularly important when competition for customers is at its highest. "Social media channels are important because they let you showcase your business’s culture and, more importantly, that is an area which helps distinguish you from the competition," he said. "It’s hard to differentiate yourself on your website, but your culture can’t be replicated."
Staying ahead of the advancements in the motoring industry is another method of ensuring your business is prepared for any market. Whether you're targeting second-hand buyers seeking an upgrade or innovation-hungry consumers seeking the latest in modern automobiles, by keeping up to date with the latest technology you can ensure you're the top choice for those still considering upgrading their vehicle.
One of the most significant innovations to hit the industry this year is augmented reality, which is set to become a significant factor driver safety and impact areas. According to industry experts, it's likely to initially appear as part of the repair process, helping mechanics to visualise what needs to be repaired, but it's also expected to hit the car seat design process soon.
Autonomous vehicles are also a hot topic this year, with functionality appearing in almost all new cars. Some of the common features that car dealership visitors may hope to see include self-parking and adaptive cruise control included in their new car. Of course, completely driverless vehicles are still a work in progress, but there may come a time when car dealers will also need to consider the addition of completely autonomous cars to their collections in order to stay ahead.