New Way to Price Cars Doesn’t Play Beat the Clock
Summary
Its software systematically helps dealers stock and price cars based largely on market demands. ProfitTime ranks vehicles either Platinum, Gold, Silver and Bronze based on how well they’re expected to do on the used-car lot without playing beat the clock. And they are giving away the cars with the greatest ROI potential.” In a WardsAuto Q&A, Pollak talks about how ProfitTime deters that topsy-turviness and frankly flies in the face of his original “velocity” philosophy (and accompanying software). But over time, it works less well because, as margin compression continues to accelerate, you reach a point where you can’t turn your inventory fast enough to compensate for the reduced gross. The new reality is that if you stock more cars than you sell in a 30-day period, the average vehicle that’s been there longer will transact at a net loss because of the margin compressions.