Best Practices: How a VW Dealer Acquires Used Vehicles

Best Practices: How a VW Dealer Acquires Used Vehicles

A Volkswagen dealer in Marion, Illinois, is applying strategies traditionally used to boost vehicle sales to encourage staff to buy more used cars directly from consumers to help the store stock its lots.

The efforts have contributed to Volkswagen from Marion’s Reliance on buying from wholesale auctions lowered per-vehicle acquisition costs and boosted used vehicle sales and dealers’ overall profitability, said Ashlee Church, Volkswagen general manager at Marion.

Store leaders stepped up their efforts to buy directly from consumers in early 2019, strengthened tracking processes around those acquisitions and subsequent sales, and implemented bonus opportunities for sellers who were successful in the new approach. The dealer also reduced emphasis on its business development center.

“We really had to work to get everyone to embrace this philosophy… that buying a customer’s vehicle today generates a future sale,” Church said. Automotive News. “That can be difficult in sales because many sellers naturally want instant gratification. They want to sell a vehicle today, earn a nice commission on it and move on to the next customer.”

But the direct vehicle purchase strategy had to be a long-term game, Church said. New policies around acquisition and sales tracking, lead handling, and compensation were critical, as the resulting day-to-day practices and subsequent data helped store managers reinforce with staff why it was important to stay focused on direct purchasing.

The strategy became even more critical in March 2020, in the early weeks of the coronavirus pandemic. The Volkswagen showroom of Marion was temporarily closed and the staff switched to sales by appointment. Dealer managers re-evaluated sales strategies and made changes that sharpened staff focus on the direct purchasing approach, Church said.

Since then, she said, the dealership has evaluated sellers’ performance on both the number of vehicles sold and purchased.

“We went to our sales team and we said, ‘We really need your help getting inventory,'” Church said. “From our salespeople to our sales management team to our leadership team, we all take responsibility for acquiring vehicles. Our salespeople on the floor are the ones handling all leads.”