increasing profit

[partsfrank]

Help me please. We're running an average of about 20% net gross profit and I need to up that or total wholesale. I need more wholesale accounts, and have run out of ideas. Salary and fixed expense eat most of my profit, so if anyone has any ideas, please help!

[GaryE]

Who does the body work for your dealership? We don't have our own body shop and made a deal the the one that does our work. We have an agreement to sell them parts at 15% off list if we send them dealership cars to be repaired and recommend our customers to go to them. They are now our biggest account because we send 3 to 4 customers a week to them. Other body shops we give 20 - 25% off.

[Chuck Hartle]

Partsfrank,

A 20% profit margin is not all that bad for wholesale, depending on your manufacturer and market. If salaries and expenses are eating up most of your profit, look internally. What percentage of your overall business is wholesale?

If you want to increase your profit, getting more wholesale customers won't help it. Remember this; it basically takes three times the effort to earn a buck in wholesale as it does in retail. Look to your shop and your service department to increase customer pay and internal sales so that wholesale compliments service, instead of service complimenting wholesale. Your only other alternative is to decrease your discounts to your wholesale customers. If you have the service and the inventory, maybe you are giving too big a discount. Your better wholesale customers will continue to buy from you if you provide the service to them.

Bottom line, look to your service department first to increase retail sales, then look to decreasing discounts to your wholesale customers. Work smarter, not harder.....

Chuck Hartle'

[Robert Button]

I have used outside wholesale reps and have brought in business but was unprepared for the amount of business we recieved. IN turn, we ticked some customers off because we couldnt provide the service. The most important thing I have learned about Wholesale is ONE customer at a time and maintaining that customer and making them a loyal customer. I have slowly over the past few years raised wholesale by about 50,000 a month that way. You will lose some and you will gain some. Its when you have the chace to gain them you need to keep them.

[Toyotaguy]

We are a fairly large wholesale dealership. We are running aprox 200,000.00. in monthly sales. Our wholesale generates around 32000.00 in gross each month. Recently I have really payed attention to the percentages. We had a bad month of total gross. Our percentage was around 19%. Since then by just cutting back some discounts we had it back up to 23%. My over head is low so at that percentage my dealer is making money. You would be shocked at how much more gross you can make if you add a dollar to each ticket sold.

When i took over the job, i wanted more customers too. Be careful what you wish for. If you can't service them, no matter what discount. they will go else where. Something we are doing is internet sales. Take a look at that. Basically doesn't cost much to advertise and all you have to do is answer the phone and take the orders down. That is working well for us. I average aprox 6,000.00 in sales a month and gross around 2000.00. My toll free number cost me around 100.00 a month and advertising was like 400.00. I have only been doing this for a few months. Well good luck...