1. Make “Real Profit” On Every Used Car Sale
Full Name I Company I Job Title I
Make “Real Profit” On Every Used Car Sale
How to Maximize Your Pre-Owned Profits
in a High Supply Market
Doug Hadden I ADESA I Dealer Consulting Services I

2. Agenda Data Driven Inventory Profit per day True Return on Investment
Aging / Pricing Plan
Inventory Sourcing

3. Data Driven Inventory 3G Method Use Data
Like Vehicles, Higher Than Average Gross, Faster Than Average Turn
Inventory Management System
AAX-Inventory+
vAuto
FirstLook
RedBumper
Others

4. Data Driven Inventory Market Performer Low Days Supply High Profits
Faster Turns

5. Profit per day
Scenario 1

6. Profit per day Scenario 1
Front-end gross profit $2,000 Finance and insurance gross profit + $1,000 $3,000 30% commission $ 900 $2,100 Days in inventory $2,100 / 20 Profit per day $105
Scenario 1

7. Profit per day Scenario 2 Front-end gross profit $500
Finance and insurance gross profit + $1,000
$1,500
Flat / finance and insurance $ 600
$ 900
Days in inventory $900 / 68
Profit per day $13
Scenario 2

8. Profit per day Scenario 3 Front-end gross profit $3,000
Finance and insurance gross profit + $1,000
$4,000
30% commission $1,600
$2,100
Days in inventory $2,100 / 90
Profit per day $26
Scenario 3

9. Profit per day Scenario 1 Scenario 2 Scenario 3
Front-end gross profit $500
Finance and insurance gross profit + $1,000
$1,500
Flat / finance and insurance $ 600
$ 900
Days in inventory $900 / 68
Profit per day $13
Front-end gross profit $3,000
Finance and insurance gross profit + $1,000
$4,000
30% commission $1,600
$2,100
Days in inventory $2,100 / 90
Profit per day $26
Front-end gross profit $2,000 Finance and insurance gross profit + $1,000 $3,000 30% commission $ 900 $2,100 Days in inventory $2,100 / 20 Profit per day $105
Scenario 1
Scenario 2
Scenario 3

10. True Return On Investment
Front-end gross profit $500
Finance and insurance gross profit + $1,000
$1,500
Flat / finance and insurance $ 600
$ 900
Days in inventory $900 / 68
Profit per day $13
Front-end gross profit $3,000
Finance and insurance gross profit + $1,000
$4,000
30% commission $1,600
$2,100
Days in inventory $2,100 / 90
Profit per day $26
Front-end gross profit $2,000 Finance and insurance gross profit + $1,000 $3,000 30% commission $ 900 $2,100 Days in inventory $2,100 / 20 Profit per day $105
APR=255.52%
APR=32.21%
APR=56.78%
Scenario 1
Scenario 3
Scenario 2

11. Iiii=P⋅i⋅t=IP⋅t=210015000⋅0.05479=2.5552=255.52% per year
Problem
You deposit $15000 into a bank account and received $2100 simple interest after 20 days. What had been the interest rate?
Explanation
STEP 1: Convert 20 days into years.
 20 days =20/365 years=  years
STEP 2: Find interest rate by using the formula I=P⋅i⋅t, where I is interest, P is total principal, i is rate of interest per year, and t is total time in years.
In this example I = $2100, P = $15000 and t = years
Result
The interest rate was 255.52% per year.

12. Pricing / Aging Inventory management systems How many like vehicles
How long
Price drops

13. Pricing / Aging
Non-Core = 10 / 20 / 30 / 45 / 50
Core = 10 / 30 / 55

14. Inventory Sourcing Data Mining Current Customers Service Drive
AM Shift
Free Appraisal

15. Inventory Sourcing
Auctions
Online
Inlane
Dealer to Dealer

16. Dealer Consulting Services
Contact Doug Hadden
ADESA
Dealer Consulting Services