Proactive attitudes and strategies to combat slowing vehicle sales

How to actually increase your market share during a slowing vehicle sales environment

Vehicle sales may slow down over the next two or three business quarters. This depends on your brand and geography. However, even during periods of sales decline, there are dealerships/dealer groups that actually increase their local market share. The following are thoughts and strategies to proactively lead during periods of slowing vehicle sales:

Be a leader.

Any Dealer Principal, Managing Partner or General Manager can be upbeat, gregarious and an all round “great guy” when sales are easy and strong. What about the opposite? 

Too often senior management show its colours when sales are down, with erratic mood swings, tyrant behaviour, micro-managing and “seagull management”; entering through the side door of the showroom, flapping around all over the showroom, squawking, crapping on people and then flying out the other door leaving everyone in their wake stunned. The once jubilant atmosphere in the showroom is replaced by tension, anxiety and fear.

The mood of a showroom is set each and every day by its senior management. If the Dealer Principal bolts through the showroom with a dark storm cloud above him, expect the exact same from the rest of the team. 

Too often salespeople are ordered to “get on the phones”, “get out there and get people in the door”, etc., without being instructed as to how, and they feel as if the weight of the entire dealership (and its success or failure) has been put squarely on their shoulders.

In times of slower sales or economic uncertainty, salespeople, service advisors and the entire team look to senior management for hope, positivity, encouragement, recognition and guidance, and the forging of even deeper individual relationships. One of the (many) tests of leadership is how we nurture (and protect) an energetic, upbeat work environment and carefully navigate our team through periods of economic uncertainty—and how we instill trust and confidence in “today” as well as the future.

Complete a technology audit in the dealership.

How much of your CRM do you really use? Although most of the software in your dealership is brilliant and has seemingly endless (and useful) capabilities, how much of it is actually used in your day-to-day business? 

Are there other, scaled down, less expensive versions that have the functions that you actually need and use? Several years ago, a Dealer Principal shared with me that he purchased a generic CRM software from Staples for $199 (one-time purchase) and that it did virtually everything that he wanted it to do. 

Many dealerships are also paying far too much for software and monthly support fees. The automotive industry pays amongst the highest of all industries in monthly fees with gross profit margins of up to 70 per cent. New businesses have sprung up that facilitate comprehensive technology audits within an organization and re-negotiate monthly support fees. 

Have more than one person appraise customer trade-ins. 

The used vehicle market is highly volatile. Having several people weigh-in on vehicle appraisals will avoid finger-pointing and blame later with respect to vehicle ageing and declining value. 

Many Used Vehicle Managers feel that they can’t win; if they don’t appraise aggressively enough (“look to book”), then they are blamed for a low win rate and losing new vehicle deals. If their win rate is high, they are chastised for overpaying for trade-ins and the resulting aged inventory. 

Consider appraising all customer trade-ins as early as possible in your sales process (literally Step 1). 

Doing this provides ample time for several Sales Managers to examine and road test all trade-in appraisals, use your technology tools (vAuto, etc.) and discuss and agree upon the value. Furthermore, could your technicians not be part of the appraisal process (upfront) in order to make more accurate estimates of reconditioning dollars? Would you buy a car privately without having a technician examine it before handing over your money? 

Implement an internal auction for all trade-in appraisals. 

It’s a universal truth in the car business that any given used vehicle (pick yours) just does not sell on your lot no matter how attractive the vehicle or how low the price. 

Yet, that exact vehicle might be displayed three doors down the street on another dealership’s lot (within a dealer group) and will be one of the most highly sought after and valuable used vehicles. 

Hence, one Used Vehicle Manager within a dealer group might be willing and wanting to pay much more for a front-door trade-in and still be able to sell it with excellent gross profit. However, many dealer groups do not leverage their size and power by working  together to keep front-door trade-ins within their group. Egos get in the way; individual silos are built and trade-ins are lost to outside competitors.  

Companies like and can create inexpensive proprietary technology that has all dealerships within a dealer group bid on customer trade-ins during the appraisal process. 

Appraisals are entered into the system by the originating dealership and all Used Vehicle Managers bid on the vehicle in a closed auction of 20 minutes or so. The originating dealership has the option to trump all the bids and keep the vehicle, or give it up to a dealership within the group that has the highest bid. This approach wins more trades and additional new and used vehicle sales. 

Don’t be a gross profit piggy.

Over the past two years we have increased our gross profit per vehicle (significantly) due to low supply and high demand. 

However, there are now many Sales Managers that are walking deals that have healthy gross profit and a new customer opportunity. These are deals that we would have been very pleased with pre-pandemic. 

Ensure that Sales Managers are counselled carefully on gross profit expectations. “Get as much gross profit as you possibly can through the deliveryof an incredible customer experience, but ultimately take the deal if the customer is going to buy a vehicle from a competitor.” You set the guidelines and philosophy. 

Have Sales Consultants complete daily activities.

It seems like a huge surprise every January and February when showroom traffic slows down. This is the norm of the Canadian market, but may be scary for newer salespeople. 

The biggest reason for salesperson depression and defection during these challenging months is the lack of productive activities—they are simply idle much of the day and staring out the showroom windows into the abyss. 

Ensure that your Sales Managers are meeting with their salespeople at each and every shift change to ensure that they are not only (quickly and effectively) following up unsold showroom and online customers, but also provide a minimum three or four sales-related activities that can keep them busy and working toward sales (e-mail or text me if you would like a digital version of a Success Planner the includes Sales Consultant Daily Activities).

Don’t cut Sales Consultants compensation plans.

This is such a cliché. In many dealerships, experienced Sales Consultants almost expect this as the first measure to reduce dealership expenses—a knee-jerk reaction to the panic of January and February or economic uncertainty. 

Decide to take your sales process seriously.

Today there is a lethargic and complacent feel to the retail industry—or one of, “We’ve got this”, as dealerships have broken net profit records (either in 2021 or 2022)—more as a result of the “perfect storm” of consumer demand, inventory shortages, pent-up demand, etc.

In fact, in many dealerships, the more money they seem to make, the less customer service and showroom experience provided. 2023 represents an opportunity to bifurcate and disrupt. 

Let’s not provide an incredible customer experience because we have to—(to compete and make money), but how about because it is simply the “right thing and the only thing to do” when someone is spending $85,000 on a new truck.

We can begin by getting serious about ensuring that each customer (whether showroom factory order or online) is treated to a documented, trained, coached and enforced sales process (Purchase Experience). 

Unfortunately, even most sales managers lack the will, desire and consistency to enforce a dealership sales process (many are now overwhelmed with new administrative duties related to tracking hundreds of factory-orders and communicating with customers). 

A sales process will only happen (consistently) if the General Manager/Dealer Principal mandates it and takes a keen, active interest.

About Chris Schulthies

Chris Schulthies is the president of Toronto-based Wye Management. Wye Management provides sales and management training (showroom and digital) for dealerships, dealer groups, OEMs and industry suppliers in Canada and the U.S. You can contact him at or 416.908.6346.

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