We have been pushing hard on turning inventory faster rather than holding for gross and it has definitely improved our allocation and pipeline. That said, it is a constant internal battle with the desk. Anyone actually finding a balance between volume and front end right now or are you fully leaning one way?
- Home
- Forums
- Dealerships
- General Forum
- Volume vs. Gross
We went all in on volume…
We went all in on volume about six months ago. Allocation improved, but the desk still struggles letting deals go. It is a culture shift more than anything. Pay plans usually fix these things, but I hate mixing them up too often.
At the end of the day,…
At the end of the day, volume is feeding everything else right now, especially allocation and used inventory flow.
The desk culture problem is…
The desk culture problem is real and the previous reply is right that pay plans are usually the lever. What we found when we made the shift is that the desk managers who struggled most were the ones whose identity was tied to gross per deal rather than total contribution. They had been measured on front end for ten or fifteen years and volume felt like giving something away. What actually moved the behavior was not changing the pay plan immediately but changing what got reported in the daily and weekly meetings. We stopped leading with front end gross and started leading with units, days to turn, and allocation rank against region. Once the desk saw those numbers every day the mindset started shifting before the pay plan changed. The pay plan change came three months later and reinforced it but the reporting change did most of the cultural work.
A deal that leaves front end…
A deal that leaves front end gross on the table to close faster can still be a strong total deal if the customer is well-qualified and the F&I penetration is solid. The desk managers who only look at front end gross are missing the total deal picture.
Reply 3 is spot on. Changing what you track in daily meetings is
Reply 3 is spot on. Changing what you track in daily meetings is a game changer. If you stop celebrating the "big gross" deals and start praising turn rate and allocation rank, the culture usually follows. Management focus dictates the desk's behavior more than anything else.
Reply 3 is the blueprint. You can't expect a behavior shift if y
Reply 3 is the blueprint. You can't expect a behavior shift if you’re still praising the "home run" deals in every meeting. In this market, turn rate and allocation rank are much more valuable long-term than holding out for a few extra points on the front end.
Volume is definitely the move right now. I’ve seen too many stor
Volume is definitely the move right now. I’ve seen too many stores lose out on future allocation because they were chasing a "home run" on a single unit. Like Reply 3 said, once you change what you celebrate in meetings, the desk usually follows suit.
The piece that gets missed…
The piece that gets missed in this volume vs. gross debate is what happens in the box. If you are turning faster on the front and the desk is letting deals go thin, F&I has to carry more of the load per unit. That works until your penetration numbers plateau and you have no more cushion. We pushed volume hard for two quarters and watched backend PVR climb because we were forcing better product penetration to compensate. Worth tracking that number before you declare the model working.
Reply 3 hits the nail on the head. You can’t change behavior if
Reply 3 hits the nail on the head. You can’t change behavior if you’re still celebrating "home runs" at the desk. Shifting the focus to turn rate and allocation rank in meetings is the only way to survive the current inventory game.
Reply 3 and 8 really hit the core issues. It’s all about shiftin
Reply 3 and 8 really hit the core issues. It’s all about shifting the culture through reporting and ensuring F&I is prepared to carry the weight. If you aren’t turning units, you’re losing future allocation, which is the real "home run" in today’s market.
Add new comment