It’s an exciting time to be an auto dealer. Research suggests that the U.S. automotive dealership market is expected to hit $57.3 billion, resulting in a compound annual growth rate of more than 4% over the next five years. This prediction isn’t surprising.
The industry has seen significant success, given the recent demand for new and used cars and shoppers’ excitement about new technologies like electric cars, connected cars, and autonomous vehicles. However, while the growth and advancements in the auto industry are compelling, dealerships still experience many hurdles to success.
The top dealership challenges
These days, running a dealership comes with unique problems. Even if your business is currently hitting or exceeding sales goals, it may not last long if you can’t overcome the top dealership challenges affecting the industry. To put your company in a position for long-term success, you need to take steps to mitigate five dealership issues.
1. Increased competition
With online-only retailers challenging brick-and-mortar dealerships, competition is fiercer than ever. For your business to experience success, you have to find unique ways to engage car shoppers who are interested not only in the dealerships down the street but also in the ones dominating online. Consumers have options everywhere, and contending for their attention requires you to have a competitive edge.
2. Reduced dealer loyalty
Increased competition means decreased dealer loyalty. Over the last five years, dealer loyalty has decreased by 1.6%, even though brand and manufacturer loyalty only reduced by 0.2%. If you’re wondering whether reduced dealer loyalty genuinely impacts business, remember that loyal customers usually bring the highest ROI on sales and trades.
3. Demand for digital communication
The days of visiting a physical dealership or picking up the phone solely to communicate with sales reps are gone. Car shoppers want the option to communicate digitally. They want a contactless experience that allows them to ask questions and receive updates. So if your dealership still requires customers to talk on the phone or sit at your desk to get information, your business may be in trouble.
4. Changing shopping behavior
Another dealership challenge is today’s new shopping behavior, an issue primarily stemming from millennials. In 2021, millennials became car dealers’ biggest pool of potential customers, which was surprising to most in the industry. People thought millennials weren’t interested in driving and that they preferred walking, biking, or ride-sharing—but the reality was that millennials simply preferred to shop differently.
Instead of immediately visiting dealerships to spend hours considering options and negotiating, millennials like to utilize online tools and research to determine which vehicle may be the best. Some millennials are open to even completing the entire car sales process online.
5. Inefficient after-sale process
For consumers, buying a car is only half the battle. Unless you do it for them, they still have to take many steps to legitimize the transaction, which they must do at the Department of Motor Vehicles (DMV). Regardless of who takes the lead, finishing the after-sale process in a timely manner is often impossible. Even though we live in a digital age, phone calls, in-person visits, complex forms, and long wait times still characterize the after-sale process.
Overcoming common dealership issues
If you want to set your dealership up for success, you need to have the ability to overcome the top five dealership challenges. Of course, many solutions can help you achieve that, but if you prefer to start with one, here’s an idea: work with a private DMV services company like our team at Barry Risk Management.
As a private DMV services company, we directly streamline and quicken the after-sale process by getting your customers’ tags, titles, license plates, and vehicle registration all online. That means you don’t have to do any legwork—we’ll take care of that for you. All we’ll need is a little information about your customer and their purchase, which you can give us online. Then, we’ll take steps to get the documents your customers need to legitimize their transaction.
Also, it doesn’t matter where your customers live or your dealership’s location. Our team has over 30 years of experience in the DMV industry and knows what each U.S. state requires for car buyers to retrieve their tags, titles, license plates, and vehicle registration. With our knowledge and online capabilities, your customers will have what they need quickly and with little to no hassle.
The best part? Our DMV services can help your business overcome the other four dealership challenges. Our efficient process and digital platform will give your team the following:
- A competitive edge: Many dealerships still use a traditional approach to interacting with the DMV. If you transition into using a more modern approach, you’ll differentiate your dealership from competitors.
- Increased brand loyalty: When customers know you can make their car buying process easier, they’ll be more likely to keep coming to your dealership instead of considering other options.
- A digital tool for communication: Since our team does everything online, we don’t need to see you or your customers in person. We also don’t need to speak on the phone if that’s not preferred. Our team communicates digitally and uses an online platform to get DMV tasks done quickly, meeting the new need for digital communication.
- A better experience for car shoppers: With car shoppers preferring digital experiences, you’ll stand out by offering a way to get their tags, titles, license plates, and vehicle registration online. Consumers will think you understand their shopping behavior and be more inclined to buy from your dealership instead of one that hasn’t aligned with their preferences.
By working with our team at Barry Risk Management, you’ll receive the advantage your company needs to start overcoming the dealership challenges impacting business owners. That advantage will set your brand up for long-term success so that your dealership continues to grow. So, don’t hesitate to reach out. Call us to help lay the foundation for your company’s victory.
Contact one of our representatives at 1-888-995-TAGS(8247) to develop a streamlined after-sale process that also helps you overcome other dealership challenges!