Even if you know the ins and outs of your dealership’s day-to-day cash flow like the back of your hand, it’s highly likely that there are some opportunities for savings tucked within your budget. You might find that a few small changes can save you serious money, along with streamlining your procurement and operations. The following hidden tips and tricks don’t require cutting corners or sacrificing quality.
Consolidating Means Savings
Start by taking stock of your existing supplier relationships. It’s highly probable that you have more than you need — and that redundancy is expensive and time consuming. Each extraneous vendor is responsible for $2,400 in economic leakage annually. Plug those leaks by consolidating with a single wholesale vendor that can offer cost savings and convenient “one-stop shopping.”
Dealerships, even multi-dealer enterprises, simply aren’t large enough to leverage purchasing power the way a comprehensive wholesale cooperative can. These suppliers have the buying power and scale to deliver measurable savings without compromising quality or having to switch from a favorite product or brand.
Working with a single, large vendor has several benefits. For starters, you’ll benefit from the purchasing power of a large vendor with access to low, fair and transparent prices. Fewer points of contact also will reduce errors and redundancy, and let you concentrate on doing what you do best: Running your business. With a trusted vendor partner handling your procurement operations, you’ll no longer have to devote valuable resources to constant price-checking and comparison shopping, inventory management and warehousing excess inventory.
As an added bonus, a vendor partner that is set up as a cooperative provides dealerships with additional savings via annual dividends — as a customer, this means you’re effectively paying yourself for financial outlays you would be making anyway.
“Our cooperative helps me manage a very diverse, very difficult business. Interacting with many vendors on my behalf really helps me simplify the entire process.
-Ed Rossi, Rossi Chevrolet Buick GMC
Big Data Delivers Big Savings
Another way to save money is to seek out a vendor partner that has robust data reporting capabilities. A supplier that can give you a holistic look at your expenses and analyze your spending regularly can be an invaluable ally in addressing any cost concerns or missed opportunities for greater savings.
Having regular opportunities for account reviews might not be top-of-mind if you’re seeking a supplier for everyday supplies, but it’s actually a critical key to remaining competitive in today’s fast-paced automotive market. Robust analytics give you visibility into category-specific spending, and can do so with accuracy and efficiency that a manual accounting of your expenses just can’t match.
A purchasing audit provides comprehensive visibility into the money your dealership is spending on everything from parts and equipment to paper towels. It can identify areas of overspending, as well as any missed opportunities for further consolidation. With this knowledge, you can improve your current purchasing practices and achieve cost savings from these controls and insights.
Choose a wholesale cooperative that makes it a priority to provide transparency in invoicing. Not only does this give you better visibility into your operations, it reduces the chance of overcharges or other errors, and entirely eliminates the potential for additional incentives that don’t benefit your business.
Why Good Customer Service Saves Money
Even in an era when shopping has become point-and-click for many everyday items, your dealership will benefit from forging a relationship with a wholesale supplier that prioritizes your experience. You want a partner, not just a vendor.
Seek out “old-fashioned” customer service and vendors who stand behind what they sell, because this kind of a hand-in-glove partnership will provide real, tangible operational efficiencies that will improve the workflow at your dealership and free employees from having to retrace their steps, correct errors or double-check orders.
Other ways a supplier can demonstrate a customer-first mentality is in their pricing and return policies: Before signing on the dotted line, be sure to ask if the vendor offers price-checking and -matching; after all, if your employees have to constantly look up current prices, you have to consider that the value of their time is coming off the top of whatever savings you might have otherwise achieved with a more hands-off seller. And ask equally detailed questions about their return policy; ideally, you should be able to find it in writing on their website, but asking a sales rep face-to-face will give you a good indication of how much the company is invested in these kinds of service elements.
Some wholesale cooperatives even take on a consultancy role with the dealerships they service, providing advice and insight on everything from showroom renovations to equipment repair, and even acting as a go-between with manufacturers and their authorized partners.
This kind of a relationship is invaluable for so many more reasons: Rather than just a supplier, they can become a trusted resource on which you can rely. (Think about it: You can’t pick up the phone and call someone at Amazon to ask if there’s a cheaper alternative or more convenient packaging option for something you need to buy.)
Bigger Footprint = Bigger Savings
Large wholesale cooperatives will have a much greater variety of inventory, packaging and shipping choices, and are more likely to have made the investment in important technologies in distribution and inventory-tracking. Seek out a vendor that offers both expedited and drop-shipping. This combination gives you the operational and financial flexibility that will improve everything from cash flow to inventory management.
Don’t be locked into a shipping schedule that was designed for their convenience; this will end up costing you money in the long run if you have to make last-minute purchases, pay for rush shipping or even pay retail prices to get something you need right away. An added bonus: You’ll also free up space in your facility if you don’t have to warehouse large quantities of goods.
What’s more, a large seller won’t leave you feeling hemmed-in with a poor selection of products or few options. To save money, you need to be able to have access to an array of choices in all product categories that will give you the opportunity to buy the best item for a specific need.
The bottom line is that large, customer-centric wholesale suppliers — particularly cooperatives — offer numerous ways for dealerships to save money. Don’t you owe it to your staff and yourself — to find one that can truly meet your needs?
Want to learn more? Visit www.wascoonline.com/why-wasco and then request a free analysis for your business.
