Aged Inventory

One of the major concerns for rebuilders, regardless of the size of their operation, is aged inventory.

Simply put, you’re not making money if you’re not selling the car.

As we travel to meet with prospective AutoSavvy rebuilder partners from around the country, we often see vehicles that have been sitting for 6 to 9 months, we’ve even seen vehicles that have sat for 3 years. It makes you wonder, “Does this builder realize that waiting to sell for the highest price offer isn’t how they are going to make money?”

Here’s an easy rule of thumb: Aging units do not make you money.

An aged unit only costs you money. Depreciation and interest over time will strip the profit out of a vehicle. Not to mention, if a car isn’t selling, your other cash needs won’t stop. Whether it’s payroll, paying for parts, or buying another vehicle to build, you need to get your capital out of those aging units to keep your business running.

One common practice that we see from builders attempting to get off their aged units is to reduce the price. However, instead of just slashing the price, and hurting your profit, may I suggest an alternative route? One of the best ways to turn those aged units is to put them through another inspection. Are there any panel gaps? Are there small cosmetic issues that might be turning off prospective buyers? It’s amazing how many simple things –when you take the time to look –are the ones holding you back.

Once you confirm that the vehicle is in peak condition, and your price point is right, you’ll have no problem flipping those aged units into cash… the cash you need to start your next build and take your operation to the next level.