Acquiring Customers During Inventory Shortage is More Important Than Acquiring Vehicles
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Acquiring Customers During Inventory Shortage is More Important Than Acquiring Vehicles

Dealerships need to adjust their compensation models and offer commissions for other products and services.

Brett Kelly is executive vice president of dealer performance at Applied Concepts, an auto dealership sales and performance training company. With more than 20 years in the auto industry, Kelly spent 15 years at Cox Automotive where he led several brand growth initiatives including Autotrader, VAuto, Vin Solutions, Haystak Digital Marketing and

The current shortage of vehicle inventory has auto dealerships across the country clamoring to buy used cars and get in first position for new vehicles from their manufacturers. Dealership owners, managers and salespersons are frustrated at their inability to put customers in the driver’s seat of their choosing, and at times it seems there is no end in sight. What exactly is a dealership to do if they don’t have the inventory to sell a car? Build relationships with existing customers, acquire new ones, offer solutions and sell other products and services.

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Since the inventory shortage began, most conversations between customers and dealerships have been short and abrupt. The customer asks if the dealership has a specific make and model, the salesperson responds no, nor do they know when they will, and the call ends. Nothing gets accomplished for the customer or the dealership.

What many dealerships fail to recognize is despite the inventory shortage there are still ample opportunities to generate revenue from customers, as well as build new and existing relationships that will yield business for years to come. Dealerships need to identify those opportunities that exist for them and determine which are easiest and most practical to operationalize.


The first step is for the dealership to mobilize and train their front-line employees on how to adjust their sales tactics and ignite a customer-centric environment of finding solutions. If for whatever reason a new car purchase is not an option for a particular customer, sales teams need to find opportunities within the service, finance or accessories departments. Rather than feel frustrated at not being able to sell a car, sales teams should be motivated and incentivized to find and implement alternative solutions for customers that will generate revenue and establish lasting relationships.

There are many ways in which an inventory-shortage dead end customer encounter can be turned into something productive and profitable. A good starting point is to ask the customer a few key questions about their current situation. The more you understand, the more you can direct the customer accordingly. Find out what the customer is currently driving, the age and condition of the car, how they use the car and why they want to get a new or different vehicle. Depending on how the customer answers, you may be able to suggest some mutually beneficial solutions:

  • Suggest a different vehicle the customer might not have thought about but is comparable to what they wanted, and one you have on the lot.
  • If their vehicle is in reasonably good condition but they are concerned it is no longer under warranty, suggest an extended warranty (service agreement). By putting a service agreement in place, it will basically turn the vehicle into a new car from a warranty perspective and the customer can wait until the inventory shortage passes and not pay top dollar for their next car. They can then trade-in that vehicle in a year or two and it will be worth more because of the extended warranty.
  • A reasonably priced maintenance program can be of value to just about every customer who is no longer under any kind of coverage. It’s a good option for a customer who needs to keep their existing vehicle for a while longer but wants to minimize the amount of money they spend on maintenance.
  • If the customer wants a new vehicle because of mechanical issues or body damage, bring them in to talk with the service department. If there are no good purchase options available, work out an affordable plan for them to make repairs. Depending on the situation, fixing their car may wind up saving them money in the long run because of the current premium pricing for new cars.
  • Invite the customer to come into the dealership and get a no-strings-attached offer on their current vehicle. Explain that because of the inventory shortage, now is a great time to sell their car. Once in the dealership, you can work with the customer to find an alternative vehicle you have in stock. The customer may be surprised at how much they can get for their current vehicle, enabling them to purchase a car they thought out of their financial reach. If there is no suitable purchase option, discuss purchasing an extended warranty, a maintenance program or making repairs.
  • If you sense the customer may end up going to a different dealership to purchase a vehicle, you may not make a sale, however, you can at least make an offer on their existing vehicle and increase your inventory.
  • Customers may want a new car because of certain features, such as a particular type of wheel or interior improvements. If a purchase in not in the cards for whatever reason, bring the customer to the parts department to discuss making upgrades. Pair this with a new service agreement and while the customer may not walk out with a new vehicle, they can walk out with a close second.

For front-line sales teams to be successful, the dealership must give them additional tools and products to offer, such as special “bundles” or discounts that will meet customer needs and generate revenue. For example, a discount can be offered on an extended warranty with repair service greater than a certain amount. The customer can walk out with a functioning vehicle and the protection needed to feel comfortable while waiting out the inventory shortage.


Recognizing that salespersons are incentivized by selling vehicles, dealerships need to adjust their compensation models and offer commissions for other products and services. If a customer replaces their air conditioning or purchases an extended warranty instead of buying a new vehicle, the salesperson should receive a commission. Proper incentives and training will also help dealerships retain sales staff during a time when vehicle sales are down.

The dealerships that will fare the best during the inventory shortage are the ones who are willing to pull up their bootstraps, get their sales teams trained and motivated to work with customers to create solutions. Despite the challenges presented by the inventory shortage, this can still be a time of profitability and business building.

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