In this industry, if you’re not pulling out all the stops to grow net profits and maximize your customer wallet share on every transaction, you’ll find long-term success and growth are harder to come by. This seems like a commonsense statement and yet across the board dealers are consistently missing a proven way to grow profits: accessories sales.
It’s all too common for dealers to reach into their profits to make up the difference for what salespeople are earning in front end commissions. Whether your salespeople feel they need the extra money or not, you definitely do — and incorporating accessories is essential to getting there.
Simply put, leading automotive retailers are using accessories to get to the top and stay there. Indeed, I have repeatedly found that many of the top-performing dealers have a firm commitment to seeing accessories sales done right.
But, what does that mean?
The State of the Accessories Market
Dealers’ slice of the accessories pie is embarrassingly miniscule — a mere 10 percent of a $41 billion market. It’s become the industry’s best-kept secret that one of the most significant untapped profit centers in the dealership lies with accessories.
Now, when it comes to dealers putting a greater emphasis on accessories, the perceived obstacles are clear. There are a lot of widespread, negative perceptions that discourage dealers from taking on this challenge. Here are a few I have run across again and again:
- There’s no margin in original equipment manufacturer (OEM) sales.
- Selling accessories for every vehicle is too difficult, especially when pre-loading seems to work for me.
- Accessories sales take away from parts sales — or from F&I profit.
Each of these perceptions is based on an outdated view of accessories sales. Also, each has been debunked pretty conclusively elsewhere. Plus, I know from personal experience when dealers get accessories sales right, they can realize a profit margin of more than 30 percent in accessories sales alone.
Getting there takes the right technique and technology for selling accessories, with the technology driving the technique and far exceeding what dealers have attempted in the past.
It takes the right accessories sales presentation technique that engages customers and elicits an emotional response. Plus, it takes a commitment to streamlining the process to make the most of the technology and to remove many of the complications dealers faced before.
Even with the right technology and commitment to success in place, there’s one additional element of accessories selling that’s critical to driving the whole process: the presence of an “accessories champion.”
What dealers are missing when trying to sell accessories is what I like to call the accessories champion — an individual in your dealership that you and your accessories partner handpick to head up the management, training and execution of your accessories sales strategy and technology solution.
This person is defined by an ability and willingness to take the lead on accessories selling technology, treating training in that technology as every bit as essential as training in selling a vehicle.
The accessories champion, ideally, is someone already viewed as a driver in the dealership — someone who has shown successful implementation of an initiative the dealer took to bring about a change. With the goals identified and the right accessory partner chosen, this champion can drive additional revenue and profits mostly using the existing staff to adjust and incorporate accessories into their daily work.
Identifying and empowering a champion is critical to accessories selling success for a few reasons:
- It eliminates the overall disruption and cost that can come when a process is added without proper logistical planning.
- It precisely defines what resources are devoted to running your accessory technology so the dealership can better measure return on investment (ROI).
- It gives the dealer’s accessories selling efforts the investment and attention they need to be fully effective.
- It helps generate buy-in from the dealership personnel.
Dive Into Accessories Selling
Accepting a status quo of 10 percent of the overall accessories market is not a sustainable path forward for dealers. As vehicle sales flatten, dealers are on the lookout for new or underperforming profit centers in the dealership, and accessories might be the single most underutilized of them all.
It’s time to make the investment in accessory technology that engages the customer and streamlines the sales process. It’s time to get serious about following through on such investments three, six and 12 months down the road.
Find the right accessories technology. Then, identify a driver as the accessories champion in your dealership, empower them, motivate them with the right bonus, and see what a fully realized accessories strategy can do for you, your customers and your dealership’s bottom line.