CENTREVILLE, Va. -

Selling cars consistently is a craft few can master. It takes someone with the right combination of character and confidence to close deals. However, many experienced dealers will admit the far greater challenge is buying the right cars for their inventory — cars customers want.

That’s because the market for used cars can be unpredictable. With vehicle values always in swing between public demand and manufacturer supply, many dealers are often unsure which units will bring the greatest return on investment.

While you can’t predict the future, you can improve your chances of selling cars faster and making top-dollar if you know where to focus your efforts. To hit your sales goals, start by evaluating your core inventory.

Finding Your Bread and Butter

Clearly, your main products are used cars, but, how do you know which are your best-sellers? Cars in your core inventory sell fastest and make you the most money. They are your bread and butter. Typically, a vehicle is “core” to your business if you can regularly sell it in less than 30 days and hold more than $1,500 gross profit. Imagine if you could find more of these cars to sell!

The good news is you can, and it’s easy. To identify year/make/model units as potential core inventory candidates, look at sales logs from the past few months. Record how many days it took to sell and how much gross profit you made on each car. Then, compare to see which units consistently sold fast and gave you the most money. These core inventory units were probably the best value vehicles for your business, and you may want to consider stocking more of them.

Of course, every dealership is unique. Even stores in the same group have distinct qualities that define their character and attract buyers. Some successful business models are certified pre-owned, while others are buy-here, pay-here. So don’t worry if you discover that your top-selling products happen to be minivans, Mazdas or even motorcycles.

Your goal is to learn which vehicles are best-sellers for your business, not which cars you happen to prefer personally. Ultimately, the year/make/model of the car is not as important as the return on investment it provides to your business.

What’s Hot, What’s Not?

Now you can identify cars that sold well in the past, so take the next step in growing your business. Find out which cars in your area are hot and which are not with help from an inventory management system. An investment in success can bring huge rewards for your business.

Using an inventory management system like AAX by DealerTrack helps you seamlessly evaluate and manage your entire inventory. Getting the right system for your dealership will immediately help identify vehicles in your area that are currently best-sellers, and which are riskier ventures.

For example, a Nissan Altima may be the fastest selling car in your area, but you may only make a couple hundred dollars profit in the end. On the other hand, it may take twice as long to sell an Acura MDX but you can expect to walk away with thousands in gross. As the manager in charge of selecting cars for your inventory, you need to have trusted documentation to support your purchasing decisions. Otherwise, you could end up with carrying costs for cars that won’t turn.

Spotting these market trends can be invaluable when considering how much to pay for used cars at auction or trade.

Did you know it’s typical for dealers without inventory management systems to have only 10-15 percent of core inventory in stock? While you should never have 100 percent of cars as core inventory, you want to aim for at least 50 percent.

Remember, you’re an entrepreneur in the used-car business. You should still feel free to take on “non-core” cars if you truly believe they will sell. Your competition doesn’t keep all their eggs in one basket, so it’s crucial for you to diversify your inventory as well. Who knows, maybe the best-selling car is one you’ve never tried selling before. Just remember to stay true to your core.

Know Your Competition

Once you determine the best-selling cars on your lot and in your market, the final step is staying competitive with other dealers — especially in terms of how you appear online. To start, make sure your prices are in-line with other online listings. Buyers often look at dozens of search page results with listings of the same types of cars, so you should update your prices regularly to stay relevant online.

Besides pricing, many of your customers want to see vehicle’s history before buying or coming into your dealership. It makes sense that not knowing about open recalls, accidents, repairs, or previous owners can make deals sour quickly.

That’s why most inventory management systems and auctions have integrated access to Carfax Vehicle History Reports to help dealers evaluate cars they’re considering. Savvy dealers check the history before acquiring cars to reduce their chances of getting stuck with a car that no one wants to buy. Furthermore, these experienced sellers include Carfax in their own TV, radio, newspaper and online advertising to attract customers and build confidence.

Stock Cars Customers Want

The market for used vehicles can be diverse and unpredictable, but you can still find cars in your area that sell consistently. You just need to know where to look. Begin by looking within at your core inventory. Once you know which cars customers want to buy, you can maximize the potential of your business by stocking more of those valuable units.

Remember, customer preferences can change quickly in this business. The last thing you need is to be stuck with carrying costs for unpopular cars that won’t sell. Prepare by regularly checking the performance of your inventory. Try using inventory management systems and vehicle history to help choose cars.

These proven tools can help dealers identify vehicles that regularly sell for the most profit in your area. You can sell faster, improve your buying power and make better decisions for your business by arming yourself with information about your core inventory cars.

Editor’s Note: Carfax regularly produces educational Webinars for dealers, and this article if an off-shoot of a recent  offering. Auto Remarketing partnered with Carfax to run these columns. This article mentions DealerTrack AAX; however, there are several inventory management options available in the market for dealers. Dealers should explore all options.