Back to all posts

Share this:

How automotive dealers can cut reconditioning time

How dealers can cut auto reconditioning time

Selling vehicles off your lot as quickly as possible will maximize your gross income. But before you can put a vehicle on your lot, it needs to be ready to sell. You get only one chance to make a first impression with a potential buyer, after all.

On average, it takes about seven to 10 days to get a vehicle ready to sell, and about five of those days are dedicated to reconditioning. By reducing recon time, you’ll have new units on the lot faster so you can sell faster, thereby increasing the overall profitability of your dealership.

Why is speed to market so important?

While in the recon process, you’re carrying the cost of the vehicle with no potential for profit until it’s frontline ready. Let’s say that every day a car is sitting on your lot it is costing you, on average, $32-$40. If you get a vehicle ready to sell in three fewer days, that’s a savings of up to $120! When you multiply that $120 savings per vehicle by the number of vehicles you sell in year, the savings really adds up quickly.

Having full control of the reconditioning process helps dealers maintain high efficiency and quality. A lot of dealers bring their recon services in-house so they can control both the speed and the cost. If that’s not an option, try choosing one or two providers so you can leverage their volume and take advantage of discounts and promotions. Many auctions offer reconditioning too, so make sure to ask at checkout.

How can you speed up reconditioning?

There are a couple of ways that you can expedite the recon process: by better managing your reconditioning workflow, and by using a floorplan provider (also called a “floor plan provider”) to finance your recon needs.

Manage your recon workflow

Make sure you don’t have a backlog of cars on your lot waiting for reconditioning that you’re paying for each day. If you have a bottleneck of vehicles in the shop, then find out why. Ask the people who are handling the recon what parts of the process can be improved—and then make the necessary adjustments to move those cars more quickly. The longer a vehicle is in the shop, the longer it takes for you to make a profit.

While a vehicle is in the recon process, you’re carrying its cost with no potential for profit until it’s frontline ready.

Floor recon expenses with AFC

Instead of digging into your cash reserves, when purchasing at auctions that offer reconditioning services, like ADESA U.S. and OPENLANE Canada, include it on the bill of sale so those expenses can be covered by your AFC floorplan. Then your frontline-ready car will arrive on your lot ready to sell immediately! Other expenses like transportation and PSI can be added to your AFC floorplan too if included on the bill of sale.

You don’t have to pay top dollar for the perfect vehicle—with solid recon practices, you can buy a less-than-perfect vehicle at auction, fix it up, and have it ready to sell for less money than buying that perfect vehicle in the first place.

Disclaimer: Terms of AFC floorplan financing are subject to a final written agreement acceptable with AFC. AFC does not guarantee any results and examples are for illustrative purposes only. Dealers should consult their own advisors to make independent business decisions. AFC and ADESA Canada are both part of the OPENLANE (formerly KAR Global) family of brands.