7 Dealership Profit Mistakes That Cost GMs Every Month
Mistake 1: No override visibility
The biggest profit mistake is flying blind. Overrides happen daily—competitive matches, manager approvals, loyalty discounts. Without structured capture, you don't know volume, reasons, or patterns. Industry estimates: 2–5% of gross slips away. Fix: Implement override capture with reason codes. Know where margin goes.
Mistake 2: Optional reason capture
When reason fields are optional, they're often blank. Freeform notes don't aggregate. You can't sum "competitive match" losses or compare locations. Fix: Make reason capture mandatory. A dropdown at the point of override takes seconds. DealerInt prompts only when an override occurs—no friction for routine deals.
Mistake 3: Vague override policy
"We use our judgment" isn't a policy. Define thresholds. What requires approval? What proof for competitive matches? Document it. Communicate it. The margin control playbook outlines an 8-step framework. Policy clarity reduces ad-hoc exceptions.
Mistake 4: Ignoring recon delays
Recon bottlenecks cost holding cost and turn. A car that sits 12 days instead of 5 ties up capital. Approval latency is often the hidden delay. Fix: Capture recon approval decisions. See where approvals sit. Streamline delegation. Recon bottlenecks go deeper.
Mistake 5: No executive reporting
Ownership and boards want ROI proof. "We have a policy" doesn't cut it. Monthly reports showing prevented loss, recovered margin, and override trends justify investment. View a sample executive report. Board-ready format.
Mistake 6: Treating all locations alike
Multi-rooftop groups often discover stark variance. One store 3x the override rate of others. That's not market—it's policy or training. Fix: Location-level analytics. Compare stores. Share best practices. Compare DealerInt with your DMS.
Mistake 7: Punishing instead of improving
Override data should drive process improvement, not blame. When a location shows high volume, ask why. Market? Policy? Training? Use data for curiosity, not punishment. How top dealers protect margins.
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