Maximizing Gross Through Smarter Used Car Acquisition and Operations

In Episode 26 of Lot Talk, Chris Keene, John Anderson, and Ronaldo Leonard from Lotpop dive deep into the current state of automotive inventory and dealership operations. This episode, backed by real-time data from hundreds of dealer calls, uncovers what’s happening in the market, why it’s happening, and—most importantly—how used car dealers can respond to increase gross and streamline operations. 

Here’s a breakdown of the core insights every used car dealer needs to know.

What’s Going On: Inventory Volatility and Buyer Behavior Shifts

Across the Lotpop dealer network, data is showing a clear trend: new car inventories are rising, while used car listings are starting to decline. However, that decline isn’t necessarily due to an increase in retail sales.

Instead, there’s a troubling buildup in “middle bucket” used inventory—vehicles that have aged out of their prime selling window (the first 30 days on the lot) but haven’t yet hit 60+ days. For the first time in a while, even top-performing dealers are falling below the critical threshold of selling what they’re stocking .

Key Stat: Top dealers dipped to a 49% two-week selling rate, down 4–5% from the previous week—a red flag indicating potential inventory management challenges ahead .

Why It’s Happening: Pricing Errors, Tariff Panic, and Identity Confusion

Several converging factors are contributing to these challenges:

1. Tariff-Induced Hoarding: Dealers preemptively raised prices expecting a tariff-driven surge in buyers. When that wave didn’t come, overpriced inventory stagnated.
2. Ego-Based Pricing: Many are pricing inventory based on what they want to make instead of where the unit actually sells.
3. Store Identity Misalignment: Dealers are stocking cars outside their typical successful price range or segment. For example, a store whose customers buy at the $21K mark might be holding 35% of inventory over $35K—a mismatch that’s choking gross .

Ronaldo noted that instead of working the facts, some dealers are “letting units bleed through” into aged buckets, where gross drops dramatically. That’s not strategy—that’s wishful thinking .

How to Fix It: Strategies for Immediate Impact

Here’s how to course correct and regain control of your gross profit:

1. Track and Sell What You’re Stocking

This is non-negotiable. If 65% of your inventory is 0–30 days old, aim to sell at least 65% of your units from that same age bracket. It’s in this window where gross is highest and risk is lowest.

Action Step: Use your inventory management tool to compare age bucket breakdowns between stocked and sold vehicles. If your inventory skews older than your sold units, you have a cycle problem .

2. Prioritize Activity on Fresh Units

Before attacking 60-day inventory, focus your CRM and BDC teams on vehicles in the first 30 days that already show buyer interest. These are your highest probability sales.

Quote: “The first thing you should do is jump on those customers that are on your 0–30 day inventory.” —John Anderson

3. Match Your Pricing to Your Store’s Identity

If your store consistently sells at 94% of market value, don’t bring cars to market at 105% expecting a miracle. It’s better to price in line with your historical transacting range and sell fast than to hope for a unicorn buyer.

Data Point: A high-performing dealer profiled on the podcast was transacting at 96% in the first 30 days with $1,900 profit per unit and selling 75% of their inventory in that window .

4. Wholesale What Doesn’t Fit

Trading for expensive vehicles is inevitable, but that doesn’t mean you need to retail every unit. If it’s not a match for your buyer base, offload it quickly in wholesale—within 30 days, just like you’d try to do in retail.

Real-World Example: One East Coast Ford/Lincoln store wholesales anything that doesn’t match their sales identity, ensuring they don’t tie up capital in vehicles that won’t move .

5. Get Back to the Basics

Poor merchandising—bad photos, weak descriptions, missing marketing—can sabotage even the best inventory strategy. If a fresh unit has no activity, this is the first place to look.

Quote: “The eye in the sky never lies. People will lie seven days a week, but the data never lies.” —Ronaldo Leonard

A Word on the Economic Outlook

The team also discussed macroeconomic factors, including interest rates and OEM pressure. OEMs may eventually be forced to introduce aggressive rate and rebate programs to maintain share. But until that happens, dealers must “play close to the vest” and avoid speculative inventory strategies.

Final Takeaways

Used car dealers have one job in the current market: Stock smart and sell fast. That means aligning inventory to your store’s identity, pricing realistically, and attacking fresh inventory with speed and focus.

This isn’t about hoping the market rebounds in July or August. It’s about controlling what you can control—today.

Three Things to Do This Week:

1. Audit your 0–30 day inventory—how much is it, and how much are you selling from it?
2. Analyze pricing vs. actual sell-through rates—are you leading with ego or facts?
3. Set your BDC/CRM to prioritize fresh inventory with leads—don’t let opportunities age.