What Makes A Car Valuable to Your Dealership

There are several factors that determine value in a car. For example, extra features, reputation for quality and stability, availability, and brand awareness. The first two are obvious; leather interior is considered more valuable than cloth interior and if a car has a reputation for excellence then it will hold its value longer. The availability aspect is based on the economics of supply and demand. If there’s a short supply like with, say, a brand new car then demand may be higher thereby increasing the value. But brand awareness is also a big indicator because some people just want to be able to say they drive a Porsche. If a certain brand has a reputation for providing luxury cars, then worth will become associated with that brand.

Current trends and popularity also assign value to cars at dealerships. Like any other product, cars move with the market and popularity determines which cars will sell and which ones will sit. Unfortunately there is no real formula to determine this so the conservative thing to do is to stick with the tried and true value-holders already on your lot.

There is no hidden secret to determine the value of the cars at your dealership. Certain obvious aspects of the car itself and the brand will indicate how much a car is worth overtime. But the bottom line is that quality determines value and the better the value of your inventory the stronger your projected profit margin.