In the latest episode of LotTalk, automotive veteran Frank Knox, co-founder of Unique Auto Solutions, shared actionable strategies for dealerships to transform their vehicle acquisition process. With over 17 years of experience at CarMax and leadership at OffLeaseOnly, Frank provided a treasure trove of knowledge on sourcing inventory effectively. Here’s a breakdown of key takeaways to help your dealership stay ahead.
1. Build a Strong Service Lane Strategy
Frank emphasizes the importance of leveraging the service drive as a cornerstone of acquisition. Here’s how:
• Team Effort: Everyone in the dealership, from service advisors to sales consultants, must be aligned and trained to spot acquisition opportunities.
• Automation is Key: Use tools that assign real-time values to vehicles in the service drive. This ensures consistent and fair offers that attract customers.
• Follow-Up Matters: Develop a robust follow-up system that maintains contact with potential sellers for 30, 60, 90, and even 120 days after the initial appraisal. This keeps your dealership top-of-mind when customers decide to sell later.
Pro Tip: Transparency is vital. Ensure your offers are fair and clearly explained to avoid deterring sellers.
2. Adopt a Cultural Shift Toward Appraisals
One of Frank’s core messages was simple yet powerful: every customer deserves an appraisal.
• Set High Standards: Frank shared that at CarMax, 70% of customers who walked through the door received appraisals, which led to a steady pipeline of inventory.
• Professional Processes: Standardize your appraisal procedures to ensure every vehicle—whether a $200,000 Ferrari or a $2,000 Focus—gets the same meticulous evaluation. This builds trust with customers and showcases your professionalism.
3. Rethink Compensation Models
To maintain focus and drive results, Frank suggests re-evaluating how acquisition teams are compensated:
• Fair Rewards: Match or exceed what you’d pay external wholesalers for every car acquired by your in-house team.
• Incentivize the Right Behaviors: Consider paying acquisition staff based on every successful buy rather than traditional sales commissions. This ensures a consistent focus on acquiring inventory that aligns with your dealership’s needs.
4. Diversify Your Sourcing Channels
Dealers often rely too heavily on auctions, but Frank highlighted the importance of exploring other sources:
• Partner with Other Dealers: Build relationships with local dealerships to acquire their aged inventory before it hits the auction block.
• Utilize Technology: Platforms like LotWalk can predict which vehicles are in demand, helping you target the right inventory.
• Leverage Digital Appraisals: While digital appraisals provide convenience for customers, they must seamlessly integrate with in-store processes for a frictionless experience.
5. Embrace Data-Driven Strategies
Frank stressed the importance of leveraging data and analytics to refine your acquisition strategy:
• Daily Targets: Avoid sporadic, large purchases by setting consistent daily acquisition goals to maintain a balanced inventory.
• Know Your Market: Use tools to identify vehicles in high demand and align your sourcing efforts accordingly.
• Stay Ahead of Trends: Monitor market dynamics and adjust your acquisition strategy to capitalize on emerging opportunities.
6. Invest in Technology and Expertise
If managing the appraisal lane, service drive, and auction acquisitions feels overwhelming, consider partnering with experts like Unique Auto Solutions. Their team specializes in helping dealerships source inventory effectively, freeing up your time to focus on core operations.
Final Thoughts
Frank Knox’s insights are a timely reminder that a disciplined, strategic approach to acquisitions can significantly impact your dealership’s bottom line. Whether it’s leveraging the service lane, embracing new technologies, or fostering a culture of transparency and consistency, there’s no shortage of opportunities to improve.
As Frank aptly stated, “The enemy is not having a strategy and not having a good plan.” Let 2025 be the year your dealership adopts a winning acquisition playbook.
For more expert advice, stay tuned to LotTalk and check out tools like LotWalk to guide your inventory strategy. And if you’re attending NADA 2025, be sure to stop by booth 1219 to connect with industry leaders and gain more actionable insights!