The Subprime Auto Report

The 12 Month Forecast: What’s Your Plan for 2007?

If the owner of your dealership wanted your strategy for 2007, how would you go about giving that to him? Could you break down your expected production into separate business channels, such as walk-in traffic, internet leads, direct mail, etc? Could you state exactly how much sales volume and revenue your department will contribute to the dealership next year? If you can’t, then you really aren’t doing enough to plan your strategy or build your credibility; both are critical to your success. In the first part of a series on department setup we’d like to introduce you to the 12 Month Forecast. Here’s part of an existing forecast:

The 12 Month Forecast divides your expected subprime traffic into separate business channels (walk-in traffic, internet leads, mailers, etc). Also, it lists how many units and how much profit each channel will bring. In the example above, this manager expects walk-in traffic in January to produce 10 units per month. At an average profit of $2500 she predicts that, from walk-ins, she will gross $25,000. Moving down the forecast, she also predicts 10 units a month from third party internet leads for $25,000 and 5 from bankruptcy leads for $12,500.

From this snapshot you can see that she plans, in March, to participate in a Capital One Mailer and start doing business with Credit Acceptance Corporation in April. These are two examples of business channels that she is developing that will add to her production in coming months.

The key to succeeding in special finance is adding as many business channels as possible to your department. It’s critical that you realize that walk-in traffic alone will not make you succesful. You must proactively hunt for new opportunities. Of course, each new marketing effort requires an investment from the dealership. This special finance manager realizes this.

Here’s her complete forecast. Take a few moments to review her business plan for 2007:

As she adds business channels and gets better at executing on each she predicts her monthly volume will increase from 26 units in January to 69 units in December. This report clearly shows that her department will continue to grow throughout the year. Using a very conservative goal of $2500 a copy and using realistic volume goals she predicts that in 2007 her department will gross $1,273,000! Based on any pay plan she and the store will have a good year.

A Good Forecast Drives More Money To Your Budget

Investing in special finance leads, direct mail, advertising, and other programs can be expensive. If you show the dealer principle that his investment will be returned many times over he is more likely to spend money on your department. The 12 Month Planner gives him this information in a professional and easy to understand format. This gives you the credibility you need to earn his trust and get the support that you need to have a very profitable 2007!

We’ve put together a clean and easy to use forecast that you’re free to use. It has drop down boxes and automatically calculates volume and profit for each channel. Subscribe to The Subprime Report and we’ll send you a copy. In addition, we’ll send you updates each time we write a new article. We do not accept advertisers and are committed to giving you only unbiased and relevant information about the special finance business. If you have any problems feel free to   contact us and we’ll be glad to help you out. Click the thumbnail below for a snaphot of the complete forecast.

We hope you have a very profitable 2007!