Post by Andrew Davis

The thing squeezing auto dealers right now? Margins... Gross profit per unit has normalized to pre-pandemic levels, but overhead—labor, floorplan interest, software—remains elevated. Benchmarks from NADA and Cox Automotive show the probability of a retail sale drops from ~70% in the first 30 days to just 10% after day 60. Let a unit sit, and interest wipes out your front-end gross. Meanwhile, Automotive News data shows the top 150 dealer groups now move over 25% of new retail volume. Mega-groups are outspending independents at every turn. The defense requires tight operational discipline and a shift to Fixed Ops. NADA tracking shows the national average service absorption rate sits at just ~64%, leaving stores vulnerable. Elite "20 Group" dealers fight margin compression by pushing for a 100% absorption rate to cover all fixed overhead. But managing this transition takes a complete overhaul of how you track inventory velocity, structure pay plans, and market to high-margin service customers. Want the full operational playbook? I’ve put together a step-by-step guide detailing the exact metrics, inventory age rules, and fixed ops strategies top groups are using right now to shield their margins. Drop a comment with "PLAYBOOK" below, and I’ll DM you the complete PDF.