Many car dealers operate an expansive facility that may cover a lot of land and incur a high monthly cost. They may have to pay extensive rental or land financing costs, with significant taxes due to the local authority as well. Further, it can be costly to maintain these facilities to keep up with wear and tear or deal with weather-related events. So why is it important for a car dealer to branch out wherever they can and look at other profit centres? And why should they consider a car hire agency along these lines?
Competitive Environment
The automotive industry is very competitive as consumers look at their options and see what they can get from a bargain. They often compare outlets as they work out where they are going to buy the vehicle and may size up your dealership alongside several others at the same time.
Value Services
Of course, they may be looking for a set of wheels, but what type of service will they receive as they go through the buying process? Will they be able to get any optional extras like an extended service warranty or find a particularly favourable finance rate?
Gaining Superiority
In this type of environment, a dealer must place themselves at the front line. They'll want to offer whatever added value they can so the consumer can see that the dealer cares and will likely come back in the future.
Extra Options
If your dealership opens a car rental agency on-site, you may be able to offer your existing customers extra services. For example, when they need to bring their vehicle in for a sizeable repair, they will be able to pick up a car from your rental fleet to tide them over.
Pricing-In
You may also be able to price a loaner car into your service contracts before you do a deal with a new client. As you will have these vehicles on-site and be able to guarantee availability, you can look good in your consumer's eyes.
Space Utilisation
In addition, you'll be able to make use of some space that may be underutilised and bring in additional revenues to help you deal with your property overheads. All in all, this could be a shrewd move for your operation as you seek to safeguard its viability.
Moving Forward
Talk with an existing agency to see if you can craft a win-win deal. Alternatively, see how you can set up your own car rental agency on-site to give you more options for your everyday business.
