How the Wholesale price TREND should influence decision making.
Look at that Manheim chart above. If wholesale price is rising, then age is of little concern as the cost to replace will be equal or higher, but, if price is falling, then operations are stressed as FASTER turns keeps you buying new units at lower prices than your competitors. Here's a snippet for an article I wrote for Dale Pollak 14 mutha fuggin years ago.
IF THE WHOLESALE TREND IS DOWN (the used car market is in doubt)
#1). *Buy Side. Patience, Patience, Patience. Buying below market is far easier, so don’t chase units at auction, we’ll buy it for less soon enough.
#2). *Sell Side. Age is the enemy of margins, in this selling environment; operations have to be razor sharp. Take the short deal…. CASH IS KING.
*Buy Side = all the efforts & techniques related to acquiring inventory.
*Sell Side = all the efforts & techniques related to selling inventory.
A pricing algo that is unaware of PRICE TREND is weak sauce.
https://www.dalepollak.com/2008/10/manheims-used-vehicle-index/
