The Economics of Owning a Used Car Lot

A used car lot can spend forty-five minutes fighting over three hundred dollars on the forecourt, then make more money in twenty minutes at a desk. What looks like a car retail business is often a lending business with an inventory problem. In this video: Why the finance office can be worth more than the negotiation on the car How an £8,200 auction car becomes £10,000 before it is even offered for sale What happens to profit when a car sits for 26 days and sells for 12.8 The floor plan interest clock that turns 60-day cars into problems and 90-day cars into losses Why total gross per unit divided by days in inventory matters more than units sold It's not a forecourt. It's a loan desk attached to depreciating inventory. Would you rather own the lot, or the little room where the papers get signed? Comment below.