Top Five Mistakes Ford Dealers Make

Precision Inventory Management has been managing Ford dealership inventories for 18 years, and over that time, we’ve seen what inventory strategies succeed and which fail.

Here are five common ordering pitfalls we see and what you can do to avoid them:

1. Chasing Allocation Without a Strategy

Just because Ford offers you allocation in regular wholesale or MAP wholesale doesn’t mean you should always take it. Having too much inventory can lead to higher flooring costs, slower turns, and less gross. Having too little inventory can hurt your sales.

The right quantity allows for a good selection and a buffer for sales increases while also keeping flooring costs in line and avoiding a heavy supply. Too much might require you to pump the brakes and stop taking allocation.

The most accurate way to forecast wholesale is to start with the production period, then factor in the arrival time to your dealership. From there, you take a snapshot of your on-ground inventory at the time those vehicles are expected to arrive and calculate how much inventory you need to order now to maintain a 90-day supply—or whatever supply target you’re aiming for. If this sounds like too much to process monthly, Precision can help determine how much allocation to take with the Wholesale Report, which you can learn about here.

A lot of dealerships default to a 90-day supply, and that's probably a decent benchmark to start with. But the right number might depend on a few things.  

• A dealer may want to target a lower day supply at big stores on large volume vehicle lines, or less complex vehicle lines like Bronco Sport.

• A higher day supply target might be right for smaller stores or lower volume lines.  You also might want more inventory on complex vehicle lines like F150 or Super Duty in order to provide enough selection for your customers.

2. Letting SIMS and MAP Units Slip Through the Cracks

SIMS orders need constant attention. If they’re not dirtied, dressed, or submitted on time, they’ll be built as is, which is usually not ideal for your inventory. We recommend dealers make sure SIMS do not get built unaltered. We manage inventories for over 250 dealers and guarantee no SIMS will schedule unaltered because we understand the problems they can cause. Read this article to learn more about SIMS management.

Similarly, MAP wholesale units often don’t align with your inventory needs and can be similar to incoming or onsite units. Developing a strategy to address MAP units and edit them before they get locked will make sure you have a healthy variety of incoming units. Read this article to learn more about MAP wholesale.

3. Ordering What the Dealer Wants, Not What Sells

Some configurations look good on paper but just don’t move. Precision analysts use real market data to match your orders to what’s turning fastest in your market—not just what someone thinks will sell. You can and should be doing this too. Read this article to learn more about using Ford’s fast turn data to drive your decisions and bring faster turning inventory to your lot.

4. Ignoring Commodity Notes

Ford tells you what’s constrained, but most dealers don’t pay attention. You need to look at commodity guides during wholesale to understand what you’ll be able to order.

This is particularly important on OTD vehicle lines. Sometimes commodities are bad enough when you might want to turn down allocation to avoid bad builds that won’t sell. Other times commodities are open, and you should move on allocation to take advantage.

We always monitor the commodity situation for our stores and give them a heads-up during wholesale if they are going to run into bad controls. Read our article explaining how to read and use wholesale commodity guides here.

5. Not Knowing How to Get Something Built

Submitting an order isn’t the same as getting it scheduled, and staying current on commodity notes is just the beginning. It's equally important to review and understand preview information. Every Monday and Tuesday night, Ford conducts a mock scheduling run, with the results posted the following mornings—Tuesday and Wednesday, respectively.

By layering your order bank with various configurations, you can evaluate the preview results to determine what's available at the plant that week and what isn’t. When a desired commodity appears in the preview, act quickly to secure it. Conversely, if none of the commodities you need are available, it’s often better to wait until availability improves. To learn more about layer your order bank, read this article.

At the individual store level, it’s challenging to see the full picture since you’re limited to your own order bank. Precision has the unique advantage of aggregating order data across all our dealers, allowing us to analyze previews at a macro level. This gives us unparalleled visibility into what’s truly available at the plant each week. On top of that, we know how to work within Ford’s systems to get hard-to-schedule units, especially when constraints are tight.

Reach out today if you’re interested in learning more about how our preview analysis can help your store secure more of the high-demand units.

Bottom line

These aren’t just ideas—they’re opportunities for your dealership to obtain better inventory and move units faster Precision is solving these challenges every week for over 250 stores using real data, proven experience, and measurable results, and we can do the same for you.

Book your demo with us today, and we’ll walk you through your own data, our proven process, and the impact of the Precision effect.