How BI can help Dealerships recoup profits from Budget 2024

Introduction

The automotive industry, a key player in the UK economy, is currently facing a complex and challenging environment. Through a combination of economic factors, regulatory changes, and shifting consumer preferences we are witnessing a complete reshape of the sector's future.

Over the last few weeks, we have seen a significant development: the increase in employer National Insurance contributions via the Autumn Labour Budget. This has increased the pressure on car dealerships.

In this article, we will outline these changes, highlight how they may impact dealerships and explain how our automotive business intelligence solution can help uplift dealerships, enabling organisations to regain their footing during this period of significant change and uncertainty.

The Autumn Labour Budget

The Autumn Labour Budget introduced a range of measures, including changes to the secondary threshold, the National and Minimum wage and a 1.2% increase in National Insurance contributions for employers from 6 April 2025. While these additional costs will undoubtedly impact businesses across the board, car dealerships may feel the squeeze more acutely.

With tight profit margins and intense competition, any additional expense can significantly erode the profitability of a dealership. To mitigate the effects of rising costs, dealerships may need to adopt cost-cutting measures, such as reducing staff hours or implementing more efficient operational processes to identify data opportunities that reveal chances to recover any losses. However, such actions could potentially compromise customer service and, in turn, harm long-term business prospects.

Our proactive customer success team has already visited many of our customers over the last week and learned that some of our groups are facing a bottom-line impact of £0.5m -£2m per annum on top of an already challenging cost base. 

The Road Ahead: A Need for Data-Driven Decision Making

In response to financial challenges, we at RWA Automotive understand the immense pressure that dealerships will face in the coming months as they strive to remain profitable and operational. Our team has extensive experience working with numerous dealerships across the UK, successfully providing dealership solutions for a wide range of challenges brought about by evolving economic conditions and regulations.

We believe that embracing advanced, data-driven decision-making is essential for navigating the complexities of this ever-evolving market, leading to a more sustainable future for dealerships. Our automotive business intelligence tools offer valuable insights that bring clarity and oversight of your dealership analytics during pressing times. Whether it’s operations, customer behaviour, or market trends, our automotive business intelligence solutions can help you identify the vital opportunities you need now more than ever.

To help you better understand our approach and methodologies, we have outlined our automotive business intelligence solutions and their benefits below:

• IgniteAftersales empowers your aftersales team to drive growth and profitability in a changing automotive landscape. By providing real-time insights and actionable recommendations, IgniteAftersales helps you optimise workshop efficiency, improve customer retention, and maximise parts revenue. With IgniteAftersales, you can future proof your aftersales business and thrive in a challenging market. For example, in the past week, we identified opportunities of £9m across 10 groups. That equates to £60k per branch largely in Aftersales in parts discounts & margins, VHC percentage checked and workshop efficiency.

• IgniteSales empowers your sales team with real-time insights to drive immediate results. By analysing key performance indicators and providing actionable insights, IgniteSales helps you optimise daily performance, make data-driven decisions, streamline sales processes, and maximise revenue. With IgniteSales, you can take control of your sales performance and achieve sustainable growth.

• PriceSmart is your data-driven pricing solution that empowers car dealerships to maximise profits. By analysing market trends and optimising inventory, PriceSmart helps you uncover hidden profit potential, automate pricing tasks, and react quickly to market changes. With PriceSmart, you'll gain a competitive edge and drive sustainable growth for your dealership.

Conclusion

By leveraging our automotive business intelligence solution, dealerships can adapt to changing market conditions with confidence, enhancing operational efficiency and improving customer satisfaction. As the industry continues to evolve, those who adopt data-driven strategies will be best positioned to succeed in the future.

Get in touch with our team today to learn more about our dealership solutions and to begin your automotive business intelligence journey.