Automotive Blog

The Christmas Rush

The Christmas Rush

Mainstream retailers everywhere are of course obsessed with sales performance at this time of year, both in-store and online. In a previous life I was with a major UK grocery retail chain, and in the run up to Christmas, every day mattered: turnover, footfall, stock cover, and profitability on the key seasonal product lines and categories were analysed on a daily basis. Planning for Christmas starts before summer, and a good proportion of retail profit is delivered in the last month of the year. This surge in sales means that driving around at this time of year, particularly late at night, you see higher than usual levels of retail transport on the move. But in many markets, you also see plenty of finished vehicle transporters during December. From the perspective of retailers outside the automotive sector, this may appear a little bizarre, as people, on the whole, do not buy cars as presents for Christmas. Of course the seasonal movements from compound to dealer that often result in what was described to me today by a leading finished vehicle logistics provider as a “huge push on available capacity up to Christmas, followed by last minute deliveries in last few days”, is largely about hitting calendar year targets. In the current economic climate these targets are more likely to be focused on maintaining or growing market share rather than hitting volume targets or profit margins. But it’s when share becomes an operational objective that the problems really start. How can share be an immediate monthly target for markets and dealers (for the sale of a major purchase like a car) when no one knows final market shares until the last day of the month, if not later? The inevitable result is end of month registrations, via real sales or otherwise, including the very visible pre-registration occurring across Europe at present. For a slow moving consumer product, which is arguably what cars are, monthly shares, or better still, rolling monthly shares, are better  used to indicate how share can be increased, but is not a logical target in itself. Market share objectives make more sense therefore when translated into a range of adjustable monthly volume targets for promotions planners and dealers - pessimistic, realistic, optimistic, - in line with volume bonuses, marketing plans and other tactical support, rather than a market share objective which neither the dealer nor NSC can do anything sensible about until the last minute, if at all. From a customer perspective however, this ill-advised end of year push ushers in the promise of January sales - all the zero kilometre cars you could wish for, at knock down prices…

Written by Ben Waller

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