Trade-Ins That Work: Turning Used Equipment into Profitable Deals
Trade-ins can significantly impact cash flow if not managed properly. In a recent Dealer’s Edge session, our community of OPE dealers discussed how to develop a well-executed trade-in program to maximize profitability.
Led by dealership expert Clint Sanders, the session was jam-packed with tried-and-true methods for creating a trade-in system that can serve as a powerful sales tool, benefiting both dealerships and customers.
Key Takeaways:
- Create a Strategic approach to Trade-Ins: A structured trade-in process supports new sales without turning the dealership into a used equipment business.
- Change Customer Mindset Through Trade-Ins: Trade-ins can influence customer purchasing behavior and create long-term relationships.
- Evolve Trade-In Strategies for a Changing Market: As the industry transitions beyond traditional lawn and garden equipment, dealers must adapt their trade-in strategies accordingly.
1. Strategic Approach to Trade-Ins
A structured trade-in process supports new sales without turning the dealership into a used equipment business. Here are the most important elements our community shared:
- Structured Evaluation to Maximize Opportunities: A thorough assessment prevents missed sales and service opportunities, ensuring viable trade-ins are accepted while minimizing financial risk. A checklist-based evaluation (e.g., compression tests, drivetrain checks) ensures accurate trade-in pricing.
- Selective Trade-In Acceptance: Accepting only brands the dealership already sells minimizes risk, ensures parts availability, and improves resale potential.
- Strategic Pricing for Profitability: Balancing higher trade-in values with reduced discounts on new equipment maintains strong profit margins.
- Quick Turnover Strategy: Moving trade-ins efficiently through auctions, wholesale buyers, or aggressive pricing prevents lot stagnation and maximizes profitability.
- Understanding Market Demand: Expensive used equipment that is difficult to finance can linger too long, making strategic trade-in policies essential.
By managing trade-ins strategically, dealerships can enhance customer satisfaction, drive sales, and maintain a healthy, profitable inventory.
2. Changing Customer Mindset Through Trade-Ins
Beyond sales, trade-in strategies have a significant impact on a dealership’s reputation. Our community shared that clear communication and fair valuations can help build customer trust, leading to repeat business and positive word-of-mouth marketing.
If a customer doesn’t feel happy with their trade-in experience, they can create negative online reviews. To prevent this, dealers have begun to train their staff on how to provide clear communication about equipment conditions and warranties. Respectful explanations and alternative solutions when rejecting a trade-in is proven to help maintain positive customer relationships.
Educating customers on tax benefits, depreciation, and overall equipment costs can also help position your dealership as a knowledgeable and trustworthy advisor. Customers often overestimate the value of their equipment, so using real-world pricing data will help set realistic expectations.
3. Evolving Trade-In Strategies for a Changing Market
As the industry shifts beyond traditional lawn and garden equipment, dealers must refine their trade-in strategies. Expanding product knowledge and understanding demand are key to staying competitive.
Over the past few years our community noticed a steady increase in battery operated equipment. Keeping this in mind, dealers have started to educate themselves more on the latest eco-conscious tools to enter the market.
Our 2025 OPE Dealership Trends Report predicted that the next category to gain popularity in the OPE industry will be smart landscaping. Robotic mowers are not only becoming more common, but they’re also beginning to establish themselves as a necessary tool for operational efficiency.
Your trade-in strategies must evolve as new categories enter the market. That’s why keeping up with the latest industry trends is essential to the success of your dealership.
Bottom Line:
Trade-ins aren’t just about numbers. They’re about strategy, customer relationships, and long-term dealership success. By creating a solid strategy, your trade-ins can become a profitable tool instead of a liability.
Thank you to all who participated in this Dealer’s Edge session. We meet every other week on Fridays at 11 am EST! Stay busy, stay profitable, and see you next time!
