July 2021 was a strong performing month, marking the end of lockdown one and the release of significant pent-up demand.
Retailers improved profitability by nearly £14,000 to £65,000 for the month during July 2021. This pushed rolling 12-month average Return on Sales up further to 2.17%
“Phenomenally strong used car performance continued to be the principal driver behind the current strong profitability, with rolling 12 month return on investment now practically up to 100%,” said ASE CEO Rob Jones.
“Stockturn is now below the benchmark of 45 days, reflecting the strength of current market demand,” he said.
“Overhead absorption continued to rise during July, with practically two thirds of the overhead costs of the business now covered by aftersales profits.
“We continue to see managed overheads with strong aftersales profits, even despite the MOT holiday hangover from the prior year,” he added.
According to Jones July represented the first month where the Government’s COVID rates rebate started to taper off, producing a fear that it would prompt a spike in costs.
“Whilst we saw a small increase in the month, there was not the leap in overheads fear and keeping costs down will be vital to protect the recent gains made in Overhead Absorption,” he said.