VIENNA, Va. -

The amount of profit that a franchised dealer pulled out of his or her used-vehicle department in 2011 was the highest it had been in four years.

That’s according to data from the National Automobile Dealers Association, which indicates that the average used-car department net profit at franchised dealerships last year was $110,618.

The last time the numbers were this high was 2007, a pre-recession year when dealers took in an average net profit of $114,884 from the used-car side of the businesses.

After a net loss of nearly $3,000 for the average dealer in 2008, net profits have climbed each year since.

Specifically, they came in at $64,166 in 2009 before rising to $103,538 in 2010 and jumping an additional $7,000-plus last year.

And for a dealer like Jack Ballinghoff, cutting the right costs is one way to generate strong profits in the used-vehicle business. The general manager of Koons Tysons Toyota in Vienna, Va., shared some best practices in this area with Auto Remarketing.

“You have to almost look at it from the other end of it; you have to keep your expenses low,” said Ballinghoff. “One of the biggest keys that dealers have to realize is that customers will find the cars. They don’t need to spend the money on advertising that they used to.

“It might be different for buy-here, pay-here … but if you’re a franchised dealer or you’re a seller of late-model cars, the Internet’s going to do the job for you; as long as you get your inventory pushed out to the AutoTraders and Cars.coms of the world, you’ll get leads,” he added.

“If you’re going to work on a little bit lower of a profit margin on the front-end of it — and there’s a lot of pressure, obviously, on the front end — you have to be very good at keeping your expenses low, and you have to be very good at F&I,” Ballinghoff continued. “You have to sell warranties.”

However, cutting costs doesn’t mean dealers should skimp reconditioning or pass on certified pre-owned programs, he noted.

To see what else Ballinghoff had to say about this element of the sales process — and other key best practices — read the complete feature in the Used Car Manager section of the Aug. 1 –15 print issue of Auto Remarketing. The issue will also include this year’s Power 200, where we honor the industry’s most influential companies.