P4 AUTOMOTIVE
Used Vehicle Operations · Policy & Procedure
Hard Transfer Rule for Used Inventory (90+ Days)
Governing the mandatory inter-store transfer of aged used units and the wholesale disposition of as-traded units.
1. Purpose
Establish a consistent, enforceable process for the hard transfer of aged used inventory across P4 Automotive stores to minimize inventory aging, control depreciation risk, and ensure fair valuation between stores.
2. Scope
Applies to all P4 Automotive dealership locations, all used vehicle inventory managers, general managers, and accounting personnel involved in inter-store inventory transfers. Excludes new vehicle inventory.
3. Definitions
| Hard Transfer | A mandatory, non-refusable transfer of a used vehicle from one P4 store to another. |
| Age in Inventory | Number of days a unit has been in inventory since acquisition. |
| Black Book Average Wholesale | The average wholesale value published by Black Book at the time of transfer. |
| MDS (Market Days Supply) | Metric indicating how quickly a specific vehicle sells in a given market. |
| MKT $ Diff (Market Price Difference) | The dollar variance between the unit's listed price and the current market average for comparable vehicles. |
| Parallel Store | A sister P4 store of similar size, market, or brand profile. |
| As-Traded Unit | A vehicle acquired via trade-in that has not been reconditioned or retailed by the receiving store. |
4. Policy
4.1 Any used unit that reaches 90 days or older in inventory will be hard transferred on the 1st of the following month.
4.2 The transfer amount will be set at the Black Book Average Wholesale value as of the transfer date.
4.3 The receiving store will be determined by the lowest MDS for that specific unit.
4.4 If two stores share the same MDS, the tiebreaker will be the best MKT $ Diff.
4.5 No store may refuse a hard transfer.
4.6 The Inventory Manager retains discretion to discuss and reassign the unit to a parallel store when operationally justified.
4.7 As-Traded units are NOT subject to hard transfer. As-Traded units must be wholesaled at 45 days.
5. Responsibilities
| Inventory Manager | Runs the monthly aging report, identifies units eligible for transfer, applies the MDS/MKT $ Diff logic, sets Black Book wholesale value, and coordinates parallel-store exceptions. |
| Store General Managers | Ensure compliance; may not refuse incoming transfers. |
| Accounting | Processes inter-store transfer at the Black Book Average Wholesale value and updates DMS accordingly. |
| Inventory Managers | Prepare units for transport and update inventory systems on the same day the transfer is executed. For units owned by their store, complete the transfer process, including the JOT form and transportation arrangements. |
6. Procedure
| Step 1 | Aging Report: On the last business day of each month, the Inventory Manager pulls the used inventory aging report from the DMS. |
| Step 2 | Identify Eligible Units: Flag all non-As-Traded units at 90 days or older in inventory. |
| Step 3 | Determine Transfer Value: Record the Black Book Average Wholesale value for each eligible unit. |
| Step 4 | Determine Receiving Store: Rank all P4 stores by MDS for that specific unit; select the store with the lowest MDS. |
| Step 5 | Apply Tiebreaker: If two or more stores share the same MDS, select the store with the best (lowest) MKT $ Diff. |
| Step 6 | Parallel Store Review: The Inventory Manager may, at their discretion, discuss and reassign the unit to a parallel store when logistics, market fit, or operational balance warrant it. |
| Step 7 | Execute Transfer: On the 1st of the month, transfers are booked at Black Book Average Wholesale. No refusals are permitted. |
| Step 8 | Physical Movement & System Update: Units are physically dispatched to the receiving store, and DMS records are updated the same day. The store that currently owns the unit is responsible for completing the transfer process, including the JOT form and transportation arrangements. |
| Step 9 | As-Traded Wholesale: Any As-Traded unit reaching 45 days in inventory must be wholesaled — not transferred. |
7. Exceptions
Only the Inventory Manager (with approval from the Used Vehicle Director) may deviate from the standard receiving-store selection, and only through the parallel-store provision in Section 4.6. All exceptions must be documented in the monthly transfer log.
8. Compliance & Enforcement
Mandatory Compliance
Failure to comply with this SOP — including any attempt to refuse an incoming hard transfer — will be escalated to executive leadership. Monthly transfer activity will be audited by the Used Vehicle Director.
9. Revision History
| Version | Date | Author | Description |
|---|---|---|---|
| 1.0 | Aug 1, 2026 | Inventory Manager | Initial release |
This document is the property of P4 Automotive. It is intended solely for internal operational use by authorized P4 Automotive personnel.
Reproduction, distribution, or disclosure outside the organization is prohibited without written authorization from executive leadership.
P4 Automotive — Confidential / Internal Use Only · SOP-UV-001 · v1.0