Price always plays a part but it is NOT everything.
I am (normally) always above AT retail checker and invariably (unless a rare car) I rarely appear on page one of searches. My stock takes much longer to sell than most but it does always sell, you just need that one person for that one car.
I remain convinced that for most sensible and normal (the ones I want to deal with anyway) people see paying £250-500 more for a straight car, low owners, plenty of history and well prepped backed by a good warranty (in house) and on their doorstep as good value (or better value than driving hundreds of miles in the hope they might find a golden egg, only to be dissapointed by a poorly described advert).
Having said that, I am so so so so quiet this month (and last to a degree) but did get a Volvo V70 away yesterday (deposit left) with a healthy margin deep in to four figures and a repeat customer is finally coming to collect their BMW they reserved at the weekend with similar margins. So finally a few quid back in my direction.
I target 8-10 cars for any given month and so far have only done 2 retail (good margins) and 1 Ebay auction (loss £150). Way behind. It always comes back, so as others have said - don't panic, tweak adverts, clean cars, clean the office and workshop/showroom - get ready for a flood of enquiries.
I had a long chat with EPV (James) the other day and he offered me some sound advice and took the time to review a couple of my ads for me - it really does help to talk to fellow traders in this "lonely" at times job.