Archive for July 2016

Money Or Power?

One of the most interesting things about the automobile business is the dealer has “the power.” The dealer has the power to fix anything that needs to be fixed.

That being the case, the only real question becomes if the dealer has the will and the money to fix what needs to be fixed.

Think about that for just a moment. They have the power. They often have the money. But, more often than not they don’t have the will.

So, there you have it. It’s not money or power. It’s a matter of having the will to fix what needs fixing. Having the will means dealing with all the messy details to get it done.

Where there’s a will, there’s a way. That’s all I’m gonna say, Tommy Gibbs

Do Problem Cars Fall Out Of The Sky?

Everyone has problem cars from time to time. You know the ones I’m talking about. The ones that want to stick around forever. The ones you haven’t yet found a buyer for.

But where did they come from? How did they all of a sudden end up on your lot? Did they just fall out of the sky?

Can you imagine how much better off you would be if you could identify problem cars on day 1 vs. day 61? Suppose you had a strategy in place to deal with them sooner rather than later?

The number one problem I see in the industry is we just don’t pay attention. We don’t pay attention soon enough. By the time we realize we have a problem, it’s too late.

Take the time to do a “trade walk” which includes all purchase units, and be blatantly honest about what you’re staring at.

Then put a strategic plan in place to deal with the more problematic units. If you did nothing more than that, you’d have a lot less units falling from the sky, hitting you in the head and giving you a headache.

And, you would have a lot better bottom line. That’s all I’m gonna say, Tommy Gibbs

Is There Pep In Your Step?

Leaders and achievers have pep in their step. Show me a slow walker and I’ll show you someone that’s not going anywhere.

Think about the people you know who are achievers and real leaders and one of the things that should pop out to you is the pace of their gait. Most of them are getting it on.

They have an air about them that says, I’m in a hurry, either step it up and come with me or get out of the way. They will run over you. I don’t mean as in they will do things to you in order to succeed.

I literally mean they really will run over you. You might compare them to a running back in the NFL, or a centerfielder in MLB, or a quick guard in the NBA. Leaders totally get after it.

At the first new car dealership I owned, I had my office located on the 2nd floor of the service building directly behind the circular shaped showroom. It was easy to observe team members coming and going.

Whenever we hired a new sales person I could place a pretty sure bet on whether they would be successful or not purely based on the pace of their walk.

So, if you want to make a major change in your walk towards leadership and success, then pick up the pace. Act like you’re in a hurry, even if you aren’t.

Never forget, others are watching you. If you want the team to pick up the pace then you need to pick up the pace.

Pick it up, that’s all I’m gonna say, Tommy Gibbs

What’s Your Definition Of Velocity?

There’s a book out by Jason Jennings and Laurence Haughton that has the perfect title for the automobile business, “It’s Not the Big that Eat the Small…It’s the Fast that Eat The Slow.”

Some new car dealers believe the definition of Velocity is:

“Velocity-a method of giving your cars away so as to impact your gross to a point of a substandard amount that will make you want to throw up your hands, beat yourself over the head, and barf.”

I have a new definition for the word velocity; the whipping boy of the auto industry that can be blamed when we use software pricing tools as the Bible, don’t use our brains and don’t use the tool as it was intended in the first place.

You can make one of two choices:

1. Hold high gross profit per unit.
2. Do lots of volume at a little lower gross.

Which way do you think is going to pile up the most gross to pay the bills at the end of the month?

Dealers have been known to complain that when they went on the velocity method of pricing their used cars to market, their grosses went south. Well duh, of course they did.

What actually happened is those dealers had let their inventories age on them and when they finally priced them to market they got crushed.

Software won’t save you. Having discipline and using your brain will save you. There will be pain unless you use your brain. I like that, “Pain, if you don’t use your brain.”

That’s all I’m gonna say, Tommy Gibbs

Got Any Pretenders?

I know this is hard to believe, but sometimes people in leadership positions are pretending to be leaders.

They pretend to be on the same team, but they aren’t.

They pretend to support the changes, but they don’t.

They pretend to say yes, when inside their head they are saying no.

They pretend they get it, but they don’t.

They pretend to support the dealer, but they don’t.

They pretend to do what’s in the best interest of the company, but they don’t.

They pretend to support technology, but they don’t.

They pretend to work with the other departments, but they don’t.

They pretend to understand the millennials, but they don’t.

They pretend to work hard, but they don’t.

Pretenders can fool some of the people some of the time, but they can’t fool all of the people all of the time.

You need to get rid of the pretenders. That’s all I’m gonna say, Tommy Gibbs

How Was It?

So, how was your June? How have your first six months been? It’s July. Half the year is gone. Kinda scary isn’t it?

Some of you have had a great first half. Some of you, not so much.

Some of you have been running full speed ahead. Some of you have been dragging through the sand.

Something has been holding you back. There may be some legitimate excuses, but maybe you just had the wrong plan in place. Just because you had the wrong plan does not mean it’s too late to fix it. You’ve still got 6 more months to go.

Those of you who have had a good first 6 months need to be cautious of becoming complacent. Even though things have been going well, you would be very smart to review how you can make things better as you tackle the second half.

Everything we do is about choices. You can choose to let things be as they are or you can choose to dial it up a notch or two.

To do so means to review your plan and the strategies you have in place. And, make the changes that are necessary to get you where you know you need to go. That’s all I’m gonna say, Tommy Gibbs

Should You Change Your Dress Code?

I’m not suggesting you take such a bold step as to change your company’s dress code, but maybe you should change your personal dress code?

I’m talking about you giving up that casual look that so many dealerships have gone to.

The argument and justification for the casual look is that the customer feels more comfortable and relaxed. The only person feeling more relaxed is you.

The customer is making the second largest purchase in their life next to a home. Do you think they want to do business with a slob? You can hide a lot of flaws with a nice business suit.

Oh, I know if you are dressed in a suit then it’s too intimidating for the customer and they won’t buy the car. Really? You’ve got to be kidding me. Look, if your people skills aren’t any better than that and you can’t overcome wearing a suit, then it’s a miracle you’ve lasted this long.

Not to bring politics into this, but I think most would agree that the President of the United States is one of the most powerful people in the world. Does he really need to wear a suit? No, but it brings respect to the office and the position. You are no different.

I’ve had 20 Group consultants tell me, “Hey, we will all be dressed casual, so feel free to dress casual for the meeting.” As much as I appreciate the offer I have never taken them up on it.

For me it’s not about trying to create respect for me, it’s about being respectful of my audience. For you, it’s about being respectful of your clients and your associates. When you give respect, you get respect.

Dressing up never goes out of styyle, I don’t care who your audience might be. That’s all I’m gonna say, Tommy Gibbs

Are You Prejudiced?

Every human holds certain prejudices. We’d like to think we don’t, but we’re only human.

The type of prejudice I’m talking about is how you treat certain customers. Yes, I know this is pretty deep, but it’s something you should be very concerned about.

On the one hand, you have some customers that you roll out the red carpet for. You treat them like gold (which you should do for all) and you even give them special discounts or coupons from time to time when it’s not even necessary.

Sometimes the ones that you treat the best are the ones that only come to see you once every 6 months or so. With this un-loyal customer you do everything in your power to get them in and out of your shop as soon as possible and often give them a free car wash. In the end, these customers are not all that loyal to you and will drop you in a heartbeat for a cheaper deal down the street.

Then there’s another customer, a very loyal one that you don’t treat quite as well. It pains you to give them a discount and you will often send them to the back of the service line.

No free car wash for these customers. If anything, you look for a way to charge them more, let alone serve them up discount coupons. The hours per RO with these customers is more than twice what it is with the others. What’s funny about this customer is they wouldn’t think of doing business with anyone but you. They are loyal to you beyond belief, but you treat them like crap.

Let me introduce you to these two customers that you show prejudices to every day.

Meet your retail customer and your used car department. That’s all I’m gonna say, Tommy Gibbs

Could It Be?

There are a lot of challenges in today’s automobile world.

Most of us are always looking for answers.

Could It Be?

1. Could it be that the consumer is using the Internet for the majority of their purchases and therefore is pushing you into a pricing war you would rather not be in?

2. Could it be that you are not managing your pricing correctly? Are you coming out of the gate based on a bucket concept and pricing everything at X amount under market? Are you failing to shoot the moon on a few select units for x number of days before you drop your pants?

3. Could it be the stuff you are buying is like an impossible dream? Are you buying 2015’s with 25,000 to 35,000 miles on them? Really? The only way you’re gonna sell them is to give them away, eroding more average gross profit.

4. Could it be that you and/or your team really don’t understand “Life Cycle Management” and the powerful impact it has on gross and volume?

5. Could it be that you are stocking cars that are way too expensive, so you end up competing with your new car business and selling them at little or no gross just to make them go away?

6. Could it be you are not tracking “GAP?” If you aren’t tracking GAP then how are you to know how much you’re giving away once the customer shows up?

7. Could it be your used cars spend the best days of their shelf life tied up in service and recon?

8. Could it be your presence on Auto Trader and your website is just so, so? When was the last time you looked at the photos on your website?

9. Could it be your management team isn’t really a team?

10. Could it be you have gotten too smart to do a “save-a deal” meeting every morning?

11. Could it be you let a lot of nice trades get away from you because either (A) your managers won’t step up or (B) they wholesale them because they feel the service department is ripping them off?

12. Could it be you have aged units and when you dump them they kill your overall gross?

13. Could it be the deal is screwed up before it ever gets a chance to be turned over to a manager and/or the managers just aren’t taking TOs?

14. Could it be you’re not willing to invest in your team what it will take to maximize results?

Maybe you just need to think about what it could be. That’s all I’m gonna say, Tommy Gibbs

I’m Going To Outwork You

The great Tennessee women’s basketball coach, Pat Summitt, passed away this week. She will go down in history as one of the greatest coaches of any sport at any level.

In Pat Summitt’s book, “Reach for the Summitt,” she states, “Here’s how I’m going to beat you: I’m going to outwork you.”

I put myself and some of my business teammates into the category of we will outwork you.

I don’t think there’s any greater attribute that one can have than the will to outwork their fellow man/woman.

For those of us who have that mindset, we can point to person after person who had more talent, but we ate their lunch in the game of life, business and leadership. We’ve passed them on the stairway to success time and time again.

I’m seeing fewer and fewer people willing to carry the mantle of “I’ll outwork you.”

It’s getting easier and easier to outwork some of the workers of today.

Maybe we should just hand them a “participation trophy” and send them home. That’s all I’m gonna say, Tommy Gibbs