From time to time I hear dealers complain that they got killed when they followed the recommendations from their software vendor about what they should buy. Maybe their interpretation of a recommendation was construed to mean you “must buy.” Or you “absolutely must buy.”

Their conclusion is bolstered by thinking that if they don’t buy these recommended units that the competition will gobble them up and they will be left out in the cold. They have surmised that this is “the answer,” and the only answer to improving their used car business.

Years ago I taught a workshop titled, “When Common Sense Meets Technology.” That’s a very appropriate title when it comes to managing your used car inventory.

For some, it’s a natural instinct that when they make a mistake on inventory they want to blame someone or something, so the easy target these days is the software provider.

See if this sounds familiar. Let’s say you’re a Ford dealer (Located right beside a Honda and Toyota dealer,) and you look at the data in your market and there is a high demand/low day’s supply for Honda Accords and Toyota Camrys. You take the recommendation (advice) and run out and buy 10 Accords and 10 Camrys. They sit and sit.

You have concluded the data was all wrong and that there was no way you could be competitive because those Honda and Toyota dealers have a certified program.

You dump the cars in the wholesale market and lose a bunch of money, swear off the software and go back to doing it the old fashioned way. And, you fire the software company and hire a new one.

As I often hear young people say “Really?” The software did
not go out and buy the cars. You are the one who loaded yourself up with too many units and paid too much.

Wouldn’t it have been smarter to test the water with onezies and twozies? How could you not see the writing on the wall?

Isn’t it logical that if you buy some high demand/short-supply units you’re going to have to pay a premium for them?

Wouldn’t it stand to reason if you’re going to go head to head with a certified program that you would have to have a price advantage?

Wouldn’t it also stand to reason that a certain percentage of the Honda and Toyota dealer’s core cars would have been traded?

And doesn’t it stand to reason they would have a little advantage cost-wise when trading for inventory? Logic would say they have an advantage you will not have.

In your mind, the data killed you. No, you killed yourself. But, you need to blame someone, so you blame the software company and fire them.

I’ll tell you what. If that had been me, I would have been thinking of firing myself. That’s all I’m gonna say, Tommy Gibbs

I don’t think any of us would deny that the car business has gotten pretty sophisticated. I wish I was a bit more analytical than I am, but I have to tell you even if I was, I think I’d still be overwhelmed at the reporting I see that some dealers and dealer groups require of their staff members.

I do see the benefit of all the tracking that’s done, but I think we have to ask ourselves, are we overdoing it? Are we taking the focus off what’s really important?

The most important thing we do is sell a car or truck. If we’re not selling a car or truck then you can track all the numbers in the world and it’s not going to matter.

When I was a dealer, one of the things we would often ask was, “Will it help us sell something today?” If not, then it wasn’t worth much to mess with it.

Without a doubt, upper manage-ment needs to be mindful of key performance indicators and they need to utilize that information to stay on top of what’s moving in what direction.

And yes, the information needs to be shared at the appropriate time, but to rant about it almost minute by minute does the opposite of helping to sell a car or truck.

Our “in the trenches management” has a ton on their plate. If we create too much focus on the wrong things then they can’t do what we are paying them to do and that’s to manage the sales department and sell more cars and trucks.

Get focused on the right things and the attitude will go up. When the attitude goes up, the sales numbers will go up. When the sales numbers go up, your bank account will go up. When your bank account goes up, you can take a nice trip and quit bugging people about the wrong numbers. That’s all I’m gonna say. Tommy Gibbs

Finally a new and exciting selling process is introduced. It has 6 amazing steps:

1. Sell Yourself-You can’t sell a car until you make a friend. Selling yourself can be confusing to some. It’s really very simple. The more you take an interest in the other person the more they will like you. The more you take an interest in the other person the more you will learn about them. Some call it “fact-finding,” some call it “qualifying.” Call it what you want, but remember you don’t sell yourself by talking about yourself. You sell yourself by asking the right questions and listening.

2. Sell the House-How much are you and your staff talking about your dealership during the selling process? Are the key points about what your dealership is all about being put on the table. What are your defining principles? What’s the history and culture of your dealership?

3. Sell the Product-Never in the history of the car business has it been so important to know your product. Are you constantly reviewing product knowledge? When was the last time you did a walk-around presentation? Do you and your sales staff walk the lot and know your inventory from one end to the other? Does the team know as much as the customers know about the benefits and features of each model? Do you and your team do a lot walk each week to review each and every vehicle in stock?

4. Write the Best Deal You Can-Even if you’re a one price dealer, the deal still has to be presented. Even ridiculous offers need to be served up. Once a person puts their name on the dotted line they are much more likely to adjust their thinking as you present a counter offer.

5. T.O.-the Golden Rule should be “never let a customer leave without checking with a manager first.” It’s the most fundamental of all selling processes. Sales would increase another 10 to 20% if this fundamental process was followed.

6. Follow Up-the mentality should be follow them till they buy or die.

So there you have it. The most amazing selling system ever invented, which by the way was the selling system I was introduced to back in 1972. Has the business changed? Of course it has. Do we shape the selling system a little differently today? Of course we do.

But the fundamentals of the business never change:
1. Sell Yourself
2. Sell The House
3. Sell The Product
4. Write The Best Deal You Can
5. T.O. The Customer
6. Follow Up

That’s all I’m gonna say, Tommy Gibbs

My best friend in high school was a wild and crazy guy who lived the last 20 years of his life in Key West, Florida. He often used the saying “Don’t panic and never follow the crowd,” when it came to evacuating the area to avoid approaching hurricanes. He never left Key West when the news media started their “run for cover” broadcasts.

Advertising is and will always be the great mystery of the automobile business. It didn’t get easier with the advent of the world-wide web, that is for sure. If anything, it has further complicated it.

Even with the sophisticated tracking of Internet leads, it’s still no piece of cake to figure out what works and what doesn’t.

When industry leaders such as Mike Jackson of AutoNation make comments in Automotive News that they are pulling away from third party leads then it creates a panic in the industry and some will say “Well, if it’s good enough for AutoNation, it’s good enough for me.”

But is it? AutoNation operates over 200 dealerships. They have an economy of scale that most of us can only dream about. When you have those numbers you can exercise experiments and do things that are impossible for a single or small group of stores to do.

There’s no argument that the power of the Internet is here to stay. Customers will sit right in your showroom and shop another dealer on their phone or iPad. Driving all over town is a thing of the past. Who remembers those days of finding newspaper ads lying in the front seat of a customer’s car as you did the trade appraisal? Not so much anymore.

When I hear dealers talking about dropping third party lead providers due to cost or the perceived lack of leads, the first thing that comes to mind is how powerful is your exposure on those sites? Generally I find several things:

1. You’re not stocking what the market wants. Maybe it’s time to re-evaluate how and what you stock?

2. Over-pricing, not market competitive. In many cases the worst person to price your used car inventory is the used car manager. They are often prejudiced because they either appraised or purchased the unit.

3. Infrequent price changes. In some cases units haven’t been re-priced for 30 to 45 days. Did I say the used car manager was the worst person to do the pricing? They have too many things to do to be able to keep your pricing up to date.

4. Lousy photos. If 80 to 90% of all people who shop for a used car shop the Internet how do you think you can be competitive by taking photos outside? You are shooting yourself in the foot by not having a photo booth.

So, before you jump on the Mike Jackson panic bandwagon let me suggest you take a hard look at those things you can actually control.

And always remember, “Don’t panic and never follow the crowd.” That’s all I’m gonna say, Tommy Gibbs