Are You Mad?

If you aren’t, you should be. Mad about what? You should be mad if you have even one unit over 60 days old.

Who should you be mad at? Well that depends on your position in the dealership.

If you’re the Dealer or GM you should be super mad at yourself and everyone around you for allowing it to happen.

If you’re the General Sales Manager you should be mad at yourself and everyone around you for allowing it to happen.

If you’re the Used Car Manager you should be mad at yourself and everyone around you for allowing it to happen.

If you’re the Desk Manager you should be mad at yourself and everyone around you for allowing it to happen. (Yes, you’re part of the problem.)

If you’re the Sales Manager you should be mad at yourself and everyone around you for allowing it to happen. (Yes, you’re part of the problem.)

If you’re the F&I Manager you should be mad at yourself and everyone around you for allowing it to happen. (Yes, you’re part of the problem.)

If you’re the Controller you should be mad at yourself and everyone around you for allowing it to happen. (Yes, you’re part of the problem.)

If you’re the Service Manager you should be mad at yourself and everyone around you for allowing it to happen. (Yes, you’re part of the problem.)

It doesn’t matter what your position is, you’re part of the problem of aging units. Either it’s your responsibility or you’re contributing to the problem, or if nothing else you’re an enabler.

Unless you’ve been living under a rock for the last 20 years you know that having units over 60 days old is stupid and a horrible business practice.

If you weren’t mad before this email I hope you’re mad now. Go ahead be mad at me for saying it’s stupid for you to have units over 60 days old.

That’s probably your problem in the first place. You want to blame somebody else. Sure blame me for your madness because that’s what having units over 60 days is.

It’s madness. That’s all I’m gonna say. Tommy Gibbs

Improving Gross Profit Part 3

1. Think in terms of improving gross in small increments. Try paying the managers a bonus for achieving nominal increases each month. Start by improving gross by $50 a unit. Do that over the next year and you will see a slow and effective way to increase your gross. You can only eat the elephant one bite at a time.

2. How could I talk about your grosses without mentioning “Life Cycle Management?” Life Cycle Management is designed to help you create a sense of urgency on those cars that are most likely to kill your grosses. The faster they go away the better your gross will become.

3. Track GAP and ROI. When you do, grosses go up. How much are you giving up once the customer shows up at your store with a price from the Internet? If you don’t know then you can’t fix it.

4. Improve your look to book. You make the most money on units you trade. You will trade for more if you get serious about improving look to book. Review every appraisal from the previous day in your “save-a-deal” meeting every morning. Someone in management should be responsible for calling every customer that had a trade and up the ante.

5. Shoot the moon on the right stuff. Since the beginning of the car business, higher grosses are driven by some home run cars. You have to understand which ones are home runs, singles, doubles and triples.

Fix what you can fix. That’s all I’m gonna say, Tommy Gibbs

Chicago Used Car Workshop

Registrations closes May 1 at noon. (We may have to close it sooner)

You will learn cool stuff that you can actually put into play.

When: Thursday, May 18, 2017-7:30 AM-Noon

Where: Chicago DoubleTree-O’Hare Airport
5500 North River Road
Rosemont IL 60018

DoubleTree Hotel Contact: Michelle at 847-928-7663 to get quoted room rate.


What You Might Be Missing?

Frequently in my training sessions I’ll ask the question, “How many of you agree that we do a lousy job of holding people accountable in the automobile business?” Without exception, they will all raise their hands.

Leaders that have figured out how to hold people accountable are the most successful when it comes to developing a culture of leaders and achieving high results.

Holding people accountable doesn’t have to be a negative experience. When people understand the expectations, they will seek to achieve those expectations, goals, objectives, culture or however you might want to frame it.

People tend to do the right thing when they know it’s in their best interest, not when you have to hit them over the head with a baseball bat.

Your job as a leader is to sell the team the idea that the things the organization deems to be in the best interest of the organization is actually in their best interest too. Achieving expectations means they win, we win and we all have more success.

Easy tips:

1. Make sure everyone is reminded of the expectations. Yes, that seems elementary, but the evaporation factor is always in play. Either as a direct message or subliminally, leaders must constantly remind the troops of what’s expected and what’s important.

2. Get on it right now. Far too often when there’s a lapse in achievement, leaders let things drag on and on. The more things are allowed to slip, the more those things become habit, and the more the expectations are lowered.

3. You don’t have to be mean to enforce expectations. People like to work in a well-run, well-disciplined organization. This isn’t about screaming and hollering at someone about their failures. It is about letting them know quickly we’re not on track; you and your team are not getting it done, whatever “getting it done” might mean to you.

At some point there must be consequences for those who cannot live up to reasonable expectations. The ultimate consequence is they get to go to work someplace else.

4. Be consistent in your actions and statements. The easiest way for expectations to fall apart is that you are all over the place. You let some things slide for some people and not for others. You cannot be Dr. Jekyll and Mr. Hyde. Selective enforcement with just a few people will destroy the morale and productivity of the team.

5. There are times when you need to figure out the real root of why expectations aren’t being met. What’s the real problem? Leadership sometimes will set the wrong expectations. Setting the wrong expectations is just as bad as not having any.

6. In order to hold others accountable we too have to hold ourselves accountable. We should make it a daily practice of looking in the mirror and being honest with ourselves.

A part of holding yourself accountable is never to forget, “Familiarity breeds contempt.” The closer you become with people the more difficult you make your responsibility of holding them accountable.

I’m holding you accountable. That’s all I’m gonna say, Tommy Gibbs

Improving Gross Profit Part 2

1. Can you reduce your recon cost? Are you being as efficient as you can possibly be? Does service have carte blanche? Is service still selling the used car department the same old same old?

2. Can you speed up reconditioning? Very few of you really know how long it takes to get a car through service and clean up. Is your sales management team constantly crying about how slow service is? Might be some truth to it. Check it out. “It’s not the big that will eat the small, it’s the fast that will eat the slow.”

3. Re-evaluate your packs. Have they outlived their usefulness? Are packs ultimately affecting your average gross in a negative way? Are they giving you a false picture? Dale Pollak refers to packs as taxing yourself. I think we are all taxed way too much. If you got rid of packs could you buy and trade for more units? If you bought and traded for more units, wouldn’t you sell more units? If you sold more units wouldn’t you have more gross going to the bottom line?

4. Have you made an all out effort to convince your sales and management staff to sell the value of your company, your product and the fact that you have the best prices in the market?

5. Re-think what you are stocking and the when, how and how often you tweak your pricing. Far too often prices are not massaged soon enough so you end up pricing your cars at the end of the cycle at crappy grosses. I suggested in a previous newsletter that you go back and review your grosses by age categories. Have you done it yet? The aging units you are selling are killing your grosses. If you don’t believe that to be true start tracking 30/30. It will blow your mind.

There are many parts to improving gross profit. Look for Part 3 in 2 weeks. That’s all I’m gonna say, Tommy Gibbs

Should You Hire Me?

For some time now you’ve contemplated hiring me to help you and your team. Yes, you’re probably concerned about the investment and you’re also concerned about my material making waves with your team.

You will earn the investment back overnight. I’d be happy to send you a long, un-purged list of clients for you to contact.

I’m sure you and your team are doing a lot of things really well. I’m not going to screw that up. But, I am going to enhance what you do well and give you some powerful concepts to take you to the next level.

Here’s the biggie; I’m going to get your team on the same page. It’s a pretty safe bet that you have management staff that all have their own way of thinking about your new and used car business. I’ll destroy the myths and line the moon, stars and earth up.

See if any of this applies to you:

1. You’ve had evaporation. Regardless of how good you are or how well disciplined you are, there’s going to be an evaporation of processes over a period of time. Bam! I can fix that!

2. You’ve had some turnover. Most people do. Turnover isn’t a sin. What’s a sin is not ensuring that the new guys and gals get it. If you don’t give them the right tools, they don’t have a chance. Bam! I can fix that!

3. The business is changing. Your team needs to understand the changes taking place and how to attack them. Bam! I can fix that!

4. Your team has gotten a little complacent, either because business has been pretty darn good or they have accepted the status quo. They need to be re-energized and see the possibilities. Bam! I can fix that!

5. Your average grosses continue to decline. Mostly they decline because someone’s not paying attention to the little things. Bam! I can fix that!

6. You have aged inventory and wholesale losses. Aged inventory helps create #5. Aged inventory causes wholesale losses. Bam! I can fix that!

7. You have a team that struggles to get on the same page. You have old school thinking. You have new school thinking. You have no thinking. Bam! I can fix that!

8. The number of days it takes to get a car online and on the line is killing you. Bam! I can fix that!

9. You’re sick and tired of listening to the bickering, excuses and lack of forward movement. Bam! I can fix that!

10. You need a coach. You need someone to lean on. You need another set of eyes on the subject. Bam! I can fix that!

A quote worth remembering: “The purpose of training is to tighten up the slack, toughen the body, and polish the spirit.” Morihei Ueshiba

Is now the time? That’s all I’m gonna ask, Tommy Gibbs

Ignorance Isn’t The Problem

One of my favorite authors and bloggers is Seth Godin. In a recent article, (LINK) Seth points out that when staff members aren’t doing what you would like them to do it’s not due to ignorance. It’s due to the fact that they don’t care about what you care about.

Getting people to care about what you care about isn’t necessarily about having more meetings and training sessions. Of course that activity is a part of giving people what they need to know. Knowing something and doing something is what separates the good companies from the great companies.

One of the best things a leader can give to his/her organization is to set the atmosphere for a defining culture.

Everybody has the same product.
Everybody has great prices.
Everybody has technology.
Everybody has trained technicians.
Everybody has good selling processes.

Culture is what will separate your organization from your competition.

Most of the time upper management “gets it.” The breakdown occurs at the next level. Far too often we don’t get enough influence from the core staff to make a real difference.

A few are talking the talk, but most aren’t walking the walk. People have to “see it” in order to start to “believe it.”

Your challenge is to get more of the “next level” involved, engaged, and believing they can make a difference.

Until you do so, you’ll hold some nice meetings. Do some nice talking. Print some nice posters. Create some nice name badges. Feel good about yourself. But, not much will change. That’s all I’m gonna say, Tommy Gibbs

Did You See it?

Did you see the game on Friday night? What game? The Women’s Final Four game with Mississippi State and University of Connecticut. Even if you didn’t you’ve probably heard about it by now.

Mississippi State defeated the University of Connecticut in overtime with a last second shot and stopped their willing streak at 111 games.

The shot maker and one of the top players on the floor, Morgan William, drills a game winner in overtime at the buzzer. At 5’5″ tall she’s the smallest player on the floor.

So let me remind you of the book, “It’s Not The Big That Will Eat The Small…It’s The Fast That Will Eat The Slow.”

Speed up your reconditioning.
Speed up your sales travel rate.
Speed up your selling process.
Speed up your turn.

You make the most money on a used car that you sell in the first 20 days. It goes south after that. If it goes to 60, you’re sitting in the locker room with your head in a towel.

Think like a 5’5″ basketball player. That’s all I’m gonna say. Tommy Gibbs