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

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

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

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