It’s Thanksgiving

It’s Thanksgiving and time to give thanks.

If you’re like me for sure you have a lot to be thankful for. Among many things I’m thankful for are your friendship and support.

Thanksgiving also starts the closeout of the year. It centers around Black Friday and rolls through the last week of the year. Like it or not, 2021 is already here.

I’ve listed some very basic ideas you need to take into consideration that will help you finish strong and get ready for your best year ever.

A. Re-commit yourself- and your thinking towards being the very best you can be. Take stock of all those great ideas running around in your head.

Write them down and make a commitment to get them done by certain dates. Post it on the wall in several places that you will see frequently. If you have a private restroom, put it on the mirror.

The dealers and GMs with the most successful used car operations are those who have taken ownership of the used car department.

The more involved you get, the more success your dealership will have. If you’re not committed to the used car business, it’s a safe bet your team isn’t either.

B. Re-evaluate-the appearance of your inventory. Let’s do a little checklist:

1. Look at your inventory online. Are they all there? Actual photos & prices posted?

2. Take a lot walk. Are the vehicles in straight lines?

3. When was the last time the entire lot was rotated?

4. Are you using angles to display your inventory?

5. Do you have hang tags? If so, do they all have hang tags?

6. Are they nasty, dirty on the outside?

C. Refocus Your Disciplines-To be successful in the used car business you have to have daily/weekly/monthly disciplines that you live and breathe by.

One of those disciplines might be to do a weekly lot walk. Every car in your inventory must be touched. If it’s in service, touch it. If it’s in prep, touch it.
If it’s in the budget center, touch it.

Everybody touches it. Even if you think you have your disciplines well defined inside your head, you’d be well served to make a written list and check them off from time to time.

D. Re-Recon-Take every unit over 30 days old back through a recon process. (You’ve already missed your best window of opportunity to make gross; that would be the first 20 days.)

E. Re-Invest-in yourself and your management team. Do something to gain some knowledge. Hire me, visit CarMax, or visit a dealer friend in another state that does a good job in used. Attend a workshop. Join a Twenty Group. Join a Used Car Twenty Group. Do something besides sitting there and waiting for something to happen.

F. Re-think- your management team. Do you have the right person running your used car operation?

Yes, that person may have been with you for years. Loyalty sometimes equals mediocrity. Maybe they have some great skills, but the fact is that you may not be making the best use of their talents.

I’m thankful for lots of things this holiday season and I’m especially thankful that you’ve taken the time to read my little Zingers. That’s all I’m gonna say, Tommy Gibbs

Why You Are Winning

I’ve written several articles of late talking about how dealers have benefited from the law of supply and demand.
Let’s think about this as two legs of a three-legged stool.

The third and most important leg that I’ve not discussed is “smarts.”

Archie Manning of the famed quarterback family holds a quarterback training camp each summer.
Archie says, “The best advice I try to give to a young quarterback is you need to know what you are doing because if you know where to go with the football, you can get rid of it, and throw it, and you won’t get hit.”

And that’s where your smarts have played a bigger role than maybe even you have given yourself credit for.
Knowing where to go with the football has played a far bigger role in your bottom line than many have acknowledged.

Today’s dealers are smarter, and because they are smarter, when the law of supply and demand balanced itself, the smart dealers have made the most money in the history of their businesses.
When you combine the amount of data available to dealers today and the intellect to understand it, then you have figured out where to go with the football.

In the long term, knowing where to go with the football makes you a lot more money than a favorable law of supply and demand ever could. Supply and demand will not always be in your favor.

Being smart will.

You’re not just winning because you got lucky. You’re winning because you’re smart. Stay smart. That’s all I’m gonna say, Tommy Gibbs

October Is Over But…

By now you’ve closed out October, twisted over the numbers and gone back to work.

Not so fast.

October is the perfect month. “Perfect for what?” you ask. Perfect for figuring out where you’ve been and where you want to go.

I can’t say that math was one of my best subjects, but I can divide by 10 real easy. At a glance, I know what the averages are for any line item expenses, sales volume, and gross profit.

What also makes October a perfect time is it sets the stage for the next year. Now is the time to start planning for 2021. Waiting until the last week in December to get your plan together is a really bad strategy.

This is the perfect time to dig in and firm up your fundamentals in all departments.

This is the time to get back to basics.
This is not the time to cut back on your training.

This is when you need to amp up your thinking, stretch your organization and stretch your imagination.

If you don’t have a solid foundation of basic processes you will never maximize your success.

This is the time to take control of the evaporation factor that’s been occurring all year long. This is the time to stop the process bleeding.

Your long-term plan should include joining a Twenty Group and attending the NADA convention. Sure it’s virtual. Do it anyway.

We all get lazy and get caught up in our daily routines. Attending these meetings gets you revitalized. It gets you outside of your daily box and opens your eyes up to what the possibilities might be. Seems like a no-brainer.

This is the time to make those plans. Teamwork is critical if you’re going to maximize your bottom line. To keep your team on the same page you have to constantly communicate to them what the expectations are and what processes they are expected to follow.

There is no shake ‘n bake solution. You don’t fix it and walk away. You fix it and re-fix it.

What to do?

1. Ask yourself if you can improve your processes? If you focus on revamping your processes, what effect do you think it will have on your business? It’s just a fact that regardless of how well disciplined you are, over time your processes are going to evaporate.

The best piece of advice I can give you is to lock yourself and your management team in a room and review every detail of your selling processes. Be brutally honest with yourself. Then take the necessary action to get yourself back on track.

2. Can you improve your team? Got the wrong players? Now is the time to make the changes. If you already have the right team in place then it’s time to let them know what your expectations are and show them the plan and the path to achieving those expectations.

3. Don’t think of your planning as you now having a plan. Think of it as a “mission.” Plans can fall apart. When you’re on a mission you stay after it until you succeed and then you stay after it some more.

I’m on a mission to get you to re-think what you’re doing. I’m on a mission to get you ready. That’s all I’m gonna say, Tommy Gibbs

That’s all I’m gonna say, Tommy Gibbs

Can’t Poop?

As most of us know, constipation can be a terrible thing. When you are constipated it’s virtually impossible to be as productive as you might otherwise be.

Exercise, drinking lots of water and in some really bad cases taking a strong laxative can often relieve the problem and get you back on your “A Game.”

Most of you have had a good run with inventory turn, but some of you have gotten slack and you have stuff aging on you.

Having 60-day-old plus units in stock is a lot like being constipated. You can never perform your best when you’re all stopped up.

60-day-old units will make you sluggish and hold back your potential to be as productive as you might be. Your “A game” will never show up when you have used car constipation. Think of it as poop in the chute.

Dealers will often give their used car inventory a laxative, flush the system and start over. It can be a risky and costly approach.

The problem is that even when they “blow it all out” it doesn’t do that much good in the big picture.

Since they don’t change their diet or exercise, so the inventory continues to be constipated and therefore hold them back from achieving their maximum potential.

A good diet for the used car department would be to have good solid processes. A good exercise program for the used car department would be to understand the role that speed plays toward good health. Good diet and exercise can help you avoid used car constipation.

Constipation makes you stinky. You don’t want to be stinky. Having aged units makes you stinky. You don’t want to be stinky.

It’s not a matter of fixing a one-time constipation issue.

It’s a matter of the right diet and exercise to live a happier and fuller life. If you give a hoot you’ll clean up your poop. That’s all I’m gonna say, Tommy Gibbs

Is It Easy?

We’re talking about your job. Yes, your job.

We know it’s not easy, that’s why you’re asked to do it. If it were easy, we’d put someone in it with a lot less talent. Less drive. Less enthusiasm. Less moxie. Less grit. Less get up and go.

Your job was never designed to be easy. If it were easy no one would care. And if it were easy, you’d be paid a lot less.

Sure, you’re not paid enough. But, it’s not always about what you’re being paid. It’s about what you’re paying to the big picture.

Sometimes it takes some serious grinding it out to get the pay to match. You will eventually get to the point where you’re being paid for more than you are actually doing.

Never forget that you’re contributing. You’re contributing in a big way. A way that others can’t contribute. We need you to keep doing what’s not easy.

Just stay the course. Of course, the course is not always easy, but needed. That’s all I’m gonna say, Tommy Gibbs

Why Do You Tolerate This Mess?

As a new car dealer for over 20 years the training of salespeople was big on my list of priorities.

We always had someone in charge of training of which I was always a part of. At one time we even had an offsite training center that was state of the art with video cameras for role play, etc.

As I’m writing this, I’m sitting here shaking my head because I just don’t get it.

Over the last few weeks I’ve driven by the same dealership at various times of the day and there are always 4 or 5 salespeople standing out on the “porch,” looking like they are getting ready to mug the next customer that shows up.

If I were a customer there is no way I’d be pulling into customer parking and take a chance with that mob standing there.

How can this being going on in today’s world?

Where’s the leadership?

Have we not learned anything over the past 20 years?

All that money you’ve tied up in your CRM and technology going right down the drain.

The owners of the dealership are friends and clients of mine.
I know their culture.
I know their standards.
I know what they believe in.
This doesn’t match any of it.

If you’ve ever wondered why you can’t get and keep good people here’s part of it right here:

People want to feel productive.
People want to feel like they are contributing.
People want to work for an organization that’s disciplined and gives direction.

Why would anyone with half a brain want to work in an organization that has no more direction than this?

Here’s the reality; that store isn’t alone. Some of you have the same issue.

Open your eyes, there’s a hot mess out on your porch and it’s costing you money.

Oh yes, there’s training going on at your dealership. It’s happening right out on the porch.

That’s all I’m gonna say, Tommy Gibbs

The Next Time You Need A Used Car Manager

First I want to make it perfectly clear the amount of respect I have for those who have been in this business for many years.

Those that have grinded it out, those that have street-savvy, and those that at times made chicken salad out of chicken poop.

There is no adjective to describe the admiration I have for you.

That being said I want to speak to those of you that are in charge of the hiring and struggle to find that superstar used car manager. The used car manager you need may very well be right under your own roof, and you’re walking right by him or her a dozen times a day.

For whatever misconceived reason, when you need a used car manager, the first thing you want to do is find a used car guru that works someplace else and lure them away.

I don’t have to tell you the challenges of hiring from the outside. I don’t have to, but I will.

1. The person you hire isn’t going to have the same culture that you’ve been working so hard to develop.

2. Their thinking about the used car business isn’t going to necessarily align with yours. That doesn’t mean either of you has it right or wrong. It just means it’s going to be frustrating and more than likely expensive.

3. If you’re running an ad in Automotive News, most of the respondents are going to be from outside your area. I’m not even going to attempt to list all the issues tied to bringing someone in from afar. If you don’t understand those issues then you’ve got a lot more problems than I can help you with.

4. When you hire from the outside you are looking for a miracle worker to fix the mess left from the last miracle worker. Most likely the mess will get bigger. All you’re doing is rinse and repeat.

5. You’re doing nothing to encourage people to want to grow and develop within your organization when you keep going to the outside. You need to promote from within.

The real answer is that you don’t need someone from the outside with a bunch of experience. What you need is to commit to giving someone from within a chance and a whole bunch of your personal time and energy.

What you need is:

1. Someone that’s a young “thinker.”
2. Someone that has high energy.
3. Someone that believes in your culture and store.
4. Someone that’s coachable.
5. Someone that has common sense.
6. Someone that understands technology.
7. Someone that has integrity.
8. Someone that has a strong work ethic.
9. Someone that has good communication skills.
10. Someone that’s hungry.

If you don’t have someone or multiple someones like this in your organization then you need to rethink your organization. That’s all I’m gonna say, Tommy Gibbs

The Pain of Efficiency

If you’re going to continue to make money, and hopefully make even more money, you will have to become more efficient.

Your processes will need to become more efficient.

Your management team will need to become more efficient.

Your entire dealership will need to become more efficient.

You must become more efficient when it comes to speed and cost of your reconditioning. I know it’s a sore subject for some of you, but the sooner you address it the sooner you will move forward.

There are many issues dealers are scrambling to deal with as we move into the most competitive environment in the history of the automobile business.

In order to do volume in used cars you need to have a “costing advantage.” By “costing advantage” I mean what’s added to the car once you own it, which includes packs and reconditioning.

To have a costing advantage you have to re-think your packs (which usually gets down to pay plans) and most importantly, what you charge the used car department from your shop.

Your sales managers don’t have control over gross as they did 20 years ago. The market conditions such as days supply are having an impact on how you price your vehicles.

More and more dealers are moving toward becoming one-price dealers and saying “no” when the customer shows up and wants a discount.

Becoming more efficient means improving the amount of time it takes to get a unit through recon and to the front line. Every day that a unit is not on your front line available for sale is costing you money. UpYourGross.Com

Sadly, most dealers do not actually know how long it takes. And even when they do, they turn a blind eye toward the problem.

They let the proverbial tail continue to wag the dog when it comes to fixing the service timeline problem.

If you’re going to do more volume you need to have an advantage when it comes to getting cars through your system and the cost tied to doing so. You must become more efficient.

The pain of efficiency, or the pain of regret. You’re going to have one or the other and the cool thing is you get to pick. That’s all I’m gonna say, Tommy Gibbs

6 Bullet Points

This is always a tricky time of the year.

It is not unusual for “Fall Optimism” to come back to haunt you when “Winter Reality” sets in.

After several record profit months, it’s easy to get high on our new founded mentality of standing tall and asking for “all the money.”

Sure, you can hold that unit longer…ahhh, maybe not.

Often there’s a disconnect between the desired goals and the skill level of those who have been put in charge of obtaining the numbers we need.

Are you ready? Is the team ready? Are you ready for the fall and winter?

It’s important to know what you deserve for any given car or truck on your lot. Knowing and understanding that is based on two parts:

Data.
Common sense.

Knowing and getting what you deserve means having a true understanding of the market and every unit on your lot. They are all different, yet we often treat them all the same. It’s knowing when to fish or cut bait.

Yes, even in this wacky market there’s a time to cash in and make certain units go away.

6 Bullet Points To Help You:

1. Redundant Training- It ain’t redundant until you’re perfect. You’re used car department isn’t perfect. Don’t confuse getting lucky and today’s unusual market with your management skills. You’d be far better off thinking you’ve recently gotten lucky than thinking you’ve figured it out. Maybe you have and maybe you haven’t. Now is the time to amp up the training for your entire team.

2. Rolling 30-Day Sales Travel Rate-Pay close attention to the number of units you currently have in stock vs. the number of units you have sold over the last 30 days. You may even want to view it over the last 15 days. Almost without exception, we are seeing inventories starting to outpace the sales travel rates. If you’re using our UpYourGross software tool, it’s right there on the scoreboard page for you to see.

3. Ask For More On The Right Units- Keep in mind the word lucky. You’ve recently gotten lucky on some units. Betting on lucky will not serve you well.

Yes, there are some that you need to start way high. Some very low. My UpYourGross software will help you know which units are which.

Once in a while, you gotta “ask for it all.” You can’t hit it out of the park if you don’t take a full swing. If it’s a low mileage, really nice car you deserve more money for it.

4. Not selling in Today’s Market-Your most profitable car is a 20-day car. If you are retailing a lot of cars at the 30, 45, 60 plus day mark, you don’t have a chance. Speed wins; the lack of speed kills.

Start charting those units that you sell at 45 days and beyond to see what they are doing to your average gross profit? In the movie “A Few Good Men,” Jack Nicholson might have been talking about you. You can’t handle the truth.

5. Lack of quantity and quality of photos –stop reading this. Go look at the used cars on your website. How hard is it to maneuver through your website? And, if you don’t have a photo booth, you cannot be competitive in today’s market. It’s an investment you can no longer afford to avoid.

6. Use Early Warning Radar-You have to be able to spot a problem child on day one, not day 61. Every one of your aged units (Your oldest unit is an aged unit) has a story to go with it. That story started back on day one and somebody wasn’t paying attention.

Fix your Radar system and your used car operation will become more efficient and more profitable.

You get what you deserve when you do the work to deserve what you get.

That’s all I’m gonna say, Tommy Gibbs

When Should You Do It?

Jeremy Foley is the former Athletic Director at the University of Florida. Foley had a 40 year career in leadership positions in collegiate athletics.

You can well imagine the number of people Jeremy Foley has had to fire over the years.

Of course he’s not always made the perfect decision when hiring and firing, but based on the school’s success, he’s been right far more times than he’s been wrong.

One of Foley’s sayings is, “If something needs to be done eventually, it needs to be done immediately.”

You will often find that to be a characteristic and trait of exceptional leaders. They see what needs to be done and they do it immediately.

You as a leader know there are things you eventually need to do, but for whatever reason, you keep putting it off.

You know there are people you need to eventually replace. If you know you need to eventually replace them, then you need to do it immediately.

You know you need to eventually change your pay plans. If you know you need to eventually change pay plans, then you need to do it immediately.

You know you need to eventually get rid of packs. If you know you need to eventually get rid of them, then you need to do it immediately.

There’s a long list of things you know you need to eventually do.

If you want to be a better leader, you would do them immediately.

That’s all I’m gonna say, Tommy Gibbs