Recently I got my normal early morning start…up early, some computer work, wrote a couple of articles, and headed to the gym. After the gym, I had a couple of errands to run but felt a little hungry after lifting all those heavy weights.

Because I’m conscious of eating healthy, I decide to zip through Taco Bell and grab something with some nourishing protein in it.

I pull up to the menu board and can’t find any of their breakfast food on the menu. About that time a little voice says, “Welcome to Taco Bell, order when ready.”

I’m still trying to find breakfast on the menu. Finally, I speak back into the little box and say, “Hey, I can’t find the breakfast menu.” Crickets.

I’m thinking, ok they must be busy, so I’ll just pull around to the window and order. I pull up to the window and the worker opened the window. I say, “Hey, what’s for breakfast?” She says, “We’re not open.”

I say, “What time do you open?” She says, “8:00.” Oh, ok…I pull up to the exit driveway and look at the clock on my phone. It’s 7:59.

I wonder, would she have been fired if she had said, we don’t open until 8, but it’s only one minute early so I’ll take your order. Or, I guess she could have said, drive around the building and you will be on time.

This reminds me of when I was a new car dealer. Back in those days, we opened the service department at 7:30 am. There would be customers lined up outside the service doors waiting for the doors to open. The service writers would be inside standing at their podium getting ready for the day and staring back at the customers.

“It’s 7:25, hey we’ve got customers, let’s open the door and get them on their way,” said no one ever.

Of course, you can imagine when Tommy hit the building, he’s screaming, “Open the door and take care of our customers.”

Now, what do you think the pushback was when I chatted with the service director later in the day about this hot topic?

“Boss, if we do that, we are training the customers to show up earlier and earlier.”

OMG, what a horrible thing that we train the customers that they can count on us to exceed their expectations and get them on their way lickety-split.

Does one-minute matter?

Maybe not to you and the Taco Bell bunch, but it matters to me and your customers. That’s all I’m gonna say. Tommy Gibbs.

Being able to inspire people can be complex and tricky. There are times when people in leadership positions actually un-inspire their team more than they inspire.

Even with good intentions, we often overthink whatever it is we’re trying to improve. Keeping it simple and real is always the best approach.

“A mediocre person tells. A good person explains. A superior person demonstrates. A great person inspires others to see for themselves.” Harvey Mackay.

Keeping It Simple:

1. Challenge them with reasonable objectives. Not too easy, not too hard. The key is the objectives have to be achievable. Achieved success will lead to even greater achievements. Success breeds success.

It’s great to be an optimist. It’s even greater to be a “realistic optimist.” Tossing out “pie in the sky” numbers doesn’t challenge people; it defeats them and they eventually just ignore them.

2. Show encouragement by leading from the front and pushing from the rear. Cheer and cheer some more. There’s nothing better than a pat on the back or a double high five to get ’em going and keep ’em going.

Sometimes you have to show them “how” and sometimes you coach them “how.”

3. Watch what you say and how you say it. Saying the right things, in the right way, at the right time can do wonders. Choose your words carefully. Remember the whole world is watching and listening to everything you say and do.

4. Show them that you care in a sincere way. It has to be real. People can spot BS from a mile away. You can’t fake it.

There’s nothing more powerful than a leader that truly cares. You either care or you don’t.

I’m pulling for you, that’s all I’m gonna say, Tommy Gibbs.

I wrote this article back in 2012, but it’s such a great story that it’s worth repeating. I wonder where this person is and what they are doing today? I can’t put the name of the dealer group in the article, but if you recognize the story and know this person, please reach out and share with me. I’m often asked what it takes to be successful? No doubt there’s a long list, but in my opinion if you don’t have “true grit,” then you don’t have much of a chance. You have to have a mindset to grind things out when the going gets tough and it will no doubt get tough along the way. I came across an example of “True Grit” last week that I want to share with you. I was speaking to a group of managers and owners of a large auto dealer group out of Orlando, Fl. They own 20 dealership around the country with 4 located in China. One of the managers in the meeting is from their Chrysler, Jeep, Dodge Dealership in San Antonio, TX. As he tells the story he had just gotten out of the Navy about 5 years ago and needed a job. He was a member of the Seabees, which you may know is an engineering unit often building bridges, etc. for the military. With a new wife and fresh out of the Navy he need a job and went to a construction site to put in an application. When he arrived it had started to rain and most of the workers had left the site and he was told he could wait around to see if the rain let up and/or come back on another day. He had just driven 40 miles for the interview and was standing their kind of dumfounded as to what to do next. It so happens that he was actually standing on the lot next to the site which was a new car dealership. A sales manager walked out and apologize to him for someone not having waited on him. He quickly explained he was not there to buy a car but had come for a job interview which had fallen through. The manager began to chat with him and quickly found common ground as he too was a military veteran. He said “since you need a job, we will hire you to sell cars. Show up tomorrow morning with a coat and tie on and for the next two weeks we will put you through our training program. At the end of each day when the training is done I will give you $50 cash for the time you are spending in class.” He drives the 40 miles back home and tells his wife he got a job. She’s very excited until he tells her he’s gong to be selling cars. She starts to laugh at him and says you’ve got to be kidding me. He tells her he’s not and that he needs ties and shirts to wear to work. She tells him they have no money. The only clothes he owns are boots from the military and T-shirts and jeans. So, in the middle of the night they head out and raid a Goodwill drop off box. In the middle of the night he’s inside the box with a flashlight pulling clothes out, handing them to her, weeding through them to try and find two outfits. And now the rest is history. 5 years later he’s a very successful sales manager making $250,000 a year. Talk about “True Grit.” How many people do you know who would go to such extremes to take a job in an industry they know nothing about?Here’s the moral to the story: There’s a lot of room at the top for those who are willing to do what it takes to be successful. It takes hard work, determination, a little luck and a lot of “True Grit” along the way… That’s all I’m gonna say,  Tommy Gibbs.

I wrote this article back in 2012, but it’s such a great story that it’s worth repeating. I wonder where this person is and what they are doing today? I can’t put the name of the dealer group in the article, but if you recognize the story and know this person, please reach out and share with me.

I’m often asked what it takes to be successful? No doubt there’s a long list, but in my opinion if you don’t have “true grit,” then you don’t have much of a chance. You have to have a mindset to grind things out when the going gets tough and it will no doubt get tough along the way.

I came across an example of “True Grit” last week that I want to share with you. I was speaking to a group of managers and owners of a large auto dealer group out of Orlando, Fl.

They own 20 dealership around the country with 4 located in China.

One of the managers in the meeting is from their Chrysler, Jeep, Dodge Dealership in San Antonio, TX. As he tells the story he had just gotten out of the Navy about 5 years ago and needed a job. He was a member of the Seabees, which you may know is an engineering unit often building bridges, etc. for the military.

With a new wife and fresh out of the Navy he need a job and went to a construction site to put in an application.

When he arrived it had started to rain and most of the workers had left the site and he was told he could wait around to see if the rain let up and/or come back on another day. He had just driven 40 miles for the interview and was standing their kind of dumfounded as to what to do next.

It so happens that he was actually standing on the lot next to the site which was a new car dealership. A sales manager walked out and apologize to him for someone not having waited on him. He quickly explained he was not there to buy a car but had come for a job interview which had fallen through.

The manager began to chat with him and quickly found common ground as he too was a military veteran. He said “since you need a job, we will hire you to sell cars. Show up tomorrow morning with a coat and tie on and for the next two weeks we will put you through our training program.

At the end of each day when the training is done I will give you $50 cash for the time you are spending in class.”

He drives the 40 miles back home and tells his wife he got a job. She’s very excited until he tells her he’s gong to be selling cars. She starts to laugh at him and says you’ve got to be kidding me. He tells her he’s not and that he needs ties and shirts to wear to work. She tells him they have no money. The only clothes he owns are boots from the military and T-shirts and jeans.

So, in the middle of the night they head out and raid a Goodwill drop off box. In the middle of the night he’s inside the box with a flashlight pulling clothes out, handing them to her, weeding through them to try and find two outfits.

And now the rest is history. 5 years later he’s a very successful sales manager making $250,000 a year. Talk about “True Grit.” How many people do you know who would go to such extremes to take a job in an industry they know nothing about?

Here’s the moral to the story:

There’s a lot of room at the top for those who are willing to do what it takes to be successful. It takes hard work, determination, a little luck and a lot of “True Grit” along the way…

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

I’ve written about this before, but you know as they say, “timing is everything,” so I’m think now might be a good time to stir things up a bit.

I’m thinking about half my readers know what a “wash-out sheet” is and the other half probably don’t. For those that don’t, in the early years of the retail auto business, dealers used a “wash out sheet” to determine how much money they made on the sale of a vehicle.

Here’s the way it worked. A new car comes into your inventory. You don’t know how much money you made until all trades are sold and thus “washed out.”

Follow the sequence. A new car creates a trade; you sell the trade. You trade in another and finally sell the last one with no trade. You then calculate the total gross generated by the sale of that one new car plus all the trades.

In this case, it took 3 transactions to determine how much total money was made. You would do the same thing if you purchased a used vehicle. If there were no trades or maybe one, the washout occurs much sooner.

With the technology that dealers have today, I believe it would be prudent to track the total gross each unit brings to the table. That would include F&I, Parts, and Service Gross generated from reconditioning on each unit as well as packs and doc fees.

Your first reaction is “We’re already doing this.” But you aren’t.

You might have a vague idea of what a single unit brings to you on the front side of the business and you might even know what a unit creates from the reconditioning gross, but you don’t have any idea what the total gross is when you track it in totality going from the first sale to the last sale that was created from the first unit sold.

The wash-out sheet is kind of like suits and ties. Keep them around long enough and they will come back in style.

Let the washing begin.

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

I realize aged units are in the eye of the beholder, but for the sake of simplicity and this conversation let’s go with anything over 60 days.

If you are of a mindset that you’re not worried about them, I can’t help you.

Actually, you can’t be helped. You’re in a state of euphoria from the horseshoe you’ve had stuck in a magical place where the sun doesn’t shine during these unprecedented times. (I know that’s a ridiculously long sentence, but I like it.)

A bunch of hardheads will just delete this message, so let me serve up some suggestions for those of you who are still with me and sitting on the bridge peaking over.

The number 1 reason you still have those over 60-day units is price. There may be other reasons, but price is number 1. There’s a price you can unload that 75-day-old car for, but you haven’t gone there yet.

It goes without saying, but I’ll say it anyway; you are far better off selling a unit at retail for the same price as you would sell at wholesale, for all the reasons that you and I know.

Now you’re going to tell me you can wholesale that unit at a profit. Keep in mind we’re talking about a 75-day-old unit.

Rock star, my suggestion is to go ahead and take the wholesale profit on that bad boy (to be politically correct let’s go with bad girl too) and move on.

Maybe ROI doesn’t matter to you, but trust me on this, your ROI sucks on that unit whether you retail it at 75 days or wholesale it.

If you create a focus on those over 60-day units, that’s a good thing, but it won’t solve your problem moving forward if you don’t pay close attention to those units now between 30 and 45 days old.

They are coming. They want to jump over there with those already 60-day-old units. You need to be price conscious of those bad boys and bad girls.

My final suggestion is to be sure to identify problematic units on day one. Have a unique strategy for them and they will never see day 61.

Units don’t age on day 61. They age on day 1, because someone isn’t paying attention.

I’m giving you smart advice. Be smart.

That’s all I’m gonna say. Tommy Gibbs

When you’re in business you have a ton of issues to deal with. None are more important than communicating with staff and management team to help them improve performance and profitability.

When you’re in a dealership day-to-day it’s like living with family members and therein lies the problem. It can be difficult to hold family accountable.

There’s tons of data for you to sort through each day to help you create a roadmap of accountability.

You often ignore it and look the other way because you don’t want to lose your family members.

Actually, sometimes it is family and that can create all sorts of issues for you and the team.

The problem is a lot of people see the word “accountable” as a negative word. Holding people accountable is actually a tool to coach them to the next level.

Coaching is about pointing out those things they may be missing. The reason you see what they don’t is because of your experience and the data you have at hand.

People don’t do things because either:

A. They don’t know what to do.
B. They know what to do and refuse to do it.

As a leader, you’re responsible for making sure they know.

Once they know you’re responsible for making sure they do it whatever it might be.

When are you going to stand up?

That’s all I’m gonna ask, Tommy Gibbs.

I’m getting a lot of questions about inventory turn these days.

Many dealers admittedly expressing concerns about units they have let age.

Even though values remain high, dealers are starting to see a leveling off of the market and the upward spiral of values starting to come back to some sense of normalcy.

Lately I’ve been preparing for my NADA convention workshop titled, “Putting Common Sense Back Into Your Used Car Department.” As a reminder it’s in Dallas on January 26 thru January 29.

Just in case you’ve gotten a little lax, I’m going to share a few bullet points from that workshop that I’m confident will help you get back on track.

1. Press Your Cost Down-This is probably the simplest and most effective thing you can do to improve your business. Know what your average cost per unit is every day and do what you can to reduce it. If you are at $18,000 today, do what you can to get it to $17,500 and so on. There is no magical number.

It’s about keeping the less expensive units and making sure the more expensive ones turn fast. If you figure out how to reduce your recon cost on the cheaper units, then you’ll figure out a way to retail more. Having lower price used cars on your lot is going to becoming more and more challenging to do. Creating a great focus on this segment will pay huge dividends for you.

2. Attack the 10 Most Expensive Units in Stock-Make a list each day of your 10 most expensive units in stock. With one exception make sure they are priced really, really right. The one exception is if you know you always make money on a unit that’s on the list then use some common sense, don’t give it away.

Consider putting bonus money on those 10 units regardless of the number of days they have been in stock. Sooner rather than later. Make sure the service manager gets a copy of the list each day and create a sense of urgency to get any of those through the shop quickly.

3. Life Cycle Management-There is nothing, absolutely nothing, you can do that will improve all aspects of your used car business more than understanding my process of “Life Cycle Management.”

Think Fast, Be Fast-You are working with a depreciating asset. Yes, your inventory has gone up during these crazy times, but those days are likely to be behind us.

Everything, including decisions on what to keep and not keep has to be done fast. Pull the trigger quickly on units that you are suspicious about. Don’t hang on to them hoping and wishing something good is going to happen.Early losses are far better than late losses. If you are paying attention and recognizing problem units early in the life cycle then you will have a lot less need to take units to the auction and lose money on them at 45 or 60 days. There are certain “Trigger Points” you need to focus on during your daily “Trade Walk.” Knowing how to use EWR (Early Warning Radar) pays big dividends.

4. Lot Walk-If you do a lot walk once a week with all the members of your sales and management team then without a doubt you will sell more units. The lot walk gets your entire team to know and understand your used car inventory.
The more knowledge they have the more they sell. Don’t get confused between a lot walk and a trade walk. They are both different and they both play a major role in your success.

5. Daily Inventory Pricing-The market changes every day and so should your pricing. Sometimes you can ask more, sometimes you can ask less. You cannot and will not achieve maximum results by changing prices every 10 to 20 days. Pricing takes intense management. It’s not something you do when you get around to it. You would be far better off if someone priced the car who is not in charge of appraising and buying them.

“The Pain of Discipline or the Pain of Regret.”

Do the little things every day and you’re less likely to have much regret.
That’s all I’m gonna say, Tommy Gibbs.

One of the skills necessary to succeed in business or life for that matter is the ability to ask the right questions at the right time and be able to cut though the B.S.

Having the ability to read people is critical to your success in life and business. People do lie.

An easy clue that something isn’t right is when someone constantly tells you how great they are even when you didn’t ask. Key words here are “you didn’t ask.”

Have you ever met someone and within the first few minutes of the conversation they start telling you they are all this and that?

It’s one of those conversations where it’s all about them and nothing about you. Isn’t there a country song “I wanna talk all about me?

If someone is telling you about all his or her great accomplishments, then you should be really suspicious. It’s not unusual for people to inflate how wonderful they are, but there’s a point where it goes beyond a little exaggeration into the area of lying.

As I’ve gotten older, I was a far greater football and baseball player in college than I actually was. (Think on that one for a minute.)

I’ve interviewed hundreds if not thousands of people in my business career.

If a person starts telling me how honest they are I’m thinking they aren’t very honest. I don’t trust you because you say you’re honest, I trust you because you’ve earned it over a period of time. (Isn’t that what happens in relationships? Trust is earned by actions and deeds.)

When someone wants to be a name-dropper by telling you all the big-name people they have hung out with and all the great things they’ve done, I would suggest you be very leery and start checking them out. If they are truly all that great, their greatness will come through and they won’t have to tell you.

I continue to be amazed at just how gullible some people are. Even people who I respect and perceive to have their lives together are easily convinced by a smooth talker. There are a lot of people in prison today who are smooth talkers. They are called con men.

You will notice that those who can “do it” don’t tell you they can “do it,” they just go “do it.”

They don’t brag or boast about it and if anything, they are humble. They show up, roll their sleeves up and get with it. The Michael Jordans of the world don’t have to talk the talk, because they can walk the walk.

When you hear all that talking, start watching their walking.

That’s all I’m gonna say, Tommy Gibbs

Being a leader is often a challenge because of the workplace environment we find ourselves in.

Being a leader is like being a parent. For example, if one parent stays at home, it can be more difficult to discipline the children due to being around them all the time.

Most of my readers are in the automobile business and are often around the same people for 12 plus hours a day.
Most dealerships have systems and processes in place designed to create focus and discipline. Even under the best of circumstances processes are constantly breaking down which contributes to poor performance and a poor bottom line.

The reality is that it’s much easier to run a large dealership than a small one.

As a leader in a large dealership, you can delegate much more and separate yourself from some of the personalities that can cause the breakdown of discipline.

Do not take that to mean that you don’t need to be involved, friendly or whatever. It just means you have to separate yourself from the emotional side of the equation.

If you are in a smaller dealership the task of separating yourself from the staff is even more daunting.I’m often amazed that leaders feel that they can socialize with staff members and still be able to properly manage and lead them.

How can you

1. Have lunch with the same people all the time?
2. Have dinner with spouses and members of your team on a regular basis?
3. Have after work drinks with staff members?
4. Party with staff members?
5. Attend sporting events with staff members?
6. Play golf on weekends with staff members?

Any of these in and of themselves is not a bad thing.

But, to do any of this with the same person on a consistent basis does nothing but create problems for you and them.

Aside from the fact it makes it difficult for you to manage them (let alone fire them) it creates a perception of favoritism that will destroy morale and team spirit.

Never forget, perception is reality. If you perceive that I’m a jerk, then I’m a jerk. The only way for that to change is for me to work toward changing your perception of me.

The burden is on me, not you. That’s all I’m gonna say, Tommy Gibbs