Here’s what you have to understand, just because you are having success doing it your way, doesn’t make it perfect. Your way is not perfect. There are many ways to be successful in the car business.

Focus on new cars
Focus on used cars
Focus on both

Packs
No packs

Four square selling system
One price selling system
Do your own thing selling system
If I could…would you

Paying on gross
Paying on volume
Paying on a combination of the two
Paying a salary, plus

New car managers appraising cars
Only the used car manager appraising cars
Anybody can appraise cars

Trade walk
No trade walk

Lot walk
No lot walk

My Life Cycle Management Process
We will find a butt for every seat

Separate recon team
All cars go in the main shop

Buying cars online
Never buying cars online
Attending weekly auctions
Buying cars from the public

Separate used car sales building
Sell everything out of one building

Teams in the service department
Groups in the service department
Conventional service department

Newspaper advertising
Radio & TV
Internet
Little bit of everything

10 Photos per car
40 photos per car
100 photos per car

Charge the used car department full retail from the service department
Discount service work to the used car department
Charge a set fee to each car
Charge no recon to a used car and make it a line item

Using a menu in F&I
Not using a menu in F&I

Hiring only green peas
Hiring only experienced
Hiring anyone who can fog a mirror

And the list goes on and on.

You should want to be perfect, but you’re not. The only way to get close to perfect is to keep looking and to keep trying for perfection. If your store is making $1,000,000 a month you’re still not perfect.

There is always more to do and something to fix. That’s all I’m gonna say, Tommy Gibbs

For years we have used the terminology, “Gross Profit Is a State of Mind.” That may have been true years ago. Not so much today. Gross is a state of pricing, processes, and doing a lot of little things each day. 

Tips On Improving Gross Profit:

1. Do a better job of training the sales people (and sales managers) to sell the value of your company and the value of the vehicle, and your grosses would be a lot better. The Team needs to learn to say “no” and to convince the customer that you have the best deal going.

2. Provide more information. The more information your sales people have about your inventory and how it’s priced to market, the more likely they are to do a better job of convincing the customers you’ve got the best car at the best price. You have to sell the sales staff before you sell the customer.

3. Do more and better research. The more research you do on what’s hot and what’s not in your market, the better off you will be. Grosses go up when you are selling a product that’s high in demand and low in supply. Key components for you to utilize are vAuto Stocking Tool, Auto Trader Data and data from Auto Count USA (Experian.)  If you’re still making decisions on what to buy based on gut instinct, you may want to rethink that.

4. Rethink “Buckets.” Buckets are a solid discipline process, but you can’t take a position that all cars in the first 20 days are priced a certain way and at day 21 another way and so on. There are some that need to be over market and some under market, regardless of age. All cars have to be evaluated on their own merits and this must be done daily, not in 15 or 20 day windows. One of the biggest problems I observe is that cars don’t get re-priced soon enough. You might want to start to pay close attention to how often cars are re-priced. Some of your older inventory may have been ignored along the way.

5. Track GAP and ROI. Dealers who are tracking GAP and ROI are seeing a big difference in their average grosses.  If you’ve not bought into this process then maybe it’s something you should take a hard look at. If you need the GAP/ROI spreadsheet, send me an email and I’ll get it right to you. (It’s Free!)

6. Fix your reconditioning timeline. If your most profitable car is a 20-day car (and it really is) how can you allow the service department to bog you down with it spending 7 to 10 days in the shop? This is one of those things that’s fixable, but it has to be done by the dealer. If the dealer wants to fix it then it gets fixed. Speed wins; the lack of speed kills. It’s as simple as that.

7. Re-do your website. How does your website look? Your website is the “New Showroom.” Do your pictures tell a good story? Do you have 12 to 20 photos? If that’s all you have then you are not in the game. You need at least 40 and they need to be done in a photo booth. If you don’t have a photo booth you need to make a commitment to get one. Saying you don’t have the space is a poor excuse. You can make it happen if you want to. Kind of like the issue in service. You can fix it. You just need to do it.

8. Install EWR into your “Trade Walk.” If you’re not familiar with Early Warning Radar, read this article. EWR will help you eliminate your problem cars.  Early Warning Radar Even if you’ve read it before, read it again.

The used car department takes a lot of energy and effort to achieve the volume and gross you need to make big money. You can say that “gross is a state of mind” all you want, but what really creates gross is your mind getting in gear and fixing the things that impact gross, not sitting around thinking about it.

My state of mind is, “That’s all I’m gonna say.” Tommy Gibbs

Yes, you may very well be lazy. Let’s admit it, we all get lazy once in a while. Some people are lazy all the while. (I meant to say it that way.)If you’re not lazy and if you’re serious, dead serious about wanting to sell more cars, then you should do a “lot walk” at least once a week. I didn’t say trade walk, I said lot walk.Before I share a great tip with you on how to make it work to the maximum, I want to define it for you so we are all on the same page.A lot walk is done once a week, preferably on Friday after you’ve had your weekend “kick off” sales meeting. All the members of the sales management team, the sales staff and the service manager go on the lot walk. There should be very few exceptions for any of these people missing the lot walk. You will hear all the excuses in the world. You should say “Talk to the hand…you’re going on the lot walk.”The lot walk should be orchestrated by the Dealer, GM or GSM depending on how you are set up. If that’s you, you are going to be the one that stirs the pot during the lot walk, but the real spokespeople are going to be the used car manager and the sales staff. The Used Car Manager-I am appalled and horrified at how little some used car managers know about their inventory. They know very little about their cars and even more shocking they often do not know where all their cars are. A real used car manager thinks of each of these cars as if they were his/her children. They know what they wore to school today, they know when they last ate, they know when they last pooped, they know who they hang out with, they know if they are late from school, and they know if they oversleep. They are always very concerned about their “children.” Rob Seifert is one of the best used car managers I ever worked with. Yes, Rob had his quirks, his strengths and weaknesses just like all of us, but one thing Rob always knew was his inventory. From the moment we owned it until it went away, he knew everything about it, where it was at any given moment and what we needed to do to get it sold. The Sales Staff-if you’ve struggled with the lot walk in the past I want to share another layer to the equation that will help you over the speed bumps. My good friend Tim Deese introduced me to Adopt-a-Car back in the ’80s. It works very well when you have the discipline to work it. It has the potential to evaporate quickly so I want to suggest you consider trying it for 60 days. When I say try it, I mean announce that you’re only going to do it for 60 days so you don’t look stupid when the evaporation factor bites you in the butt. You can always renew it. The fundamental adopt-a-car program is that each sales person has their own used car inventory and they get paid extra money if they sell their own units. If another sales person sells one of their cars they still get paid on it. If a sales person trades a car in, that car is part of his/her inventory. All other inventory is distributed on a rotating basis to the entire staff. When you first start the program you will have some orphan cars that you would do the same with. My suggested pay plan looks like this: In order to make this work you have to have the discipline to take cars away when a sales person doesn’t adhere to the program. The main reason we are going to pay them to sell their own inventory is to get them to help us make sure the car is standing tall at all times. Here are some reasons to take a car away: 1. Cosmetic problems 2. Trash in the interior 3. Gas on empty 4. FTC and/or window stickers edgy 5. Hang tags not properly displayed And now for the lot walk kicker. During the course of the lot walk the sales people must be able to recite the following on their inventory: 1. Year, make and model of the car 2. Mileage of the car 3. How long have we owned it? 4. The Internet Price and Last price change 5. Something they know about this car. It may be one owner or something they looked up about this model on the Internet. You can come up with your own list, but if you are going to pay them to sell their own inventory then you need to require them to know something about it. Make sure that when you do the lot walk you take a copy of the inventory with you and check them off as you go. “Voila,” there will be some missing cars and the used car manager and sales staff need to have an answer. Anything else is just plain lazy. I’m not lazy. That’s why I send you this stuff. That’s all I’m gonna say, Tommy Gibbs

I was standing in the airport the other day (nothing unusual about that) and I overheard one guy say to another, “Go sell something.” And he responded by saying, “I’ll do my best.”

I have some shocking news for that guy, just as I have for you. Your best is not good enough. Never has been, never will be. 

We often hear people in business and sports speak of giving 110%. Well, it’s the same deal with 110%. 110% isn’t good enough because, trust me, someone else is giving 111%. There is always someone willing to do more than you.

The fact of the matter is you can always do more. Sure, there are all sorts of excuses as to why you don’t do more, and they are just that…excuses. If you’re a sales manager and have 10 sales people working on your team I can guarantee you that if you think back over the course of the previous month, you could have helped and pushed those sales people to get one more unit each. Maybe even two units for some of them.

If you’re the dealer or general manager I’m thinking you too could be doing more. We can all do more. I kick myself at the end of every day because I know I can do more.

Maybe you got distracted, maybe you got busy, maybe you got satisfied, maybe you got sideways about something goofy and your mind went out in left field.

The Superstar players don’t get distracted. They don’t let busy beat them. They are never satisfied, and they don’t let others get them off track when they hit a wall.

You and I both know you can do more. That’s all I’m gonna say. Tommy Gibbs.