Sometime back around 2018 you will recall a paradigm shift in the vAuto world in their thinking on used vehicles.

The shift taking place was about changing your thinking of a unit’s age from pure days, which they refer to as “Calendar Time,” into a tool called “ProfitTime,” which is more focused on a unit’s overall investment potential.

Because the used car automobile business has returned to a more normal depreciation cycle of values dealers are once more focused than ever on getting back to a more discipline basics of running their used car departments.

There’s nothing more important that you can do than to management the life cycle of each used car based on its profit potential.

To understand this idea a little bit more and how it relates to UpYourGross’ Life Cycle Management, let’s consider Velocity principles and the problem ProfitTime is trying to solve.

The Problem

Velocity principles would teach us that turning and burning units can boost ROI and allow grosses to accumulate. For many years, total gross vs. average gross has been something many of us have been focused on.

But what if there are some vehicles that we could have made more money on had we allowed ourselves to hold them a little longer and price them with a little extra gross built-in?

Strictly following the Velocity principles would leave these grosses on the table. As a general statement, holding a trade-in a little longer than something you acquired at an auction should make good sense to you.

The Solution

Rather than applying the exact same turn and burn strategy to every unit, what if we intelligently managed how we priced units based on their investment potential? This would allow us to strike a balance between applying a turn and burn mentality to the vehicles that require it, and seeking more gross for our great investment units.

This is exactly what vAuto has tried to capture with ProfitTime. They give each unit in your inventory an investment score each day. These scores range from 1-12 and segment into precious metal buckets. This allows you to understand each vehicle’s investment potential and execute a strategy that attempts to strike a balance between turn and burn units and hold out on good deal units.

So This Means Days Don’t Matter, Right?

Well sort of, but not so fast. Let’s step back a bit and take a closer look at the factors that drive a vehicle’s investment potential. Once you have a unit in your inventory, its investment potential is based on the gross the vehicle can generate.

Essentially, how well you bought the vehicle (odometer-adjusted cost-to-market) and the market conditions for that particular unit (Like-Mine Day Supply and Market Sales Volume). ProfitTime wraps these data elements together to determine the vehicle’s investment potential.

I’d envision using ProfitTime to understand a unit’s profit potential so that you can price your cars more optimally on day one and so that you can keep them priced right as their profit potential changes. This should allow you to strike a better balance between turn and burn units and staying firm on good deals.

It’s important to note that this investment potential doesn’t care if the unit is one day old or 40 days old. Therefore, from the ProfitTime perspective, how long you’ve owned the car simply does not matter.

However, I would be careful to not generalize and make a blanket statement that days don’t matter at all. If you just sit on a vehicle that was deemed to be Platinum on day one, it won’t look too rosy on day 100. In fact, as the days pass, the unit’s investment score will worsen, as would be expected with any depreciating asset.

Where Do Days Come Into Play Then?

Days still come into play when you are looking at your ROI. This is because ROI is not only based on the gross you’ve made, but also on how long it took you to make that gross. This all starts to come together when you see the bigger picture.

Vehicles with low-profit potential from the get-go will see their ROIs start substantially lower than vehicles with a higher profit potential. This gives you less time to move these units from day one if you expect an investment return. You can think of this as buying a green banana versus a brown banana. The green banana has more time to be useful on day one, while the brown banana is already running out of time.

You can still make money on brown bananas, but you must sell them fast and understand all the pluses that go along with cranking up the volume with brown bananas.

Additionally, vehicles with factors that lead to quicker depreciating market values will see their profit potential decline at a faster rate than vehicles with steadier market conditions.

These units will have pressure to be moved quickly too.

In nearly all cases, each day that ticks off the calendar lowers the vehicle’s ROI, even if its gross doesn’t go down. However, the starting ROI and rate at which the ROI deteriorates each day will vary for different vehicles.

How does ProfitTime fit Into UpYourGross’s Life Cycle Management Philosophy?

At UpYourGross we’ve been preaching a lot about a life cycle management philosophy that is built on the concept of having a unique strategy for every unit. The reason we do this is we recognize that not all vehicles are created equal. When we talk about a concept like setting an auction purchase unit to a shorter life cycle, we are essentially saying this vehicle has less gross potential, therefore, it’s ROI will automatically start lower than that of, say, a customer acquisition unit. Therefore, we need to get rid of it faster.

You can strike similarities between the concept of ProfitTime and Life Cycle as follows. Calendar Time is simply the vehicle’s true time or age in inventory. Intelligently setting a unique Life Cycle to a vehicle means that its expiration date is no longer tied to Calendar Time; rather, it’s tied to its investment potential. An auction purchase might expire at day 45 while a customer acquisition expires at day 60. This philosophy operates on the same fundamentals as ProfitTime.

So if Profit Time and Life Cycle are Similar Why do I need Both?

The truth is each tool offers you a distinct benefit and those benefits increase in value when used together. While you don’t have to have ProfitTime to use the Life Cycle management tool we’ve built with UpYourGross, knowing a vehicles ProfitTime score makes “intelligently” setting the Life Cycle for each unit a bit more analytical rather than purely experience-based.

This isn’t to say that there’s no place for experience, but as many of us know making decisions backed by data is a good foundation for establishing consistent and repeatable processes.

And, you don’t need UpYourGross to use ProfitTime. But when you pair the two together, they put you in the driver’s seat of driving more gross to your bottom line.

Think of it this way, the ProfitTime score will help you select and updated a unit’s life cycle and UpYourGross will help you manage your inventory when you end up with many different units all following distinct life cycles. With UpYourGross, you’ll be able to easily see which units are about to expire and know what units you should be focusing on.

I guess you could build a massive spreadsheet and hire someone to punch data into it all day to help you keep track of it all.

However, we recognized that establishing and managing a unique strategy for every unit could be a daunting task to manage in spreadsheets-the exact reason we created UpYourGross in the first place.

What if I’m not Ready for ProfitTime?

If you’re not ready to make the jump to ProfitTime, I’d still encourage you to stop treating all vehicles the same. Not all vehicles deserve a generic 60 or 90 days just because you find that process and inventory age timeline simple to implement.

Try following a process that sets a unique strategy for every unit and see how easy it is to manage that process with UpYourGross.

You might just be surprised at how your bottom line starts to look when you combine ProfitTime and UpYourGross. That’s all I’m gonna say, Tommy Gibbs

Written by Tommy Gibbs & Jarrod Tanton, Founders of UpYourGross.Com

There are a lot of common problems when it comes to the used car operations for new car dealers.

But of all the problems and challenges that dealers face, the number one problem is that dealers trade or buy a unit and have a lack of “intent.”

Most would say, “Of course I have intent. I intend to sell this unit and make some money.” That makes total sense, but the problem is, it’s far too general.

That’s like saying you’re going to drive from NY to LA without a plan on how you intend to get there.

How many of you have ever heard the saying, “Every used car has to stand on its own?” If you’ve been around long enough you understand the term and can probably agree with the statement.

That being true, how can you give them all the same shelf life?

How can you not have a specific intent for each unit?

Most managers don’t think, “What’s my intent,” when a unit comes into their inventory. They paint them all with the same broad brush, which doesn’t make a lot of sense.Intent starts with the appraisal and is finalized during the trade walk, where the “final intent” is determined.

If dealership managers would look at each unit and clearly state their intent, they would have fewer inventory problems, turn would improve, and average gross, volume and ROI would go up.

I’m not going to go into the details here in this newsletter, but my life cycle management process gives you the disciplines to determine and carry out your “intent.”


My intent with this article is not to try to sell you something. My intent is to get you to think harder about what your own intent happens to be when you bring units into your inventory. That’s all I’m gonna say,

I’ve always loved the word “relentless.” There’s no higher compliment than someone saying that you are relentless.
In simple terms it means someone who is determined to do something and refuses to give up.
They get knocked down.
They get up.
They never give up.
In the journey of life, we often encounter obstacles, setbacks, and challenges that can seem insurmountable. It’s during these moments that the quality of relentlessness can make all the difference between success and failure.
Being relentless means refusing to give up, no matter how tough the going gets. It’s a trait that has been the driving force behind countless achievements and inspiring stories throughout history.
Here are 7 Bullet Points of Relentlessness:
1. Overcoming Adversity: Relentless individuals are those who see adversity as an opportunity rather than a roadblock. They understand that setbacks are a natural part of the path to success. Instead of being discouraged by failures, they use them as stepping-stones to propel themselves forward.
2. Unwavering Determination: Being relentless requires an unwavering determination to achieve one’s goals. It means setting your sights on a target and refusing to be swayed by distractions, doubts, or naysayers. Whether you’re striving for personal growth, career success, or any other aspiration, this determination keeps you on course even when the seas are rough.
3. Learning and Adaptation: Being relentless doesn’t mean stubbornly sticking to a single path no matter what. It means being adaptable and open to learning from your experiences. If one approach isn’t working, a relentless person will pivot, reassess, and try a different strategy, always with the ultimate goal in mind.
4. Pushing Beyond Comfort Zones: Achieving remarkable things often requires pushing beyond your comfort zone. A relentless mindset encourages you to embrace discomfort and uncertainty because you understand that these are the places where true growth and innovation happen.
5. Resilience: Resilience is the cornerstone of relentlessness. It’s the ability to bounce back from failure, rejection, and disappointment with renewed vigor. Relentless individuals view challenges as opportunities to test their resilience and come back stronger.
6. Inspiration to Others: Being relentless doesn’t just benefit you; it also inspires others. When people see your unwavering commitment and determination, they’re more likely to believe in their own abilities to overcome challenges and achieve their dreams.
7. The Road to Success: History is replete with examples of relentless individuals who achieved greatness against all odds. People like Thomas Edison, who failed over a thousand times before inventing the light bulb, or J.K. Rowling, who faced numerous rejections before publishing the Harry Potter series, teach us that relentlessness can turn dreams into reality.
So, if you’re striving for something extraordinary, cultivate the power of relentlessness within yourself. Remember that success often lies just beyond the point where most people would have given up. Embrace challenges, learn from failures, and keep pushing forward. You have the potential to achieve greatness; all it takes is an unwavering commitment to being relentless in your pursuit of your dreams.
In conclusion, being relentless is a quality that can transform your life. It’s the secret sauce that helps you conquer adversity, stay determined in the face of setbacks, and ultimately reach your goals.
The secret sauce. That’s all I’m gonna say, Tommy Gibbs

I’m a big fan of making the team inclusive of what’s going on.
I’m a big fan of educating the team.
I’m a big fan of getting insight from those who are in the trenches.
I’m a big fan of listening to the troops.

But I’m not a big fan of rule by committee.

Ruling by committee is an easy way to avoid accountability.
Ruling by committee allows us to blame no one when it fails.
Ruling by committee is a sickness designed to allow those in charge to accept responsibility for nothing.

Ruling by committee is a way to hide in the back room. Ruling by committee is peeking through the closet door.

Step out of the closet, come into the room, and be counted. If you’re ruling by committee, stop it! You’re not running a democracy; you’re running a business.

That’s all I’m gonna say, Tommy Gibbs

The great thing about the phrase is you’re going to have one or the other. The cool thing is your get to pick which one!

Being a former Marine, part of my core values as an individual comes from my Marine Corps training. And no doubt a large part of my success in life comes from being well disciplined.

Many of my disciplines have come from being an athlete where you cannot achieve any level of success without discipline. Without question people with a military and/or a sports background make better employees/team members because they are well disciplined. Yes, there are exceptions, but work with me.

Discipline shows up in many forms in the workplace including being on time, achieving assignments, how you dress, how you talk, what you say, how you say it and who you say it to.

Discipline shows up in your personal life every day. From your routine when you get up each day to the moment you lay your head on your pillow.

I cannot fathom someone achieving a key leadership position or having a personal life that’s balanced unless they are highly disciplined.

If you do not have a sports background, military background or if you didn’t grow up in an environment where there was a focus on discipline then you are at a total disadvantage as you attempt to climb the ladder of success. It is virtually impossible to achieve success in sports or the military without discipline, and business and life are the same.

It’s pretty much a sure bet that if you are un-disciplined in your work life that your personal life is no different and chaos has become your best friend.

Discipline is about controlling willpower/self-control over one’s desires to do the wrong or easy thing. It’s about doing the right thing when the wrong thing keeps screaming “why bother.”

Focus on improving your discipline regardless of where you have come from and where you might be today. Observe others around you who you deem to be well disciplined and start to emulate them. Pretty soon others will start to emulate you and now the tribe becomes very powerful.

Only the well-disciplined ever get to be the chief of the tribe.

“The pain of discipline or the pain of regret.” You get to pick. That’s all I’m gonna say. Tommy Gibbs

I had great mentors when I first got in the car business. One of the first things I learned was that when a salesman was working a deal the whole world stopped.

Most of us are familiar with the tower or desk concept, the area where deals are worked, which can at times be like Grand Central station. It’s the nerve center. It’s the airplane control tower. It’s the emergency room and ICU all rolled into one. It’s serious business. You need to be serious.

What it’s not, is a place to socialize, but socializing does happen there. With that being the reality, the management staff has to have the discipline that all silly activity stops when a salesperson walks in the room. To this day, when I’m in a dealership and a salesperson walks in the tower I want to say, “Whatcha got?”

Sometimes they have a deal.

Sometimes they have a question.

Sometimes they need encouragement.

Sometimes they are looking for a little push.

Sometimes they are just lost.

But at all times I want them to know I care about them and I’m there to help them do business.

Maybe you should be just a little more serious. If you’re not already using the term “Whatcha got,” maybe you should.

By saying “Whatcha got,” you will get a lot. That’s all I’m gonna say, Tommy Gibbs

The first of anything is always the best. Coffee is a great example. I highly anticipate each morning the first taste of my cup of coffee.

It’s amazingly the best. Most things are like that.

The first time you kissed your wife, husband, girlfriend or boyfriend is far better than the smooches you’ve most recently got.

The first lick of your ice cream cone is better than the last and so on. It’s called the law of stuff tastes better at first. (Yes, I made that up.)

Used cars are that way too. Selling one in the first 10 days tastes a lot better than selling it on day 70. The biggest difference between selling a used car and getting a kiss is that selling a used car is based on math.

Kissing is based on kissing. Imagine that?

Here’s the problem:

Dealers often failed to recognize those units that need to be first, as in sold really fast.

Those will be your most problematic units such as ones you’ve buried yourself in, bad color, auction purchases, high dollar unit, etc. These are units that you do not have a favorable cost to market or days supply.

You have to accept the fact that you’re not going to make a as much gross on those as you might make on others. Never forget they serve a worthwhile purpose in your business model. There are benefits galore at turning and burning these units.

Because the pandemic has had a dramatic impact on the law of supply and demand, some of our older kisses have been really sweet.

Unfortunately some dealers have been hypnotized into thinking an old kiss is always going to be just is good as a fresh one. Maybe you’re a great kisser or maybe you just slobber a lot.

Do yourself a favor and take a look at a handful of your oldest units in stock. Ask yourself, “why are these units still here?”

The odds are good that whatever you come up with was there on day one and you ignored it.

This article isn’t mean to be a commercial for my software product, but if you had been using my life-cycle management and recon tool, the odds of you still staring at those units would be about slim and non.

If you want to improve gross profit and volume, you have to know which ones to hold and which ones to fold and never forget all kisses are not equal.

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

Peripheral Vision

I think that a large percentage of successful people played a sport or two along the way.

It’s not imperative for someone to have a sports background, but it sure does help.

Here are some reasons why you should give consideration to hiring people with a sports background:

They know how to win.

They know how to lose.

They love big moments.

They want to learn more.

They know how to compete.

They always give their best.

They understand preparation.T

hey stay focused on the basics.

They get up when knocked down.

They coach and like to be coached.

They will get down in the trenches.

They know how to run the score up.

They understand mental conditioning.

They understand physical conditioning.

They know they must maintain discipline.

They like being on the team and understand teamwork.

They have drive, determination and the will to win.

They are eager to get off the bench and into the game.

They think fast.

They react fast.

They can react on the fly.

They have great peripheral vision, thus they always know what’s going on around them.

Hire more people with a sports background, That’s all I’m gonna say,

As is the case with most Zingers I write they are usually a result of issues I come across in my travels, or emails and phone calls from dealers and managers with specific questions.

I was contacted recently by a general manager whose dealer was putting pressure on him because the average F&I gross was falling.

Here’s the specific question as it was presented to me:

“Great article this past week and as always very true. Here’s my question. We have been selling more and more inexpensive cars (many that have over 100,000 miles) and the volume definitely has increased and our turn is much better, but that being said our backend averages have dropped.

We are selling fewer products because the cheap cars are not eligible for product. My owner is putting tremendous pressure to keep backend averages up, but due to us pushing prices down and selling these older cars our averages are falling. Basically the numbers are telling me we are doing a poor job in used car F&I. Your thoughts?”

You have to believe the dealer likes the volume that these lower price cars are bringing to the table, but he also wants the higher F&I income. I get it, I really do.

However, it’s possible the dealer is missing the big picture or he is doing what dealers sometimes do; he’s working the management team. Been there and done that and there’s nothing wrong with it unless it totally screws up the heads of the members of the management team. It may also be he’s trying to create an environment of “If you think you can, you can.”

The first thing that has to be realized is achieving high gross profit and doing volume is a contradiction. It goes against Tommy’s laws of nature.

I’m not saying it can’t be done but I will say it’s very unusual, and there has to be a very special set of circumstances for it to happen with consistency. If it’s going to happen in today’s market it’s because the dealership has amazing talent or they exist in a very unique market.

There is no question F&I is going to take a hit when selling cheaper cars. What has to be determined is, are you better off selling them, with a smaller F&I average or not selling them at all and pulling your F&I average up. Hello?

Suppose the dealer puts so much heat on the F&I averages that the GM throws in the towel on the less expensive units and goes back to retailing more expensive cars and a better F&I average. Is the dealership really better off?

Here are 10 key questions that need to be answered:

1. What about all the parts and service gross that would have been generated on the less expensive cars going through service and reconditioning?

2. What about the fact that you could have put more money in some trades because you intend to retail them vs. wholesaling them? How many more car deals do you end up making because you have a better plan?

3. Does the increase in volume from the less expensive units impact the attitude of the sales staff and their ability to earn additional income? Isn’t it true the best time to sell a car is when you just sold a car?

4. What’s the benefit of having someone driving a car, any car, high dollar, low dollar, that they purchased from you?

5. Is there a chance you just sold a car to someone who might never have set foot in your store because you had a vehicle at a price point they could afford to pay?

6. Is it possible that this new customer has a friend or relative who might one day come back and buy something because of the way this new customer was treated during the buying experience?

7. Are the odds in your favor that they may come back for an oil change or other service?

8. Does doing business generate business?

9. What’s the “Return on Investment” on selling these less expensive cars? Relative to the amount of money tied up aren’t they a far better investment than what you would make with a $25,000 car? How many times in a year can you turn over a $7,000 to $10,000 investment vs. a $25,000 investment?

10. Doesn’t it make sense, that if you can sell more cars with less money tied up that it’s a good thing? There really isn’t much of a downside to increasing volume and decreasing investment.

To keep the accountability up on F&I it might be a good idea to keep two logs; one with the more expensive cars that you hold to your normal F&I standard and another for the less expensive cars. You have to decide how that gets broken down.

Let me remind you that what’s really important is how much total gross you are generating. I always say, “You cannot spend average gross profit. You can only spend total gross profit.” That’s all I’m gonna say, Tommy Gibbs

The car business is not as complicated as we sometimes make it.

When I first got in the business back in the early 70s, we had a sales meeting every morning. Yes, as in Monday through Saturday. Part of the meeting had a bit of rah, rah, and part of it was training, covering issues, sorting out details of what our production was relative to forecast, and so on and so on.

For the most part, daily meetings have gone out of style and daily training is gone…well, I don’t know where. At best, the management team has been assigned counseling duties to review the BDC activity. At worst management says hello to each salesperson.

From time to time the Dealer gets all wired up and implements a new program/process that demands certain things are done. At best, it’s a 90-day excursion to futility.

It’s a given that those who consistently use positive best practices are the ones who achieve the most success. One of the things that happened during those daily meetings back in the “good old days” was the used car manager would get up in the front of the room and tell everyone to get their “sheet” out of their back pocket so changes could be made. The referenced sheet was the “used car list.”

He would then say something like “draw a line through stock number 2345A. We sold that car last night.” Further saying “add to your sheet, stock number 4645A. Tommy would you stand up in the back of the room and tell everyone about the nice little car you traded in last night.”

As antiquated as that might seem to you it’s far better than most do today. If you want to sell more used cars you need to provide the team with more information about what you have in inventory. A great method of doing that is to do a lot walk once a week. Yup, just once a week, when done right, will generate some amazing results. If nothing else, I can guarantee you at least one more used car sold by each salesperson.

The lot walk (Different than a trade-walk.) is done right after the “Save-a-Deal” meeting. I just know you’re doing a “Save-a-Deal” meeting so it shouldn’t be hard for you to add the lot walk at the end of that meeting. Every salesperson and every manager go on the lot walk. New, Used, they all go on the “Lot Walk.” Make sure the service manager is included in this walk.

You should stop and talk about every used car sitting on your retail lot. The conversations that come about will amaze you. A real byproduct of the lot walk is the salespeople will start to tell you why certain cars haven’t sold. They also gain so much more knowledge about what’s on the lot. Do not leave the “Trade Line” out of the lot walk. They need to know what’s in the system and what’s about to become available.

This is a great time to inquire about what they think you need to stock. Of course, you can’t fulfill all their needs, wants and desires, but it becomes a great opportunity to educate them about the law of supply and demand and why they need to sell the value of your current inventory.

When the team is educated, they tend to educate the customer. When the customer is educated as to the value of your product you sell more cars and make more money. Education for both starts with the information shared on the “Lot Walk.”

Let’s Walk. That’s all I’m gonna say. Tommy Gibbs