I’ve spent most of my life observing and studying leadership skills. It started with my first little league coach, my college coaches, my experience as an athlete and as an NCAA college basketball referee.

Then into the business world, observing some of the best and some of the worst. Reading, studying, and attending workshops have all been a part of my journey on why leadership is stinky and the reverse, why it excels.

1. They aren’t flexible. You can tie this thought to any sport you want. The best teams are lead by people who make the right adjustments at the right time. Leaders are like boxers. They are bobbing and weaving. Far too often leaders get locked into whatever and their whatever drives the team nuts.

2. They don’t pay attention. What a simple concept. Real leaders have their eyes and ears open 24/7. They don’t lock themselves in their office and issue orders. They walk around. They talk. They listen.

3. They think they know it all. Nobody knows it all. You don’t, I don’t. Even CNN & Fox don’t. Leaders know what they don’t know.

4. They want you to rely on them to tell you everything
to do. That’s not what real leaders do. Leaders say, “I trust your good judgment, you decide.” When you stumble, they coach you up, not put you down.

5. They walk like a turtle. Show me a slow walker and I’ll show you, someone, nobody wants to follow. Get some pep in your step and get your butt in gear.

6. They are a stick in the mud. What a miserable life if you can’t laugh at yourself. If you don’t have a sense of humor you need to get a sense of humor.

7. They are arrogant and egotistical. There’s a big difference in being confident and being a jerk. Don’t be a jerk.

8. They aren’t likable. Ties into being a jerk. If you’re not likable the odds of being a great leader are about slim and none.

9. They hide the details. Leaders want to give you more than you need to know. They know that the more you know, the faster you learn. The faster you learn, the faster you buy-in. The faster you buy in, the faster the team grows.

10. They put the wrong people in the wrong seats on the bus. Leaders know that just because you have skill A doesn’t mean it’s a fit for seat B. Getting the right people in the right seats is critical for success.

11. They have lapses in integrity. You either have integrity or you don’t. It’s not a part-time thing to be used when you see fit. Leaders have integrity 24/7/365.

12. They say stupid things. Leaders use common sense before they open their mouths. The problem in today’s world is common sense isn’t so common.

13. They run around like a nut. Leaders know when to be calm and when to get excited. Too much of either makes people suspicious of you.

14. They have boss tattooed on their chest. Leaders aren’t the least bit concerned about tattoos or titles.

15. They say, “Look at me, look what I did.” Leaders say you guys did an awesome job. Way to go. I’m proud of you.

16. They blame others. Leaders say, “I let you down.” I need your help so I can do a better job. Let’s all work harder and smarter to do better.

17. They say do this, do that. Leaders say, “I need your help.”

18. They got promoted over their head. They know it. Everyone knows it. Not their fault. Somebody screwed up. Leaders don’t have to live with it. When all else fails, leaders hit the eject button, reset and move on.

19. They never read the bible. Leaders follow the golden rule. It simple. It’s easy. Preach it. Talk it. Walk it.

20. They don’t do what they say they are going to do. Leaders are true to their word.

21. They lack discipline. Leaders understand the pain of discipline or the pain of regret.

22. They confuse friendship and loyalty. Leaders are loyal, but they are smart enough to know when their loyalty to certain individuals is hurting the team. Leaders make hard decisions. You can be loyal without being stupid. Don’t be stupid.

23. They don’t own a mirror. Leaders find most of the solutions to their problems in the bathroom mirror.

24. They live in the past. Leaders say, just because we’ve always done it that way doesn’t mean we’re going to keep doing it that way.

25. They stop learning and growing. Leaders invest time and money on self and team development.

26. They resist change. Leaders knock down the walls of resistance. They know resistance is enemy #1.

27. They let people be mean to others. Leaders have a motto, “If you aren’t nice to your teammates and our customers you can’t work here.” Another simple concept for you.

28. They micro-manage. Leaders are good checkers, but they give people a job and let them do their job. They coach when necessary and stay out of the way the rest of the time. Leaders don’t “number” people to death.

29. They don’t look like a leader. I understand you want to dress casually. I do too, but I don’t. Ok, I’ll give you one day a week and that’s painful for me to say. The rest of the time you need to set the example and look the part.

30. This one’s for you. You pick. I’m sure you’ve got one that I left out.

I’ve said enough so that’s all I’m gonna say, Tommy Gibbs

(Written week of April 20, 2020, in the middle of coronavirus pandemic.)

I get several calls and/or emails a day asking, “What should I do about my aging inventory now that sales have slowed so badly.”

My first piece of advice is this may not be the time to be thinking about writing your inventory down.

It is certainly a time to think about retailing everything you can at some number.

That said, there may come a point at which you need to write down a selected few units or possibly your entire inventory.

If you’ve been allowing units to exceed 60 days then you may be in big poop and have to bite the big bullet.

The first thing to understand is don’t bother writing your inventory down unless of course, you’re going to commit to some serious changes.

Often when dealers write their used car inventory down, they take a big hit, a deep breath, and say, “OK, done, let’s move forward.”

Many dealers lack the discipline to steer away from what got them there in the first place. Therefore, in six months or so, the owners are staring at the same hot mess they tried to fix and thinking here we go again.

It hurts me to say this, and I know it’s going to cause a few of you to unsubscribe from my newsletters but taking units to the auction and dumping them is just plain dumb.

If you thought enough of that 60-day old unit to bring it into your inventory as a retail piece, you should have been able to find a retail buyer for it at some number. There’s a number that every unit can be retailed at.

Therein lies the problem. You won’t retail it for what it’s actually worth, yet you’re willing to wholesale it for what it’s actually worth.

Of course, your attitude is different right now as a lot of you are being forced to retail units at less than desirable numbers. You would have been better served to have had that sort of mindset before we got to this hot mess of today.

Hey Einstein, which way do you think you have the greatest opportunity to recover from a unit that was probably a bad decision from jump-street? Insanity.

The instances where you have to dump a previously assigned retail piece in the wholesale market should be very few. If you’re in the retail automobile business, then retail your units.

Yes, the grosses on all that aged stuff are going to hurt you for a while. Dumping in the wholesale market will hurt you more. If you have a lick of discipline and stay with it, you will be fine and never, ever have another unit over 60.

My Life-Cycle management process gives you the disciplines and strategies that will keep you from saying, “More write-downs, here we go again.”

If you’re interested I have an easy to use spreadsheet that I’d be happy to send you. It helps you make the adjustments and encourages you to set a new life-cycle on each unit you write-down. Hit the reply button and it will be on its way.

One more thing to keep in mind; 30 days is now the new 60. Be mindful of your 30-day rolling sales numbers vs your current inventory numbers.

This may or may not be the time for write-downs.

If you are going to write down your inventory let me coach you through it. It costs you nothing for me to help you.

That’s all I’m gonna say, Tommy Gibbs

(Written in April 2020 in the middle of the coronavirus pandemic.)

There’s never a perfect time to make changes.

That said, we should certainly do our research, do some strategic planning and pick a time and place that gives us the best chance to succeed.

Many dealers are likely going to be making tough decisions about staff and business strategies in the near term.

One of those most likely to go to the top of the list are pay plans.

Part of that evaluation is to determine if you’re incentivizing the right behaviors that are going motivate the mindset of current and potential team members moving forward.

Dealers have known for years that paying on gross has its issues but evaluating options and making changes often gets put off because of the concern of upsetting the staff and the “timing” is always wrong.

There may never be a better time than right now to make that change.

In the end, a smart Dealer/GM would be wise to seek input from the sales staff and sales management.

Buy-in of the “new plan” has a much better chance of succeeding when the team believes it’s their plan.

Maybe this is also a good time to review:

1. The selling process.

2. Used car aging policy.

3. Recon time to the front line.

4. Website (I dare you. Go look at it. Click around a little.)

5. Ability to sell a vehicle remotely. Do you have a real process in place? (Electronic Signature and delivery procedure.)

6. Staffing. The right people? The wrong people? People doing the wrong things for their skill level? “The right people on the bus, sitting in the right seats, doing the right stuff.”

7. Advertising & Marketing. Are you spending the money in the right places? Better yet, are you holding those places accountable for the numbers they are generating or not?

8. F&I process from the turn-over to F&I to contracts in transit. Is F&I a part of your online selling process?

9. Factory receivables. Are your factory receivables in shape and being followed up on? Are you getting every dime they owe you?

10. Never has there been a better time to evaluate your leadership and communication skills than right now.

Right now, more than ever before in your store’s history, your team needs to see and hear you. It can be a one-on-one session or an all-hands-on-deck meeting. It just needs to be.

There’s no perfect way for you to deliver the message. Just make sure you keep delivering.

People often feel they are left in the dark about what’s going on.

You are the light. Shine your light. You are their light and hope that we will get through this hot mess.

Go shine your light. That’s all I’m gonna say, Tommy Gibbs

When I was a kid growing up in Richmond VA my father had a “dirt lot” used car lot.

My father and some of his fellow used car dealer friends loved to gamble. Back in those days they would rent a hotel room in downtown Richmond and play cards all night long.

Some nights he came home with money. Some nights he came home broke.

My father’s nickname with his peers was “Nervous.” Yep, they called him nervous. He was always worried that the cops were going to raid the joint and take ’em all to jail.

We all inherit traits from our parents. I inherited the “nervous” trait from my father.

Used cars make me nervous. Some used cars make me more nervous than others. This is a time to be more nervous about some than others.

You should be identifying the ones that make you the most nervous and come up with a plan to make them go away.

A few of the ones that make me the most nervous are:

1. High dollar
2. High miles
3. Bad colors
4. Bad equipment
5. Cars we have too much money in from jump street
6. Anything 45 days old and older
7. Auction purchases
8. High cost to market
9. High day’s supply

Gambling made my dad nervous.

Used cars make me nervous.

Gambling on the wrong used cars makes me even more nervous.

What makes you nervous? That’s all I’m gonna ask, Tommy Gibbs

Going back to 2013 (Article) and even further I’ve been trying to tell you that now was the time to take action.

I’ve continuously said you cannot afford to do things when you “have to.”

I’ve said time and again that you need to be leading from the front and not chasing from the rear.

I’ve talked for years of the fact that you don’t need those big fancy showrooms. I realize that can be a tough fight with the factory, but some of you let your ego get in the way with size, cost, and sizzle.

I preached for years that all salespeople need to become Internet salespeople. People want to deal as little as possible with your staff in the showroom.

Even without the coronavirus you’ve seen showroom traffic dwindle year after year.

How many times have I said you have to be set up with electronic signature so you can do as much as possible online?

So here we are; social distancing is the theme of the day and many dealers are scrambling to change up their business models.

Some of you have heeded that advice and are in better shape than others. Even so, you still have work to do.

I hate to be the bearer of bad news, but there’s no going back to “normal.” This may well be the “new normal.”

If you’re not already dialed into the new way of doing business you need to quickly go into a “balls to the walls, take no prisoners” mindset and sense of urgency.

Put as much time and money in as you have to. We’re at that point in time where you don’t have a choice.

Now you have to, which is never the position any of us want to be in. You just have to do it. That’s all I’m gonna say, Tommy Gibbs

We’ve all heard the saying, “When the going gets tough, the tough get going.” Those words were never truer than they are today.

I actually started writing this a few weeks ago, but my spin on the subject is spot on depending on your definition of the word “competition.”

Right now you’re not just competing against other dealers, you’re competing against the media’s spin and unknown factors that are upsetting you, your team, and the market.

We’ve had some good years so it’s easy to feel somewhat satisfied.

You can never be satisfied. Those sounds you hear behind you are the competition coming to gobble you up. If you take just one little break, take your eye off the ball for one second, or have one little hiccup, it could be the very thing that starts a downward spiral.

As Starbucks CEO Howard Schultz reminds us, “Seek to renew yourself, even when you’re hitting home runs.” How appropriate is that in today’s market?

Tough times and competition always make you better. Those competitors running behind you are a good thing. Learn to appreciate your competitors and make it a point to learn from them. Use them to scare you into more heightened motivation and a stronger competitive mind-set.

Successful people often succeed out of fear. The fear of failure. The fear of falling back. The fear of giving up all they have worked so hard for. It’s that fear that causes the successful ones to keep pushing and to keep looking for new and better ways of doing things.

Scott McNealy, CEO of Sun Microsystems, once said, “You either eat someone for lunch, or you can be lunch.”

Competition is the very lifeblood of a driven business leader. Study it. Embrace it. Love it. Use it as success fuel. Use it to take you to the top of your mental game.

Develop an unstoppable competitive mindset, and it will push you so far ahead of the competition that you won’t have to worry about looking over your shoulder.

Competition is an extra spice that keeps life interesting, keeps us on our toes, and stimulates us to greater creativity and productivity.

The best leaders realize that when they are having success it’s easy for the team to become satisfied and complacent and it’s the leader’s job never to let that happen.

A leader’s job is to push the team through the good times to the next level, and the next level, and the next level.

Pushing through the good times was my original thought on this newsletter. Real leadership shows up when times are tough.

Make sure you show up. That’s all I’m gonna say.Tommy Gibbs

I received a call the other day from a dealer raving about how great his used car business is.

Over the years his increase in used car sales has been astonishing. In part, because he became a believer in a lot of my concepts and philosophies; none more important than retailing anything that has a breath of life in it.

I’ve always been a big believer in trying to retail everything that has a breath of life left in it. Certainly, you have state safety laws to abide by and of course, you may have your own standards for safety and reconditioning.

Often dealers conclude that they don’t want to mess with the older used vehicles because they don’t want to damage their reputation. I’ve never understood that part. The customers buying the older, cheaper units are thrilled to have that vehicle. It’s not going to hurt your reputation.

In case you’re sitting on the fence on a “Budget Center,” ask yourself these simple questions.

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. wholesale 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 simply 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 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 another 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 isn’t much of a downside to increasing volume and decreasing investment.

It’s found money, 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 50. 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?

There are two problems going on in today’s market.

1. We 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 ton of gross on them, but they serve a very worthwhile purpose in your business model. There are benefits galore at turning and burning these units.

2. The bigger problem is dealers often think turn and burn on everything, with little or no regard for an attractive market position.

If you have a favorable cost to market and days supply why do you need to blow that unit out so fast? Yes, you’ve made a profit, but you left a bunch on the table.

If you want to improve gross profit, 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

You’re not ready. That’s different than being not prepared. You’re never ready.

But, no one is ever ready for the next step.

You’re not ready for the next promotion.

You’re not ready for your next business venture.

Just because you’re not ready doesn’t mean you don’t prepare.

Not being prepared means you haven’t studied enough. You haven’t read enough.

You haven’t sought the right mentors.

You haven’t listened enough.

You haven’t asked enough of the right questions.

You haven’t explored the Internet enough.

Not being prepared means you just haven’t done enough, Tommy Gibbs

Given the chance, most people I know would jump at the chance to get an open point.

If you have the assets to make it happen, the only drawback for you would be staffing and no units in operation to support your fixed operations.

Even with those obstacles, most people will figure a way to make it happen

This type of opportunity doesn’t come along often so your decision is understandable.

Since the odds are not in your favor of getting an open point, why not invest in your used car operation?

Your new car volume isn’t likely to improve all that much with the numbers nationally hovering around 17 million. Cranking up used cars makes a lot of sense.

Of course, I think you should invest in my training and invest in increasing your enthusiasm and passion for the used car business.

That said, perhaps the best investment for you would be in a standalone recon/service center. Your first reaction is it doesn’t make financial sense. Let’s look a little deeper.

If you have two or more stores or if your stand-alone store is selling 100 plus used a month maybe it’s an investment you need to give serious consideration to.

If your current service department is operating at close to 100% efficiency, you are more than likely losing customer pay because you’re not able to service those customers in a timely manner.

We live in a world of “now.” If you can’t get them in right now, you may very well lose them forever.

With your used cars not clogging up your service operation, you should be able to quickly work your way back to 100% efficiency in the service department.

By having a separate recon car operation you’re going to shave a number of days off the number of days tied up in recon.

Every day you save makes you money. Forget about the savings in holding costs. Your grosses are the best in the first 10 days you sell a car. Faster is better.

With a recon car operation, you’re likely to be more flexible about how you price labor and parts to the used car department.

That’s especially true when it comes to keeping some of the older, cheaper, high mileage stuff, etc.

Retailing a unit vs. wholesaling a unit is always a winning proposition for you.

If you don’t have room to build a building, then look for something you can rent or buy within a 5-mile radius of your store or stores. Yes, you will have to shuffle them back and forth, but you can figure that out.

Some questions you should ask:

How much internal work are you now doing?

What’s the impact of moving that from your service department?

Can your service department make up the difference?

How many additional units will you have to sell for the recon center to more than pay for itself?

By opening a separate recon center what’s the message you are sending your organization?

Now is the time to invest in your used car operation. That’s all I’m gonna say, Tommy Gibbs