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 say. 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 2017. 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.

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 is an absolute 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 achieve 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

One of my favorite subjects is talking to management teams about not missing trades. I know this is hard for you to believe but without exception I’m always told, “We never miss trades.” Makes you go hmmm, doesn’t it?

Here’s another way to think about it. Have you ever made a deal because you put more money in a car than your competitor? I’m thinking the answer is yes. Therefore, your competitor missed a trade. I’m also thinking your competitor would say they never missed a trade.

I do believe most of my readers are smart enough to realize that yes, we all miss trades once in a while. Someone’s making those deals. And yes, they may have very well buried themselves in those units we “missed,” but they got to make a deal and we didn’t.

A common term in today’s business is “look to book.” If you’re not familiar with the term, it simply means; how many units did we appraise and how many did we get. If you appraised 100 units this month and you traded for 25, then your look to book is 25%.

I’m often asked, “What should my look to book be?” Most people would say your look to should be 50 to 60%.

Tommy says you should know every day what your look to book happens to be and think in terms of pressing the number up. The more you can press your look to book up, the less of a need you will have to go out and purchase units.

If you’re going to bury yourself in a unit, you are far better off to bury yourself in a trade.

If you raise your “look to book,” you’ll miss a lot fewer trades. Trading for more cars means you’re selling more cars. That’s all I’m gonna say. Tommy Gibbs

This is a scary time of the year. Ghosts, goblins and creepy things are everywhere.

Lots of things scare me. Here are a few:

It scares me when a dealer hires a buyer. It’s always done with good intentions, but more often than not it doesn’t have a happy ending. The buyer I’m talking about is the one the dealer is putting on the road to go off to wonderland to buy cars. Months down the road the dealer is stuck with a lot of aged units and wonders what happened?

It scares me when a dealer makes a wholesale profit. There are rare sets of circumstances when it can be done. Maybe the dealer cut his/her teeth in the wholesale business or maybe they run an in-house auction for the junker units. But other than that, there aren’t many legitimate reasons for making a wholesale profit.

It scares me when a dealer tells me, “We never miss a trade.” I understand the intent. It’s the right thinking no doubt, but never think for a minute that you don’t miss trades. Everybody misses trades. I’m thinking if you’re making that wholesale profit you might be missing more trades than you think.

It scares me when a dealer hires a new used car manager and turns ’em loose. They come on board with great stories of how much they have accomplished at their previous stores. (Notice, stores is plural.) So, the dealer says, “Go get ’em.” What should happen is the dealer or GM becomes Siamese twins with the new used car manager for the next 90 days. Every minute that the dealer can spare should be spent with this used car manager listening, teaching, learning, coaching and sorting out fact from fiction.

It scares me when a dealer doesn’t know what their oldest used car in stock is. Better yet, the used car manager doesn’t know. To add insult to injury, no one knows where it’s parked. These are your sickest children. How can you not know?

It scares me when a dealer tells me they get units through service and recon in 3 days. There are some that do. Most don’t and most don’t really know. The best and worst answer is the same. “I don’t know.”

It scares me when a dealer has a belief that it’s ok to keep used vehicles for 75 or 90 days. I might understand it if we were living in the 1970s. Back then maybe we just didn’t know any better. How can you not know better in today’s information society? How can you not understand the fact that you don’t make money when vehicles sit that long? How can you not know you’re working with a depreciating asset?

It scares me when a dealer isn’t tracking GAP, ROI and 30/30. You can’t fix what you don’t know.

I’m not easy to spook, but a lot of things scare me and they should scare you too. That’s all I’m gonna say. Tommy Gibbs

By and large most dealers and managers have come to understand it’s not the big that will eat the small but the fast that will eat the slow. We all know the faster we can get a car on the lot and online the more we increase our odds of making a respectable profit.

If you are committed to 60 days or less (which you should be) then any days in the cycle in which the unit is not available for sale is a killer.

The question often comes up, “When does the clock start ticking?” Does it start with the acquisition, the day you own it, or does it start when the car goes on the lot/online?

Let me make this as clear as I possibly can. It starts the moment you own it. Period. No exceptions, no ifs, ands, or buts.

The two issues that often come up are the delay in getting vehicles from auction sites and those units we can’t sell for legal reasons such as we don’t have the title as required by law in some states.

10 Things To Help You Win The Clock Ticking Game:

1. If you are in a state where there are title issues there has to be a clear line of communication with the office on a minute by minute basis to alert you when the title arrives. Any breakdown in communication is costing you money. Staying after these title issues cannot be left up to chance. Somebody has to take ownership of chasing after the titles.

2. It’s a fact that you are having to go further out of your area to buy cars at auctions, but you have to be selective and know what the timeline is that you are dealing with. Anything you can do to reduce transportation days, the better. You might even want to consider paying the trucker a bonus for fast delivery.

3. How hard are you trying to buy cars in your own market? Do you have a procedure set up so that when someone comes in and wants to sell you a car that you give them the full routine with a written appraisal? Does your website have a self-appraisal link so the customer can get real numbers from you quickly.

4. Mine your customer base. For sure, you know which cars you always do well with. Often they are right under your nose hiding within your CRM. Vin Solutions has some great tools for finding those vehicles and giving you a chance to buy the car, trade the car or ultimately sell the owner a new car.

5. How about a unique and separate website that drives the customer to your website to sell you their car? I saw this one in the Tampa market a few months ago: “SellYourCarToUs.Com.” It belongs to a very nice used car operation over in Orlando, FL. It’s imperative that when they land on your site that there be an easy, one click button to get them to a self-appraisal. Check it out. You will be impressed.

6. If you’re in a market with CarMax consider promoting that if the customer brings their CarMax appraisal to you within 7 days of the appraisal, that you will give them more for their car than CarMax or give them $100 cash if you can’t beat CarMax’s offer. What do you have to lose? Suppose you buy 10 extra cars this month and also pay out $1000 in loser fees. Do ‘da math, what did you make on the 10 extra cars?

7. Increase your odds of success and efficiency when buying online by using Stockwave. This may well be one of the biggest game changers in the history of the car business. Take a look at this short video. CLICK HERE

8. Fix your service and recon issues. I know it sounds like I’m picking on service a lot and that’s not my intent. I just know in most dealerships it’s the same old, same old. How many total days are being wasted from the time the car is acquired until the time it gets on the lot and online? In today’s age of speed you have to find every day that you can if you’re gonna win the “meter game.”

9. Make sure you include in your “save-a-deal” meeting every morning a list of all vehicles that are either in transit or tied up due to title issues. The more you pick up the intensity on these units the faster things will happen.

10. Pick up the intensity level. Not just you, but the entire team has to understand that any day that a vehicle is not on the lot/online it’s costing the dealership big money.

Pop Quiz:

When does the clock start? When you own it.
What can you do to improve it? Re-read 1 thru 10.

Control what you can control. That’s all I’m gonna say, Tommy Gibbs

Dealers all over the country have a big push on buying cars from the public.

Many are spending thousands of dollars on advertising, marketing and software in an effort to find more and better cars at their front door.

Some have even hired an “Equity Specialist” who has a full time presence in the service department and customer lounge in order to solicit customers with an offer of, “Would you like us to appraise your car for you?”

Some dealers have even started an “exchange program” offering the customer a new or newer car for the same payment that they currently have.

It’s all a waste of time. Yes, it’s a waste of time if you haven’t put meaningful processes in place that are customer friendly and effective for you and your team.

Seven Mistakes:

Mistake #1: The tendency when someone says, “Yes I’d like my car appraised,” is to drop them off at the used car manager’s desk and leave. The person making contact with the customer needs to remain the contact. Though somewhat modified, there needs to be a “full routine” presentation by the contact person to each and every customer that says yes.

Mistake #2: Most dealerships only want to buy what they know they can retail. If the program is going to be effective you have to be willing to buy anything from a stone piece of junk to a very expensive luxury car. CarMax has built the reputation that they will buy anything. Bring it to us and get a number. That should be your mantra.

Mistake #3: You try to steal it. What are you thinking? Get real. Get the unit. You will pay far more for it at the auction than you will at your own front door. Step up. Don’t be stupid. You need to own that unit.

Mistake #4: Giving verbal or handwritten appraisal quotes. Whatever you hand the customer needs to be computer generated in the most professional manner possible. The quote should be good for a minimum of 7 days.

Mistake #5: Not paying the sales person or contact person based on the acquisition. If you want staff members to give the “full routine” then you need to pay them just as if they sold a car. The full routine might actually inspire the seller to buy a car from you today or months down the road. Think about how much more efficient and cost effective it is when you can buy a car at the front door. The savings on the auction fees and transportation cost alone make it more than worthwhile for you to pay a reasonable commission.

Mistake #6: Someone hands the customer the appraisal and says, “Just let us know what you want to do.” The manager and the contact person need to do a complete review/presentation of the appraisal, answer questions and ask for the business.

Mistake #7: No one follows up with the customer. There should be a system in place to follow up within 24 hours, 1 week, etc. even if it means upping the ante $500 or so to acquire the car. There’s an old and very useful saying in the car business, “Follow them till they buy or die.” That saying applies to you buying their car as well.

Eliminate these 7 mistakes and you won’t be wasting your time, energy and money. That’s all I’m gonna say, Tommy Gibbs

The summer is over. It has been a pretty good year for most of you. It’s easy to become complacent when times are good.

Dealers make the most money when they are coming off tough times. When things are tough, dealers get back to the basics and grinding it out. As business gets better they are in a great position to make a lot of money because they have cut out all the fat.

But as business gets better, dealers tend to get lax with spending, processes and their daily disciplines.

Ask these questions of yourself:

1. Have you dissected every expense on the expense page?
2. Do you have too many people in the wrong places and not enough in the right places?
3. Is your selling system the selling system you think you have?
4. Are you evaluating every trade that you don’t make?
5. Are you holding a daily “save-a-deal meeting?”
6. Are you doing a trade walk?
7. Are you utilizing my “life cycle management process?”
8. Are you evaluating all the wholesale pieces to see if they have life in them?
9. Do you have a photo booth and is your website the best it can be?
10. Have you shopped your own dealership? Have you shopped CarMax?
11. Do you hold your staff accountable?
12. Can you shorten your selling process?
13. Are you using vAuto to buy and price your units correctly?
14. Does your current inventory level match your seasonal selling rate?
15. Are you still doing business the same way you did 10 years ago?
16. What’s the turnaround time for a used car from the time you own it until the time it’s ready for the line?
17. Are you leading the way or are you talking the way?
18. Are you mining your customer base for nice used cars?
19. Are you relying on packs to save your gross profit?
20. Are your pay plans old, outdated and not in tune with today’s market?
21. Is your volume and gross going up or down?
22. How many turns a year are you getting with your used inventory?
23. Are you tracking ROI/GAP?
24. Are you forecasting or “hopecasting?”
25. When was the last time you let Tommy Gibbs coach you?

These are great questions you should be asking yourself. That’s all I’m gonna say, Tommy Gibbs

I’m sure you do. And, I’m sure if one of your children was sick you would keep a close eye on that child until they recovered
from their sickness.

I’m appalled at how many used car managers don’t actually know where their sickest children (oldest old used cars) are.

Often when I’m reviewing inventory with a used car manager I’ll ask them to tell me about certain cars in their inventory.

On some of the cars I’ll ask them, “Where is it?” They will say, “It’s in the inventory.”

No,” I’ll say, “Where is it? Where is it parked?” Typical comments are, “I’m not sure”, “I think it’s out back”, “I think it’s in the service department”, “I think it’s in clean up”, “I think someone is driving it”, “I think it’s sold.”

You’re not being paid to think. You’re being paid to know. The great used car managers know where every car is at every moment of its life with their store.

The great used car managers know where all their children are, especially their sickest ones, regardless if they have a 40 car inventory or a 400 car inventory.

They just know. You wanna know why they know?

They know because they care. They know because they are great parents. They know because the more they know about where their children are, the more they can protect them.

They can protect them from the evils of the world such as becoming aged, poor ROI, and slow turn. Show some love. That’s all I’m gonna say, Tommy Gibbs

I often hear dealers complain about the quality of the people coming into the business. They complain that it’s hard to find people willing to work and who want to make some real money.

Could it be that dealers are trying to hire the same type of person they were trying to hire 20 years ago?

I’m betting that many of you have experienced sales people selling less than 8 units a month. How can someone come to work every day, and only sell 8 cars a month? You have to ask yourself, how is that possible? Are you making excuses for their lack of performance? Have you accepted mediocrity?

There’s a difference between showing up for work and actually coming to work.

The best way for you to start to raise the bar is to raise your standards for the type of people you hire and the type of processes you demand that your organization embraces.

Raising the bar is exhausting. Raising the bar means being committed to the hiring and training of a different type of sales person.

Raising the bar goes against the grain. Raising the bar requires one to be a student of the game and have the willingness to change the game knowing there will be serious opposition from the masses. Raising the bar means developing new and innovative pay plans. Raising the bar means changing the selling system to fit today’s buyer. Raising the bar means having the courage to throw “Legacy Thinking” out the window.

Changing the game means changing the rules. Changing the rules means holding more people accountable for raising the bar. The bar does not get raised and left in that position. The bar has to be raised every day if you are going to continue to play the game and be successful.

Realize that raising the bar even just a little bit gives you an edge. It’s easy to do because so many of your competitors are locked into lowering the bar and accepting the business as it is, not as it could be.

To raise the bar:

Do It With Enthusiasm
Have No Fear
Change The Expectations
Don’t Make Exceptions
Create Accountability
Defeat Legacy Thinking

So, the choices are easy, you can continue to lower the bar, you can raise the bar or you can head to the bar. That’s all I’m gonna say, Tommy Gibbs

I’ve come to realize that one of the greatest frustrations of dealers, general managers and sales management in general is average gross profit. The focus on average gross profit has its moments when it drives the management team nuts. I would suggest in some cases it caused the team to lose focus on what’s most important.

I’m not denying that we need to have a focus on average gross and I’m not denying that for a lot of dealers there’s room for improvement.

Having said that, I do believe many of you would be better served focusing on total gross and removing (Try it for the next 90 days) average gross from your vocabulary.

More often than not there’s an expectation of total gross for the used car department. The real goal should be how fast we can hit that number and beyond. The goal should be to pile up as much gross as you possibly can, as fast as you can.

Never forget you cannot spend average gross profit. You can spend total gross profit. That’s all I’m gonna say, Tommy Gibbs

Yep there is. And, you know who he/she happens to be. But, you keep them around because they are productive. Nobody wants to work with them. If anything people avoid working with them. Sales people don’t want to work with them. The office staff avoids them and the service department cringes when they show up.

But, you let them hang around. They have some skills you’ve found useful over the years. Skills that are no longer serving the team and the organization well today in today’s market.

You won’t get rid of them because you feel a sense of loyalty for all they’ve done for you over the years. You’re loyal to them. They aren’t loyal to you or they would have sense enough to know that their bullying creates a divide for the team.

The longer you let the bully stay in the room, the uglier the room will become. The uglier the room becomes, the more people will leave the room. The more people leave the room, the harder it is for you to build a winning team. The harder it is to build a winning team, the more your culture will erode.

Enjoy your bully in the room. That’s all I’m gonna say,Tommy Gibbs