10 Tips-Others Want to See You Fail

1. EMBRACE ANXIETY– It’s motivation to take action.

2. GET AFTER IT-Focus your energy on making positive change. Crank up the intensity and aggravate the competition!

3. PUT FEAR IN PERSPECTIVE-What’s the worst that can happen?

4. BE READY-Preparation breeds Confidence.

5. DON’T DWELL-Forget minor setbacks; learn and move on. (Don’t let the setback become the standard!)

6. HEALTHY DISCONTENT-for people or things blocking your progress. (Continue to surround yourself with losers and you will continue to lose.)

7. INSPIRATIONALLY DISSATISFIED-with yourself…YOU have to step it up! (YOU must set the example!)

8. DAILY DOSE-of paranoia…fix yourself… (We’re back to you again. You must set the example!)

9. CONTINUE-to look for answers. (Continuous Improvement-You never get it right!)

10. NEVER– ever give up. Other people want to see you fail! Don’t let others control your thinking!

That’s all I’m gonna say. Tommy Gibbs

Do You Need a Used Car Manager?

Where can I find a good used car manager? I get 15 to 20 emails a month asking me that question.

Often, when speaking to a 20 group or at a convention, someone will approach me and ask me if I know anyone they can hire for the used car manager’s position.

Very seldom do I have a name. Think about it. For the most part, if someone’s really good at what they do, they are smart enough to stay put.

Whoever they are working for is smart enough to treat them well so they do stay put.
99.9% of the time when someone leaves an organization all the inventory problems come to the surface upon their exit.

My advice is always the same; you need to find someone within your organization, someone who knows your culture and who you can develop for an even greater position.

That’s what leaders do. They grow their team. They don’t run out and hire other people’s problems.

I often say if I were in your shoes, I’d find someone internally with a strong work ethic, who is open-minded, technologically savvy, has some common sense, and I’d coach them to greatness.

For at least 6 months I (meaning the dealer or GM) would hold their hand. They would be my assistant. We’d be like Siamese twins and we would do everything together. He/she would follow me around like a puppy dog.

Here’s how it would work:

I do it and they are with me. (The best part about this is you’re going to find out where all the obstacles and landmines are located.

Because you have the power, you will fix a lot of issues that have been holding your used car operation back.)

Eventually, I’d hand it off to them and they would do it and I’d be with them. I’d watch. I’d critique.

At some point, they would do it. They don’t need me except on issues outside of the scope of their authority.

And then, here’s the biggie, (this is how you grow) they do it, and someone is with them.

This is how you compound and grow your organization. Just like compounding interest.

Until you take this approach, your ability to grow will always be limited. To do anything else, you’re just plugging holes with a temporary worn out cork.

That’s all I’m gonna say, Tommy Gibbs

Someone Needs To Hear From You

This business is never easy. One of the most interesting things about it is you don’t get to enjoy the wins for very long.

If you’re like me, you love the challenges it brings to the table each and every day. I always look forward to getting up in the morning and “getting after it.”

The number one thing I miss about being a car dealer is connecting with the team members and the energy I get from them each day. That’s really hard for many of you to do right now.

Since I’ve been in the speaking, training and coaching business I primarily work alone. It can be challenging at times since I only have myself to rely on.

Your situation right now is different, yet similar. I like the mindset of “staying after myself.”

You’re now being challenged to stay after yourself. It’s easy to feel despair and quit. I don’t mean that you’ve actually quit, except maybe inside your head.

Even under normal circumstances, it doesn’t matter if you
work alone or work with 500 people, you still have to “stay after yourself.” It’s something you can actually get better at.

“Staying after yourself” requires planning and discipline.

Some key elements to “staying after yourself” include reading, writing, listening, doing research and finding positive things on YouTube to view and share with your team.

Those things open your mind and help you see what the possibilities might be.

I’ve become a firm believer that writing is a bigger component to success than one might think.

I don’t mean that you have to be an award winning author; writing your thoughts down each day helps to open your brain up to where you’ve been and where you can go.

Writing helps you “stay after yourself.” It will help you self-evaluate your actions, your behavior and how well you are accomplishing those “continuous goals” you should be writing down. You have to constantly evaluate, tweak and adjust your goals so you are always moving forward.

A big part of staying after yourself is to “stay after others.”

The more you encourage others, the more you are encouraging yourself. There is nothing you can do that is more important than helping others along the way.

You text or private message others, but can you imagine the impact you can have right now with a simple phone call? You have a powerful voice. Now is the time to use it.

The person on the other end needs that call. You may need it even more.

Since you can make a difference, go make a difference.

That’s all I’m gonna say.Tommy Gibbs

Recon Mess

There’s a lot of discussions these days about the number of days it’s reasonable to hold a used unit before retailing it.

In the past, 60 days was the timeline most successful dealers worked with. Dale Pollak wrote recently about the new normal being 30 days.

Every piece of data I’ve looked at over the past 17 years validates that Dale is spot on.

If nothing else, dealers have come to understand the necessity of the Velocity concept and turning inventory. Of course, today dealers are working a tick harder to ensure they make the most money possible on units that they have a favorable cost to market and day’s supply in their favor.

That being said, any way you want to slice and dice it, speed to the front-line has never been more important than it is today.

If you’re not using a recon tool to track and zero in on where you’re not efficient and where you need to make some improvements, then it’s doubtful you will ever get close to the new normal of 30 days and gone. 30 days and gone doesn’t mean dumping units in the wholesale market. It means finding a retail buyer within that 30-day time frame.

There’s an underlying problem when it comes to 30, 60 or whatever. It’s the failure of upper management to communicate to service management the importance of the relationship and impact the entire recon operation has on the success of the used car department.

The reality is that lack of understanding also impacts the new car department. The used car department will miss trades and lose new car deals when they have a lack of confidence in the support of service management.

Issues will come and go in your recon operation. Lifts break down, technician shortages, a slug of used cars hit the ground, and an overload of retail customers are things that are going to occur.

The strategy of upper management should be to keep everyone informed and educated about what’s going on and what the expectations happen to be.

Everything that happens in your dealership, good and bad, is a result of great leadership.

Great leadership understands the need for speed, daily communication and keeping the team on the same page.

Great leadership doesn’t just talk the talk.

Great leadership walks the walk.

Be Great. Start walking or in the case of recon, you need to start running. That’s all I’m gonna say, Tommy Gibbs

What’s Next?

It’s Thanksgiving and time to give thanks. If you’re like me, for sure you have a lot to be thankful for. Among many things I’m thankful for are your friendship and support.

Thanksgiving also starts the closeout of the year. It centers around Black Friday and rolls through the last week of the year. Like it or not, 2020 is already here.

I’ve listed some very basic ideas you need to take into consideration that will help you finish strong and get ready for your best year ever.

A. Re-commit yourself- and your thinking towards being the very best you can be. Take stock of all those great ideas running around in your head. Write them down and make a commitment to get them done by certain dates. Post it on the wall in several places that you will see frequently. If you have a private restroom, put it on the mirror.

The dealers and GMs with the most successful used car operations are those who have taken ownership of the used car department. The more involved you get, the more success your dealership will have. If you’re not committed to the used car business, it’s a safe bet your team isn’t either.

B. Re-evaluate-the appearance of your inventory. Let’s do a little checklist:

1. Look at your inventory online. Are they all there? Actual photos & prices posted?
2. Take a lot walk. Are the vehicles in straight lines?
3. When was the last time the entire lot was rotated?
4. Are you using angles to display your inventory?
5. Do you have hang tags? If so, do they all have hang tags?
6. Are they nasty, dirty on the outside?

C. Refocus Your Disciplines-To be successful in the used car business you have to have daily/weekly/monthly disciplines that you live and breathe by.

One of those disciplines might be to do a weekly lot walk. Every car in your inventory must be touched. If it’s in service, touch it. If it’s in prep, touch it. If it’s in the budget center, touch it. Everybody touches it. Even if you think you have your disciplines well defined inside your head, you’d be well served to make a written list and check them off from time to time.

D. Re-Recon-Take every unit over 30 days old back
through a recon process. (You’ve already missed your best window of opportunity to make gross; that would be the first 20 days.)

E. Re-Invest-in yourself and your management team. Do something to gain some knowledge. Hire me, visit CarMax, or visit a dealer friend in another state that does a good job in used. Attend a workshop. Join a Twenty Group. Join a Used Car Twenty Group. Do something besides sitting there and waiting for something to happen.

F. Re-think- your management team. Do you have the right person running your used car operation? Yes, that person may have been with you for years. Loyalty sometimes equals mediocrity. Maybe they have some great skills, but the fact is that you may not be making the best use of their talents.

I’m thankful for lots of things this holiday season and I’m especially thankful that you’ve taken the time to read my little Zingers. That’s all I’m gonna say, Tommy Gibbs

What Does a Bear Do In The Woods?

Eats corn.

My business partner for most of my adult life has been Ashton Lewis, Sr. an amazing human and Automobile Dealer in the Hampton Roads area of VA.

Ashton grew up in both the automobile and farming business. One of Ashton’s farms was located adjacent to the Great Dismal Swamp in Chesapeake, VA where corn was a primary crop.

As Ashton tells the story, he would observe a bear come out of the woods, pick an armful of corn to take back into the woods to eat or share with his friends and family.

The bear would sometimes drop an ear of corn and rather than continue into the woods, the bear would put down the armful of corn and then re-gather them all up just to save one ear of corn.

That’s what it’s like when you keep hanging onto that aged unit that you’re never going to make any money on. You spend too much time trying to make money on an aged unit and not enough time figuring out how to make money on the fresher pieces.

Your window of opportunity to make money on a used car is about 40 days or less and that’s a stretch.

Had you been smart enough to identify units that have little or no profit potential on day 1 then you wouldn’t be looking at a stone-cold loser on day 61.

The Bear-Drops ear of corn. Throws down all the others. Wastes time and energy re-gathering the ears of corn.

You-Do not identify problematic units on day 1. You waste time and money struggling with aged units on day 61. Grosses go south because you’re selling too many units late in the life-cycle. You never reach your full potential because you’re thinking like a bear.

Had the bear paid closer attention to how many ears of corn he/she could actually carry then the bear would not have wasted time and energy dealing with one stupid ear of corn.

Had you paid closer attention to what you were dealing with on day 1 you wouldn’t be beating your head against the wall trying to figure out what to do with an aged unit on day 61.

My life-cycle management process makes you a much smarter bear. That’s all I’m gonna say, Tommy Gibbs

Was March Great?

A lot of dealers had a record-breaking month in March. Some of them have already spent too much time gawking at their financial statements, poking their chest out and patting themselves on the back. And guess what? For some of them April is off to a slow start.

Let me caution you; you cannot be 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, one little hiccup, it could be the very thing that puts you into a downward spiral.

People are successful for a variety of reasons, one of them being “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.” No truer statement has ever been made.

Being a hard-charging competitor can be craziness at its best. Competing is fun. Trying to get better is the lifeblood of competing, leading and winning.

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.

What you have to realize is that most people are just lazy and because they are lazy they can become complacent very easily. Ultimately their lazy streak will show its head; that’s when you can “own” them.

There are times when you can have a good month in spite of yourself because the market lets you win.

No easy wins this month. Time to go to work. That’s all I’m gonna say, Tommy Gibbs

Are You Striking Out and Don’t Know It?

I would venture to guess that 80% of the dealers in the country have units over 60 days old in their used car inventory. I’m being generous. It’s probably more like 90%.

How can that be? With every piece of data known to mankind showing convincing evidence that it doesn’t work, dealers just ignore the obvious.

I’d like to think I’m a great salesman. Most great salesmen are easily sold. I wanna be sold. I’m begging to be sold. I’m begging you to sell me.

So come on, sell me on why it’s ok for you to keep used car inventory past 60 days. Heck, even past 45 isn’t working out so well for you.

Recently, I’ve had a few dealers tell me inventory is so hard to find that they are keeping cars longer.

How does that help your inventory problem? Come on, sell me.

Does keeping a car longer ever make you “more gross?” Come on, sell me.

If you finally retail a unit at 90 plus days at X price, couldn’t you have sold it for the same price back when it was 45 days old? Go ahead and sell me that you couldn’t. I’m waiting.

Do you make a greater ROI when you sell a car at 90 days vs. 30 days? Come on, sell me.

Do you make more gross at 90 than you do on day 30? Come on, sell me.

When you keep a car longer, do you make more money on it than if you sold it sooner? Come on, sell me.

You can’t get the units through reconditioning fast enough, so you want to keep them longer? Come on, sell me. Say hello to my Recon Tool.

You can’t find inventory, so you want to hold them longer? Come on, sell me.

The big volume players such as CarMax, Texas Direct and Carvana have to buy most of their inventory. You can’t find cars, so that’s a valid excuse for keeping them longer? Come on, sell me.

Do you really think holding cars longer is the answer? Come on, sell me.

You trying to justify keeping vehicles past 60 days and making money is like me trying to hit a 95 MPH fastball. Ain’t gonna happen.

I’ve never had a dealer who was committed to a short turn say they regretted the strategy.

I’ve had lots of dealers regret keeping cars past 60 days. Come on, sell me.

I like being sold. Come on, sell me. I’m waiting. I’m still waiting to be sold. That’s all I’m gonna say, Tommy Gibbs

When Does the Clock Start?

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.

But Tommy, it’s been in the body shop for 20 days? Nope, no, no, no. The clock is ticking. Your money is tied up from day one. You’re working with a depreciating asset. If you try to think any other way, you are lying to yourself. Don’t lie to yourself.

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 is better. You might even want to consider paying the trucker a bonus for fast delivery. Our software helps you keep track of days in transit.

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?

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. Fix your service and recon issues. I know it sounds likeI’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.” My UpYourGross software comes with a free “Recon Tool.”

8. 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.

9. 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.

10. Consider hiring a “Chaser.” A chaser is just that. It’s someone who chases your units through the system to ensure nothing sits any longer than absolutely necessary.

Pop Quiz:

When does the clock start? When you own it.

What can you do to improve the clocking ticking? Re-read 1 thru 10.

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

Improving Gross Profit Part 3

1. Think in terms of improving gross in small increments. Try paying the managers a bonus for achieving nominal increases each month. Start by improving gross by $50 a unit. Do that over the next year and you will see a slow and effective way to increase your gross. You can only eat the elephant one bite at a time.

2. How could I talk about your grosses without mentioning “Life Cycle Management?” Life Cycle Management is designed to help you create a sense of urgency on those cars that are most likely to kill your grosses. The faster they go away the better your gross will become. My UpYourGross software tool puts you on the path to better grosses and more efficiency.

3. Track GAP and ROI. When you do, grosses go up. How much are you giving up once the customer shows up at your store with a price from the Internet? If you don’t know then you can’t fix it. (GAP-Give-Away-Profit)

4. Improve your look to book. You make the most money on units you trade. You will trade for more if you get serious about improving look to book. Review every appraisal from the previous day in your “save-a-deal” meeting every morning. Someone in management should be responsible for calling every customer that had a trade and up the ante.

5. Shoot the moon on the right stuff. Since the beginning of the car business, higher grosses are driven by some home run cars. You have to understand which ones are home runs, singles, doubles, and triples.

6. Try some old-school. If you’re not a true one-price dealer serve up an under-allowance on every trade. It should be part of your discipline each time you appraise a unit.

7. If you’re still struggling with gross maybe it’s time to let me train your entire management team? My message is powerful and long-lasting.

Fix what you can fix. That’s all I’m gonna say, Tommy Gibbs