We are at the time of the year where we are doing our Christmas cards for our customer base. I think the cards are really important as we need to make sure that our customer base knows we care about them enough to wish them happy holidays. The problem we have is that we have tried various cards/letters not really knowing what is the best route to take to ensure that we get a positive response from our customers.

     To save money we have gone to a bulk card that we are all sending to our customers. While I agree with cutting costs wherever we can, I don't think this is the best place to cut costs. I wonder what the customer is going to think when they open the card. I wonder if they will really feel like we care.  Basically all we are sending is a card that says "Happy Holidays" in a nice font included with a signature from the salesperson and a business card. Some people here at the store think that this card is sufficient and there is no need to do more. I personally think they are just too lazy and don't want to put forth any more effort than they have to!

     Anyway, I think it is important to do more but other people disagree with me. I'm not suggesting we break the bank or anything, but I think it is important to show the customer that you really do care about them and it is totally appropriate to invest a little bit more money to do so. What do you guys think? Is there anything that you have tried that is effective, relatively inexpensive, and still shows the customer that you care?

    The owner of our store has been harping on me and the other sales manager lately about closing rates.  I feel like it is an issue that he constantly brings up and almost seems like we will never be able to get our closing percentages to a level that he is ok with.  We think we do a really good job with the opportunities that we have and I feel like we have a really good sales team. I can't imagine that we are so much lower than what is considered average. But what is average?

     These are our benchmark closing percentages that he wants to see from us.

1. Phone calls: 15%
2. Internet: 12%
3. Walk-ins: 25%
4. Demos: 85%
5. Be-backs: 50%

     We aren't too far from these percentages most of the time but we usually aren't ever there consistently.  I just get sick of the same old conversations with regard to these figures. I wish we could get to those #'s from time to time so we could blame our lower sales on something else. I feel like they are a little bit on the high side, but maybe that is the point.  What do you guys use a benchmark #'s at your dealership? Are we high, low, or right on?

     We have been working on our 2011 forecast numbers for the last 2 weeks. Forecasting for our store usually consists of hours of crunching #'s from the past years, a mandatory Sunday meeting to present research and forecast for next year, and then several meetings after to compile all the #'s together to come up with an overall master plan for the upcoming year.

     While I think that a lot of what we do is important and making goals is very important, I think we put way too much work into forecasting and it seems to be the same thing year after year. Like I said, I am a firm believer about setting goals in order to stay focused every year but I feel like we are putting in a lot of work to set a forecast that is similar to last year plus 10% or so.

     Anyway, this is the only store I have ever worked at so I don't know any different. Is that the norm for most dealers? I'm sure most dealers set goals and strive to improve in any way possible, but how much time and effort is really put into it? What have you guys found to be effective in your goal setting?

     I have never been a huge believer in negative reinforcement. The tough thing as a manager is to figure out what actions to take when you have repeatedly told an employee what to do and he fails to listen.  So what is the best way to handle a guy like that?

     We just had an issue with one of our salespeople last week and it has created enough controversy that I decided to write a post on it.  This guy has a history of being late more often than he should. He has been verbally warned from the owner of the store on several occasions not to miss is morning sales meeting.  We have never threatened anything against him nor have we ever written him up for his actions. He was late to another meeting last week and as a result, the owner decided to penalize him by taking away his largest spiff for the month ( which will end up being $500).  He is obviously really pissed about the situation and feels like he should have been warned about the negative reinforcement first. He also thinks it is a very extreme punishment and something a little more reasonable would have been more appropriate.

     I find that I am torn as to who's side I am on. I completely understand where the owner is coming from in that it is really hard to manage someone that doesn't listen to what you ask of them and are constantly making the same mistakes.  Conversely, having sold before I see where the salesguy is coming from. It was a  pretty drastic punishment and it could have been handled a little bit differently. 

     With all that said, what is the best way to approach a situation like this.  Is negative reinforcement really the answer or is there a more effective way that won't kill the moral of the salesperson?  What has worked for you guys in the past?

     We recently hired 4 salespeople within a week because us managers felt like we were short staffed and didn't have enough coverage on the sales floor.  Like always, the entire sales force complained about how we were flooding the floor and they weren't going to be able to get in front of enough people to make a living. I get where they are coming from having been a sales consultant before.  Nobody welcomes more salespeople and additional competition.

     All this sparked what I thought would be a good topic to throw out there.  What is the proper amount of salespeople with regard to how many cars a dealership sales? 

     I know some people think that the more sales people that you staff, the more cars you will sell. Although there is some truth to that, I think there eventually has to be a cut off.  I don't agree with flooding the floor because I think it will kill moral on the sales floor and will lead to high turnover in the long run.

     On the other hand, you could argue that if you can get a core group of a minimal amount of guys that know what they are doing, then that would work as well.  I think the 2 drawbacks  to that approach are coverage and finding that core group of guys.  I think you would regret this approach when it comes to vacations, days off, and excessively busy days.  Also, it is really hard to staff a team where everyone knows what they are doing.  I also think this approach will promote laziness because the guys wouldn't have to work hard and fight for every deal in order to make a living.

     Anyway, what is the right number? Is there a magic formula based on how many deals your dealership does?  Maybe I shouldn't worry about it and just ignore my sales guys:)

     I had such a good response to my post last week about the relationship between the sales department and the accessories department, I decided to take the conversation a step further and write a post on the relationship between sales and service.

     I received a lot of great comments talking about what an appropriate markup would be on our accessories to make it to where sales had an opportunity to make some gross on the accessories that we included into the deal.  It triggered the question: " What is an appropriate rate that the service department should charge the sales department with regard to reconditioning used cars"?  I am the used car manager at our store, so this is a topic that is pretty close to home and is also something that I have spent lots of time discussing with the GM.

     The thing that has always pissed me off about our reconditioning process is that the used car department pays the same $90 per hour for labor that any shmuck that walks in the front door would pay.  I don't know if that is the norm at most dealers, but I'm not a huge fan of paying that much (especially since I am by far their best customer).  The reason I hate it so much is because I get paid off the gross of each deal and every extra dollar that I give to the service department is a dollar that I don't get paid on. My argument to the GM is that he is making the profit either way, regardless of the labor rate that I pay to the service department.

     I'm thinking there has to be a better way to do this to where it is a win-win for sales and for service. What do you guys think?

     Hopefully I’m not alone on this one, but I have gotten to the point where I basically hate our accessories department.  I consider our accessories department a necessary evil at our dealership because I know we can’t do without it and I know we can’t get rid of it due to the fact they generate extra profit for the dealership.  With all that said, I would still love to get rid of it!

     Let me explain the reason for my hatred.  As a sales manager, I get paid on the front and back end profit of each deal. I don’t get paid a dime on what the accessories department does. My main complaint is our accessories manager gets a chance to sell his crap before the customer gets into the finance office and sometimes the accessories that are included into the financing make it to where our finance managers can’t be as profitable as we need them to be. I find that I am purposely sabotaging the accessories manager’s opportunity to sell product by lying to him and telling him the deal is maxed out. I do that so our finance department has more than enough room to sell their back end products and still have a buyable deal with the banks.  My other complaints are I don’t really like the guy too much and he is constantly pissing off our customers and tanking my salesguys’ surveys.

     Anyway, the point of all this is that I think there has to be a better way to set this up to where I don’t hate the accessories department.  I get the argument that he needs to talk to the customer before they go into the finance office so the accessories can be put into the financing but that is the part that bugs me the most.  Maybe the solution is to make it where salespeople and sales managers get paid extra on deals where accessories are sold. Or maybe there is an alternate way to get the accessories financed. Who knows! Any ideas you guys have would be great because I’m sure that they are better than the current process that we have!

     I run a used car department at a new Ford franchise. We have been doing really well lately, which I'm sure is the case for most dealerships. We have actually been really, really consistent this year and have basically sold 75 used cars every month (+/- 2 cars).

We for sure aren't complaining about the numbers we have been putting up lately, but I think it is always important to take a step back and analyze things even during the better times.  Because of the fact that we have leveled out at 75 units, we are trying to find a way to take this thing to the next level.  We aren't trying to get greedy or anything, we are just trying to explore other options to help us bump 10 or so units per month.

     With that said, I feel like we have tried just about everything to help us get that extra bump. We have tried screwing with our car/truck mix and putting more cars out there than we normally do ( all that did for us was cause an aging problem!).  We have tried the whole set and subset method and buying things in large bulk and selection.  We have tried the price band method by just focusing on cheaper inventory.  We are next to a Chevy and Dodge store and we tried buying some of their  more desirable cars and give them away.  We have tried bumping our display up by 15-20 cars. We have messed around with different ways to advertise. And finally, we are currently trying some high roller cars that we have never tried in the past due to our demographics. 

    Anyway, we like to think we are pretty good at what we do but we can't seem to take this thing to the next level.  I'm beginning  to think we have reached are store's capacity but I am still optimistic that we can grow a little bit more.  Any ideas?  Have any of you guys tried something that I didn't mention? Or maybe an secrets as to what I may be doing wrong?

    So I am pretty new at this whole management thing and am struggling with one of our new sales guys. He does so many things right and so many things wrong that I don't even know where to start. I'll do a quick list of his pros and cons so you guys can see what I am dealing with!

     Pros: 1-  He sells a lot of cars and will probably lead the board almost every month this year.  2-  He is a very likeable guy about 60% of the time.

     Cons:  1- He is very argumentative with managers when he doesn't get his way 2- He is confrontational with sales guys and has earned a pretty bad rep with most of them 3- He refuses to do any Ford certification testing that we require 4- He forgets things almost as quick as you tell them to him 5- He magically disappears any time that there is any lot work to be done ( lining cars, parking PDI's, locking up, etc) 6- He misses morning training meetings fairly regularly, he isn't very punctual, and he leaves for 1-2 hours randomly during his shift.

     Anyway, there are so many things that I don't like about the guy due to the fact that I try to run a pretty tight ship but he also is a likeable, funny guy who can outsell anyone else on the floor.  My predicament is deciding what to do with a guy like him. Anytime I try to tell him what to do he gets mad and defensive and doesn't really care what I have to say for the most part.  I don't want to be too rude to him in fear that he will blow up and quit and I don't want to lose a 15 car guy. With that said, he needs to be held to the same standard as the rest of the sales guys and I know it is my job to make sure that happens.  I need to figure out a way to get him to be more of a team player in a way where I don't piss him off. Any suggestions?

     I wanted to throw out a post about hiring new sales consultants. We have had some great posts and comments about training new sales consultants but in order to train a new sales consultant you have to hire some first!

     I don't know what everyone else has been running into, but I have seen so many different kinds of people from so many different walks of life due to the fact that a lot have people have lost their jobs lately.  The problem I am having with that is having to decide what type of previous experience would translate over to selling cars.  The other problem is deciding whether or not these prospective employees will be in it for the long haul if I hire them and give them an opportunity. 

     My goal (like most other dealerhips) when I am hiring someone is to find a guy that will blend well with the team and hopefully find a guy that we can train and will eventually make a career out of selling cars.  I realize that the car business generally has a pretty high turnover but I try to limit that by hiring guys that are serious about making this a career.  I just feel like if I were to hire some of the ex realtors, developers, construction workers, and sales people from other industries they won't consider this their profession and it really is just going to be a temporary solution to their problem.  I could be wrong, but it seems to me that as soon as the market recovers in their respective industries and they have an opportunity to go back, they will.  Another problem is that a lot of these guys were making really good money back in the day and are in the position where they need to continue to make quite a bit of money.

      I don't know if there are different questions I could be asking during the interview process but I find that it is really hard to determine what intentions a guy has with regard to making this a career.  I have also been really up front with guys with regard to a realistic income that they can expect their first year and I may be shooting myself in the foot.  I just want to hire and train a guy under the pretense that he will make over $100k his first year. It's definitely tough to decide.  Any thoughts or suggestions on what has worked for you guys?