One of the things I like most about the DSES conference is that it ‘recharges’ my batteries after spending three jam-packed days full of actionable takeaways! However, it is important to note that while it is great to re-charge your batteries by attending conferences, it is just as important to take the time during the year to implement the new ideas. One of the most significant issues we face on the dealer level is actually following through with the newly developed ideas.

Think about it, we go to the conference and have every intention of following through with the new ideas. Everything from BDC Training, Marketing, Social Media, etc. to then go back to the dealership and not taking the time to follow through with the new ideas. That said, here are some of the things to consider when making changes within your dealership remembering that change takes time!

You Cannot Change Anything By Simply Thinking About It! Where to Start? Less is More. Do Not Overwhelm Yourself With too Many Ideas.

As mentioned above making a change on the dealer level takes time, energy, and most importantly action! New ideas on how to approach your BDC can be both exciting and inspiring, but the harsh reality for many of us is that none of the ideas come to fruition. To make the changes happen, we have to take the time out of our busy schedules and realize that we are not alone in wanting to make a difference.

One of the hardest things to deal with when wanting to make a change is prioritizing which changes need to happen first. That alone can make the whole process overwhelming, and cause for you to shut down with your eyes glazed over. To avoid this approach, it is best to jot down all of the ideas you have and review how each idea affects the dealership. Understanding that any and all changes can affect the dealership. In doing so, it will make approaching the transition easier. And as mentioned above, there are others in the dealership that you might be able to work with that can make it a little less daunting to make a move forward with a new idea. I know first hand what it is like presenting an idea where everyone is excited, but no one was willing to lend a hand. It is overwhelming.

Here is an easy but effective way to manage a new idea:

Project: Outline the details of the project and what the positive impacts are - don’t be afraid to show examples of the project.

Employee Involvement: Outline the managers who are going to be involved in the project. Keeping in mind that you can sometimes use the BDC Agents or Sales Consultants to assist you! Especially if the project involves social media.

Timeline: Review the scope of the project and all of what is involved. Set a realistic expectation as to when the project will be completed. Knowing that while we want the immediate gratification for our efforts exhibited that change takes time. This can be an issue on the dealer level though when results are often expected immediately.

Task Assignment: More often than not if those working with you on the project do not have clear responsibilities than it might lead to confusion as to who is handling what on the project. This is a recipe for disaster, and to avoid this issue, it is best if each person who is working on the project has a clear understanding of what their respective role is! The less confusion, the better.

Lastly, but most importantly it is best to have a review of the project - i.e., what is working, what needs to be adjusted or changed. Perhaps the responsibilities need to be shifted. Whatever the case may be it is imperative that you address any issues immediately; otherwise all of your hard work and efforts might fall by the wayside, which can be very frustrating!

Bottom Line: Change is inevitable, and the easier we make it for us to adapt to change by being proactive versus reactive the better the results will be for the dealership. As working in a reactive setting does not afford the opportunity to grow or develop. Those who want to better themselves will not last in an environment in which they feel they are stagnant. And this is not to say that all ideas are going to work or be developed, but it is offering that it is important to encourage change.

How do you handle new ideas suggestions? What is one change that has had a positive impact on the dealership?

Designing a pay plan focused primarily on commission on the dealer level is not uncommon; in fact, the entire premise of the pay plan is “the more appointments you book that show and sell the more you will make,” which can be true depending on the pay plan. However, if the pay plan is just focused on commission, it can quickly become a group of individuals working separately. And because there is not a team effort when it comes to managing customers, there are often gaping holes in your follow-up. Just check one of your BDC Agents work-flows at random, and you will find several uncompleted tasks.

To avoid the risk of losing sales due to a lack of team effort, there are other components to consider when approaching the pay plan:

Hourly Rate vs. Salary?

It is quite common for your BDC Agent to be an hourly employee, which can be quite costly. A prime of example of this is overtime. Take a look at their hours; are they clocking out for lunch? If not that can add as much as five hours per week in unintended over-time, which depending on your state is time and a half for their pay. You take one to two BDC Agents doing that, and now you are paying ten hours a week, and forty hours a month! If you salaried your BDC Agent, you would potentially save thousands of dollars in overtime. However, when it comes to determining their salaried rate, it is best to review the going rate in your area. So while it might sound harsh - business is business, and in many cases, the overtime that is worked was highly unproductive.

Only Paid if the Appointment is Sold?

There are two sides to this scenario, and both are worth addressing; one of biggest reasons dealers do not pay based on whether the appointment sold or not is the age-old argument of “they do not have control on whether or not the customer sells,” which is true. The primary purpose of the BDC Agent is to book an appointment getting the customer into the dealership. Now that said, the reason why dealers have moved towards the plan that only pays if the customer sells is due to the issue of “the BDC agents do not bring in quality appointments. They will try and qualify the customer more if they know they only get paid if the appointment sells.”

Two things, if your BDC Agent is bringing in a customer with a recent repossession or if the customer wants a $350 payment on a $45k vehicle with zero money down - then yes, that is not best practice. However, your BDC Agents have far more significant issues if that is what they are doing. The second issue with that pay plan is the fact that if the BDC Agent is being paid only if the unit sells then they might be too involved in the deal. For example, instead of the BDC Agent moving onto to the next phone call, email or text they are steadily focused and involved with the desking manager and sales consultant handling the deal. That distraction can cause for ill productivity; as much as a half an hour can be lost as their focus has shifted.  This is not to say that your team does not need to have a commission-based plan, but this does offer that there are perhaps better ways to pay your BDC Agents. One of the ways of doing so is by paying if the appointment were to show, and then pay a volume bonus. If they hit “x” amount of shown appointments, they get a tiered bonus.

Bottom Line: your hourly rate could be costing you thousands of dollars in unintended overtime. It is best that you take some time - as you are planning for 2019 - and review the amount of overtime year over the year looking to see if your appointments increased. Chances are it is minimal, and if it is minimal than you know, it has costed your dealer money decreasing an already thinning bottom line. The other thing you ought to consider too is reviewing the cost of the BDC. Wherein, once you look at the payout of their commission, plus the salaried rate (or hourly), less their “sold” units, you can look at their actual cost and what their ROI is for the dealership.

How do you pay your BDC? Do you have an hourly rate or salary? For those with a salaried rate have you noticed any changes in their performance?

It is easy to look at a few reports and come to a conclusion that your sales managers are just not cutting it. That is everything from their closing rate, sold rate, front-end gross, to their overall performance on hitting the OEM objective for the month. However, there is much more to what makes a sales manager successful than of what meets the eye; in many cases, the GM can prevent his or her sales managers from doing their jobs. Noting that within the last few years the role of the sales manager has arguably changed. That said, here are some of the top reasons your sales managers are not working out and how to address the evolving position. 

What Is the Sales Manager Responsible for on the Dealer Level? Are We Really a Team or is it About Which Manager Adds More Profit to the Bottom Line? 

One of the most significant sources of dissension on the dealer level derives from their individual performance. Wherein, the GM might note that sales manager “A” desked more deals than sales manager “B,” but sales manager “B” headed up training and onboarding; meanwhile, the GM accused that sales manager “C” must not be doing anything! The idea that he is glued to his sales tower. When in all reality, sales manager “C” is responsible for OEM Reporting, Payroll, and purchasing inventory. Therefore, even though the sales manager “A” had more desked deals s/he did not assist with any other managerial duties. 

The above scenario is more common than you would think which in many cases causes many controversies. Wherein, the GM will not take the time to note that each manager is playing an integral role in ensuring the dealership's success, and instead of taking the time to review each of their positions they expect both “B” & “C” to desk more deals. With the idea that it will increase sales. That is not the case, however, as the sales start to decrease because you have now lessened the training, RDR’s become an issue with incentives that were not applied for, payroll becomes an issue, and the inventory is not managed. All of which causes for a vicious cycle of burn-and-turn. Where the GM inevitably burns and turns his management. 

The way a dealer approaches management cannot remain the same narrow-minded perspective. Instead, the dealer has to think of the bigger picture; that is business development, which is not limited to having a BDC staff that makes phone calls and sets appointments. Instead, the dealership needs to work with their sales managers regarding what business development means on the dealer level. Everything from phone calls, manifest lists, equity customers and CRM management to name a few. But this cannot happen if the GM does not afford his sales managers the opportunity to approach those topics. And while the GM might offer “I never said they could not do those things,” it is also known that their pay plans are solely focused on units sold, which makes sense. However, to increase the number of sold units and increase the Gross Per Copy, there has to be both business development and training! 

The GM has to be cognizant that each sales manager plays an integral role in the dealers overall success. And managing them off of “one point,” without managing “how” they both approach and execute the sales is a costly mistake which causes for turn over and lost profits. The bottom line is that no longer can the sales manager role be limited and defined by a few reports. A Sales Manager has to understand business development, and the GM has to support that role. If not, it will be that much harder to both maintain 

Before you can cast blame on the sales manager for their performance, it is essential to understand what they are responsible for when it comes to the dealership's success. Each store you visit, however, have different expectations, which makes it that much harder to draw a fine line in the sand mapping out their respective duties. Not to mention, because sales managers have different responsibilities it makes it harder to hold each one accountable. To avoid this approach, it is best for each manager to have their own set of responsibilities allowing each manager to do their job. 

How do you measure your sales managers success? 

In a perfect world on the dealer level, each customer that visits the dealership would be logged into the CRM. However, we know that this is not the case,  and there are certain instances in which the managers and sales consultants deliberately do not log the customer into the showroom. As for why they choose not to log the customer in the showroom could be for a myriad of reasons. Everything to their excuse of “they were just looking” - “bad credit” - “wanted to pay $9,750 for a $12,000 car” to name a few. That said, here are some of the top things to consider when keeping tracking of your dealerships daily showroom log in the CRM.

Not Every Customer is Logged Into the Showroom. Where is the Sales Manager? The Customer is Not Just Visiting the Dealership for the Sake of it.

It is common practice on the dealer level to have the manager “TO” (turn over) the customer before they leave the store; in many cases, it is mandatory for the manager to do so. However, we all know that not all managers will turn over the customer or in some cases the dealerships do not log the customer in the CRM at all. This is a problem. A problem that has to be looked into. Otherwise, you are letting what could be a sale walk right out the door. This is especially true for those sales consultants who are new to the industry.

For example, a new sales consultant speaking with their sales manager might say:

Sales Consultant:  “The customer said they were just looking, and then left”

Sales Manager:  “Did you get their contact information?”

Sales Consultant:  “No, they did not want to provide that.”

Sales Manager:  “Okay, don’t add them to the CRM”

If you think that does not happen, think again. It happens far more than you would want to admit. When is the last time you noticed a sales consultant not logging a customer into the CRM? What if anything did you do about it? This issue can be avoided for the most part if there is a strong manager presence on the floor along with proper, quality training. That is the sales consultant being comfortable with gathering the information needed to assist the customer. Knowing that the better their needs analysis is, the better chance they have of closing the sale! However, that cannot happen if the customer leaves the dealership, and we do not have their contact information.

If Your Managers Allow this and Participate the More Important Question is WHY?

I once worked with a sales manager who was always so proud of his closing rates on the desklog. But no sooner than he’d spit out his numbers, he admitted he did not log in the two customers from yesterday. As for why he did not log them into the system the excuses were (as mentioned above) “they were just looking. They came in thirty minutes before close.” - “they have no credit and cannot purchase” - this could very well be the case. But regardless of why it is they are visiting there is no excuse not to log them into the CRM. This scenario is like the BDC Manager saying “well we cannot get ahold of John Doe. So we are not going to count that against our closing rate,” which means the closing rate magically increased by 2-3% - it does not add up, no? This all can be avoided however if the culture shifts. That is understanding that not all customers will purchase a vehicle. In fact, dealers usually close only half of the customers they work with, which could be even lower if they logged all of their customers in the CRM!

This is also  a multifaceted issue. Wherein, sure your sales consultant can easily add both a first and last name into the CRM. But if they fail to get their phone number or email the customer profile is useless. The first step is your sales manager spending time with the sales consultant inquiring into why they did not gather the information? The more practice your sales consultant has in gathering the information, the stronger their sales will be! The second thing to review is your policy with your management team. Making sure that your managers are not playing games with the numbers by not logging them into the CRM. Lastly, if you are paying a bonus for the managers on their closing rate percentage - this too could cause for them to “forget” to log that customer into the CRM. Where it completely takes away the purpose of the competition in the first place.

Bottom Line: Logging your customers into the CRM is crucial. The dealer has spent thousands of dollars to inquire the customer. And while you will not sell every customer that walks through the door, you will have enough data to review possible break-points. Is it their demo? Is it the way they present numbers? Is it their sale process? to name a few examples. By being more involved and making sure the customer is loaded into the CRM you will see an increase in sales.

What policy or training do you have in place to make sure this does not occur? Is this an issue you face on the dealer level?

With Fixed-Op’s carrying the weight financially for dealers it is essential that your service advisors upsell product in the service lane. That is everything from additional services to selling accessories such as windshield wipers, and cabin filters. However, this does not seem to be the case where many service advisors have become order takers versus taking the time to both understand the customer's needs and suggest additional services; knowing that our customers are not going to ask to purchase other services. That said, here are the top reasons your upselling is not effective and how to change your tactics! 

Appointments With Pre-Selected Services. Customers can easily go online and schedule their appointment for a specific service.  

Appointments can assist us on the dealer level when it comes to being able to plan accordingly. That is ensuring that we have enough advisors to handle the traffic. As well as taking the time to make sure that your advisors are not overbooked, which can cause significant delays;  meaning the oil change that was supposed to be 45 minutes turns into a 2-hour ordeal, which can affect the customer's experience. Not to mention, an upset customer is less likely to agree to additional services. That and providing a rental to every customer - especially for a customer who is only getting an oil change - is not always cost effective. So how do we handle this issue? 

A busy shop can be a great thing! However, as mentioned above, if the appointments are not orchestrated it can become a disaster. To avoid this issue, and make sure your team is upselling your customer it is best to call the appointment beforehand. In doing so, your advisor can build rapport (especially for repeat customers), and upsell before their arrival. For example, if the customer has serviced with you previously, you can quickly look up their history; reviewing their profile to see if they have declined services in the past.  Looking to see what their objections were, which will allow you to serve the customer better. This way upon their arrival they are on the same page regarding what to expect. Moreover, if there were to be changes or additional items needed they might be more obliged to agree and have the work performed. However, none of this can happen if we do not take the time to call the customer before their arrival. 

Coupons Do Not Always Work. Offer Services that Compliment their Needs. 

There are those who tout a coupons success, but in the automotive industry, coupons do not always work, and dealers do not always have to drop the price on a service to get traffic. If you were to review oil change coupons - reading the fine print - many of the retailers who do oil changes can be more expensive. Not to mention, they rarely have OEM certified technicians. Another issue with many of today's coupons is that it pushes the customer into the service on the coupon. Wherein, if the customer were to use the coupon for the said service that is all that is on their mind and of course, the service is at a discounted rate. So if they were to be then offered a service at full retail, they are much less likely to want the additional add-ons. Think about it for a moment, you go into a store with a 20% off coupon for “one item,” and the cashier offers you an “add-on,” but for full retail - don’t you pass it up? The same is said for the customer standing in the service lane. That said, it is more important for the dealer to have a strong online presence and offer their services and amenities as opposed to merely providing a coupon. 
 
What if the Customer Says No? How to Overcome the Objection. 

The customer saying “no” is the most common objection and in many cases, the dealer will follow-up with an email to the customer with a coupon for their declined service. However, before it gets to this step, it is best to figure out and address why the customer said no in the first place. For example, if one of the declined services was for tires, the customer could easily think that the place down the street is the way to go, not even thinking about the fact that your dealer sells tires. That said, you can offer the customer a price match guarantee. Not to mention, we know that today's buyer is all about time. So if we can save them time and assist them, it is a win-win situation. However, this cannot happen if we do not ask. 

The other thing to note with regards to declined services is that if we keep sending the same message with the same coupons, then we cannot expect anything to change. Instead, we have to take a step back and look to see if the declined service is typical - a trend at the dealer in which case more training is needed - or if it is a one-off situation. In either case, it is best to build a rapport with the customer understanding his/her needs so you can better assist the customer. Knowing that people buy from people, and this cannot happen if we take “no” for an answer without having taken the time to build the much-needed rapport with the customer. 

 Bottom Line: The customer is not always going to agree to your recommendation, but if you can offer them a sensible solution then the customer will be more obliged to accept. Think about this for a moment; if the customer comes into the dealership for their oil change and in the back of their mind knows they need to stop at the local store to pick up windshield wipers because they believe the dealer is more expensive, then they will not even ask you for them. So if you were to offer the customer that their windshield wipers need to be replaced, and you have them as low as “x” then you could be saving them time. The customer will undoubtedly be appreciative that you have saved them time. Something that they were not expecting. So don’t be afraid to ask. 

Do you start the upsell process before your customer arrives? If so, have you found success with it? 

There is not a lot of flexibility when it comes to customizing a work-flow in many of today’s CRM’s. Where in many cases the standard work-flow is both a phone call and email, and while both are very important - so is texting. In fact, texting could arguably be more important - in some cases - than the standard dealer email that does not always answer the customer's questions. That said, here are the top things to consider when implementing a work-flow and the shortcomings we face on the dealer level.

If the Customer Does Not Provide a Phone Number the CRM Still Says to Make a Phone Call.

This is one of the most common issues with the CRM’s in today’s market. Wherein, even though the customer does not provide a phone number the work-flow still offers that the BDC Agent or Sales Consultant needs to make a phone call. This also then means that in the CRM’s reporting it will offer that the BDC Agent or Sales Consultant has not completed their workflow tasks. And if your pay plan for the BDC Agent is tied to the completion of their tasks it makes it that much more difficult to manage. As the BDC Manager will have to manually delete the overdue tasks and or change them to another type.

Where is Texting? Many of today's CRM Work-flows do not include texting as a part of the work-flow.

One of the biggest pet peeves with a lot of today’s CRM’s is that they do not include texting as a part of the work-flow. Yet as we know, texting the customer is becoming more and more relevant as it is a very effective means of communicating with our customers. That said it is important for the CRM providers to ensure it becomes apart of the work-flow. Otherwise (as mentioned above) if your BDC Agent’s pay plan is tied to the completion of their tasks their focus will be misplaced. As they are making unnecessary calls and emails.

A Rigid Work-Flow. Two Phone Calls on the First Day. Emails and More!

There is such a thing as over communicating with the customer. This is especially true if you are calling the customer two to three times, emailing and texting them. All without receiving a response, unless that is of course to unsubscribe or they have opted out of texting. And make no mistake, this is not to offer that we should not try to get in touch with the customer a few times on the first day. What it does offer, though is that we need to make sure the content we are offering makes sense. If the customer is not responding to your phone calls and or replying to the emails you sent then it is best to review the content. It could be something as simple as your subject line, or that the email went to their spam folder. Either way, before completing that additonal email task is best to look at your overall open and response rate. This will help you get in front of more customers!

Bottom Line: Instead of worrying about the completion of a task for the sake of it make sure the content is relevant. Knowing that not all leads are the same and or require the same level of contact. In fact, in many cases, the customer might add in their initial reply email what times work best for them for you to call. So if you ignore this - to complete a task - then you could potentially run the risk of losing this customer. In doing so, you will see an increase in the overall response rate, which will translate into more sales.

How Do You Handle Your Store’s Work-Flow? Do You Find That it Limits your BDC Agents Productivity? Do You Tie Your BDC Agents Pay Plan to their Work-Flow Task Completion Rate?

One of the things I enjoy most when traveling abroad in Europe - Greece, Italy & France -  is taking a closer look at their automotive trends. That is understanding how dealers operate in Europe. Namely, what are some of the biggest differences on the dealer level? Here are some of the key differences and a few are worth taking a second look at!

Store Fronts Without Dealer Lots. Limited Inventory. The Interior is More of a Meeting Place than a Traditional Showroom.

One of the biggest differences between the US and Europe are the physical dealership location themselves. Where for us, it is about maximizing the real estate we have. Making sure we have the right vehicles parked out front with sale prices. This is not the case for many of the dealerships in Europe. In Paris for example, the dealers are mostly in the city center. The entrances are grand with floor to ceiling windows that showcase a few select vehicles. The OEM logo is a prominent feature on the exterior, but blends in with the overall building. As for the interior, there are only a few vehicles parked in the dealer showroom. In fact, it is not really a showroom, but rather a meeting room to speak with new buyers. This is a far cry from the dealership setup we are accustomed to with showrooms being a focal point of the dealership.

Test Drives? Demos are not as Prevalent as they are with us. The Customer Buys the Vehicle Sometimes Without Test Driving it!

I was able to speak with a dealer and I was told that in many cases the customer will purchase their vehicle and have it delivered to them either at the dealership or at home. But in many cases, all of the decision making is done at the store and it is a very straightforward process. I have always believed that a test drive is a key aspect of making a deal happen. Where if the customer is not happy with the vehicle than all bets are usually off when it comes to selling the vehicle. Would you purchase a vehicle without test driving it?

Key Takeaway?

The biggest takeaway was the fact that from the two dealerships I visited they were very focused on customer service. As for inventory, there were very few cars on the showroom floor. If the customer wanted to review another model it was done so by going online. The sales consultant would then review and explain the features at the desk. And while that is not the case for all European dealerships, it is quite different than of what we are accustomed too. Lastly, when I mentioned the word BDC I got a confused look. BDC centers are also not common. Bottom line, I always encourage you - when traveling abroad - to take a minute and tour a dealership. It is always fascinating to see what the major differences are in how we operate on the dealer level.

What is one of the biggest differences you have noticed when traveling abroad?

There is always hype in retail when it comes to the holidays. That is our mindset as an industry - the idea that our customers are eager, ready to shop for that fantastic deal. And while several studies suggest the holiday weekend can be quite successful, it is essential to keep in mind that your dealer sets realistic goals for a holiday. To do so, it is best to follow the following guidelines!

What did you do last year? Are sales generally up year over year?

One of the things we need to do more - on the dealer level - is to look at year over year reporting. Looking to see what the sales trends are making sure that the reporting you are reviewing is accurate. One of the best ways to get accurate reporting is to use your OEM’s online sales data. Using the sold data with your OEM will ensure it was an actualized deal. As for the pre-owned sales, you can easily review your DMS system, and pull your sold data.

The purpose of reviewing your year over year sales is to set a realistic sales goal. Wherein, if you want to increase your sales by ten or so percent (which sounds excellent), then you need to plan accordingly. Namely, perhaps there is one brand model that you are lacking in sales. Those units might also be aged. That said, you can look and see if there are any additional OEM programs to help absorb the discount. If there are programs available, then it’s the perfect opportunity to offload that inventory. 

For you to sell that inventory, however, it’s more than just setting the price. You will also need to make sure you have the right marketing in place to support the campaign. One of the most effective means of campaigning your inventory is to do so via social media. As the cost to run the campaign is still relatively low. You will also want to put together an email blast. One that is directly marketed to the customer. Such as a customer who has not yet otherwise purchased, but expressed interest in the vehicle. That very list, though, should be different than of the email list of customers who expressed interest but did not respond back to the dealership. In doing so, you will have a highly organized call list.

Holiday Hours. How Late to Stay Open?

Every dealer has their own standards as to what the hours are for the holidays. The best way to approach this scenario is to - as mentioned above - review your year over year sales. If you have low sales numbers and did not spend additional money to “market” holiday offers then you can expect for your sales to be light. If that’s the case, it is also best to not have a full staff at the dealership. As fully staffing your dealer - on a slow day - for a holiday can actually wind up costing the dealership money! This is especially true for those who are hourly and (depending on the state) require time and a half.

Bottom Line: this is not to say that your dealer should be closed for the holiday. But what this is offering is that if you are choosing to be open, there are best practices to follow to ensure that your dealer will have a successful sales day. That is making sure to review reporting, strategize an effective marketing campaign, and make sure that you are not overstaffing your dealership.  The last thing you ought to check - and make sure is accurate - is your stores hours! You would be surprised to see how many dealers forego updating their hours - leaving their customers unsure as to whether or not your open.

Is Labor Day a successful sales holiday for you? Do you also keep service open?

A solid second chance finance program on the dealer level can be quite profitable. But in many cases, the program falls apart in which case the dealer shies away from starting the program again or at all. Having gone great lengths initially to get the program up and running. That is purchasing the right inventory, hiring a finance manager who understands second chance finance, to then all of the branding and marketing that is involved. That said, why do these programs fail? And if they do fail, why give up? Yes the dealer makes profit, but this program does also assist the customer who otherwise would not be able to purchase a vehicle and or they are having to purchase from a buy here pay here which - as we know - does not always report to the credit beaurus in which case it does not assist with their credit. That said, here are to the top things to consider when wanting to run a second chance finance program. 

It’s All About the Processes. You Have to Have the Right People in Place. 

As mentioned above a successful program means having the right people in place to ensure that the program is running smoothly. One of the best ways to approach the hiring of your second chance finance program is to first understand what the demand is at your dealership. Wherein, you might not have to hire additional staff to handle the traffic. If you do not need additonal staff, make sure that the sales consultants you have selected understand the program. Knowing what steps they have to complete when handling a second chance finance customer. Offering that you expect the same level of customer service to be offered. However, the way you offer the customer service has to be in alignment with the customer and dealership. By providing the right level of customer service can make for a great experience. One that your customer will remember! 

Have the Right Inventory. Explain to the Customer How the Process Works. 

We have most likely been in a situation where your customer calls in - with credit issues - wanting the brand new model that has all of the options. If we could offer them the vehicle of their dreams, we would do so, no? But this is not always the case. As we know, the banks usually have a loan to value ratio limits. As well as finance limits. In so far as the lender might only finance 85% or so of the loan. That having been said, there is a best practice when it comes to approaching the customer with this information. Namely, we do not want to just offer “that will not work,” and instead offer “Mr. Customer, I can certainly understand. At this time, based on your credit history, the lenders will offer (insert options), and in time perhaps you could transition into your (vehicle).” This is not to say it will always work, but in most cases, the customer will see that you are trying to work with them. 

Regarding the inventory goes it is best that your purchasing manager buys inventory that is approachable for the customer you are seeking. Wherein, if your purchasing manager is purchasing inventory in a steep price range 35k+, then it might be a bit difficult to make that vehicle work. The other thing to consider to depending on your lender's requirements is both the age and mileage of the unit. The lender will sometimes have restrictions. As for the customer, it is best to make sure you clearly state what the next steps are online. Offering how the customer can expect to navigate through the car buying process. That is everything from completing the credit application to working with you to select the right vehicle that meets their needs. In doing so, it will offer for a very smooth buying experience! 

Bottom Line: A credit acceptance program can be very lucrative. However, for it to work processes have to be in place on the dealer level to ensure that everything runs smoothly. One of the most important factors is having the right inventory. By having the right inventory in place - along with the staff to work with your customers - you will have a much better chance of everything working. Lastly, make sure that you have a clear outline as to what your customer can expect when purchasing a vehicle with you! 

Do You Have a Second Chance Finance Program? Have you had success with your program? 

Leadership development is not limited to your sales managers on the dealer level. Your HR department can have a profound impact on your entire organization as they, in theory, are assisting your owner in defining the vision for your company. And in doing so, they are to facilitate an environment in which you are able to perform as a leader. But this is not always the case as the HR department can actually cause damage to the organization. 

Here are the top ways your HR department can affect your Dealer’s Leadership. 

HR Is Not on the Same Page With Your Sales Managers. They Are Playing Sides With Upper Management. 

Albeit, it is not easy to manage an organization or the way in which your employees communicate on the dealer level. However, one of the most significant issues a dealer faces is the degree of “playing sides,” that occurs on a daily basis. In which case, the HR director will often speak with the GM or Owner agreeing with their thoughts on what is occurring on the dealer level. That is everything from the manager's performance to how the employees view them as a manager. What the HR director often neglects to mention - when speaking with the GM or Owner - is the “managers” side of the story. Wherein, because they agree with the owner - despite having agreed with the sales manager regarding the issue a few moments ago - they offer a new story that can and will impact your career. A Manager cannot lead a staff if their GM or Owner does not believe in their capabilities. This also destroys any trust that was built with HR. Wherein, if you - as a manager - went to HR to discuss infrastructural issues thinking it was a confidential conversation - to then find out it was not only discussed with upper management but now HR was no longer on your side. This is not your HR director being a leader. This is a lousy HR Director. 

Bad Performance Reviews. Putting Words Into Your GM’s Mouth. The Aftermath You Did Not Anticipate. 

One of the worst things your HR department can do is put words into the GM’s mouth for an employee review. This can cause for bad morale and issues on the dealer level. For example, if the HR director has a problem with a said employee, and they “feed” into a misconception with the GM or Owner - not only does this reflect poorly on your HR department, but it can also cause for mistrust with your employee as they feel sandblasted for something that is not even related to them. 

The other issue with this is that it is very easy for the employee to decipher - within the context of the review - if it was from your GM or HR director. And if your manager is able to see that the criticism came from someone that does not manage them and or is not aware of their work it can create mistrust. Where your sales manager loses their trust and respect for the HR director as they have - in essence - stabbed them in the back. Don’t be this HR director. This is not how you build a department or assist in the overall management of your companies morale. 

100% Turnover. Same Management. Where is the Insight? Where is HR Director? You Can Only Point the Finger So Many Times Before Pointing it Back at Yourself. 

While your sales managers have a direct impact on their team regarding turnover - the same is said for your HR department. Wherein, your HR department needs to be an integral part of the on boarding program. That is ensuring that the new hire has a space to set up. I cannot tell you how many times I have witnessed a sales consultant starting, but they do not have a computer, desk, or any of their logins. And instead of calmly explaining that we will get them their information, the Management staff would run around frantically - looking horribly disorganized - which put a very bad taste in the new hires first day. That said, it is best to avoid this approach and make sure that your staff has the right logins they need. The other thing to note - beyond the onboarding - is asking yourself, why there is so much turn-over? Is it the manager? Is it HR? Is it the GM? Turnover of any kind is not good, but when your turnover reaches nearly 100%, there is a much larger issue at hand. That is what is HR doing - on the dealer level - to both work with and develop the sales managers. If HR is working directly with the sales managers than the turnover ought not to be at levels, we deal with. 

Bottom Line: HR is just as responsible for curating the companies morale and ensuring that the owner’s vision is translated on the dealer level. This cannot happen, however, if the owner does not have a vision and or the HR director is unable to connect the dealers. Working towards developing the leaders on the dealer level providing them the necessary resources. And no longer can HR simply offer that it is not up to them to work with the managers on Pay Plans or Job Descriptions. And while this is not to say that it is HR’s direct responsibility, they have to be able to facilitate an environment in which case the sales managers are allowed both approach and work on said projects. All of which will have a positive impact on the dealer level. 

Do You Have an HR Department? If so, what challenges do you face?