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Todd Smith

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Is Your Dealership’s Technology Stack Hurting Your Sales and Destroying Your Profits?

This question was posed by a great dealer friend of mine, Todd Caputo from Sun Chevrolet the other day. Are dealers spending so much money and time on technology, implementation and the management of all these tools that it is distracting them from the fundamentals of the business of selling cars at a profit and managing the customer relationship.

With industry-wide disconnect and fragmented technology providers, dealers are forced to use many systems that all cost money, have over lapping functionality and don’t communicate very effectively. This nightmare scenario wastes countless hours and delivers a poor return on time investment. All while technology vendors create confusing metrics to protect their business at the cost of dealership efficiency.

Let’s focus on one part of this discussion today. The human capital part. This is an often-overlooked part of our business as we are usually just focused on our typical KPIs:

    *Leads converted to appointments.

  •     *Appointments to showroom visits.

    *Showroom visits to test drives.

  •     *Test drives to write ups.

    *Write ups to sold units.

Let’s think different and ask some fun questions. How are your people using their time? Maybe you have ten salespeople and two managers… a total of twelve people in your variable sales department. This translates to a 40-hour work week per employee which would give you a total of 480-unit hours of work time for the week. How are these hours allocated? Does each team member have a plan for time utilization?

    *We can dive into so many areas here:

    *Product education training

    *Sales process training

    *CRM updating and maintenance

    *Lead follow up

    *Vehicle Demonstrations and delivery

When we can create activity work buckets, we can see much more clearly how our people are using their time. Don’t be surprised if you find a ton of wasted time. I do this experiment for myself every few months to get a reality check on my time and effort and where it is being directed. I write down everything have done for the week in fifteen-minute block increments like an attorney does for billable time management. It is an eye-opening exercise to see how much time is being wasted doing nonproductive things that aren’t align to with business goals.

What I am getting at here is that your “People Capital” is crucial to your success, but sometimes we are so focused on the technology that we miss the hidden cause of missing our goals, which are lack of effective time management for ourselves and our team.

You may discover that your current technology is a huge time suck because it is creating inefficient processes that are eating up your most valuable currency. You may also discover that it takes five clicks to do a task when it should only take one or two, yet this task needs to be done 100 times per day.

Opportunity is all around in order to figure out how to leverage your technology in a way that maximizes your return-on-time. One this is for certain, all of us only have 24 hours per day and that is the one currency that nobody can get back, slow down or alter.

Here are two different ways you can apply this at your dealership to better understand how time is being utilized (or underutilized) at your dealership.

  • Observation- Observation requires sitting and watching your team at work and really understanding what they are doing at a granular level. This means down to the amount of clicks it takes to accomplish repetitive tasks. An example of this could be observing that your CRM requires three clicks to find a customer profile. After that, the salesperson has to reach over and dial the phone number on the desktop phone then has to click into a notes field to update the customer record followed by clicking two more times to create the next task.
  • Self-Observation- Empower your team to write down and track exactly what they are doing down to the most mundane detail of their processes. This may take a little explanation to sink in to for them and I have found you will need to explain it multiple times to your team until they start giving you the feedback that you need. This can be highly effective and a fast method towards finding some real time sucking activities and inefficiencies in your processes that are costing you money and results.

This is just the tip of the iceberg of what you can accomplish when you start to understand the precious asset of time and its impact on your dealership’s success. “Return-on-Time” should become a staple of what you are tracking which will maximize your team’s performance on the variable side of your dealership.

The funny thing is that we have been tracking this stuff forever in fixed operations with our understanding of job labor hours, shop-load time etc. Now is a great time to start applying it to the variable side of the business.

I would love your comments and thoughts and thanks for taking the time to read and share this article.

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