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Rick's Daily Blog

2/8/2014

Hitting New Ground

New opportunities provides new ways to increase market share. 

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10:35 am          Comments

2/2/2014

China's Guangzhou plans to assemble cars in Russia

It appears one of my former clients, China's GAC Motor Co will be assembling vehicles in what is being consider emerging markets. GAC Motor Co is a division of Guangzhou Automobile Group who in turn has a partnership with Honda and Toyota. 

GAIG owns the production platforms that turn out the Chinese version of Honda's and Toyota's models sold in China. 

It was not that long ago GAC Motors got started, If I remember correctly it was around 2008. Now they plan to expand into Eastern Europe, South America, and the Middle East. 

If you like to read more about this, just click on the picture below. The link will take you an article in the Automotive News China. 

 

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11:17 pm          Comments

1/31/2014

What is your new approach to compliance?

Below is a good read on what industry insiders are saying about the current regulatory environment and how compliance must be something ever single individual employeed by you understands.

For years we have been talking about compliance and it is no longer something that the back office handles. With our transactions becoming more transparent, the days of the old 4 square is coming to an end. Consumers know more about your vehicles and your cost than many of your sales people and they also know the 'steps to the sale".

As consumers become more informed on how the system works, they are becoming more concern with the exposure of their personal information. This means your entire team should be aware of The Red Flags and Safeguard Rules, as well as the many other regulations.

The article below (which you can link to by clicking on the picture) provides a great starting point if you still have questions. 

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10:57 pm          Comments

1/13/2014

Buy Here, Pay Here and the CFPH

It is 2014 and time again to review our policies, procedures, and practices. This image might be diffcult to view and if so do not worry, you can also find this on my public facebook page. 

 

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10:03 pm          Comments

Drive Your Same In Store Sales
Drive your same in store sales

Over the next few days we will be confirming our on-site training dates for the first quarter of the year. In addition to the District Training Meetings and the Dealer Exchange Events, we are providing a series of in store training on several subjects. 

Review the subject material with the short overview and send back a reply with the day of the week that works best for you and your team. A member of our staff will reach out to you (I will also personally reach out to you) to set the date and arrange the final arrangements. 

Subject Material:

  • Phone Training (selling the appointment vs the car) This is a two day event including scripts for inbound calls, outbound calls, prospecting calls, sold customer calls. Remember each time your staff answers a call it will result in either a gain or a lost. Are you capturing 100% of the opportunities? 
  • Quality Consumer Experience (closing a customer faster with a higher gross profit) This three day event includes First Impression, Relationship Building, Current Vehicle Review, Inventory Selling vs Ordering, Presentation, Demo, Write Up, Negotiations, & Closing Holding Gross. Included are our customer training programs designed around the culture of your store and market. Some of the following are; "Be First, Not Last", "Myths vs. Facts", "Social Media Closing", & "Control Your Market"
  • How to prospect to sell more calls with-in your 30 day sell cycle (step by step process to find your next customer) This is a two day event working with your sales and management team to use prospecting to sell more vehicles in your 30 day sale cycle. This is a real hands, intense course resulting in on-site and remote activities 
  • Overcoming Objections (from "I have to think about it" to "Let me talk to my spouse") This is a two day event role playing and working with real life objections that are keeping your sales team from closing deals while the customer is in the showroom. Using techniques developed by Sandy Corp, Half-A-Car, Key - Royal, AutoNation, Honda of North America, of course Credit Acceptance and many more; we can get your sales team wanting to hear a objection vs being fearful of them.  
  • Internet & E-Mail Sales (Take away the fear of using the Internet to prospect and close more deals) This is a series of three 1/2 day events design to get rid of the fear of using your cyber showroom to close more deals. With over 80% of consumers using smart phones, computers, and other web base devices to find vehicles and work a deal; it is important to the survival of your organization to have every single sales person and manager on top of your cyber showroom floor and able to close a cyber prospect.  

To sell more today, we really have to understand today's buyer. Our business has experienced many changes over the last decade and is experiencing dramatic changes today. Today's buyers are much more willing to pull the trigger on a single visit than every before, They did not want nor will they accept spending 4 hours trying purchase a vehicle. The buyer's expectation of what we provide is greater than ever before. With this said, buying is still emotional and is the driving force behind the selection of the vehicle and dealership. Negotiation while still a logical process, must support the emotional aspect of the transaction. 

So much is not taught when we get into the science of selling. Not understanding how to be effective in all areas of the sales process cost your dealer units and money.

We are still currently working on the www.rickwise.com website but you can also reply using the contact page on the site in addition to responding to this message to inquire or set up dates of the on-site training.
7:38 pm          Comments

9/10/2013

The Fokker F.VII the best of the best?

The Fokker was the aircraft of choice for many of the airline companies and it dominated the American market in the late 1920's. Now this all change with the 1931 death of Notre Dame football coach Knute Rockne in a Fokker F10. 

Any company or product can dominate a given market, but unless they can stay on top of current changes or handle a crisis, they can and will slip.

 

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Click on this picture for more information on the Fokker. 

10:45 pm          Comments

Get a infusion of $20,000 to $40,000 every 3 months
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6:36 pm          Comments

5/10/2013

Adventures with unplanned challenges

Just recently I got stranded in Detroit due to a US Air flight. Forcing me to find a local hotel to stay at my return to the airport at 4:00 AM. 

As I started the process of canceling appointments and reshuffling my schedule, my inner child started to surface thinking how unfair this all was. 

It was not until I was in the air looking out the window at the morning sunrise reflecting off the storm clouds that it hit me; my troubles are nothing compare to what was going on around me. 

Sure I could stay in that self pity mode or enjoy the moment viewing the sunrise with a recently acquired new friend sitting next to me. 

Life is too short and we are not that important in the scheme of things to get so worked up over small changes to our set plans.

By mid morning, I had made a few new friends. Enjoyed a 30,000 flight to clear my head, and view the start of an amazing day while others still slept.

So was getting hit with a cancel flight really that bad? Yeah it was not planned, but sometimes our biggest adventures start with a unplanned challenge.

With that thought, I wish you find your next adventure when your plans get side tracked. 

Go out and make it a great day!
6:17 pm          Comments

1/11/2013

Geogia's New TAVT, Good or Bad for BHPH Dealers?

Georgia's change in how pre-owned vehicles are taxed is fast approaching. It has been almost a year since we discussed this but as you know, the sales tax and the ad valorem tax will be replaced with a title tax. This is part of House Bill 386 which was signed by Governor Nathan Deal. 

The sales tax will be replaced with the (TAVT) Title Ad Valorem Fee beginning on March 1, 2013. The state of Georgia has been working for some time to bring the state up to speed with the level of technology so in turn we can stream line the title, taxing, and the tag process.

Our previous sales tax will go away and the 6.5% fair market value tax will apply to all pre-owned vehicles. On January 1, 2014 this tax will increase to 6.75% and on January 1, 2015 this tax will go to 7% and will be payable at the time of the sale.

So what does this mean to our BHPH Dealers? Well under this new law, the complete tax will need to be collected at the time of the sale and this can create a hardship to these Retailers. With the average down payment dropping and the level of risk for our BHPH Retailers increasing, this additional fee can be the breaking point for a few of these Dealers. 

Currently the GIADA is working with the state of Georgia to provide some sort of payment plan for our BHPH Dealers. As to date nothing has been solved but hopefully we can find some sort of solution. I recommend that every Dealer review the changes taking place in our industry and reach out to embrace these changes.

10:27 pm          Comments

9/4/2012

Why Are We Not Successful?

I have had the honor to work with some of the most recognized sales trainers in our industry. I have attended so many seminars and training classes you would think that I would be at the top of my game! Yet that is not the case. 

Over the years I wonder why I had to re-start my efforts or get re-organized. But a client of mine shared his thoughts on this very subject. He did not have a catchy name for his reasoning so I have tried to put on paper what he was telling me, hopefully it will translate...we shall see.

This client had noticed over the years how we would arrange a day of training in his store and while the sales team would use the "gems" given to them for a few days, in a while they would fall back into the same routine. It was not from a lack of desire, it seem to come from trying to install a new concept too quickly into the sales process. It was discovered by taking "baby steps" and introducing a small change, the entire team could move as one and achieve the desire result until it became a habit. At which time we could move to the next step.

Waiting for just the right moment was another concern. So many times he would hear "I will wait until the close of the month", or "I am too busy now to focus on this." It is easy to find reasons to push off a change of a routine or to add something new to the mix. So how do we overcome this? The simple answer is not to over think this, just do it! Do not worry about the outcome or failure, understand it is just a slight change in a process and it will not change the world either way...so why worry, just do it. 

This client also found if he offered a reward system for even the smallest of change, he could create an environment in which change is fun. We all have a fear of failure and this insecurity plays a huge role in holding back on embracing new concepts or processes. He discovered when he rewarded effort; he got a better response from his team. He made "taking the lead" in fact fun and less risky. In turn his team was more willing to take a chance. 

Last but not least it was his belief on focusing on the small steps and not on the end result that got my attention. His reasoning was that many times the end result just seems too large or too distant to motivate the team. Yet they could get excited about completing a simple task which in turned moved them closer to the end result. 

In the end he stated that so many times we try too much too soon. So going forward, I am going to take the pressure off of myself to make a complete change and just try to take small steps to a better self and a better process. 

 

4:59 pm          Comments

6/24/2012

How To Move From Goal To Reality
I have a wedding to attending in September and need to lose at least 20 pounds over the next few months. Of course my record of success has not been that high recently with my previous attempts. What I have been told is that our ability to lose weight is based on our willingness to suffer through a great deal of discomfort. It is the balance of my ability to be hungry and yet resists the desire for a pizza.


You know, trying to lose weight is very much like making any goal a reality. When it comes to the discipline and willpower that is required, most of us feel the need to ‘break’ at some point.

So how can we reduce the amount of pain in making a change? A good friend of mine and my mentor lost his weight just by getting rid of all bread and pasta out of his diet. He focuses on protein and veggies. He cooked with spices vs. oils. In other words what my friend did was change the environment he was in to assist in reducing his weight. By changing his environment, he reduced the temptation around him which reduced his need for will power.

Have you ever wondered why someone can lose so much weight, look good, and receive the praise of family and friends; only to gain it all back? It is because while all of us can learn a new habit, such as how to eat, we cannot keep it up if we still have junk food at home. What I mean is, unless we change our environment the temptation is too great to go back to what we use to do.

A client of mine assigned us with the task of increasing the closing ratio of two green peas (new salesperson for anyone reading this who is not in the car business). Every morning we had a conference call to review what steps we had taken the day before. We reviewed all aspects of every minute that we planned out with each of these ‘grean peas’; we perfomed role-playing both in person with them as well as on the phone. At the end of the day this process resulted in higher closes and even higher grosses. Now you would think they would be happy and would continue down this path we had laid out for them, but as soon as we backed off from the everyday phone calls and mentoring, both of them once again fell behind.

What we forgot to do was change their environment and their life style. Of course how we do this is by setting up priorities, sounds simply right? But as we all know it is not quite that easy.

Most of us set our goals for the month or year. We have all good intentions, but as soon as we get out of bed we fall back to the same old set of habits and it does not get any better once we make it to office. As soon as we enter the office everything is thrown out of the window as we start to put out fires. We have to return phone calls, answer e-mails, and handle “issues” that has popped up. By mid-day any thought of our goals or objectives are “gone with the wind”.

So what are we to do? Well let’s start by shaping our environment by changing how we start our day. Below are a few things we might want to try:

  • Identify three to five things you want to get done over the next month. Try to stay with three but no more than five. Write these items on a pad and keep the pad with you. Take anything off the list that does not get you to your goal. Make sure this list consist of action plans that you can give at least 90% of your time and effort to. To make this work you should prepare your days so your other activities do not take you away from these goals or tasks.
  • Determine what would be the result of these goals. Will it be more money, a promotion, a higher level of security? Once you achieve these goals what would you do to reward yourself? Will it be a new car, home, or boat? Maybe a vacation. Whatever it is, get a photo of it and place it on your bathroom mirror so you see it every morning and every night before you go to bed. This action alone will cause you to keep it near and dear to your heart.
  • Every morning get up and view that photo, make time to review your list and determine which item on the list is the most important for you on that day. Make appointments with yourself on your calendar for that day to address these items. By doing this you will start to make careful choices in your day with the limited time you have to achieve these goals.
  • Sit down with a manager or peer to discuss these goals. Have this person be aware of your game plan so they can monitor you on a daily basis. Talk about your goals and why you have them in the first place. Have your peesr or manager challenge you on your goals to make sure these are the right items for you to focus on. One of the biggest mistakes we make is focusing on the wrong set of goals. Find someone you trust who has your best interest at heart and can assist you with this. It will be important that you review your goals everyday with this person.
  • If you set a 30 day time line for your goals, set up a weekly review to check how far you have gone. Set up your own round table with others you believe in so they can review your goals with you and your progress. This will become your support group.
  • At the end of the day view the picture of your reward. Review your list before you sleep as well as review the actions of your day. Make adjustments as needed. But know that unless you learn to manage your time and stay focused, nothing will happen.

Oh, a word of advice, be careful what you choose as your reward. Your mind is very powerful and will create a mental environment for you based on your desire. Soon you will see your current environment as being uncomfortable and not where you should be. The discomfort your mind creates will push you to achieve your goals. You will get what you want in the end, so choose wisely.

As I say, “fake it until you make it”. Place yourself in your new environment in your mind and your body will soon follow. Good luck on your new adventure.

10:18 pm          Comments

Quick Tips to Improve Customer Service Skills

 also how to close more deals

It is a belief that body language translates so much to our customers / clients. Because of this belief we must take extra care to deliver a proper body language to our customer / client if we want them to receive the “over the top” experience from our dealership.
Here are a few very simple things we all can do to improve our body language and of course improve our customer relationship skills.

Smile:
Of course we all smile, right? Well I will tell you that many times when we mystery shop our dealerships, we usually just get a passing glance or grunt. Remember a smile tells your customer / client knows you are paying them attention. It gives them the impression that you do care and that you enjoy what you are doing.

Have a good posture:
Posture is so important. Your posture is view as a short cut to your mood. So what is a good posture, it is when you keep your spine straight, your legs just slightly apart, and your hands behind your back. All of this will hopefully push your chest out and keep your chin raised. You never want to slouch as this gives the impression that you are in a bad mood or just lazy.

Lead with an open hand:
This is one of my favorites, this technique is very subtle and used whenever you are giving directions to a customer / client. If you point with a finger or thumb, this is consider rude and of course we do want to avoid  being rude at all cost. The use of the open hand is inviting, your body language is saying “allow me to show you the way or right this way”.

Face the customer:
This is a very important tip when it comes to body language. Make sure you face the customer with the front of your body. You do not want to turn your back on them or stay slightly turned in a profile because this gives the impression you do not care.

Keep eye contact:
This is the easiest of all the traits. To insure the customer knows you are paying attention to them is to keep eye contact. Eye contact says: “you are the only person I am listening to right now”. Yet this is one of the most overlooked aspects of body language and is easy to forget as you try to get many things done at the same time.

9:50 pm          Comments

6/12/2012

15 Steps to Sub Prime Success

                                      15 Steps to Sub-Prime Success

What follows is nothing new, but maybe it is a re-fresher we all can use to fine tune our Sub-Prime Sales Process. Yeah sounds boring, right? Maybe it is, yet once again this was the subject of choice in a most recent 20 group meeting. So go get a beverage of choice, find a comfortable seat and start this read. We asked 10 of our top Sub-Prime Managers to give us a blue print to success and this is what we go:

1.    Plan for the sale. If you do this you will increase your chances of selling by developing a consistent plan of attack that accounts for all possible outcomes, questions, and objections. Sales is all about the numbers, and you must have contacts, prospects, and a first act presentation. Your sales plan is your road map to achieving your goals.

2.    Attract prospects. Special finance customers need reliable transportation and want both value and variety. They are often jaded, however, by the flurry of fast-talking, unprepared salespeople who over-promise and under-deliver. They have become skeptical of offers for “Guaranteed Financing.” Your store’s culture must set the tone for a relationship that builds trust in the minds of your future customers.

3.    Master the telephone. If your entire team does not learn to master their phone skills with proven scripts and word tracks that by pass price and overcome objections, you will find your traffic count low and your customers’ credit scores even lower. You will miss out on that segment of the market that actually has the ability to shop at other stores, and more and more dealers are taking the plunge into special finance (you do not want to be just another flavor). Most customers want and will shop from the comfort of their homes and will contact you by phone or computer.

4.    Set the appointment. An appointment implies professionalism. Your time is valuable and in demand. The ability to set appointments in a way that will compel your customers to actually show up is a critical. You must be able to separate yourself and the dealership from the competition via the Internet and the telephone.

5.    Master the meet & greet. A bad first impression will put your prospect on the Be Back Bus…first stop? Your nearest  competitor. Every customer must be met with professionalism and enthusiasm. By now most of us have reviewed this with our sales team and have this “in the bag”

6.    Perform a needs analysis. Assessing each customer’s particular needs is step number 1 in your first face to face meeting. This analysis will separate you from the competition and help position your team as experts in the industry. The needs analysis also is a critical step in the process for bypassing price and taking directing the customer’s focus to the financing.

7.    Take the statement. Also known as the credit application, the customer statement is the second part of the interview, subsequent to the needs analysis. It must be accomplished accurately, with diligence and attention to detail. The information will be used to make important credit decisions and there is little room for error, particularly when it comes to the calculation of gross monthly income and time on the job.

8.    Make a credit decision. Time is of the essence! With accurate information, you can and must make a correct assessment of the customer’s credit strength and buying power. Only then can you present vehicles for sale that will sell at a profit and fit the needs of the customer. Without a detail credit application, you will make your lender’s decision needlessly difficult.

9.    Vehicle selection / reselection. It is important to give the customer a selection of vehicles from which they can choose and never give the impression that they have to buy something they do not like or want just because of their credit situation. So do not worry about the customer getting locked into a vehicle that will not work. Most customers will choose a vehicle that meets their budget first.

10.  Structure the deal and obtain lender approval. While the salesperson is demonstrating the vehicle, the desk or finance manager is working to get an approval. Remember times is of the essence.

11.  Demonstrate the vehicle. While the financing details are being worked at the desk, the is salesperson is taking the customer on a test drive and selling the vehicle itself. It is important that you exceed the customer’s expectations as a prospective buyer.

12.  Go over the number. A presentation of financial numbers to any customer should never take place unless you have all the decision-makers present and your customer is ready to make a commitment.

13.  Close the deal. Never fail to ask for the sale. You must ask the prospect to buy your product and then gain their commitment; the true litmus test for commitment is the deposit. A prospective customer will not leave a deposit unless they are going to buy.

14.  Contract and deliver. Once you have sold a vehicle that you can get financed and on which you can still earn a profit, you must now contract the customer and deliver it to them. This is the step in the sale where there is zero tolerance for mistakes. Your contracts have to be perfect and you must collect all the stips up front. Otherwise, your contracts in transit will skyrocket and your controller will be screaming. Anyone who presents loan documents for a customer to sign must be thoroughly trained on all federal and state compliance requirements.

15.
Ask for referrals. This is last and perhaps the most important step on the road to the sale. This is your chance to ask your customer for referrals-not references, but referrals. You should ask for five referrals from every sold customer with the expectation of getting three new prospects

6:03 pm          Comments

3/21/2012

Is it compliance or harassment?

This has been a dry topic for a few years now. The Automotive Retailer Dealer knows by now that compliance is playing a bigger part in our everyday business. Last November the Federal Trade Commission sent out certified letters to retailers requesting information about their business practices.
 
A request was made for copies of every retail installment contract the retailer enter into from October 2009 to present time. Many in our industry believed the FTC was looking for information about our indirect lending or BHPH practices. With the creation of the Consumer Finance Protection Bureau, it was to be expected.

What came as a surprised was the amount of information the FTC was requesting. The letter that many retailers had received requested information on the corporate structure of the dealership, revenues from the sale of new – used vehicles, copies of all service contracts sold and other financial products, documents that discuss any policies and procedures (a compliance workbook), training manuals, documents concerning oral or written complaints, and any information the owners might have concerning any lawsuit proceedings.

While it appears many more changes are coming, one area that we seem to placing on the back burner is real time harassment risks with employees in the dealership environment. Many of our retailers have in-depth harassment training, handbooks, and seminars; but most of the time it does not translate to the showroom floor.

The back office might have a compliance workbook, harassment manuals, and seminars; but it seems on the showroom floor it is still the same old game. From playing with customer’s personal information to joking with our peers to the point that it might be consider harassment is still a very real threat to the owners of our profitable as well as our struggling dealerships. With what is becoming a strong sales year, I am sure many of the agencies will want even more information from us.

Well you allowed me to ramble on here tonight, but I hope what you are getting out of this is that you must get a handle on all things we consider as compliance related. Remember it is not how much you make; it is how much of it you can keep. Violation of these rules comes with a very high price tag today and it does not need to be that way.

11:29 pm          Comments

5/2/2011

What Makes an F&I Director
                                                              What Makes an F&I Director

“Congratulations, you are getting a great deal!” says the salesperson to the customer (says the spider to the fly). “All you need to do now is sign the paperwork”. This is usually how our customer / client is introduced to the Finance Manager.

Many survey’s clearly show our customers believe the Finance Manager is the man / lady in the suit behind the desk that works his “magic” to dazzle them with the figures as they bump the monthly payment.

Recently www.edmunds.com had an article titled “Confessions of an Auto Finance Manager”; it was an update from the first article published back in 2008. While the article appears to be right on reviewing some of the practices we have all witnessed in the F&I department, it also gave the impression that the F&I Manager and the Dealership was out to rob the customer. The man / woman in the back office is the closer or heavy hitter that will work the “magic”. I do not believe in it and I believe the days of pack payments, playing with the information on credit applications and playing the shell game is gone.

In today’s market, we all know that the only way to stay in business is to work with the customer / client. To provide honest information and answer their questions while providing options. The F&I Managers play a very important role in all of this. It is the F&I Manager that has the duty and responsibility to review the numbers of the purchase, review the information that will be used to complete the documents and inform the customer / client on all the warranties/services offered by the factory and dealership.

When we say the F&I Manager is the ultimate closer, what we mean is that this individual has the ability, talent, and knowledge to confirm the information, complete all the paperwork, protect the interest of the customer / client and the dealership. This person has to do all of this as well as handle any fears or concerns the customer / client might have. For the privilege of doing all of this compliance, the F&I Manager are given a very slight opportunity to promote the services of the department and to make a decent profit for the dealership.

The truth is preparing contracts and arranging financing is a job for a financial expert. With reduced profit margins, the F&I department is indeed, a “stand alone profit center” designed to provide several F&I related products and services for a slight profit. This concept benefits the customer / client as well as the dealership. Without this department many of our customers /clients could never receive the “discounted deals” they enjoy so much when selecting a car or truck. The F&I Manager is an important part of the entire process and holding this position requires a great deal of knowledge, talent, and ability.

The F&I Manager and F&I Director in our industry today are true professionals! They are a student of the industry, they are aware of all the latest trends in the financial community as well as in the automotive industry. This individual works the longest hours in the store, has nerves of steel and the ability (actually the love) to work in a high stress environment. But the rewards are great! For a proven F&I Manager, they are rewarded with one of the highest paying jobs in the dealership. That is why only your brightest and most proactive individuals should ever be in that office.

Rick Wise welcomes your thoughts, comments, and feedback as we work together as a industry to build a best in class series of practices for the today's F&I office.

6:57 pm          Comments

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