“Cadillac Dealership Closes” was the headline in a recent local newspaper. As my colleague was showing me this headline, he pointed out the caption below a picture of the dealership that stated, “…the Dealership, which has been at location ‘X’ for three decades, has closed because of the economy.” The store manager went on to explain that, “Soaring oil prices and a credit crunch were to blame.” Here is a letter that was submitted by a loyal customer after reading the newspaper article regarding the dealership closing.
“I have purchased four GM trucks from this dealership over the past 12 years, spending close to $200,000. You may wonder why I kept buying from them. Believe me, it was only because I’m a die-hard GM truck fan, and it was the closest dealership. The dealership blames the bad economy for their demise. But I doubt that was the problem. In the time I bought my four trucks, I never once received a thank you note. Never once received a call to see how I was doing with my vehicle. Never once received an invitation to come in and try one of the new models … the service department was terrible: making us always feel as if we were an imposition to them and rarely fixing any problems on the first try. In fact, after the fourth vehicle, my wife said she would divorce me if I ever even thought of buying another car from this dealership. I was not surprised to see this article in the local paper.”
I am of the opinion that economic prosperity and the surge within the powersports industry allowed many dealerships to grow, and covered up a plethora of marketing and operational sins. Obviously, the above-mentioned was in a different industry, yet I feel the message is the same. The future will be different, and the future is now. I don’t know about you, but I don’t want to leave the success or failure of my business up to oil prices, or the general state of the economy. So here are my Five Triggers for Success in 2009:
Leverage Your Dealership’s Hidden Assets
Although the term asset is usually associated with financial statements, an asset is somebody or something that is useful and contributes to the success of something. Your staff is a huge hidden asset. You’re already paying them to be there, so why not have them send thank you notes, make follow-up calls and do productive activities that can generate sales, rather than sitting around reacting to the next walk in?
If your average salesperson could increase his closing ratio by 5%, and your accessory person could increase dollars per ticket by 20%, this would have a huge impact on business without an increase in overhead. Or is that too much of a hassle because it would require training? How about your customer database? This is another huge hidden asset. Statistics have indicated that 65% of people stop doing business with a company because they get the feeling that they are not important. In other words, customers expect you to market to them. They feel unwanted if you don’t, and will go someplace else.
The Power of Association
I fought this one for years, and like most things I do, I learned the hard way. As Napoleon Hill wrote in his bestselling book, Think and Grow Rich, “Analyze the record of any person who has accumulated a great fortune, and many of those who have accumulated modest fortunes, and you will find that they have either consciously or unconsciously employed the Master Mind Principle.” The Master Mind Principle is a formula that was developed after Hill, a journalist at that time, interviewed more than 500 of the wealthiest people in the country and determined that the common thread to success is that you need brains outside of your own. A peer group you can talk with about your goals, your challenges and your successes. Meeting with and networking with other like-minded individuals that are performing similar business activities is invaluable, and I’ve personally experienced the power and synergy to be gained from this format many times over.
The late John Wyckoff wrote two great books with the Mind Your Own Business theme. One of the biggest challenges I faced in my dealerships day-in and day-out was accounting. If you’re like me, most likely selling bikes and P & A, desking deals, writing service tickets and changing tires came pretty naturally. But, can you print timely accurate financial statements, analyze those financials and then develop a specific implementation plan based on your analysis? I suspect this is one of the most challenging disciplines for most dealer principals to develop, yet the most important. W.G.M.G.D. is a term Dealership University recently produced a Quick Takes video about. It stands for What Gets Measured Gets Done! Minding Your Own Business is much more difficult than it sounds, but is a key trigger required for success in the new economy.
Focus on the Most Productive Area
I once had a service manager quit and leave me hanging with $15,000 in unpaid and un-submitted warranty claims. I became so consumed with getting paid from the OEM and cleaning up the imperfections of the service department, that I spent the better part of an entire year as the interim service manager. In the meantime, I completely quit working on the most productive areas in the dealership. Our marketing was virtually non-existent, my F&I department was less than stellar, and major unit margins were so skinny it was embarrassing. I rarely analyzed financials, and if I did, it was only long enough to determine they weren’t accurate anyway. I was making business decisions with my emotions, rather than sound logic, and I speculate it cost me more than $150,000 that year.
Commitment to Speed and Implementation – Strategy Gets You on the Field and Implementation Pays the Bills
I was recently at a major business conference and a well-known speaker said, “Less than one third of you in the audience will take any action from what you’ve learned here. Look to your left, now look to your right, and ask the person next to you will it be them or will it be you?” The good news for you is that your competitor down the street probably isn’t going to make any changes for ’09. The question is … are you? The speaker went on to talk about the new economy and suggested that it will not be the big that eat the small, it will be the fast that eat the slow. The concept of massive action will be required, and the ready, fire, aim approach is much better than a complete lack of action.