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Is Your Company Being Held Hostage?First, I have to confess I probably have no right to get angry at what happens to other peoples businesses, but my number one pet peeve is when I go to a business and the employees are holding it hostage. Especially if that business is a car dealership. And yet month after month, I go to dealerships that have that exact thing happening. It drives me up the wall. What is the number one sign that your dealership may be held hostage? It seems like the common thread is when the owner or GM asks someone to do something,a task, a change, but something, and the job is not done. Where I come from that is called insubordination, but it is tolerated at an alarming rate. Here is another sign of being held hostage, Taking the easy way out. This is like a parent who will not discipline the child and wonders why at 18 he’s a dropout and in jail. Another words, you have an employee who is not producing to industry standards but he gets to keep his job and gets paid very well to do substandard mediocre work. Does the farmer tolerate a cow that produces no milk? NO! There is a name for that cow and it is hamburgers. Here is another sign that you should beware of, not hiring new blood. This evolves into a complacent workplace. You must have new people to work in order to have success doing things your way. This keeps everyone on their toes and stirs up your sales force. Constant new blood is a key. And then hold these people…all of them including managers…accountable. And lastly, the big sin I view is lack of a uniform process. I see so many places that have manager A doing it like he did at his old store and manager B doing it like he did at a completely different dealership. The effect is you have a million different ways the store gets pulled. And then there is the dealership that has virtually no process at all, more common than you would ever think. Recently I had the pleasure to view a Honda dealership up close and personal. I had the experience of watching a salesperson get terminated because he did not follow company policy…touching with the desk before a consumer walked. This dealership also had certain products and processes on every car and deal and those products were included on every car deal, no exceptions. I am sure there was an over remittance and the dealer was able to squeeze net out of every car deal on top of gross. What an idea, guaranteed net profit before the vehicle is even sold. Also, if your performance as a manager is substandard, you are put on a short leash and put out to pasture. Am I saying to make life miserable? No way. Get your employees trained and motivated to let you extract every nickel of profit available to you the owner. If you have to insist on paying non productive relatives because it is a family business, but they drag your business down, pay them to stay away. And speaking of family, if you want to see the ultimate best in owners’ children running a strong strong dealership, go to Courtesy Chevorlet in Phoenix and see the Gruwell boys. Bill Gruwell, you have every reason to be proud of your sons. Every time I step onto the lot, it has energy just oozing and professional looking salespeople full of energy. It is a breath of fresh air.Knee Jerk Reactions Can Cost YouJune was a rough month in the car business for most domestic dealerships, even in Houston. I had a dealer cut out a program that delivered a 2087 Per Cent Return on Investment. Now if it was a big expense I could see it more easily. However, when the numbers come off your dealer computer management system and you terminate a program that is very cost effective and one that gets customers to spend money…verified, then someone is giving you bad advice. I would fire my accountant and my service consultant.The Ten Million Dollar Service ManagerAre you still on a factory owned service contract because your service manager has convinced you that it is easier to do claims and that it pays better and gets better satisfaction. Here is another one…it will keep you from a factory warranty audit if you use the expensive factory program. If you are selling two hundred cars per month or more there is a name for that service manager, The Ten Million Dollar Man. In effect, that is how much money he has cost you over a 5 or 6 year period. To me it is the Ten Million Dollar Lie. Switch to a dealer owned service contract program and see how fast your old service contract company comes running to shower you with money. Generally, it would be money better borrowed from Tony Soprano with the terms they give you.Email Addresses: Are Car Dealers In Prehistoric Times?The answer would be generally yes. I have dealers that have thousands of customer names in the last 18 months from sales and service, but very few email addresses. In fact, the number I usually see is one to 2 per cent email addresses, a number that is way too low. Dan Kennedy, the marketing genius, will not buy a business if the customer base is not complete. That is how important a successful businessman thinks email and data bases are. Yet there is a way to capture email addresses. It is almost a foolproof process, and after six months you can have almost your whole customer base marketed and advertised to with a push of the button. All you have to do is want it, and to call me at 888-295-5314. It will be the best marketing move you have ever made with the best ROI. In signing out I would suggest the book, “Ruthless Management of People and Profits” by Dan Kennedy. At first I was a little skeptical about this book. No one likes to think of themselves as heartless. The book has so much common sense pouring out of it, that it can help you do some processes that will keep your company from being held hostage. One idea makes it worthwhile. Until next month, Peace.
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