Keep it Close

Contrary to popular belief in the industry: IF you are selling 10 units a month; you do not need 30 units on the ground.

This time of year historically, dealers “Load Up” in anticipation of Tax Season.

In 2019 that could prove to be a costly mistake.

If I am selling 10 units every month I am going to have 13 – 15 really good units “front line” ready and 3 in the shop.

In business terms I am “Keeping It Close To The Vest” – minimizing my cash out lay and maximizing my time.

Allow me to elaborate …

SUPPLY – has been and will always be a Dealers #1 source of grief, aggravation, time and money.

No supply – no sales.

If you’re keeping 30 units on hand and selling 12, well lets do the “simple math.”

15 units (over what you need ) multiplied by an average of $500 unit average recon = $7,500 cash out-of-pocket that you do not have to spend there.

Now lets add 1 hr per unit “shopping” time & 3 hours per unit (transport/recon/etc) = 4 hours per unit times 15 units = 60 hours!

So far, by slimming our inventory we’ve managed to save 60 hours and $7,500!

I don’t know about you, but 60 more hours is the real exciting part for me.

$7,500 can get me better (more) advertising, maybe a new sign or a better web page, possibly a marketing program or…. used where it’s needed most!

Now let’s get back to supply; with over 4 thousand dealers just in the Houston area alone that equals LOTS of competition for the same units.

The same 2008 Impala I am bidding on in a major urban auction will be less expensive at a smaller auction ( 100 dealers instead of 600 dealers there).

And what does all this have to do with your dealership – TRAVEL my friend.

If you want a more “steady” supply stream; you’re going to wind up on the road (physically or electronically) buying 200, 300, 500 miles or more away from home!

That brings in ADDED cost – transport!

From Florida – let’s figure $800 (usually less) on a unit I bought online for $1500 in back of what I could buy one here. I’m still $700 ahead of the game when the unit arrives!

That means more profit at market price OR a lower market price (usual profit) = quicker sale!

When you can take your time and really “shop” – good and sometimes great deals are there to be found.

You’re client wants a DEPENDABLE / FAIR PRICED unit and to buy it from someone they feel they can trust (that is an entire days class I teach – building trust).

What does all this add up to … simply put; it all adds up to more success on your part!

Keeping better, lower mileage units (time for shopping is now freed up) and working on the important things like marketing (gotta know who you are, what you carry and how to get you)!

More is NOT always better!

I would rather have 15 solid units (one’s I wouldn’t hesitate to hand my MOM the keys to) over 25 to 30 units that some little something is always going wrong with.

Time to reconsider your strategies.

As always I am available for private consultations.

Riding Out the Holiday Season

Christmas is a unique time of year in the automotive industry, sales are historically very slow in most markets of the U.S., and Texas in particular.

Most of you know that I travel extensively across Texas, and so far I have found sales to be slow with ONE exception – CASH.

For decades I have known and passed on to my dealers: from late October until mid February CASH cars are king!

I have dealers all across the state still selling 18 – 25 cash cars – EVEN in December.

Depending on your market / advertising / transparency the pricing ranges from $6,500 up to $11,500 with mileage from 110k to 140k – pay ATTENTION to what I just said!

  • Target market = knowing to “whom” you are advertising / their pricing point and the particularly “hot” vehicle they are after.

This will greatly affect what you are purchasing and from where you purchase.

This is where recon is KING and having a standard 60 /80/120 point STANDARIZED check list is worth it’s weight in gold!

Having all of your inventory go through the same process of reconditioning only assures MORE customer satisfaction and can be on Hell-Of-A-Closing tool for higher gross profit.

Having a DMS (dealer management software – like Frazer) can be an invaluable tool because of the information with in.

What color car sells the quickest?

Which make of vehicle sits on the lot the longest?

Where are your advertising leads doing their best?

All of this information including zip code analysis and more is available to you right now. Most DMS companies can create custom reports for their clients for a small fee or no fee at all!

Having a CRM (customer relationship management software – like Selly Automotive) allows you to “funnel” all those leads through one place with plenty of “tools” built in for calendaring / email / texting / photo sharing / price quoting / etc.

Having all that in one place, along with reminders for you about followup (which leads to more sales and referrals) allows you more productivity and less “Oh Crap I Forgot to …” !

If you have salespeople, you can watch “how” your lead is being handled and what is being said – not to mention switch prospects between salespeople, should the need arise (vacation/termination/etc.).

  • Niche Advertising = knowing where your dollars get their most return – not only in number of leads generated but also in leads closed.

Where is your target market looking first?

Is social media important in your target markets PURCHASING criteria?

If so and you know nothing about social media (Facebook/Twitter etc) then HIRE someone or some company to do it for you!!!

****WARNING**** you had best do 2 things when “contracting out” your advertising

– 1st ask for references and verify that results are worth the money

– 2nd Preview and authorize all verb-age and campaigns BEFORE they are posted
(remember it is YOUR license on the line here if a complaint is lodged).

How much will you spend in advertising in order to garner a sale?

Average advertising dollars that I see being spent out there is $300 per unit.

That being the case the WHY are some of you still only adverting on Craigslist “For Sale By Owner” (besides a lie to the customer – which by-the-way BLOWS your credibility you are limiting yourself to that niche market only) ?

  • Transparency = knowing when to “show your hand” and what to show is now a crucial and key part of today’s selling.

When you have certain standards in place (recon check list and procedures) these become major assets to your sales.

Today’s buyer wants to know as much about your vehicle as possible (CarFax / Autocheck/ NADA / Recalls / etc.) BEFORE it becomes their vehicle and the burden is on you for this information.

Now if this is a $2,995 unit – they can spend the money for the CarFax, however if it were me – I would still provide one (procedures – standards in place).

Your reputation is EVERYTHING in this business – that and most dealers out there are STILL conducting their business based off a 100yr old model.

Business has changed and if you are not willing to keep up and make some changes in your business thinking – then do not complain when you are left behind and your sales tank !

If I had a prospect that was curious as to the vehicle’s condition – promise you they would have an overload on their hands. I would gladly show all my pictures (showing any and all imperfections) along with my recon report showing what I did and what I did not do. Then my CarFax, NADA retail sheets and a “Drive Out” price quote. If my unit is more expensive than another one that prospect is looking at – then I am going to use those reports to build value in my unit / my dealership and myself. People pay for quality and value – EVERY TIME. As a matter of fact in most instances once value outstrips price – people buy!

OK, so there you have a successful formula
to “Ride Out” the Holidays.

Create-a-great-future : One day at a time, one client at a time

From all of us at Tom Hampton Agency (Tom/Lety/Ana/Denise/Barbara)
W
e send our warmest wishes for you and yours – that this season is one of great abundance
(Family, Friends, Love, Health and Happiness)

New Documentary Fee

Starting June 1, 2016, the documentary fee amount, that does not require a cost analysis, was increased to $150. This is a result from recent amendments to the documentary fee rule at 7 Texas Administrative Code §84.205.  While a dealership could file for a documentary fee up to $150 starting May 25, 2016, your dealership could not charge a documentary fee up to $150 until after June 1, 2016.

The new online filing system became available in the Application Licensing Examination Compliance System (ALECS), in late June. Documentary fee filings will only be accepted through ALECS. We encourage your dealership to link your ALECS account if not done so already and you intend to submit a documentary fee filing.

A retail seller must comply with the notification requirements of Texas Finance Code, Section 348.006(e) prior to increasing its documentary fee above $50 or prior to increasing its documentary fee from any previous filings above $50 up to $150. Documentary fee filings above $150 will require supporting cost analyses to review for a determination of reasonableness. The OCCC will provide written notification when a documentary fee has been determined reasonable. The new filing system in ALECS will allow a dealer to check the status of a documentary fee filing.

How to change your Documentary Fee in ALECS:

Log into your ALECS Account

  • Choose Manage my Business On the Left side of your screen
    • in the License group
  • Doc Fee Filing (on the far right side of the screen)
  • Select your license  (Motor Vehicle Finance License)
    • Add the Amount you want (up to $150)
      • Add your Name, Email and the Start Date then click on Submit

Webinars for RTB #007-15 Mandatory 24 Months of Registration for New Vehicle Sales by Franchised Dealers

TxDMV logo_But

Webinars will be held for all county tax assessor-collector offices and franchised dealers to discuss RTB #007-15. This RTB was sent to provide further guidance and clarification to RTB #005-15 sent on June 18, 2015, regarding mandatory 24 months of registration for new vehicles with a two-year inspection.

The webinar schedule is listed below and space is limited, so please reserve your virtual ‘seat’ as soon as possible by registering through one of the links provided.

Webinars

Thursday, July 16, 2015 at 9:00 AM – 10:00 AM CST
https://attendee.gotowebinar.com/register/4614208665948460034

Thursday, July 16, 2015, at 2:00 PM – 3:00 PM CST
https://attendee.gotowebinar.com/register/2870262278016675330

Friday, July 17, 2015, at 9:00 AM – 10:00 AM CST
https://attendee.gotowebinar.com/register/1016683585679350274

Friday, July 17, 2015, at 2:00 PM – 3:00 PM CST
https://attendee.gotowebinar.com/register/4203144149276511234

Integrating “Two Steps, One Sticker” into Frazer

TwoStepsOneSticker
If you’ve been following the latest news, you know that the “Two Steps; One Sticker” program went into effect on March 1, 2015. But how do you integrate the new Inspection Fee into your Frazer?

  • In Frazer:
    • Under the Miscellaneous heading at the top
    • Choose 1 System Options
    • Click on the Default Government Fees button
    • Enter the New Inspection Fee in the appropriate field
    • Click on OK

Click for Screenshot
Click for Screenshot

What is your Inspection fee? Visit the Two Steps, One Sticker: Dealers page for more info.

New webDealer 2.1.0 Guide

WebDealer Carlot

Per the Texas Department of Motor Vehicles –

webDEALER 2.1.0 is scheduled to go live March 1, 2015. The attached User Guide link is for the latest release, webDEALER 2.1.0. It is intended to aid current and future users in learning system features. The 2.1.0 release contains changes applicable to all dealers.

webDEALER 2.1.0 is compatible with the new “Two Steps, One Sticker” program mandated by Texas statute, HB 2305, 83rd Legislative Session (2013). It is equipped to help dealerships easily verify inspections and calculate fees due at the time of registration and titling, including the state’s portion of the inspection fee.

The new document management feature in 2.1.0 enables dealers to submit supporting documents in a single file, eliminating the need to attach documents separately to applications.

The used vehicle pilot is complete, and used vehicle functionality will be available to all dealers with this release. This new functionality gives dealers the ability to view current vehicle records when transferring used vehicles. Additionally, options to provide evidence of ownership for used vehicle transactions with a Texas record include Certified Copy of Texas title, Texas title, or out-of-state title.

If you have any questions about the release notes, user guide, or would like more information about webDEALER 2.1.0, please contact your county tax assessor-collector. Check with your county to see if they are currently adding dealerships at this time.

webDealer User Guide

Coming Soon! Client Education & Support Center

We are working closely with our Clients & Vendors to develop & offer the best experience possible. A Client Education & Support Center is currently in the works and should be available late 2013. Upon completion, it will offer Tutorials & other Enhanced Features complimenting our product line. Check back in the coming months to see how our Premium Member site is developing!