The concern or lack thereof concern for “Cause and effect” is ultimately what can make or break a dealer.
Wikipedia says the definition of cause and effect is: The relationship between an action and the result of that action in regards to how it affects you or others.
Many businesses have unique challenges but the lack of concern for the overall business outside of the immediate department of a dealership is typically an issue that can cause dealers hundreds of thousands of dollars each year. It is not uncommon for dealers to be completely departmentalized and even have severe friction between the business units. If this sounds familiar, you might want to continue reading.
The most overlooked low hanging fruit at any dealer is something that typically doesn’t cost a dime. Many dealership employees focus on the problem in front of them and seldom pay attention to the root cause or how their solution to that problem will affect others. Consistency and process will make you more money than any fancy new computer or piece of shop equipment will ever do.
It’s mind boggling how ramped the “All for me” mentality is throughout a dealership. Sales managers only care about selling the car, parts managers only care about their gross profit %, service advisors only care about selling the services that they receive that spiff on, and even the detailers want to clean the car that pays the best. If we could accurately calculate the overall cost of this mentality, I think many dealer principals would fall out of their chairs. Inefficiency = less profits.
As a personal example that I have recently dealt with, the detail department is used by pretty much all departments within a dealer. Detail billing issues, quality issues, customer service issues, payroll issues, staffing issues and simply which car should go next effects the entire flow of the dealership, yet seldom does anyone look to resolve the issue. The detail department is recognized as the black hole of the dealer and complained about regularly. Fixing this area will result in additional service revenue, sales improvements from keeping the sales team on the floor, overall CSI and accounting efficiencies through accurate paperwork & reconciliation.
After 20 years, I set out to fix the issue through technology. I thought “how could anyone not want to fix this industry wide issue?”… I need to fix the relationship between the on-site sublet detail company and/or the internal detail department and all the people that use them. All we need to do is create a real-time system that can instantly communicate to everyone and handle invoicing, purchases orders and payroll. Simple right?
Solution solved… We’ve created a just that. A solution that will make everyone’s lives easier through an easy to use web based paperless process. From the car sale of a car all the way to accounting, quick simple and accurate!
You can’t teach an old (Car) dog new tricks:
What I quickly found out is that the old saying of “you can lead a horse to water but you can’t make them drink” is never truer than in a dealership. The sales manager says “I don’t have time to create a ticket”, the service advisor says “I’m too busy to sell a detail” the accounting department says “I can’t get them to use it” and the GM says “We’re just too busy selling cars to make them do it”… The end result is dysfunction that affects almost everyone.
Coming from the retail side of the business and dipping my toes into the vendor side of the auto industry was quite an eye opening experience. Some dealers are so successful, and then there are some that are so dysfunctional and inefficient you wonder how they keep their doors open. Leadership either gets it or they came from the “I’m too busy selling cars” world and it’s deeply engrained through the business.
You eat an elephant one bite at a time:
The world is changing around us and if we don’t get on board, it’s going to pass us by. The old car dogs will quickly go away with the ever changing technology available to help improve a dealership.
Our detail solution has quickly created a solution for many dealers resulting in bottom line profits. What’s it worth to keep your sales team on the sales floor instead of consistently walking back to check on their cars? Give your service team a menu of detail services for their guests and accurately giving current work flow and delivery times from their desk? How much is it worth to have accounts payable & payroll accurately calculate the entire detail department with the click of a mouse?
There are so many areas of a dealer that can be fixed through technology solutions on the market if you really care about the end result. It’s up to the leadership to determine what type of leader they want to be. If you set out to fix your business one area at a time, it can be done. The key is taking that first step and being involved with that change from the beginning. I have found that everyone will push back against change but once they just do it (because you gave them no other option); they’ll never do it any other way…. That will be their new habit and you can move on to other challenges.