#100 - MM - PPP Money To The Rescue

Hey guys and gals, happy Monday to you. Hope everyone is having an awesome week geared up. We know that the money is on the streets. Luke. I just barely. As of the date of this recording, which is, you know, right around the teens, the 20th. What day is it today? I don't even remember. It all blends together. It's a day. It's today. We. I signed my loan docs for my PPP loan with my local bank. So good news for me. Not 100% sure when the funding is going to hit. It's still kind of in flux right now. But I want to time it with when my payroll is because I got eight weeks from the date of funding to get the full amount spent so that it can be. The full amount can be forgiven. If I understand this whole program right, and I am no expert. Maybe you know more. I know some of the guys in the group have really done some good research on this. What's the status on your ppp, Luke?

So right this second. So my bank originally was not a SBA digital filer or whatever it is. They were SBA approved, but did not have a portal, I guess is what the. Is what they're calling it. So I mean just they've been working really hard to get that portal set up for several their, you know, bigger clients trying to do this and. And luckily they just got that portal set up and we were submitted to the portal a couple of days ago. Now, I'd already had everything together every, you know, every time there was a new update to the application. Whenever I redid the application, it's all been done submitted both my retail company and our service department. And we're in the queue. Hopefully we'll. We'll be signing papers here next day or so.

Yeah. So your retail company, your service department have separate payroll filings, ein numbers and does your RFC as well?

RFC does. But we do not run payroll through our rfc.

Oh, that worked out well for you then, huh?

Yeah, it did. So, you know, what we've always done is we run because payroll costs money to run. So we've always ran it through our sales department, our retail motors. And what we do is just every month we split. We split costs, split labor.

Yeah. Reimburse the dealership for the finance companies just like you would with your rent, your utilities, your advertising, all those shared expenses. Yeah, we do that very similarly. Now, what I wanted to bring up with you, and I want to keep this Monday minute. I know this is supposed to be a minute, but it's kind of recently Come to my attention of, obviously, we know that the $350 billion is not going to go far. It's about a third. From the stuff I've seen and the experts that I've heard from, it's about a third of what small business needs to operate for two and a half months. So I don't know if that means that every application will be forgiven a third or if it's the first 350 billion that get in the system will get their full amount forgiven if they qualify. Is there an ethical play here, Luke? As a dealership, I'm in Utah. We were not a shelter in place like New Jersey or California. My dealership probably ran at about 20% of what it should have been. I feel like my employees were probably working at about 30 to 40%. Ethically, do I need to look at my PPP loan and say, hey, I've paid the whole thing out over these eight weeks, but I was impacted to the tune of 50 or 60%. Let me pay back 50% of it and let me get 50% of it forgiven?

Well, I don't know that's option, Jeff. You know, ethically, I don't know that. I don't know there's anything to be worried about there. If the government's gonna do it, they're gonna do it. I paid a lot of money in taxes in, and I hadn't got a lot of it back.

Well, I mean, I get a lot of it back every Friday when my customers make their payments.

Because you don't look at it that way.

Unemployment. Yeah, I love unemployment. Extended and increased and SSI and ssdi. Right.

I mean, yeah. And I didn't. I didn't go. You know, I feel you. If I get it, fine. If I don't get it, that's fine too, Jeff. I'm going to make it either way, I believe. And there's probably a lot of dealers out there and there's probably a lot of other small businesses that aren't going to make it.

Oh, there's a lot of dealers that won't. Especially, you know, I feel for. Again, we've talked about this. Our retail guys that are, that are, you know, I don't want to say paycheck to paycheck, but it's hard. And so I look at it this way and I say, okay, ethically, you've got both positions. Because I'm a dealer that had the luxury of buy here, pay here in my cash flow. But I also am very conservative. I keep a lot of cash in the bank on purpose. That's a strategic plan of mine that I've got at least six months of overhead to operate in cash in the bank because I'm not dispersing it. I'm not doing crazy things. I'm not being crazy. So as a financially conservative company, I can make it through the storm. Should I not take a government handout?

That's where it comes in is like, I can make it. If they're gonna give me the money, I'll take it. I don't have to have it, you know.

But does that mean someone else doesn't get it?

Who knows? And it comes down to how good a business you are. Right. And so. But I have a big payroll. I mean, you know, we. Our payroll's 60, 70 grand a month. So, you know, there's a lot of money going out and if it wasn't coming in, I would be in trouble.

And that's just yours. That doesn't even include your employees.

That's funny. No, but we, I mean, we keep a lot of money in the company and you have to in a buy here, pay here store. And you should keep a lot of money in your company. And if you're not, then you're not running your company. Exactly right. I feel very bad for a lot of these companies that are by a. No matter if they're a car dealer or if they're the bakery down the street or whatever. I'm trying to help out and do what I can to these. For these other folks. Ethically. Is there a position? Position is if they say, you know what? I didn't need all of it and, and they're gonna give me a loan for 0.5% interest. I'll still take the money and pay it back 1%. I thought it was.

No, no, no. It's one. Well, it's my docs. I don't know if I got a markup, But I'm a 1% loan. Yeah. Either way, two year payout.

I'll take it at 1%. I'll take. I think ours was $160,000. Whatever loan was, I'll take it at 1% because I can't borrow money for 1%. So if they forgive it, fine. If they don't, I'll take the money.

And I think that's a good attitude for everyone to have. If you take this money, plan on paying it back at 1% over two years because who knows if you're going to get the forgiveness? Who knows if you're going to qualify who knows if the money's going to be there? And if you're. If you're a dealership that really, really needs it, hopefully you do get that forgiveness. And if you're a dealership that doesn't, and you get the forgiveness, man. I think you got to make sure you took care of your employees really well getting through this and staying on. And I want to make sure you take care of your vendors and you take care of your local community. And best worst case scenario, you're reinvesting that and spending it with your local radio and your local advertisers and your local vendors and those guys that can. Can show up and you're helping those other businesses stay afloat.

I totally agree with that. Just one last soapbox before we get up on there. Pay your rent. Okay. Pay your electricity bill. There's no reason for any dealer not to have enough money to know they got for their rent and for their electric bill. That's insane. That's not a good business model. And don't put someone else in a position because you didn't plan ahead. Make sure you take care of your employees, like Jeff was saying, but take care of the people who've been taking care of you. I get frustrated when I see people saying, I didn't pay my rent. Well, why didn't you?

Anyway, I didn't have to pay my rent. I get two months of deferments or this, this, this. And it's like, well, did you know that your landlord is actually paying for his retirement out of that?

Or it's groceries. I mean, come on.

Yeah, it's always. It really is. Who's going to be left holding the bag? You know, I give my customers a month deferment. My landlord gives me a month deferment. Does his bank give him a month deferment? And does his bank's bank give him a month deferment? You know what I'm saying? Who's going to be the last one holding the bag in this situation? So if you have the ability to take on some of that burden, you know, I think that's a responsibility of a healthy financial company.

And if you do have. Yeah, if you do have customers that truly need it, truly need that deferment, give it to them. But if you got people trying to play, you know, get all the information before you do these things.

Absolutely. Great. Well, our Monday 5 minute. Our Monday 15 minute extended a little bit. Guys. Stay tuned for Thursday's episode. Thank you. Thank you so much for subscribing to our newsletter that will be coming out soon and leaving us a review. We really appreciate the reviews on itunes and Google and everywhere else. It helps us in the listings. It helps us get the word out to more dealers. This is the time we need to be rallying together as dealers.

Yep.

Thanks, Luke. Have a good week.

You too, buddy.