#143 - Top 5 Compliance Landmines w/ Steve Levine

Hello, guys and girls. Welcome to this episode of the Independent Dealer Podcast. We want to thank everyone for joining us again. Thank the audience for the online reviews, people that have left us, itunes, reviews and the such. We really appreciate it. Helps us push the podcast out to more people. Today we are joined by Steve Levin, Ignite Consulting. We're going to go over some really awesome stuff today. Steve's top five points, potholes. Dealers might be stepping in as far as their legal and compliance. We cover things like an annual document review, complaint management software, credit reporting, staff training, written policies and procedures, a lot of really great stuff. Steve, say hi to everybody.

Thanks for having me. I'm really happy to be here. I think this is going to be a great session.

All right, guys, here we go.

You are listening to the Independent Dealer Podcast with hosts Luke Godwin and Jeff Watson. Thank you so much for tuning in. Let's do this.

So, Steve, thank you so much for joining us today. Give us real quick. Give us a little bit about your background. I mean, how did you get into this exciting business of compliance and consulting?

So, I'm an attorney by trade. I've been doing this about 30 years. And I spent about the first 10 years of my career representing dealers, finance companies, and every kind of crazy lawsuit imaginable. You know, the typical crazy stories that you hear, the car that ends up in the pool and, you know, people hiding cars from the sheriff, things like that. So got really busy with that. And then at some point, I had that epiphany moment and said, wouldn't it be great if I could stop my clients from getting sued, stop them from having to deal with litigation? And that's when I started more to focus on the compliance and the training, things like that.

So you saw dozens of dealers doing it wrong and thought to yourself, we need to fix the problem, not the symptom. So, Steve, we're going to talk about that today. I wanted to go over kind of the top five faux pas or issues you see dealers have. What would you start us out with? What is that number one where we should dive into this.

So the number one thing I see, and we work with dealers, all different shapes, sizes, all around the country, that the number one mistake that I see is dealers don't get an annual document review. They use the same documents year after year, and they're just hoping that they're getting it right. And you have to check those things because we routinely, when we first start working with somebody, the first thing we do is ask for a document review. And we routinely See, mistakes. They switch dmss and they didn't realize that some of their documents fell off or that they added a new general manager who added a couple of documents, and those things contradicted other things that were in different documents. So you really have to have a comprehensive package because that's what you're presenting to the customer. And then that's what ultimately you have to defend yourself with if the customer attacks.

Yeah, that's true. I literally, I mean, honestly, the reason that sparked this whole conversation, and Luke might be able to speak to this more, but we had a dealer in our 20 group. I don't know how much information we can share, but he got sued a class action lawsuit for quite a few dollars because he'd been doing some practices that weren't quite right. And we can get into that some more. I'm sure that'll be a topic one of year five. But I realized, I mean, you're talking about an annual review. I don't know that many of us dealers have ever had a review period of our documents. I think we're just printing out whatever comes out of our dms.

Well, I got a question on that, Steve. I mean, aren't you good? DMS is supposed to make sure that the documents they're providing to us are, are vetted and are the right thing. I mean.

Okay, so this is a topic I'm particularly qualified to talk about because I used to be the general counsel for autostar. Well, which was a dms, which I.

Which I used for years.

Okay. So every DMS I can pretty much guarantee is going to have wording in their contract that says that the dealer is ultimately responsible to look over the documents and make sure the documents are right, that the dealer owns the documents, and it's your responsibility, not the dms. So that's number one. Number two, the DMS doesn't run your business. You run your business. You know how everything is supposed to be working. And during my time at autostar, I saw plenty of occasions where the dealers were doing things contrary to what they should have been doing with the software. So that's really something you can't rely on. Whether it's a software provider or really any vendor, you've got to take responsibility and make sure that you're running your business.

Yeah, I understand that, but. Yeah, I understand that. I guess my, my biggest thing is if we have a contract that is a plain paper contract printed by our dms, I mean, the probability is pretty high that it's been vetted and done Properly, if it's a good dms. Correct.

Let me give you some examples. So, yes, just about any DMS is going to have vetted retail installment contracts. But in doing document reviews, I see plenty of instances of where the retail installment contract will have an arbitration clause, but then the dealer adds a separate document that has either a competing arbitration clause, which isn't good because the judge is likely to knock both out, or it has another document that contradicts something in the retail installment contract. So if the DMS is going to be responsible for its retail installment contract, yes, but there's a whole lot of other documents that could undermine the DMS documents.

And you just said something that, that I didn't even think about. Most contracts do have arbitration clauses, and I know many dealers get another arbitration contract sign. I mean, arbitration document. Is that counterintuitive? I mean, that sounds like what you just said.

That's a big problem. And a lot of times. But the way it happens is the arbitration clause, whether it's in the retail solar contract itself or it's in a separate agreement, that's great. But then maybe they'll have a vendor that they start using that has a different arbitration clause in their document. But it's not limited to that document. It basically says the entire transaction. And that's really problematic because if that goes in front of a judge, a judge is likely to say, well, that's confusing to the customer. And that argument's been used to throw out arbitration altogether, keep people in court. The other thing you have to watch out for when it comes to arbitration clauses is quite honestly, I've seen some that are really poorly written. I've run across one recently that the dealer was on the east coast, but for some reason the clause they were using demanded arbitration to be held in Phoenix, Arizona. I think the judge would look at that and say that that's not convenient to the consumer. Let's throw it out. I've seen others that call for use of commercial arbitration rul, which is going to get thrown out because transactions and consumer transactions. So I'm a huge believer in arbitration clauses. If I were in your business, I would not be doing business without using an arbitration clause. It is very valuable to defend yourself against lawsuits, to keep yourself away from runaway juries and class action lawsuits. But you have to make sure you're doing it right. So that's some of the best advice I could give you today is use an arbitration clause, but make sure you're doing it right.

Yeah, I would say sometimes you don't know what you don't know. And I think a lot of dealers piecemeal this all together and kind of hear something, so they go and grab some document out of their dms or they copy and paste it from a buddy, and then they throw it into their document package all of a sudden, and it becomes the lay of the land for their dealership. And it doesn't make sense or it's confusing or I didn't even know I was supposed to have arbitration or GPS disclosure. So, yeah, I definitely think.

That'S what a lot of dealers do. It is kind of thrown together over the years, and that's dangerous. And I'll tell you, the more that that dealer is, you know, that they grab paperwork from another dealer, they find something on the Internet. I call it practicing Internet law. That's really dangerous because it may not work in your state and your situation.

But is it similar to where, like, you know, I have friends that are like, well, you know, I'm gonna do this on my taxes and my accountants. I mean, he signed off on it like, he did my taxes. No, no, no, no, no. When the IRS sues you, they sue you. They don't sue your accountant. So when you screw up in your documents, they're not gonna sue your DMS provider, Likely, they're gonna sue you, the dealer. Right?

Yeah, that's exactly right. You can't take that liability and try to throw it over the fence at.

Somebody else because they're the document provider.

Right, Right.

Okay.

You're one. That's not in the contract. It's liabilities on you.

Number two. What's the second thing? We do our annual document review. What else?

This is kind of a broad one, and you've heard about it a lot in different forums. But I'll just give you the practical approach. You have to have some sort of robust complaint management process at your dealership. I see so many lawsuits happen because little problems weren't nipped in the bud and became big problems. Heck, just recently, I'm helping a client get out of a lawsuit, and it turns out that they were sued because the customer is talking to somebody in servicing, and they were just disagreeing. And this servicing agent made a flippant comment, well, go ahead and sue us. Well, sure enough, they went down to legal aid, they found a lawyer, and they did sue him. You have to have a good way to track your complaints, and that doesn't mean buy expensive software. I tell most of our clients you could do it on a spreadsheet, but you have to do it daily, weekly, monthly, you have to look at what you're doing. You have to make sure everybody understands what a complaint is, what the definition is. You have to understand what you want your workflow to be and how you resolve things. And I will tell you, there's a big correlation. Our clients that do it right do not get sued. But the ones that struggle with it and don't want to invest the time in it, they are constantly dealing with either social media complaints, escalated complaints, regulator, because they're just not willing to put in the work to do it right.

That's interesting. I think everybody needs a complaint department, and that should be probably one person within your dealership that handles Heat customers. So we need to take it a step further, though, Steve. I guess if it gets to that point, should you're saying to have a document that that Heat employee fills out every time there's a complaint, is that. I mean, how do we determine.

You have to define what a complaint is.

Yeah, that's what I was about to say. What is.

Yeah, because some people want to write down everything, and that's kind of ridiculous because every little dissatisfaction becomes a complaint. In my mind, a complaint is something that the customer voices where they're not happy with a product or service that you provided. So it's tangible. And you write it down in one place because it becomes very important for you to identify, here's what people are happy with and here's what they're not happy with. In fact, one of the pieces of advice that I give to clients is put something on your website, tell us how we're doing. So you're giving customers the pathway. Put a sign up at your dealership, let us know how we're doing, and give them an email address, something to go to. You want your customers coming to you and voicing those things instead of just getting frustrated and going on social media and blowing you up. Because I've seen a lot of instances where that happens. And once it goes viral like that and starts working its way around, it takes a life of its own.

Yeah, that probably could bring other people in. If somebody really wanted to do a class action, say, well, you know what, I was treated that way, and then next thing you know, you're in trouble. That's very good advice to do. And, you know, I don't know if a lot of you know this, but if anybody's on the Google suite for email, you can actually take what's called, like, I think they call it a ghost email. And you could have complaintsalwomotors.com and that can go to your complaint department so that you. So that you can keep track of that. And also, like Steve was saying, that's a good way to make sure people are being addressed as they should be.

I would strongly recommend. Don't call it complaints, though.

Yeah.

Negativity. To let us know how we're doing.

That's right.

Hey, everyone. Just a quick, quick interruption to the podcast. Luke. Last week we had a great episode with Taxmax. We want to let everybody know they have done a special for listeners of the program.

That's great.

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Yep. Call Bill, use the promo code, podcast, get 25% off. Back to the episode. That's great. And it comes down to two. I think we had an episode talking about, you know, the Google review and responding to those Google reviews. And I think all you're really trying to do is just get ahead of these things when they're small, small fires before they become large, large issues. A place for customers to kind of get that out of their system and maybe get heard.

I'm sure Steve would say this as well, that the worst thing you can do is ignore a complaint. Right?

Yeah. You do not want to ignore complaints. You have to give customers that pathway to ventilate. Usually there's a resolution there, but once you let them come. But if you ignore them, that's when, you know, it used to be they go to the Better Business Bureau. Now they just go to social media. I had a call a couple of months ago from a dealer that had 40,000 views on a customer complaint that went viral. And if you look at the comments, they had people from all over the country weighing in, that they had lawyers weighing in. You don't want that kind of attention. You've got to give them the pathway. You got to let them take care of it with you.

Agreed.

Yeah.

So what's the. What's. What's the next thing there, Steve?

Oh, gosh. The number one lawsuit being brought against creditors these days is either not furnishing correct credit information or not handling disputes properly. So I think that that really big one. We work with a Lot of people that have never looked at how they furnish. They rely on a third party provider to do it. They press the same button every month. That's the extent of what they do. You have to make sure that you're better than that. We could teach people in a couple of hours, we could teach you how to do a self audit. If you don't want to do that a couple more hours, we could do the audit for you and kind of tell you where you stand and identify a great deal of your risk right then. Same thing with these credit disputes. This has become a cottage industry. A lot of law firms have set up separate credit repair type organizations to hunt for cases for them. It's really dangerous out there, especially in certain parts of the country. So, you know, you may be getting that same letter every month for three months and you think it's the same letter and you throw it in the trash. But that letter, I pretty much guarantee you, has been designed to trigger action on your part. And if you're not responding correctly, they're setting you up for a lawsuit. And those are really sticky lawsuits. Usually people wind up writing a check for a couple thousand dollars and settling them. And that could all be avoided if you just do a little bit of work up front.

That brings up maybe a larger topic. Luke and I don't think we have time to get into it, but is there any advantage to not reporting credit these days? I know we've spoken to some dealers that are like, I'm just going to stop doing it altogether. Stopping is one. I don't know how you ever get off the train, but, you know, five years ago we all wanted to report, and now none of us want to report.

I tell people, you know, if you are in a market to where you feel like if you don't report, it's a competitive disadvantage, then you should report. And you have to invest the resources to do it correctly. If you don't feel you have that situation and you don't need to report and the clientele in that area doesn't care, then, you know, you may want to think about not because it is responsibility, it can be liability. Now you said something important, though. If you want to stop reporting, that's a whole other discussion that gets involved. What you've been doing, what you advertise, what you represented to customers. You may not be able to stop immediately. You may have to do it over time.

Yeah. So help me out. When I get those little mailers from Experian saying someone's disputed their. Their account. I can't just throw those away, right?

No, you better not throw those away. Or, gosh, I worked into a dealership, I guess it was sometime last year, and there was a pile, and that's all the pile was. And that's really dangerous. You are responsible, not only by law, but you're responsible under your contract with the credit reporting agencies to conduct an investigation. And if you don't, and I've, I've handled some of these lawsuits where you both get sued. You and the credit reporting agency both get sued, guess who they're going to be looking for? The credit reporting agency is going to turn right around, point the finger at you and said, look, you never responded. You never did this. So it's important that you do this the right way.

Is there any.

So can I just write. Can I just write agree with the customer? You know, there's those four boxes. Can I just say whatever they say is right and send it back? Because they're not going to complain if I agree with them, Right?

Yeah. That's a really dangerous thing to do though, because that's not accurate.

But they think it's accurate. So who's going to say it's not?

Sometimes it isn't. And if you do an investigation and you believe you're right, that would be inaccurate, and that could set you up for problems down the road. So it doesn't take a lot to learn how to do a meaningful investigation, look at it, and handle these correctly. It's the type of thing that we can teach you very quickly.

Yeah, we have a whole person that's been handling this and been doing it for years. So what we see, Steve, and I'm sure everybody out there sees, is you get these form letters from credit repair companies over and over and over and over again. Those are different than the ones that come directly from like E. Oscar from Equifax. And these type things, are they handled differently or is it the same process?

Those are different because one is a direct dispute, one is an indirect dispute, and they do get handled a little bit differently. And I want to caution you about those letters that you're getting. You may think that the same, but a lot of times they're not the same. One sentence is different. Maybe one reference to a statute is different. And when you don't respond correctly, that leads to a lawsuit. That there are actually law firms. This is what they do, this is what they specialize in. So you really have to be careful and not just assume, well, this is something that customer picked up on The Internet for five bucks.

Yeah, okay, fair enough. I still think you should report credit, but we do all the really hard work. If somebody disputes, we're gonna dig and make sure we didn't mess up, because, hey, sometimes we do.

Right?

Hey, everyone. Sorry for an interruption. We're not sorry because we're telling you about a great product. Dealer re Reinsurance is the way to go. If you're not already using reinsurance, you're losing money. Jeff, why is it so important?

I just look at it at the end of the year, buddy. Tax time, man. I'm looking at how much deferred, rerouted income I get to do by taking the expense on my warranties, putting them over in my reinsurance company and not paying those taxes right now.

And also, you know, selling that extended service contract, one you can believe in, one that you know is going to help protect your customer because you have control over it.

Yeah, yeah. I mean, I used mine three, four times last week. Great. Great headache and savings. So call the guys, Tim and Taylor Byrd over at Dealer Rent. Back to the podcast. All right, Steve, give us a couple more. Give us a couple more.

So one thing I'm a big believer in is you have to train your people. And we work with a lot of people all around the country, from management to, you know, people right in the door. We're trying to help them learn the business and do their job. And some of the big feedback we get is nobody's ever taught me how to do my job. Never. Nobody's ever talked to me about this compliance stuff. I routinely talk to sales folks that can't tell you why a buyer's guide is in the window and what it has to do with anything. I talk to folks that can't tell you the difference between an extended service contract and a limited warranty. Those are just a couple examples. So you really need to give your folks a base education and train them. And I'm a big believer. I do not like cookie cutter training to where you go to a class online, you answer a couple of questions, and that's it. I think that people should have the ability to ask questions and have feedback and have discussion about it, because so much of this business is gray. It's not black and white, it's gray. And your people have to understand what's being expected of them and how they're going to help keep you out of trouble. So, you know, just spend a little bit of time. And in the last six months, during this pandemic, there's been a decrease in emphasis in this area. And I think that that's dangerous. And I'm starting to see it percolate up where that lack of training is causing some issues and creating complaints, creating some liability.

That is so important. And we, we try to train as much as we can, but you can tell salespeople over and over again, you know, how to explain documents and this, that and other. But you still run into problems and they're not explaining it right. What do you think about these companies out here that are closing, that have a computer closing the sale? You recommend that or what's your thoughts on that?

So I'll give you a disclaimer. I was actually Secure Close's attorney for a while and I've done some work for Secure Close, so I'm a believer in their product. I have that prejudice because I've seen it before and I've worked with it. I think if you could take some of that personal variable out of the equation and stick to the facts, that's a really good thing. Because if it's written correctly, if it's done right, the closing is going to be the same way every time. And that's a huge risk that you're taking out of the equation. But it's good, but it's got to be done right. I've seen write scripts, you know, we're going to record all our closing and they write scripts and the scripts contain some pretty big flaws. And then it's a bad thing that I wish wouldn't have done it. But if it's done right, I think it's a really valuable tool.

Yeah, I mean, it only makes sense. I think we see it in. If you have a dealership of a medium to large size, it's just very, very easy for nonsense to work its way into the verbiage of what someone's using on a contract. Right. They all think that the buyer's guide or that the limited warranty or that the GPS disclosure needs to be presented this way. And it gets completely skewed to some nonsensical explanation. And you're like, how did you even. Where did this come from? Like who? Well, Bob taught me how to say it that way. Well, where did Bob get that from? Well, Bob was just lazy one morning and it worked into his vernacular and all of a sudden he started explaining it in a completely backwards situation. I have the same problem, you know, with collectors. Hey, when did we stop sending letters out? You know, like, when did this happen? I don't know. I was just never taught to Send a letter. Okay, so we've not been sending our right to cure letter for how long?

Just don't say that out loud.

That creep up into your dealership. Hypothetically speaking, if that were to happen to a dealership.

Yeah. So this is a really good discussion. So you don't have to say, okay, we're going to record all our closings and we're going to build this huge process, but at the very least, make a script and have your sales folks and your FI people all sign off that they got this script. And here are the key points in the script. Here's how we explain the contract. Here's how we explain gps. Here's how we explain arbitration. You're giving them enough information so if the customer answers questions, customer asks questions, they can answer articulately and not just pull something out of thin air. It's always better to say, I don't know and get the answer than to just make something up out of thin air.

I agree with that. And then your salespeople, if they're not being trained, they're making something up out of thin air. Just to let you know, let you all out there know that.

One of the things I really like about these closing platforms is they do a good job of providing enough information, answers those customer questions to where they're not going back to your folks and catching them cold asking things they don't know the answer to.

Yeah. What happens, Steve, when you do a good job closing customer and then, you know, months later or weeks later they come back, well, I didn't know I was paying this for the car or I didn't know my payments were X. How's a good way to handle that, Steve? Because you, you know, you explained it to him. You showed him exactly what the interest charges were. You showed them what the rate was, and then a year later, you know, they, I'm paying 24% interest. What are you talking about?

It's not even a year. It's like a week.

Yeah, well, we have it after a year sometimes. What is there a good way to handle that?

So I think the, you know, I'll call it a trick that the trick is to present the information in the best way possible. So you've got, you know, sometimes it's 4, 6, 8 page retail installment contract, you got a ton of information. All of it protects you. But there's nothing wrong with doing a separate document that asked for a couple of customer initials that just says, I understand my payment is this. I understand that it's due here. I understand that I have to have insurance with so much deductible and just pull out those key pieces of information and have them initial that, sign that separately. When I used to do litigation, I've done trials to where that document saved the day for my clients. I remember one case in particular. The customer initialed in 14 separate places on this document. I mean, it just laid out all the responsibilities. And. Is that your initials? Yes. Is that your initials? And just beating the customer over the head with it in front of a jury. And it took the jury about five minutes to decide. So that's a really valuable thing to do.

That is a great idea. And is that a document we can produce on our own? Yeah. I mean, is that.

I would. I would suggest that we talk and go through it together and make sure that you don't push too far, because some of y' all are really good entrepreneurs. And you'll try to put the kitchen sink in there if you can.

Then it just becomes a big old document again.

One page. You want it to be nice big font. You want to have a place for initials or a signature next to it. You just want the high points. You don't want to regurgitate the entire contract.

So, yeah, that's a great idea.

About how many different documents does the average dealership have at closing now?

I don't know that there is an average dealership. I did a document review yesterday. It's the shortest one, and I've done it a long time. That they had like, six I won last week. You were probably 30. Yes. I don't know that there is an average. It depends on the state you're in. It depends on whether there's a trade or not a trade. I mean, there are some forms you need in certain circumstances.

When you review the six, were you like, man, you guys are completely exposed. Six is not enough. Or could someone get away with that because they had the right ones?

What they were doing, for what they were doing. It was, you know, it was just the facts, but. But that worked. They didn't really offer aftermarket products. They didn't have a whole lot of other things that they were doing. So that they were just doing a basically sales finance transaction. They didn't have to worry about GPS or a whole bunch of these other things that you get into.

Mm. Hey, Steve, I know this kind of gone into a whole document thing. Is there. Is there anything not smart about having front and back on plain paper forms? Or is there. You have an opinion on that?

You know, I think as Long as you're getting folks to initial everything, whether it's front or back, I'm fine with that. The problem that I run into occasionally is I see folks that they haven't read their documents and they just let the customers skip sections and not sign things and not initial things. And then when they try to hold them to it, you know, it's really hard to argue that the customer knew.

So what's the best thing to do if a customer comes to you and there is a complaint and for some reason you didn't get that document signed or there was a missed initial.

What'S.

The best way to resolve that at that time? Before we get into litigation, is there a. Is there a good way to go forward then?

Yeah. I'm a big believer that you have to listen to people. There are people that they are serial trying to get a deal and trying to trick you, but for the most part, people aren't doing that. You have to smell out the bad ones and then you have to be willing to work with the other ones. And if you've made a mistake, you admit the mistake and you move on. If something is gray area and you got to bend a little bit to get them to keep the car and keeping making their payments, you do that. You know, this is ideally, this is a long term relationship. So sometimes you have to bend a little bit and be candid with yourself about when you might have fallen short.

Yeah.

Do you find that's the biggest headache or the biggest catalyst is stubborn dealers, bull dealers that just want to dig in in the beginning and be like, no, they were, I was right, they, they were stupid. And then it blows up into some big thing and you look back and say, hey, buddy, six months ago when this guy came in and sat down with you, had you just conceded this small point, you would have saved yourself hundreds of thousands.

Yeah, I think it used to be a lot worse, actually. I mean, back when I was going to court, I dealt with a lot of those where dealers were just unwilling to see a middle ground. I think now between all the good information on social media, all these dealer groups, the 20 groups, just all this effort that you all put into talking to each other and knowing what's going on in the business, I think that really helps. I think for the most part now our clientele is pretty honest with themselves about what they do well, what they haven't done well, and they take care of things. And it's only those extreme situations that turn into complaints or something more.

Yeah, sometimes you'll See those dealers that want to respond to a negative online review and just air out the laundry and really let this customer have it, you know, because they think that's them standing their ground or standing up for themselves. They're not getting pushed around. And you're just like, oh, man, you know, this could come back to bite you.

That's a pet peeve of mine because I have seen so many folks create liability for themselves by going too far on social media. You've got to be very careful. Remember, your customers have privacy rights. And I know you want to blow them up, and I know you want to tell your side, but a lot of times it's just better to say there's two sides to every story. We respect you as a customer. You have privacy rights. Please call us and we can communicate about this.

That is the only way to handle it.

You're not so much trying to convince that customer, but you're trying to show the rest of the audience that we're not emotional, we're not knee jerk. We understand the customer relationship. We hold it sacred. And if you become our customer, we're not going to do that to you.

Yeah, that's the biggest thing at these dealers, or anyone for that matter. A business lights into a customer and you just think, well, I don't want to do business with that guy because if I get sideways with him, he's gonna. He's gonna light me up.

And that's. And it's not even. And this is something that also needs to be trained. Your dealership, it's not even the dealer. You can't allow the salesperson to do that either. You can't let any of your staff just go rogue, because if they do, that causes you problems. So make sure that you train with the staff on how to deal with heat customers and how to deal with people who aren't happy with them, because it's gonna happen. There's. There's none of us walking earth today that's gonna make everybody happy every time we do something. So you need to train, you need to make sure that you're getting across to your. Your customers and your employees that this is how we handle things. And it's top.

And again, the last six months, I've seen a decrease in training as people have been so busy with other things. And you really need to start re emphasizing that to your folks.

Yeah.

Cool.

Steve, give us final one more tip in closing.

So whether it's policies and procedures on things like, you know, collections having written policies or procedures, it could Be collections. It could be the credit reporting content. I think written demonstrable policies are really important. Something I see a lot of dealers not emphasize that I think is super important, especially in this day and age, is their employee handbook. You need to have a good employee handbook with an arbitration clause, I might add. You need to make sure that everybody reads it. You need to get them to initial it once a year. You should take an hour, it's one hour a year. And go through the handbook with your team, make sure people don't have any questions. There is so much employment litigation out there in this day and age that you really have to protect your business and make sure that folks know that relationship is governed by this handbook. And here's the rules for all of us.

That's very good advice. Yeah, yeah.

You know, I had this thought the other day and this is probably again, not something I should admit on the podcast, but there should be a strategy. And it might be specifically just with mechanics, but I feel like when I hire a new mechanic, I should set them up for some sort of petty theft situation inside the dealership that they don't know that I know about, but that they've taken advantage of. So that three to five years down the road when I have to fire them for something, they want to start hurling threats for this, that or the other, just nonsensical stuff at me or their managers. And I'll just be like, hey man, did you know that when you got hired, I know that you stole that thing from us and I'm just going to keep that in my back pocket. Is there some sort of like quid pro quo blackmail policy that I can replace Steve? No.

Okay. But I do think that there are things that you could emphasize or documents you could have them sign and you get them to admit that they understand the rules of the road that they're going to be held to at your business and you know, if they don't follow them.

And a non disclosure.

Well, okay, so let's talk about this for a second. I think non disclosure agreements are really important. I think that confidentiality agreements, non solicitation agreements for key personnel are really important. I've seen dealers have to get involved in messes because they weren't using those type of documents. And I think that we're talking about HR things. Progressive discipline is really important for folks to follow. If you've got that paper trail and then that process that you follow over time, it's going to save your bacon. So let me be real clear when we talk about non disclosure agreement. You know, everybody, I don't care whether it's, you know, your lowest level person or your highest person. Everybody should sign a document that says I'm not to disclose anything that I come across while I'm working here. Whether it's your secret sauce, trade secrets, proprietary information, your customer information. I'm not going to disclose that. And then you should have, you know, a non solicitation for key personnel. And I don't care whether it's a month or two. You know, if you try to make it for a year or two, some jurisdictions get a little bit funny about that. But, but even if it's just a month or two, it stops your people from walking out the door. You know, it used to be that they took the Rolodex with them. Now they just take their cell phone with them because they've taken all of your customer information, put it in their cell phone. So you need to have a written policy about that. And then you need to say you can't do that and you're prohibited from maybe it's even a month. You're prohibited working for a competitor of ours in a five mile radius for a month. I mean that right there is going to let you get a hold of things and you know, if you need to pursue it, you're going to be in a much better position to do so. So I think those things are really important to think about.

Well, Steve, you and I need to have a conversation, that's for sure. How do the dealers that want an audit, that want to talk to you more, how do we get a hold of you?

My email address is steve.levinegnitecp.com or just send an email to infoignitecp.com our website is igniteconsultingpartners.com we'd love to talk to you. We have all different sorts of arrangements. We understand that there are small businesses, big businesses, you all have different needs. We love to work with dealers. We love to talk about this business.

Awesome. Steve, thank you so much for joining us today.

Thank you for having me. This is wonderful what you guys do.

Thank you.

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