152 - Time to Plan Your Dealerships 2021 Roadmap

Welcome to the Independent Dealer Podcast with hosts Luke Godwin and Jeff Watson. A podcast by Dealers for dealers. Here we go.

Welcome to another episode of the Independent Dealer Podcast. Today, Luke and I are going to follow up on our conversation from last week we had with Jim Rhodes, and we're going to talk a little bit more about setting our goals for the new year. You know, last week was all about looking back at 2020, making sure that you are tracking your key performance indicators that are crucial for the health of your dealership. And this week, we're going to talk more about how to project into 2021. Right, Luke?

Yeah. And, you know, Jim had a bunch of interesting KPIs, and our forecasting sheet are pretty much my KPIs, so, you know, it's a very interesting topic. It's something that you should do every year. Joe Lascoda taught me that probably eight years ago. And some of y' all may not know Joe Lascoda out there, but I would say he's probably one of the best dealer trainers on the block. And ever since we did that, our business has changed. And I think that is something everybody out there should do. And we've given you actually the worksheet to do it, right, Jeff?

Yeah. Yeah. So it's just like, you know, the old analogy, like, you're not going to go on a road trip without a roadmap. You're not going to go somewhere without punching into your GPS and not how to get there. So why do we just plow into 2021 without any kind of roadmap or metrics or game plan to achieve it? So Luke has put together Google or actually an Excel spreadsheet. We have it available for download on our website. So this is going to be more of a workshop. It's going to be a different type of podcast. If you are used to just listening, hopefully you'll be able to follow along in your brain. But it's probably going to do you a lot more good to go to the YouTube channel and follow along, or at least download the spreadsheet and follow along through audio while we go through this, because we are going to be actually going through the steps of how to forecast. Luke and I are going to kind of take a hypothetical business, plug the numbers in, and show you guys how to use this tool, this Excel spreadsheet tool. So go to theindependentdealer.com about halfway down under our newsletter subscription button, you'll see a little link that just says, Download 2020 goal projection spreadsheet. And that's what we're going to be working off today. So if you are on the YouTubes, you will be able to see the screen share. Hopefully. If we knew how to do this thing right. And we're going to walk through this goal setting and forecasting sheet. Luke, start us out.

Luke.

There's a couple of assumptions we got to get into.

Sure. And I want to just tell you that if you're not, you know, if you're retail only, then you may want to change the first thing. And I think the first thing to look at is sales per month goal. So if you. If you don't do buy here, pay here, take the buy here, pay here out. If all you do is buy here, pay here, take the retail out. If you do retail plus cac plus buy here, pay here, maybe you need to add a line. So just remember however you want to look at it. But I don't. I think it's very important to look at it broken down and not just one particular thing. If you do multiple things. You understand that, Jeff?

Yeah, absolutely. And I think, you know, we're gonna go all the way from the start of the sale for the retail dealers. And then we're also gonna be getting into, you know, the write offs and the charge off for the buy here, pay here dealers that are out there. But if you're a retail dealer or a subprime dealer, you can just substitute the buy here, pay here section, you know, the charge off section for your discount. You know, you can look at that and say, okay, here's my retail sales, here's my gross, but here's my discounts. I'm just gonna put that in the repo line where the buy here, pay here dealers put their charge off. So that's a great idea.

I didn't think about that, Jeff.

Kind of the same deal. So I think, I think we can. This is gonna work for our all dealers, right, Luke?

Yeah, I think so. And like Jeff was saying, there are certain things you need to know. You need. You need your last year's. Well, you need yours sales goal per month. So the way I look at this is I want to look at last year and decide whether we want to grow this year or we're going to be about the same. Are we going to do less? Because, you know, some people may have decided last year, hey, I did. I did 15 cars a month, and I'd like to get to 20 or. But there may be some people out there say, I did 15 cars a month. And I want to do 10 next year. So you need to have that in the back of your mind. So if we look at the windows, start there, Jeff. Or do you want to go through each one of these first?

Yeah, let's do that. We're going to pull up these assumptions. These are 10, 9 numbers that you need to figure out first in order to plug these into the spreadsheet.

Sales goal per month. That should be pretty easy. Also, average gross per deal. So look back last year, and last year was an interesting year. So if you have at least two years of data, you may look at that and see if that's pretty normal as it fluctuated some. We did see our average gross per deal go up last year. So you need to look at that and assume that it's going to be pretty much the same as it was last year. Probably not much difference. Your doc fee is pretty standard. That's set by your state. So, Jeff, what is your doc fee?

299.9.

So gap penetration. So if you're selling gap out there, you should know the penetration rate. So that, that means If I sell 10 cars last month, how many Gap products I sell? We do pretty well with this. We're at about 60 or 70%, which is really high. Yeah. Most people are going to probably fall around the 30% when you think.

Yeah, I would say so.

30%. And the profits probably 250. A contract up to you may. It might be a little higher.

Yeah.

It just kind of depends on what your state allows service contract as well. You need to know what your percentage is there and what's your average profit per penetrated deal.

Yeah, obviously with the service contract, hopefully, especially if you have your reinsurance company set up dealer e, you want to have a high, high penetration in the 70 to 80 to 90% on service contract sales.

But that's not the ones you're giving away as a warranty. This is something you sell on top of that.

Right. Service contract.

I think last year we ended up at about 50, 55 to 60% penetration. And so. And then your, your average profit per contract. And there may be different. You know, if you're selling a 24, that profit may be different in the 36. So I'd break those apart and make sure. Make sure you break those apart.

What are you making typically on like a 1212? I mean, we $400.

I don't know. I don't sell 1212.

Okay. But I got a 24. 24 or 36? 36.

So 24. I think we're gonna make 795.

Okay. On top of cost. Okay. So you're a little stronger. I'm gonna, I'm gonna go with some safe numbers and easy for us to calculate. Okay, sure.

Average monthly payments for this is out there for the buy here pay here. Dealers you should know. Well, so it's not my average monthly payment that we're going on here, Jeff. It's actually the average we collected per account for the year.

Okay.

So what I do is I look back at my total collections for the year or for each month, and I look and say, okay, If I have 500 accounts at the beginning of the month, then I look at what I actually collected for that month, I just divide that and I do that for each month throughout the year, and I come up with the end number. So, okay, at the end of the year of 2020, I collected something like 457 per account. Okay. So when I look per month. And so when I look at that I go, okay, I know this is what I'm gonna probably collect and what historically I've collected. So what I'm gonna do is take that number and multiply it by the amount of accounts I had at the beginning of the month. So If I had 500 accounts beginning month, multiply that by 457. What does that number come up to? 500 times four. What I say 57. Mm. That's $228,000. $228,500. Okay. Mm. So that's gonna be my, that is gonna be my projection, my forecast.

Yeah, we'll go over that in the next sheet. But for this, your average payment collected was about what were you? $400.

Think 400 is a good round number to use.

Okay.

Okay.

Then of that 400, what's your average interest?

And it's probably, let's say $100. That's probably a good number to go on.

Okay. Okay. Repos a month. This is for our buy here, payer guys, of course. Or you could put this in as your discount.

Yeah. Or if you have any chargebacks or anything like that, you know, kind of, kind of depends on which way you look at it.

Uh huh.

So you know, just take your, your repo number and you know, I think industry average is probably around $5,000 loss per. Per repo. So I think that's probably a good number to go on.

Okay. And you're probably five a month. If you've got 500 accounts, you're doing 1% a month, 2% a month.

I think they're probably higher than that. So as industry average, you're going to be a little higher than that. So but I think. Let's just say 10, I think is a good round number probably.

Okay.

And at $5,000. Copy. Okay. And then service income, you may. You have to change that as a number there, buddy. Service income, you may have a service department, you may not. But I really think it's something important to look at. It's really. I mean, it's important for me because it's a key part of our business. So I'll project that as well for next year. And the best way to look at that is look at your total sales for the year and decide again if you're going to grow or not. Have you grown over the last three or four years? And if you can. Look, I know that my service department is growing about 10 to 15% a year. I do know that it's not going to continue on, that I'm going to level out at some point. But I forecast it, I think this following year to grow at about 12%.

Okay.

So total sales would grow at 12%. Your profits not gonna grow at 12%, just to let you know that.

So service income, you'd say.

And that's. Are we looking at net service income here? Are we just looking at sales?

I don't know.

Okay. We're looking at both service sales. And then. So service income would be your total sales, let's just say $50,000.

50.

50,000. And then you're going to. Probably less. You're going to aim for about 15%, but it's. You got to have a really good shot to get there. So let's base it on 9%, so about $4,500 net income a month.

And that's the number you want here. You're going off net income.

We're going to go. We're going to have another line there, Jeff.

Okay.

For ServiceNet.

Okay. Hey, everybody, real quick to jump in here and plug our sponsor tax Max Luke's. It's tax time.

It is. It's. It's getting there, right? It's not quite there. We got to get through the riots and all these craziness before we. Before we get into tax season, but I'm ready for it. January is. It started off a little slow. How about you, Jeff? Are you doing some.

Well, I reached over to get into my safe to pull out this check. So if you guys are on the YouTube channel, you watch the video. That's a $6,000 deferred. Not even deferred. It's a customer of ours. It's great. They came in, we filed their taxes. They get, like, $8,500 back every year. They got the refund advance max. So I got a check for $6,000 guaranteed. I printed it right here at my dealership. I'm gonna go stick it in the bank this afternoon. We put it towards their down payment. They got into a new vehicle, so it's wonderful. That's the beauty of Tax Mex. I already literally have my hands on tax cash right now.

That's crazy. So I'm not as. I'm not as good at that as you are, so make sure y'. All. You're telling people you're doing tax max, right? That's. That's one thing that. That I forgot to do this year. So tell people you're doing it and actually do it, because as Jeff is proof, he's already got tax money.

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That's awesome.

Back to the podcast.

Okay.

Okay, so these are our assumptions we're going to make with this model. So now let's get into the actual forecasting spreadsheet. This is the one you guys can download from our website, the independent dealer. About halfway down below our subscribe button, you're gonna see a little link you can click on. It's not spam, it's not malware. It's not gonna crash your computer. Hopefully run it through Norton. This is the little Excel spreadsheet you're gonna see. So I think you've got most of the calculations built in here. So let's go through these steps. Luke, how do you go about forecasting your year? How do you have this tool in your dealership?

So we're gonna. Don't. Don't type in that top box, of course, because there's a formula there. So what I'm gonna do is I'm gonna look at what I did last year, and then I'm gonna look at What I did in 19, and I'm gonna decide whether I'm gonna grow. What do the current conditions look like? They look like we're gonna sell more cars next year, or does it look like we're gonna probably be lucky to do the same? So I go month by month now. You don't have to do this. But I know that in January, we're going to try our best to hit 35 total car sold. And that would be, you know, 30 buy here, pay here deals and five retail deals.

Okay.

And you see it totals up there. February is going to be a little better, right? So let's say 35 buy here, pay heres, and 5 retailers, and we're going to stay at 5 across the board on the retail because that's historically what we've averaged. And we have found out that if we try to go any harder there, it hurts everywhere else. All right, so March, we're going to do about the same as February. Let's say 35. This is actually my projections, these actual projections from last year. We're going to. We're going to slow up a little bit in April. Then we're going to do 28, and we're gonna do 28, April, May, June, 25 in July because it's too hot to come outside. And August, we'll do 30 because for some reason, August is better. September, you know, September, everybody goes back to school. But still, it can be pretty strong. So we'll do 30 there, and then October is always good. So 32, 30 November, 30 December. Okay. And so if you look at the end here, that's gonna give you the total car sold for the year421. And I'm gonna tell you how close I got to that number, Jeff. Which is. Which is hilarious. We did 410 cars. We did 362 buy here, pay here deals. So I was within one number of that.

Wow.

And we did 48 retail deals because I was projecting maybe a couple more than I should had last year. But it's interesting that for two things about forecasting, don't go crazy, right?

Okay.

I learned this from doing triathlon. And when you do really long distance triathlon, you always have an A go goal, a B goal, and a C goal. So you're out there, and before the race, I'm a, I'm gonna do this, you know, I'm gonna go 10 hours at Ironman. And then you go, well, you know what my B goal is? Me to break 11 hours and my C goal is going to be to finish. Right. And so you can adjust these as you go. But what I'm telling you is this, you need to be at that B goal. What's really obtainable. Don't go. I'm gonna. I'm gonna increase sales by 100% because I'm just telling you, you're probably not going to do that. So be realistic and know what you're doing here, because there's nothing worse than not hitting a goal. Right? And so just, Just keep that in mind. Anything there, Jeff?

No, I just. So funny. If you guys are in the forums, our good friend Tracy Meyer posted something about. He reread Grant Cardone's 10x rule. Right. And obviously Grant's freaking whatever. But so I got back into the audiobook this morning and Grant would say the opposite. You know, he's very much set audacious goals. Shoot for them, don't adjust them down. And that's kind of what the first chapter was about, is set these goals that make you stretch and make you 10x your stuff. And I get what you're saying, Luke. Don't set unrealistic goals. But I think a good stretch goal is good for you. And I don't think there is a B or a C. I cannot A. And that's it. And there's no reason we shop for 40, but we hit 30, so everyone still gets to go out to dinner.

No, no, no, no, no, no. There's a goal and there's a forecast. And maybe I said that wrong. Your forecast needs to be a realistic. You can have bigger goals, but be very realistic with your forecast. And those are two different things. And I should have said that earlier.

And this. So this would not be. You wouldn't necessarily go out to your salesman and say, hey, guys, we're trying to do, you know, 30 buy here, pay here this month. You'd go out there and say, guys, we're doing 35 this month. Because, you know, my forecast is based on 30, but I'm always gonna stretch you guys. We're always gonna shoot for assuming that's where you wanna do, you know, I'm not saying that's probably the classification of this whole thing is not everybody wants more sales. Not everybody wants more. I get it. Maybe you just want to increase your grosses or decrease your cost of whatever, but. Okay. No, totally understand that.

Yep. And if you look, everything populates for you. So I guess I must have a gross already figured in there.

Yeah, it looks like, you've got 32, 60, 56 as your gross per car.

Yeah.

Okay, so you guys as your dealers, when you find out what that average gross is, you may want to go in and change this number right here to reflect what your actual gross per car is based on your historic or based on what you want your goal to be. Right. This is forecasting. Would that be a place to say, hey, I'm typically at 2,000 a copy. I want to get that up to 22 or 25.

Yeah. Which is very doable. So make sure you adjust that and also your doc fee. I probably have the 225 in here as doc fee. Mm. And I must have my warranty penetration in here as well, so you should. You should change those numbers.

Yeah, I just.

What did you do? Just go back.

I just. I just ruined your formula.

Just go back there.

Okay.

Okay.

Okay.

All right. You will need to put your gap. It looks like you'll need to change those type things.

Yep. Okay, so you got your gross. So you put your gross here, but then you put your gross per unit here as well. So that's. Okay, that's taking 5B. Divining it. Oh, that's what's giving you this. Yeah, this is also giving you your gross times 5B. Okay. That's just dividing it back out. Interesting.

Okay.

Your average gross and then your doc fee, he's got his at 225. You know, obviously, each state has mine at 299, and everyone's got everything else somewhere else. So.

So gap. So, Gaap, if you don't know your penetration, you can do that. If you go down to the gap percentage and put in 30% and see what happens. Yeah. Or just do. Actually do. There you go. So it'll. As soon as you put in that you need. You will need to change your gap profit there so you'll. It'll reflect your.

Your number and your 30% across the board.

Luke, that's what I do. Whatever my percentage is for the year, I just. I just do that.

Yeah. Okay. Going to drag that gap 30% all the way across the board every month. He's penetrating 30%, which means he's selling nine gap contracts and making $2,250. It looks like it's already calculated in your warranty. Your 24. 24. And you're 36. 36. And by warranty, I think you meant service contract.

Yeah. See? Yeah, I'm sorry. I should not interchange. Yeah, I should not interchange those, but I do.

Okay, but it looks like you're calculating that at a 35%. 24.

Get 35%, and then 36 would be 20%.

Okay. Those are the upsells you're doing above and beyond the warranty that you provide for free.

Right.

You give a warranty?

Yeah, I do. 1212.

At 1212. Great. So then you look down here, and that's calculating this number here on the warranty profit. You see these formulas Luke's already put in that he's making 550. $505. Sorry. On his 1212. And he's making $605 on his 3636. Yep. So those are two assumptions that you would want to change based on how your warranty, what company you're using the average. If you got your own reinsurance set up. Sorry. For your service contracts, what kind of profit you're making on those service contracts. So that's going to give you your total warranty profit across the board here. Anything we missed from that?

I don't think so. I think everything's in there. And then we go to collections. And if you see. I think if you fill in the accounts. Bom. Let's say you started the year with 500 accounts. Okay. It should.

Yep.

Didn't for some reason. Oh, yeah, did. Okay. So you will need to look at that every month. So what I typically do is I say, okay, what's my growth been? And I can tell you right off the bat that we've grown at about. Well, last year our accounts grew at 12%. Our for the last five years, they've grown at about a 9 to 11% gain. So I'll know at the beginning of the year if. If I had 500 accounts, I can figure about it. End of the year, take 500, multiply it by one point, whatever your growth is, let's say 10%. That puts me at 550 by the end of the year. Right, Right. So I need to look at that. I know that I'm going to peak. Typically for me, my accounts will peak probably in August or September. And y' all go, why is that? Well, because your sales slow down, your repos increase at end of the year. So I know that I'll probably. Somewhere in that, if I've got 500 accounts, I'm growing at 10%. I'm gonna probably peak around 560 or 570 or of those months, and then I'm gonna go back down. And by December, I'm gonna be at probably 550 accounts. So just Keep that in mind as you do this. Gradually grow them each month so you hit that number and then bring them back down. And as you do that, it do this. It should project your collections. And I want to tell you how close I get on these projections, just to let you know, we. I use that as my collector's bonus. Right. And we typically are working the last two days to hit those numbers. And I mean, sometimes we blow by them, but in general, they're working the last couple days to make sure that they hit those numbers. And that's really where you want to be with the forecast, because you want to know how much cash you have coming in and what you're doing. Mm. Any questions? No.

No.

That's great.

Okay.

And your interest income is based on that same number. So Jeff filled out all those, and y' all can see where we are here. It's just something you really, really should have a good feeling for how much cash you're collecting. Because if you don't know, you can't forecast what you can do. Another way to look at that is you need to know, and this is getting in the weeds, but you really. Why do you have 800 way out there?

Well, I'm taking your average. I'm taking your. Your beginning of month accounts, and I'm adding in your buy here, pay here units, and I'm subtracting out your repos. Okay.

All right.

But I'm not subtracting out payoffs. So that's one thing we were missing in here. That would. That would throw our assumption off just a little bit.

Yeah, and it throws it off a good bit.

So I'm blowing out your calculations, huh? Because you're not running at a. You're not running at a 20, you know, a 20% repo rate. Right.

Ours is, I think, 9% last year or something to that effect.

9% for the entire year?

Yeah. Geez. Okay, so you gotta. You gotta remember to really look at your. Your numbers here. I think, actually. Let's see. Let's look. I had 68 total repossessions last year.

Mm. So it's gonna put you closer to that. Yeah.

Five to six, eight point, 8.5%. So. Yeah. And that's. You really need to know those numbers. But I think most. I think in general, most people gonna be probably around the 20%.

Yeah.

Yeah, I think that's a fair assumption.

Yeah. That still doesn't get us back down to where you have a lot of. So if you're only. If you're only repoing five accounts a year, but you're putting 30 on the books, you've got a lot of payoffs out happening, huh?

Yeah. So typically in a month we average 15 payoffs.

Yeah, I'm gonna say. And then some. So that is another number to look at here. You know, what are you not recapturing some, or maybe that is some of the sales you're adding back on, you know, whatever that is. But yeah, you would want to project because if you look at just straight sales, subtract repos, you're like, wait a minute, I'm gonna have ridiculous amount of accounts at the end of the month. You do need to account for those payoffs, the insurance, the bigger factors.

And the bigger you get. This is something people forget. The bigger you get, the harder it is to add accounts. Especially the better car you sell, the harder it is. Because what ends up happening is those cars last a lot longer than the term of the contract. And so if you're not good at making sure you get those customers back in the store, traded out into a new car, and if customers just don't want to do it, which is going to happen a lot, they've never not had a car payment. Then when they get to the point in their life where they don't have a car payment, that's pretty significant for a lot of these people, you know, saving them $400 something dollars a month. And that's really a game changer to them. They can buy a house, they can do a lot of things at that point. So factor in your repos, factor in your payoffs. And actually, I look back the last quarter of last year, we were averaging over 20 payoffs a month. So that's a significant number. And our portfolio is around 800. So it's a little bigger than this. So we've got the repos in there, you got your repo loss in there and something. I took off this spreadsheet because I didn't really want to confuse people, but I. On my forecast, we actually have a net profit line. And what I did was I added together all the profit sources there and I subtracted my average expenses, average monthly expenses, and that'll give you a net profit that's pretty easy to figure out. And so you can add that if you want to. And it gives you an idea. Okay. If I do what my forecast says, my net profit is going to be, you know, whatever it is. And at that point you can take and figure. I think a lot of CPAs would say, figure 30% of that as income taxes. You could even back your taxes out of there too. And know how much money at the end of the year you're going to need cash wise to pay your taxes and then what you're going to have left over, because that's a big deal. There's so many people in our industry to get to the end of the year and they think they've made a million dollars and they, they forget that they got to pay taxes on that million dollars.

And so yeah, for sure. And we've definitely argued that that net income, whether it's a, whether it's an aggregate number or a net per sale, is really the only number that substantially matters from that. You know, in my opinion, you can talk about sales numbers and these fat grosses and all this other nonsense, but what you're keeping and put it in your pocket at the end of the day or the end of the tax year is really the factor of your long term wealth. And if you're building anything in your dealership and putting money away. So that could be an entire exercise on its own. It's just figuring out your actual net. And then do you need to take steps to increase it? You know, some people do it by design. They're a little, maybe heavy on management or heavy on ownership or low on grosses because that's way they want to operate and that's fine and they're doing okay. And other people are probably way below where they should be to stay viable and stay in business long term. So they need to look at that. Are they bloated overhead, they have too much personnel, or they're just not asking for enough money? You know, they're all wrapped up into the V auto mentality and they're just slinging them out there, not making anything.

And that happens. And you should be very cognizant of what your net is and buy here, pay here, stores, both stores. But it's so, so important because you can sell yourself out of business quickly.

Yes. And that's a whole, like I said, a whole nother topic to talk about. Costs and overhead and carrying and your floor lines and your interest and your, that stuff. I mean, unfortunately you could get into projecting clear down to the nuts and bolts of this stuff. But for the purpose of this conversation and everyone's sanity, we're gonna keep this, you know, at these 20 numbers, which is, which is still a lot.

I'll tell you. If you. I don't know. Jeff, you ever look at Chris Mayer's forecasting sheet? He did, and it's into the nuts and bolts. And it gave me a headache just looking at it.

And he's a nuts and bolts guy.

Yeah, he is a nuts and bolts. And that's the reason he's a great operator once you get this down pat. Because I actually took a ton of calculations out of here because I didn't think. I just didn't think everybody needed all the things that I look at. You got to get started somewhere, and that's a good place to start. It is.

And it's very easy to add lines to this if you decide you want to throw in these things. And we haven't even talked about cash flow. You know, that's the, that's the other large, large component to this, which goes along with your net income is your statement of cash flows. And are you projecting your cash flows for the year? If you're a retail dealership, we all found out in 2020 that cash flow is crucial. You know, if you're not projecting and hitting those numbers, are you going to be able to keep the doors open and make payroll at the end of the month? Best case, worst case scenario. And then if you're a buy here, pay here dealer, are you going to sell yourself dry out of business? Yeah. Yeah. You end up selling so many cars that you can't replace the ones you have and your bank accounts empty and you got ahead of yourself. So definitely tying this in with a statement of cash flow projection would be. Would be handy as well, for sure.

And in service sales, you know, you can actually just look at what you've been doing in your service department, project that out. And you know, let's just say that we.

This is a sales total number or do you want to put the service net here? Oh, there's service net right below that.

Yeah. So you got service sales and just stretch out all the.

And you say you'd average about that 50. That's what you guys are doing every month, huh?

No, we're doing 86,000.

Okay. But if you're doing that and then you're trying to net 15% on that.

Yeah.

Okay.

Well, you're trying to net. You're trying to net 15%, but that number there is 9%. I think 9% is where people need to. Need to look at to start with. And when you're a really, really good shop, you're hitting 15% is my opinion. Sounds like a lot of work. It's a lot of work. A lot of work. 15% net.

We dealing with mechanics?

Yes, dealing with mechanics is a headache all on its own. But I think to have a very successful car dealership, you have to have a service department. I know there's plenty of people out there doing it without it, but to really maximize your potential as a car dealer, you need a service department. Okay. And there's plenty of people that argue that in a new car store, of course, that service net should be covering your overhead, but it's never going to happen A. In an independent facility, in my opinion.

Yeah. Yeah. You'd be a real unique bird to be able to pull that off. Right. Very, very strong service. And there's a couple we see out there where their service center, you know, dwarfs their dealership. Yeah. In size, scope, and attention. Their mechanics turned car salesman.

Well, somebody like James Santa Stevens out in New Mexico, he's a NIADA board member. That guy. He's a service guy.

Right.

And Matt McMurray. Service guy. But they sell a few cars, and James may sell more than a few. I'm not sure about his sales numbers, but for the most part, we don't have the luxury of warranty work and recall work and. Well, we do have warranty work, but the amount of work that comes through those new car service facilities.

Yeah, yeah. Different. Different deal. Luke, to wrap this up, any other words of advice? You know, I would just qualify this whole conversation with. If you've stuck with us this far, hopefully it made some sort of sense. I know we made a lot of jumps and assumptions, but what this does is it gets dealers started. It gets you thinking about it. You may like this spreadsheet, you may not. You may build it out, but it gives you somewhere to start and lets you know that you need to be doing this.

That's number one. You need to be doing this every year. If you're not doing this every year, you. You're flying blind. And nobody wants to fly blind. This is a very rudimentary way to start. Actually, 20 Group has a different one that. That works. It's pretty simple, too. But do this, and it's not too late to do it for the year, Jeff. And that's. That's so important. We're only at January 14th when this drops. You're really only 10 working days in. So take this weekend when you get off work, on Saturday or Sunday, after you've gone to church and spent some family time together, get in there and look at your numbers and really project out, because it will change the way your dealership operates.

And then take this spreadsheet, save it to the desktop of your computer so that you look at it every single month. That's the other thing. Just like with goals, if they're not in front of you and you're not looking at them and you're not seeing them, then you completely forget. Because if you tune back into this thing in July and realize that, man, this is nowhere close to my projections, I've fallen back into my old habits, and I'm not focusing on these couple of, you know, metrics that I wanted to achieve, then it does you no good.

Hey, and Jeff did, on that sheet that I shared with you, at the bottom, does it have the actual for this year?

Yeah, yeah. Everyone will be able to see that there at the bottom of the sheet.

Make sure you put that in.

Yeah, yeah. So I scroll down. Luke has actually finished out the calculations where you guys can go in and put down the actual, and I put.

Those on the same sheet. And the reason I do that is because once I do this for one year, you know how easy it is to do for the next year? I mean, it's like nothing. I mean, it's. It's already there. We rock and roll, and we make our projections for next year.

Yeah, yeah. And then how cool is it to go back and look at it year after year after year where you've got your projections, you've got your actuals, and then it's much, much easier to kind of gauge your growth and kind of a projection trajectory? I'm sure you could put this into, you know, Excel graphs and spreadsheets and bar charts and all that other nonsense.

I have. Yeah, I have graphs, growth graphs, all. I've been doing it since it appears, since 2015. So I just look at this year after year and have all. Actually, I've been doing it since. Yeah, 15. So, I mean, that's six years of me doing this, and I really think that it's made me a better operator, and I know that it'll make you a better operator. Cool.

Guys, appreciate your time, and we will speak to you all next week. Kind of an anticlimactic end there. I expect you to say something exciting.

Sorry.

So do it again. No, no, it's fine. I'm not gonna edit that.

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Sa.