#324 - Using AI, Business Model, Best Decision Ever

This is the Independent Dealer Podcast, Education by Dealers for Dealers. Now here are your hosts, Luke Godwin and Jeff Watson. Hello and welcome to the independent Dealer podcast brought to you by Buckeye Dealership Consulting.

That was weird, Jeff. No, that was a new, new intro you got going there.

I'm not going to say I'm getting bored with our intro, but I'm just trying to work out some new stuff. You know, maybe people keep people kind of, you know, tuned in, entertained.

Well, I'm glad, I'm glad you're trying to keep people tuned in. That's, that's a good thing.

You know, after 300 something episodes.

It.

Can get, it can get monotonous, right? Like listen a lot. People listen to me tuned in. Guys, thank you so much. Like, blows my mind that anyone listens to us other than my mother in law. So thank you. If you are here and have been here or if you're just discovering us now, good luck. Who knows what the next three years are going to bring.

Well, Jeff, you say that, but how many people did we have walk up to us last week by here pay year united and thank us for, for helping them out? And you know, I, I was blown away, flabbergasted, humbled. Which is, you know, hard. I'm not the humblest person in the world. And just to, just to hear that, it's just, I mean, it was amazing. Thank y' all, everybody that, that said hello and, and just all the feedback was great. Thank you.

It was so humbling, so cool to think that we've had impact on anyone's business, their livelihood, their well being, you know, their family. Like, obviously the way you run your business, your mental health, your financial situation, all trickles down. So to think that we had a positive impact. Now if someone came up and said, hey, I took your advice, I went bankrupt, I'd be like, yeah, well that makes sense. Like, you know, yeah, you get what you pay for. So that would, that would have made more sense. But for people to see that we've helped them or turned them around or kept them motivated to be in the business, super flattering. Really, really cool. Definitely makes it all worth it. So please, if that is you reach out to us, let us know, send us an email, send us a Facebook message, a YouTube comment. We really have no idea if we're doing any good. And we don't know what you guys. Yeah, we don't know what you want to hear more of.

Give us a thumbs up on the right.

Yeah, yeah, yeah. Leave us an itunes review or something. But, but really though, tell us what you would like to hear more of where we can do better, you know, topics. We love to tune in. We obviously just do it out of our own curiosity and we have no idea if anyone's paying attention or even cares.

Yeah, we know.

But we did have a great time down in Vegas. The Bellagio was great. Bahir Payer United was just well done as always. Great education, awesome day and a half, two day of education. I took home a bunch of notes. So it was definitely motivating for me to go down there. As someone who's heard it all, been involved with all of it, I still think that there's a lot of value to be brought home from these types of conventions.

Yeah, I had about a page of notes and then I had about a page of notes from the day before and then I got a lot of middle notes from all the dealers. I talked to the different things people are doing out there and I love seeing that these vendors that are involved in Buy Here, Pay Here United, the amount of free knowledge they're just throwing out there for you. Really cool. Really cool.

Yeah. And what's really awesome is when you get to have that one on one conversation with these guys and they get to tell you, you know, their new features or what they're thinking about and you get to give them feedback as a one on one dealer. Hey, what we really need is for you guys to do this or do that or tweak this or tweak that. So I know we spoke with a couple different vendors and I was like, hey, this would be really cool. And they're like, oh, actually yeah, that's a great idea. Let's do that. You know, and then sure enough, you know, two to three to six months from now, we'll see those features kind of start rolling out. So that feedback loop is just like way tighter when you go to convention and you're able to face to face with these vendors for sure.

You know, Jeff, there was a, I thought there was like one theme of the convention. Can you guess what that is?

I need money.

Well, cash was a big thing, but.

Where do I get funding for my operation?

We're actually going to interview somebody next week that has a, a lot of experience getting money for dealers and, and the, the way, the different ways you can go about it. So I thought that was super interesting. But AI, AI was just mentioned so many times. I was on a panel and, and they were talking about AI and it came to me and I got, I don't even know what you're talking about. But it's just so, it's so interesting how many dealers are using AI and the different things they are using them for. So maybe I gotta get a little more. Tune in to a. Yeah, yeah.

So we will play these sessions for you guys over the next coming weeks. You know, our Hot Topic sessions that we did at the end of each day. And you know, one of Luke's presentations and some of, some of these episodes will kind of put them out over the next few weeks. But we did have that as kind of one of the hotter topics was how are you using it inside your dealership? And a lot of these companies are using it inside their software. Right. So you'll see your software provider starting to roll out these little widgets or little plugins. You know, the AI can write the description or interact with the customer or do something, but there's also a lot of applications for us that we can use, you know, outside of our vendors, you know, where it comes to what, what are our manual processes and what can we. How can we use these plugins, these chat GPTs and Gronks and Llama 3 and all these different language models to help us be better at our job. Right. Like, I know Luke is like a spreadsheet jockey, right? He loves himself a Google Sheet, but, but if he were to just take a couple minutes and let AI teach him how to make a better Google Sheet, now he's being able to process way more data and, and, and kind of dissect these, these data sets that he's pulling out of his DMS a lot easier.

Yeah, I, I really have to get going on that and get chat GPT 4.0 and really dive in. And I know I can do it. It's not. Yeah. Do I like new technology? Not typically when I first start, but, you know, after a couple weeks I'm like, why don't, why not do this six months ago? So there's probably no time like the present to get going on it. So I encourage everybody out there to, you know, it. Who cares what vendors are using, what widgets? I think it's one of those things that we could probably. It's probably so smart that we could use it ourselves to create some of the things that we might be paying vendors for. So I think it's a good idea to, to get going on it and, and try to try to use it to, to make, make us look smarter, maybe.

Yeah. Like, I feel all I get is that image of like a gorilla with A. So like a gorilla with a calculator or something, and he's just like pounding on it the whole time. I figure that's probably what Luke's office looks like as he's trying to learn.

Look at it right here. He's just.

He's just yelling at the keyboard, telling it to compute things. But. But what? What that. The bigger ide in it. We talk about that every single week. But this really, really drove home that fact of, like, I can use things like AI tools to work on my business, not just me working in it. Right. I. I can use it to help me write policy and procedure manuals. I can help it use it to help me, you know, dissect sales numbers. I can use it to help respond to Google reviews so that I'm working on my business. And then I'm setting up processes for my sales team to say, hey, man, check this out. This is what I learned. This is going to become part of our process. Now you know my mechanics. Hey, this is what I learned. Now you're going to start use this for parts ordering or, you know, tracking data inside of our repair shop, you know, so we can use these tools to help our employees become more effective. Right. It's not always about just like, replacing labor and, oh, we're going to get rid of humans now. No, we're going to make them more efficient at their jobs. Right. So they can do it better.

I can't wait till AI is like inside of our. Our scan. Our DAG scan tools. And it's. It, you know, it takes what codes are there and spits out possible solutions and then searches the web for what's going on. I. I think that's going to be game changer when it comes to shops. I would guess at some point.

Yeah, yeah. How could it not? Grab the codes, check it against all data in Mitchell and the blogs and the forums, and then triangulate what is the most likely repair.

And then check this, check this and report back.

Yeah. Hey, dumbass, does it have gas? Check the grounding wire first. You know, don't go through a million steps and order a ton of parts if you haven't checked the ground first. And then it's. Then.

Then the last thing it spits out is a big cannon. It just says, fire the parts cannon.

Fire the parts cannon. Yeah, that's. We got a lot of that going on.

Don't we all? Don't wh.

Part of the best and worst session I attended and my takeaway notes, they had four just great, successful Dealers. So they said, hey, what, what's the best and worst decision? And they had a lot of great answers. One of them, which was universal for all of them, was join a 20 group sooner and start your reinsurance company sooner. Right? Both super boring. Like you guys have heard that a million times from us. It's the, it's the blocking and tackling, it's the basics. Join a 20 group, whatever level you can afford to get in on and start your reinsurance company, whatever dollar amount you can afford to contribute. Right. A lot of growing dealerships. It's very, very hard to fund a reinsurance company. That's why I didn't do it for many, many years. Because I'm like, how do I suck out 5, 10, 15, $20,000 out of my dealership every single month? And even now it's a cash, it's a cash drain to fund a reinsurance company with service contracts, warranties, gab, vsi, like all those, all those ancillary products, especially for a buy here, pay here, where I'm self funding those products upfront, it can, it can pull a lot of cash out of your dealership. But interesting to me that that was universally the best and worst decision these dealers had ever made.

Yeah. I mean, it's the best. Those two things are best things I ever did for mine. And you know, we're probably, I had, I had my reinsurance probably five years longer than I started 20 group. And I'm still learning things in my 20 group that I can do in my reinsurance company. It's, they, they kind of go hand in hand. Honestly, it's just such a great idea.

Yeah.

Call Bucket, call Buckeye today. If you don't have your reinsurance company, get it set up, get it rolling. Because you know, 10 years from now you'll be like, man, why not do that 10, 10 years sooner.

Yeah, absolutely. One other interesting thing, talking to these dealers was just the many, many variations on the business model, right. Like this is a cat that can be skinned so many different ways, Right. And every dealer has kind of a different twist or angle or, or vibe. You know, we met one dealer out of California who's doing all buy here, pay here Teslas. Yeah, right.

Incredible. Yeah.

Yeah. He's basically run out of money. He's got more buyers than he can afford cars and he's got it set up where he sells the car, gets the tax credit and does the buy here, pay here on it.

I tell you, super, super sharp guy too. I was talking to him and actually we Won't go down. Some of his secret. But he knew something about these, these Teslas that you didn't know. I thought it was pretty interesting. And, and there's a, there's a whole business model. EVs are, EVs are here in case anybody didn't realize that they're here and they're going to stay, they're not going anywhere. I think if you're going to build a portfolio of, of evs, I would do it on Tesla and Rivians and nothing else. But Rivians aren't, aren't going to be in price range for a bit. But man, I tell you, it's such a, such a cool business model.

Yeah. And to that point there's many, many different versions of that business model. Right. So you know, we, we met some other dealers who are doing more inner city, right. They're downtown Atlanta and they're, you know, their business model is, is certain cars to certain buyers, you know, and that's kind of the niche that they sit in and they do it really well. Right. And of course we have other buy here pay here friends that are doing, you know, they probably sell 90% trucks right there in the area where that's what they can sell. People are going to pay for them, they're going to hang on to them forever. If you're in North Dakota oil country, you can buy here pay here trucks all day long with five to six grand down and a grand or two grand payment a month, right?

Yeah. If it's my, from Wyoming I think. And you know that was, listen to the podcast and talking about trucks, you know, I sell some trucks but nothing like Wyoming trucks.

Right? Yeah. Everything's got to be four wheel drive, right?

Everything's got to be four wheel drive.

That makes sense. In other areas like Florida, you wouldn't even waste your time on a four wheel drive, right.

You're not gonna, not at all.

You're not gonna prepay for that or the premium, the headache, all that kind of stuff. I remember back in the day, remember those were, that was one of the no fly lists for the early buy here pay here model with the lead. Right. No convertibles, no two doors, no four wheel drives. And it's like.

For the most part I live on the no four wheel drive rule. All wheel drive, four wheel drive just because of the extra cost. I see no reason behind it here in South Carolina. Oh no. Who knows?

Yeah, so I think what that says too is you've got to know your demographic in your area, your market, you know, and then being in a niche is smart. And that's something that I admittedly having this conversation earlier today with a friend. My dealership has kind of evolved out of my niche. And I don't know that that's good or bad. Right. Time will tell. I carry more higher end cars than I ever really carry. You know, sometimes out of just personal curiosity, sometimes out of chasing my outside finance deals, you know, I want some credit union stuff that I can make a quick turn on. But does that confuse my salesman, confuse the public? You know, does it dilute my brand? Do you want a 2021 Hyundai Elantra sitting next to a 2011 Hyundai Elantra? Like, it can get confusing.

Yeah, you can't be everything to everybody. And we, we made a conscious decision, probably right before COVID that we were only gonna. The only thing we had on our lot was what we would buy here, pay here, and that was it. There was, there was no confusion. If you wanted to come in and pay cash, that was fine. Or if you want to go to the credit union, that was fine. But we were not going to be confused and say, yeah, we're going to finance that car, but the car next to it, yeah, we, you got to go outside finance. We decided not to do that. It's, it's, it works for us. And we know what we sell. We sell Hondas, we said Toyotas. And we sell SUVs, and we sell trucks. And, you know, we know what we sell. And it's really, you know, it is our brand. The cars we sell are our brand. Really and truly.

Yeah. Yeah. We won't go down that rabbit hole. Not a conversation to get into because a little different philosophy. What else I found interesting? We talked about it for a second with the vendors, but, you know, we had a conversation with. And we're in a room with the CEO, with the decision makers, with the folks where it's like, hey, man, I want this button to be blue. They will make it blue. Right? You don't get that?

I think you said the wrong company there, buddy.

Oh, yeah. That was the company that we struggled with. So we said we wouldn't say their name. But our blitz pay folks that we were in the room with, they are the ones that will listen to you. You know, I said, hey, it'd be great if you guys did some webinar trainings. You know, how about you? Did a weekly webinar where my collectors could jump on and you could teach them things. It's such a contrast from the company that I mentioned earlier, which I won't mention again, that when you're calling into some of these companies and, and of course, your credit card processing is one of the most crucial. Right. Like they have your money, they literally have your money hostage, and then they decide how much of it they want to get back to you or how much they want to yank out. And guess what? If you guys follow the Facebook groups, sometimes they can yank out too much money from you and you don't catch it for three or four or five years. Right.

Yeah. Blitzpay has been nothing but a game changer for us. And I, I recommend everybody out there to use. But another thing they, the, the CEO is sitting there at Buy Here, Pay Here, United, helping us doing the things that, I mean, she, she's just great. And so just, you know, use BlitzPay number one, but number two, use vendors that you can talk to and you can get on the phone because it just makes, you know, I say that and I use idms, but, but use, use vendors that will return your phone call.

Yeah, that is a huge part of it. So much of that personal interaction is really like the biggest takeaway from these conventions guys. So if you have not attended, you don't plan on attending, I would definitely recommend that you do. National association NIADA conventions coming up June 17th through the 20th at the win. Yeah. At the Wynn in Las Vegas. So you've got time to get signed up. Luke's going to have a session. I think I'm part of a session. It'll be a great time to again, get out and get educated, meet with the vendors face to face. The ones you don't have that you might be interested in and the ones you do have that you want to get some face time with or learn some new features or, or vent your problems. Like, this is a great time to do that kind of stuff.

It is. And I mean, you know, Vegas a little hot during that time, but you know, you need to go, you okay, you missed this one. You didn't go be at the next one. Because it's. We'll be there and you're going to learn. It's that simple. You are going to learn something. You're going to take it home and you're going to make your business better. Jeff, we've been in business 38 years and our friend Get, Greg Barrett, who's been on the show a couple times now, he said something so just easy and profound. I was like, oh my, why didn't I think about that? And so we implemented it Yesterday. It's just those little things that we've been around the business for all this time and did we not pick up on it? I don't know. The simple things get me a lot of times at these conventions.

Yeah. So interesting. You know, we talked about, you're going to hear five things. You know those five things, you know or should have known or could have put it together. But sometimes people will paint it in just the right light or it'll hit you at the right time in your dealership's evolution that you're like, oh, yeah, this actually is the thing that I know I should be doing. And then you could look back at notes from 15 years ago and realize, oh, I actually wrote that down 15 years ago. I just never put it into practice. Right. And so you go and you're constantly reminded of. Of what you could or should be doing to make things better. And it might hit you at the right time where you have the bandwidth to actually implement it. Right.

Yeah, yeah. And also that if this, if. If multiple people tell you the same thing multiple times, you can be guaranteed that it works. And that's a big thing, too. And that's. You know, what's so funny is you hear it from one guy and you hear it from another guy and you're like, man, I just. I just heard that guy say that. Yeah. And he'll say, well, yeah, I taught that to him.

Yeah.

You know, it's just. It's the little things that keep us going. It gets us better. It's just those little, Little tweaks.

Yeah. Yeah. You would think we'd be better than we are.

Yeah, you would. But. Oh, well, you know, and I keep harking on CPI and getting better at cpi and I'm trying, Jeff, trying.

Well, you're doing great. I think you're doing wonderful. So congratulations to you. It's.

Yeah, it's hard.

Guys, thanks for listening again. If you have concerns, you have feedback, you have questions for us, please reach out to us info@theindependentdealer.com or Facebook or. Luke doesn't use technology, so probably carry your pigeon or smoke signal. And he will. He will definitely get back to you.

Yes. And we'll see you next week with a better episode, I hope.

Jeff, thank you for listening. Please leave us a review. We'll catch you in the next episode.