#349 - Work On It, Not In It

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. Luke, you were over on the west coast, weren't you?

Yeah, I was in California the last four or five days.

Yeah, me too, man. I was on the south end of the state, you were on the north end of the state. Two very different activities, I'm sure.

Yeah, you know, I, I had a little bit of wine. I hadn't had a drink in 75 days and then, then I had a couple bottles of wine probably over. Over the matter of three days of back. I'm back to sober loop. It's no fun, but some people like it.

And I sat around on a lot of beach chair and played sand volleyball for four straight days.

So I'd actually. That sounds like a lot of fun.

It, it actually was great. It was great. But we're back at it and I say that because we, we need a break from our dealership. Right. Sometimes it's fun to get out, to have a little break, to recenter yourself. And I always come back reinvigorated, probably because I have a stack of freaking issues that are sitting on my desk right now. So. So maybe that's why I come back fired up. I don't know.

The buzz, the buzz was killed quickly.

Yeah, yeah, yeah. But, but it is, it is one of those things where you come back and you see all those issues that are issues. And we've talked about this before, guys, if you have issues, if you do come back from a vacation or say you're coming down to New Orleans to see us at Buy Here, pay here, or you're going to any kind of a, you know, getaway. If you come back and you've got a stack of post it notes or issues or fires burning, you have a process problem. There's a process that's broken and your people don't know what to do in this situation.

The most important thing you can do in your dealership is, is develop processes, Jeff. And that's really what owners should do. It's hard, but the, the first thing to do is to start, okay? And it's, and it's simple. It's. Starting today is so much easier than starting, you know, five years ago because you got this little thing called chat GPT, right? But the first thing is just writing down what you do and developing the process as you go because you can leave once you have processes in place and not Worry about your phone blowing up your pocket, but you got to write those things down.

Yeah.

And that first starts is hard.

And that's the best way to identify what needs to be done. Right. As you see those things and you think, okay, here's the issue sitting on my desk that I need to handle what is broken. Okay. I need to go into my processes and figure out either just retrain the employee, hey, we already have a process for that. Please refer to the manual. Or, or let me, you know, explain it better or type it up better. Or, hey, we completely don't have a process for this. Let's write one so that this isn't an issue a second time. Right. And that's the best way to know where, where your process is broken is. Where are the headaches? Where. Where's the smoke?

Yeah, it's. It's easy to identify, hard to fix sometimes, but you can't fix it. Can't fix it without. Without writing it down.

Well, working on your business, not in your business, that's the problem. We come back on Monday and all of a sudden we just start cranking and, and just whack a mole. Right? We're just doing that instead of saying, wait, wait, wait, here's the process. I'm going to fix this process first and then I'm going to solve the issue or solve the issue and then fix the process. Whichever it is, it's like, you know, it's a business in a box, right? I mean, you write all those processes now you've got a repeatable business that you could take anywhere, you know, which is actually kind of a great business idea in itself. Dealership in a box.

Yeah, you know, a couple, a couple of places tried that before. It didn't work all that well because you have to constantly change your processes. Unfortunately, you've got to tweak them. They're not gonna.

I mean, JD By Rider, some of these franchise dealerships. It is a business in a box, right? You get a gy rider franchise it. It's spelled out for you, 90 of the stuff. And there's a little bit of flexibility, I think, for the owner operators.

But yeah, for sure. You know, We've sat in 20 group with several JD by Rider stores and it's all run the same. And, and most of them are very.

One thing I found that one of my broken processes is I recently changed over collectors and it was hard, right? This was. She was with me four or five years, but she had been burning out. And this, the writing was on the wall I saw the signs, and I had. I. I kicked the can down the road because, A, that's just a hard. It's a hard band aid to rip off, right? It's just hard. B, I didn't have anyone to replace her, so I didn't want to say, like, hey, you're burned out. You got to get out of here. You're mismanaging stuff. I had accounts falling through the cracks. You basically. I mean, they become account blind, right? There's accounts that haven't been worked in three or four months. Right. Just sitting there at the auction. Cars that are just rotting at the auction because we haven't just sold it, like, just handle it. Repos that haven't been sent out, that should have been picked up, just cars that just should have been charged off. Like, just charge them off. They're done. They're gone. So collectors get account blind. And what happened was I just let it go so long, and because I couldn't find a replacement, that just. It just compounded the problem.

Yeah, you can't do that in our business. And collections, it's got to be handled. You've got to stay on your. Your job to stay on top of your collector all the time. Like, there's. There's no way around it. And it's an easy job to get burned out in as well. And so, you know, you got to do what you have to do to figure out, how can I be proactive? You know, a lot of times that's bringing in two collectors, even if you only need one. Right. So you do have backup when you have to make a decision, but you also. It's the most important part of our business. You got to be able to slide back into that position. And if most of us who have buy your pay here stores at one point in our life were collectors, you were salespeople. You were collectors, your inventory buyers, your detailers. You were whatever you were, all of it. And so when we have lost collectors in the past due to the. I'm not sure we've ever had a collector quit. Maybe we had one that we had to fire, but you have to be willing to step back in that role until you can get it back on board. And it's hard. It's a. It's a hard job work. Flexibility is. Is one thing you can really do to. To help keep people's mind in the game. You got to make people take vacations. I know that sounds crazy, but if that means as a collector, you're sending someone on a cruise or to Las Vegas for training or whatever. But you've got to keep those people clear headed and motivated because if you don't, oh, buddy, it can get, it can get rough.

Yeah. What I find with sending someone on vacation is, has two great results. Right. They get a recharge, you get to get into the account and start working their job to see what they are and aren't doing right. You know, and that applies for all positions. Right. When you go in and say, hey, now I'm going to handle this for the next five days, man, where am I at? Like they kept notes. Do I even know what's going on here? Like, you uncover so many skeletons in the closet that it's actually, it's a really, really good thing to do. Common. And that's one thing I found is that when I replaced my collector, all of a sudden now I'm helping my new collector clear out all these accounts. It's like, well, I'm doing it now with my new collector. I could have done it three months ago with my old collector. Right. Had I just sat down with her and said, hey, we're going to go through each account. We're not going to skip over any of them. Do I need to charge this off? Do I need to send this out for repo? Do I need to skip trace? Do like the same thing I'm doing now with my new collector I should have done three months ago so that it wasn't this huge pile of man charge offs and repos and cleaning the slate.

Yeah. I mean that's, that's a really being proactive in this position is super important. And meeting with your collector a lot, it's just one of those things you really need to meet with your collector a lot. And if there's an issue, then you got to help them fix that issue.

Yeah. And one thing that's really helped to plug Blitzpay right here is having a great payment processing platform that's been super easy for us to transition over. It's easy. That's the one thing that my new collector just picked up so quickly. It was so easy for her to just pick it up and jump right into it. Because it's so intuitive. Right. It's easy to handle. It was easy to send out links. It's. I got these automated test messages set up so that my collector doesn't have as much of a workload every single morning when she shows in because a lot of automated text messages have already gone out and reminded people. So it's been probably the easiest Part of the transition for the new collector.

Yeah. And the automation of it makes collector's job easy, too. And that's super important, especially in today's times when you can just. You set it and forget it. Super, super easy. And you can do it from anywhere, Jeff. That's a key, because collectors do need to be able to do it from home. If you don't have them working Saturdays, they should probably send out reminders of Saturdays. So all these little things you can do to. To really help using Blitzpay.

Yeah. What I found is kind of funny, too, as a side note, you know how, you know, they talk about, like, you know, if. If you're. If your husband works at a. You know, cleaning cars, your car is always the dirtiest. Right. Or if you're. If you work landscaping, like, your yard is always the worst. Or if you marry someone who does massage therapy, you're never getting a massage. Right. Like, so what I found is that, you know, Luke, we do this consulting for dealers, and we take phone calls and we help do training and. And I sit down with collectors that aren't mine and talk to them about these things. I didn't realize that I don't do the same thing for my collector. Right. Like, I know what to tell her, and I know all these things, but I'm realizing that I'm not communicating it to her in the way and in the frequency that she needs. But yet we do that, you know, what, once, twice a week with other people's collectors and other people's managers. So it's just really funny how as dealers, we think we are training and educating our employees, but we're probably not doing it the way we would be doing it if we really treated ourselves like an outside consultant. Right? If I. Like, it's just so funny.

It is. It is interesting that we. It's easy for us to go somewhere and tell everybody else what they're doing wrong. Right. And how to fix it, then that. Sometimes fix it yourself. But I think. I think that goes with the territory. You know, you gotta try.

And to that degree, it's good to bring people in because you may have told your collector that 30 times, but they need to hear it from someone else sometimes, right? Someone that maybe just sits different or maybe it hit. They. They word it differently or they're able to relate more. So bringing in outside consultants, trainers, I think is invaluable for your staff. Just.

Yeah, it does. I mean, Alexa always gets mad at me when. When she's told me something 100 times. And I ignored it. And then I went to a conference and somebody said it, I was like, did you know this? And she's like, you're an idiot. I've told you that before. So yeah, call it, call Jeffrey, get us in there. We'll fix your problems.

Yeah, yeah, yeah, we gotta. One other thing that's kind of interesting is I look at a lot of these like rulings that have come down lately and, and you know, we know we have the Cars act or Cars Rule that's you know, gonna, may or may not happen. There's a lot of good things in it that we should be doing anyways.

Most dealers are doing anyway.

Yeah, yeah. Deceptive pricing, all these, you know, non required add on back end products. Some of that's crucial. Right. Posting prices. Some of the real common sense stuff we should be doing anyways. But there's a lot of little nonsensical, hey, I want to catch you and find you. Because I don't like used car dealers. And we see a lot of it happening out with these dealerships that some are, some are probably blatant deception. I think there's a handful of dealers, like in any industry that are out there to just run fast and loose until they get caught or get shut down. And there's other ones that just make just innocent mistakes. Right. Maybe you just didn't know you weren't supposed to be doing it. We don't hear about those ones, I think as much. Right. Because with the exception of a few really aggressive states and really aggressive district attorneys, you know, they're going to come in and slap you on the wrist and probably let it slide as long as you fix it. I think it's the real egregious situations that end up making the news and get these big fines.

Yeah. It seems like you're reading to me a couple of things that's happened lately. Do business the right way and then you don't have to worry about it. I don't understand that, Jeff. Is it that hard?

You know, I think a lot of times it's just dealers don't know. I think that's part of it is like either a. Like I said, they're either trying to be sketchy or they just don't know that that was sketchy or that they can't do it that way because maybe that's the dealership they came from, or maybe they found some loophole that's going to make them more money because they can just. You know, the example we use is this Kansas dealer And that got in trouble for issuing, you know, too many temp tags, you know, not delivering titles in time, not disclosing any kind of known recalls that were on the car. And they got a, you know, pretty, an average size fine, probably large for them, but they also got their dealer license shut down and that's big, right? So if you get fined and get your license revoked, how are you going to make money to pay that fine?

Yeah, we've seen that happen. You know, I've seen that happen so many times. You know what ends up happening, Jeff? They, they get the girlfriend and put it in their name.

Yeah, it's.

It's such a joke what happens with some of these fines and things like that. I just, I don't even know what to say.

Then. They just, I mean, you end up, they end up paying it over time or what, Just starting. Starting under another license and running another way. Huh?

That's all they do. They just put in somebody else's name.

And off the go and off they go. Yeah, these interest rates in the current car market is definitely starting to prove some of that out. Oh, yeah, a couple of. My number one competitor in town is pretty much closed doors because of some stuff and, you know, some other things I want to talk about, but. Yeah, mismanagement, man, Mismanagement. Like keep your eye on the ball. I just, I cannot say it enough. It's crazy. And so part of that is just to make sure you guys are coming to convention coming up down in New Orleans.

Yeah, we're coming in Saturday, aren't we, Jeff?

Yeah, we got a couple weeks left. The 10th through the 12th down in New. New Orleans.

Yeah, New Nolan is. And that'll be fun. I haven't been down there in a while. We're hosting one session on sales and then we are also doing a wrap up on a day is what I've been told. So that's exciting. Yeah, it's exciting. Want everybody to come, Everybody listens. All, you know, 20,000 of you show up and we'll. Jeff will love us for that. Jeff Martin. That is. And be a lot of fun, A lot to learn. There's, it's just a lot going on in the industry right now and if we don't stay on top of it, we're going to get behind. And it's tax season and. Yeah, I mean, don't, don't forget about this, everybody. It's tax season. About 60 days or, you know, 80 days. So now is the time to prepare for that. Get your train in, get what you have to do, because it's probably going to be a pretty good tax season. We'll have Bill on from Tax Max before long and tell us how great tax season is going to be. You know, he's always excited about it, but it's going to be a good one. It's always a good one. If you're prepared.

He always loves tax season.

If you are not prepared, tax season will not be good. I can promise you that.

So what's interesting, I did want to talk about that for a minute is you look at MMR retention and it's done what it's done every single year, guys. The next four to six weeks to eight weeks, MMR retention drops, which means people are selling cars for less than mmr. Right. Sellers are being more aggressive. They want to unload inventory before the end of the year. The kind of dull days of fall, and then it shoots right back up week 6, 7, 8, 9 and 10 of next year. So if you're going to stock up, you're going to be ready for tax time. Definitely now is the time. And I don't know that it matters who's in the White House. I know so many people are waiting to see what happens in a couple weeks. I don't know that it matters. I haven't heard anything that either one has a better, like, directly related to us. Right. I had this conversation with some of my guys the other day at lunch. As far as the business goes, I don't know that either candidate has a plan that will help me directly. You know, I, I think one of them may have said they want to double the child tax credit. I don't know if that's going to happen or. I don't know.

Let me, let me tell you what, Let me tell you what both of them are doing. They're vote buying. That's all they're doing. They're telling everybody, we'll give them everything, Jeff, and none of them gonna do anything. So it's not going to affect you. Don't worry about it.

But here's the thing. So what if one of them says, hey, I'm going to double the child tax credit.

Okay.

It's huge for us.

Is it huge?

It's huge for us. If you double the child tax credit for 2025, that is a big deal.

There's no way is that going to happen. Well, for 2025, not 2020.

Yeah, yeah, whatever. I mean, that is a big deal for us. Like, that directly impacts our customers. Right. If, if you're going to extend unemployment if you're going to blah blah blah blah. You know this government handout nonsense make interest on car payments tax deductible and doesn't really affect our customers. I don't think they care since here there. Yeah so anyways but there are some larger issues that could affect us. Obviously you know my portfolio is half Latino. I mean if they all got deported on January 1st that could be an issue.

It's never going to happen Jeff.

Anyways, all this being said we want to see you guys out at New Orleans November 10th through the 12th. Luke and I are going to be there a couple days early. We're going to have some fun. So let's wrap it up with that guys. When you get off this podcast jump on the interwebs, get registered and we will see you in a couple of weeks. Thank you for listening.

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