#354 - Favorite Things of 2024

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 y' all this week by Buckeye Dealership Consulting. Luke, Happy Thanksgiving, buddy.

Yeah, happy Thanksgiving to you. I like the way you said y' all there.

Yeah, yeah, I was just trying to fit in. You're. I guess you're at your cabin or somewhere. You're up in the mountains. I wish it was way back woodsy, like I was trying to just fit in with the. The country folk.

Yeah. You know, sorry, guys, if I. I sound maybe a little under the weather or cough a few times today. Been a little sick, which kind of sucks. But thanks for saying y', all, Jeff. I really appreciate it.

Yeah. Glad you could join us. You know, we try to. We try to appeal to all demographics of listeners, you know, kind of our country dealers, and then, you know, a very smaller demographic but growing is the middle class white woman. So this episode is inspired by them, so appreciate both of them for listening. Does your, Luke, does your wife do something called a favorite things party? Have you ever heard of that?

Never heard of that. That must be an LDS type situation, everybody.

I don't know, it could be. It could be a western middle class white woman phenomenon. But what it is is all these soccer moms get together and they have a little party and they talk about their favorite thing. So they bring a gift to this party. That's something that's been fun for them. Enjoyable, whether it's a toy, a program, a lotion.

Rails really fast, buddy.

Say what?

This could go off the rails really fast.

Again, it's a Mormon party, so it's very genius. Okay.

Okay.

And. And they bring this gift and then they do a gift exchange exchange. So it's kind of like your typical white elephant gift exchange, but it's done with these favorite things. So I thought it'd be kind of fun if we did ours here on the podcast. Just as kind of a tip the hat to those two middle class white female listeners we have.

Yeah. And it's. I mean, it's Thanksgiving. It's our six year anniversary as well, Jeff.

Yeah, that's crazy.

It is crazy.

It's the second longest relationship I've ever had.

That's a. That's not amazing. That's awesome.

So let me kick this off with one of my favorite things for 2024. And I say this because it has actually generated the most cash for me in 2024, but I'm also going to die. It is going to die in 2025. You know what it is?

And see, I got my hat on.

You do? Yep. You, you a cyber truck owner?

I'm not, I didn't buy one. I didn't. When my, when my, when my note came up, I didn't do it.

So what that is the EV tax credit. So one of my favorite things for 2024 has been the fact that I signed up with the IRS's EV tax credit. So, you know, this is one of those ideas that we give you guys that obviously does you no good. So we're going to get it out of the way because if you tried to sign up today, by the time you actually got accepted, the program's probably going to end under President Trump. Him and Elon have both hinted to the fact that they don't want these taxes, tax credits going out for new and used ev. So there's a very good chance that it gets kiboshed first part of 2025. But for me, it's actually been a great program as far as cash flow for the dealership. We have filed 75 of those in the month now, 2024. So to the tune, we're just shy of $300,000 that we have received from the IRS, which for most of those have been in house finance deals. So they lowered the cash on street or the cash basis of those cars that I otherwise would have financed into my portfolio. So it's been a great, great help to get these people into some of these hybrids and EVs, helps them with their down payment, and it's been a great boost for dealership cash.

How many of those are Tesla's?

Yeah, probably 10, maybe.

Okay.

Yeah. And only one or two of those, actually, one we did in house, that was last tax season. So only one buy here, pay here Tesla. The rest have all been retail, and I've got four on the lot and I've probably got, I don't know, 20 Chevy Volts that I need to get sold before they, they cancel the program. But it's been good.

Yeah, well, that's good. I, I, you know, you were on top of this. You were probably one of the first people I even heard talk about it, and you sent it to me. I didn't understand what you're talking about. I never got signed up. I only sold one Tesla Model Y. I do own a Tesla Model Y, which I really love, and I'm kind of glad they're ending this, this tax credit. I think it's garbage. It's really hurt the resale value on Teslas. I think for those of you out there that hadn't driven a Tesla. You want to talk about the things I love? Every time I get in that Model Y, I love that car more and more. The last month they gave us another free trial of, of self drive and FSD is almost perfection. Now Jeff, I know you complained about the cyber truck the other day and the FSD in it, but the Model Y is just, it's on time, man.

Yeah, yeah. I don't want to get into the weeds, but I do feel like the newest version has gone backwards. I took a long drive on Wednesday with it and it was, it was stupid. It made a lot of dumb, dumb moves. So I don't know, it seems like it comes and goes for me. But yeah, yeah, that, that, that IRS tax credit will go away. And the question is, will all of those cars now be, be $4,000 cheaper because the tax credit went away or will some of those ones that were close to 25 go up because everyone, all those prices were kind of, they were all gravitating towards the 25,000 threshold that the used ones had to be in. So now that the cheap ones will get cheaper because they're not propped up artificially with that $4,000 incentive and the more expensive ones will go back to a normal tom depreciation curve because they're not being dragged down to the 25.

I think that's what you'll see. I think you see a lot of model threes go up in value. A lot of model wise go up in value, which should help all that. But I think, you know, a lot of the other lower end evs will, will go down in price, in my opinion.

Yeah. Oh, that's true. And I can, I can vouch for it here. If I have any test Chevy Volts left over when this program ends, I'm sure I'm gonna have to discount them all to get them out of here. Right. Because they just won't be quite as valuable if they don't have four thousand dollar gift attached to them, so to speak. So what do you got, Lou? Give us one of yours. What's in your favorite things of 2024?

I tell you, I, I got back to buying a lot of cars myself in 2024. And I know Jack Carter talked about this a lot, but back to, back to the basics, kind of buying cars at CarMax, which I hadn't done for a couple years, walking those cars back to buying a lot of Myself, hands on. And I really enjoyed being able to do that. I know people dog on Manheim so much, but I tell you, I'm. I'm a fanboy of Mannheim, and it's just, it's great to see the consistency of a company for 20 or 30 years. The consistency of, you know, what you get when you get it. The CRS have gotten drastically better since 2020, all through Covet. And again, there's gonna. People, there's gonna be people that are gonna dog on me for, for saying how good Mannheim has been, but I, I just believe they have a superior product out there. And I'm just happy to be able to buy cars sometimes, a lot of times sight unseen and get the product I'm, I'm expecting to get. Yeah, that's, that's, that's counterintuitive, but I like it.

Yeah, that's interesting. I think it all. It's probably has a lot to do with price point and types of cars and, and maybe even your local auction and the quality of the consigners. You know, I know as I'm looking through the auction list this morning, I've gotten to the point where, man, there's a lot of, you know, Joe's Auto sales, you know, selling these cars. And it's like, oh, yeah, I mean, if Joe can't. Doesn't want that, you know, all wheel drive, you know, Chevy Highlander or a Toyota Highlander anymore, like, I definitely don't want it. Right? So if he can't move it, I don't want to buy it. I don't care how good the deal is. So there's, there's something to be said about finding your niche and getting good at it, I think. I don't know if more competition in the auction space is good or less. You know, you argue that, well, if you don't like Anheim, you don't like their fees, go buy somewhere else. It's like, yeah, I'm sorry, man. In my region, there's nowhere else to go. You know, I try to get on ACV or back lots or whatever they're called now, or go to Odessa. It's just the, the volume is not at those auctions in my area, and.

Same as me, but, you know, I almost consider my home auctions Florida now. So, you know, it's the volumes there and it's, it's good to see these really large new car dealer groups having like, special auctions just for their, their inventory, I think. You know, I think that Manheim is, has embraced that model of specialty special store auctions, which creates a lot of. A lot of trading, you know, a lot of dealer trades running at auctions because of this. And I guess they had to do it to battle acv.

Well, the shipping, too. I mean, a lot of those new car guys, it's like, hey, they can get a. I don't know what kind of deal they get from Manheim on the selfie, but when they have to ship 100 cars, you know, down, that's a big expense for them. Right. So Manheim was trying to comp them for transportation, and now Manheim says, you know what, even better, we'll just send a camera up there and we'll do the sale on your back lot.

Well, they do that, but they also ship to the auction, you know, a couple auctions that are central in, In. In Florida, which makes it easy. It's just. And it's easier to. To ship cars as dealers from these big auctions. So, you know, it's, it's convenience for everybody. And I'm sure that the new, the, the big new car franchises are getting richer because of it, but, you know. Oh, well, it's the way it is.

Yeah. So one thing we'll plug, obviously, is our sponsors for the podcast is part of our favorite things. And, and we hear dealers complain a lot about the post sale. Right. And do the post sale inspection. Buy the psi. Don't buy the psi. Enroll in Deal Shield. Don't enroll in Deal Shield. It boils down to a law of averages and risk mitigation. Right. They can do the exact same thing we can do now. You might say, well, you know, I only pay 200 a car and I've returned three cars this month, so I'm ahead on my money. Yeah, I see how long you can do that. Right.

Yeah.

You might be able to beat them. One month, two months, three months, four months. You might be able to beat Deal Shield, but you're not going to beat them consistently.

So they'll go up on your. They'll go up on your rate.

Yeah, exactly. It's all, it's all an algorithm. That's what I'm saying. You're not going to win, so just do it yourself. Right, which is what we talked about here, Buckeye, with having your own PSI product. You can just reinsure it yourself, and then it doesn't matter if you win or lose 100%.

And Buckeye is the way to go. Reinsurance is the way to go. And we say this all the time. You've got now you got four weeks to get reinsurance done for 20, 24. If you haven't done it now. And we still see people in these groups going, who should I use as a warranty man? You've got to do it yourself. You got to warranty yourself. You got to get your CPI going. You got to get all these, these pieces of the puzzle going to make your dealership run like it should. And Buckeye is a place to do it. Jeff, when you, you asked, when you brought up this idea of, of what you're thankful for, this is coming right off the Buckeye ad. So I want to, we're, we've stopped the Buckeye ad. So what I'm thankful for is our CPI process we put into place this year.

Interesting.

And how we, we all get bored in the business we do, right? And in, as my wife says all the time. We, we run six businesses. We, we have to buy the inventory, we have to recon inventory, we have to sell the inventory, we got to finance the inventory. And then when you add CPI on top of it, what it can do is it can be another, it is another business. So gives, it gives some of us who are bored in what we normally do a chance to reinvent a new business without actually starting a new business. Right? And so at the first year, I really struggled with our CPI had really had grown to the point where we were getting claims and we were having to, to mitigate customer complaints because of the claims and how long it was taking. And so we know a lot of people that do a lot of cpi. But I could never get to the point of, of someone telling me, okay, if you're doing cpi, this is what you have to do when claims come up. And I could never get a good process, so I had to build a process myself. So, you know, it took a couple of months for us to really nail this down. But throughout 2024, our CPI has grown every month. We're going to have a huge month this month as well as last month when it comes to collecting. And damages are going to be damages you're going to, you know, good dealers, I think, are, you know, probably, you know, 30 claim claim rates and average dealers are in the 50 claim rates. And we've learned how to stock parts because we sell a lot of the same vehicles. We learned how to keep repos that we know we're going to use pieces of. We've been able to do all these things to help get our claims done quicker. We've gone to different body shops and said, hey, can you help us with this? And we do still do some of it in house. I've even got where some of my regular mechanic technicians understand how to swap fenders and swap hoods and swap body parts pedals that we can get things done quicker when we do have an accident. And I think we've really got it nailed down now. So, you know, thankful this year. Thankful that the process of CPI claims handling and just CPI has become this whole new avenue for me to figure out.

Yeah, you kind of realize that you're a, you're an insurance company and a body shop as well as all the other things you do, right?

Yep.

Yeah. And people aren't going to have their insurance. I had this conversation earlier with my collector and shop manager and we've got one of my beloved Kia souls back there just piled up in a little mess because apparently this gentleman who had the car for about a month and a half decided to broadside a deer or something. And whatever his story is, and of course the full coverage insurance that he gave us at the time he left only lasted about two weeks and then it expired. We didn't get notice in time or we weren't listed as lien holder. And then he thinks he would have automatically had our CPI product which we didn't get notice of. So it didn't get added, let alone pay for it. So anyways, it's a whole long story of if you think your customers have full coverage, good chance they don't. And those are the ones that are definitely going to get hit the side of a deer and total out your car regardless. So you might as well just get everyone on CPI from the beginning. And that's what my goal is going to be for 2025 is how do I make this product so attractive that I can get a large majority of my customers on it so that it, I can now treat it like its own business. Right. I cannot worry about claims. I can have people to handle those. You know, assign an employee specifically on it to follow these claims through to the end and either fix the car or get them into another one. Yeah.

What's, what's another thing you thankful for?

I'd say this is, this is an old one that we've used before, but it's come in really, really handy the last couple of months on a few incidences. We, as I think a lot of dealers did is we, we went and this is, we probably been doing this for maybe four or five years, but we went and attached Apple airtags to every one of our dealer plates and every one of our jump boxes. So I went out and bought a whole slew of apple air tags, which I think you get them like four for a hundred or something. And I just went in my phone and added them and just taped them to the back of every dealer plate and taped it to the back of every jump box that we have. And I'll tell you what a, it's not a fallback for my employees not to look for their plates. I always tell them, hey, man, if you can't find your plate, you need to go look, right? I'm not, I'm not just a librarian trying to tell you where you're, where you left your plate at. But what's happened on times when we have sent it on test drives, and for some reason we went back to those stupid magnets that you put on your dealer plate and you think it's going to stick to the back of the car, but it never does.

And so these cars made of metal.

Anymore, these plates freaking jettison themselves down the middle of a freeway, and that plate goes sliding down the freeway, but luckily the air tag stays on and I can ping it and send the salesman back to pick up his battered license plate off the freeway. But I haven't lost any this year, and that's been super handy. And then locating them when we leave them in cars or test drives, or even locating our jump boxes when we happen to leave them in a car or leave them somewhere, it's literally been such a huge time and money saver that these little air tags have paid for themselves two or three times.

I'm sure that's, that's interesting. I've not done that, but I saw a. I was down in the office on Friday putting, putting test drive cars on tags on car stuff, and two or three of those dealer tags were so mangled, like, you could tell they had come off four and five times. And just. Anyway, it was interesting to see.

Well, at least you recovered them all. My. All my low number, because in Utah they're all labeled, you know, 1, 2, 3, 4, 5, 6, 7, 8, as it goes up. I don't have anything below 10 anymore. They've all been lost, destroyed, gone somewhere. So anyways, it doesn't cost me a ton to replace them, but it's just more out of the hassle and headache of man, trying to locate these things sometimes becomes such a headache. So I definitely recommend you guys get the air tags, put them on everything, Put them on your keys, put them on your. Your dog Your wife, whatever you're trying to keep track of. That's funny, right? What else you got, Luke?

You know, the consistency of our dms, I'm, I'm very thankful for. Now, Jeff, you're not gonna agree with me on this.

No, I'm okay.

But you know, IDMS has been kick down the road and, and spit out and all these things. But it's so consistent and it doesn't mess up my, my QuickBooks, it exports. I don't have to do all that. I reconcile every once in a while. Yeah, I'm thankful for the simplicity of it. Could it do more? Yeah, but you know, I, I like what it does and I'm happy that it, it's stable and I don't have to change anytime soon.

Yeah, yeah, that's true. I would definitely say I would probably put this in the larger category of software providers that maybe deliver what they say they will. Right. And don't try to hook you. Now, I don't know if I would put IDMS or Solera in that category, but I'm going to make a broader category. And of course I'm going to put in companies like Blitzpay to say, hey, these guys are straightforward. Like, I just talked to TJ today and I said, hey, you know, I need to switch my credit card processing for my dealership, right, which is a separate entity. And I've been using a physical terminal. Like I need to switch that over because I've got this physical terminal. Like, it's stupid to have it. Why don't I just use you guys? And he said, yeah, well, you know, XYZ might be a reason to keep your physical terminal with this company. And he was just straightforward with me. You know, I said, hey, whatever your rate is, if that's it, I don't think we can beat that right now because you have a physical terminal and you get to run that as a card present as opposed to their virtual terminal which runs a card as not present. And that fee is a little bit more on those cards. So he kind of said straight up, based on the small volume that you're doing for down payments and your shop, it might not be economical for you. So I appreciate vendors like Blitzpay who are just straight honest with you. They're not trying to tie into some long contract, get you hooked on something, all these promises up front, and then not deliver.

Agreed. Blitzpay has been great and it is nice that there are some software providers out there that continue to charge the same amount and don't Feel it necessary to go up 5% every, you know, six months?

Yeah, yeah, yeah. One other thing we did this summer, which, which was fun for us, and again, another stupid idea that we do here in our. In our showroom to just make the place a little more fun for both customers and employees. There's a website called vivore v o r.com and they basically sell commercial grade appliances. So this summer, I bought both a slushy machine and a soft serve ice cream machine. They Both were maybe 5, 600 bucks each. But what we do is we stick them out in the, you know, the entryway, the kind of receiving area, and we'll just have slushies. You know, it gets. It gets really hot here in southern Utah, 110 degrees. And our customers just love being able to come in, hang out, you know, while they're doing their application. They get an IC or they get a soft serve ice cream or something. And to be honest with you, the employees probably love it more than anybody. I think they're the ones that probably consume the majority of it. But it's one of those kind of fun, little unique things that you can do in your dealership for both your customers and your employees just to show that you care. You're trying to make it fun. You're trying to make this an enjoyable experience to be in your dealership to buy a car. So something as simple as just, you know, commercial grade appliances out, out of the box type stuff. Not just a coffee machine, not just a can of soda.

But that's pretty neat. Yeah, that's a great idea. Especially down there. Gets so freaking hot.

Yeah. Yeah. I don't know what you would do in your area.

Well, ice cream would melt, like, immediately. Huh.

Sweet tea. Is that what you guys just.

Yeah, you don't even need a machine for that, but, you know.

Oh, okay. Yeah, you just, Just serve it up.

Yeah, just brew it right there.

Oh, it's interesting. Drink it out of a mason jar. Is that all you guys have there?

Yeah, you get mason jars, a little bit of ice. Yeah. Be good to go.

That's good.

That sounds good. I tell you one thing I'm thankful for, Jeff, and, and this might sound a little corny, but every time we go to a convention or something, we meet so many new listeners that, that have, you know, that make us feel really good about ourselves. Oh, it's, you know, it's, it's great. I love listening, y'. All. I've learned so much. Then they reach out on Facebook and then, you know, I'LL call pretty much any, anybody reaches out to me, I'll call them and just talk to them and see what we can do to help because it's, it's flattering more than anything. It builds my ego and I really like that.

So I believe it.

Really appreciate it. I really appreciate the fanfare we get.

Yeah, yeah, definitely. It's been fun and that's what we as we wrap up this episode. Guys, just to, to talk to you about the next couple weeks what we are gonna set up are how I built this revisited so we're gonna try or we are currently interviewing some of our favorite and are not favorite so popular unpopular just we took a whole mix of our previous How I Built this series and we're doing an update and saying hey, we talked to you two, three years ago. You told us about how you built your dealership and where you are now. Let's see what's happened over these last three years. Where are you now? So that's going to be a really fun I think series going forward through the month of December. So be sure you're staying tuned.

Yeah. You know what's, what's interesting is that these last three or four years have been a really interesting time. Probably one of the most interesting times we've seen in our business Compare well since 2008, 9, 10. So you know, it's been a good 10 year run and then people had, people had great years and then you, you hear of people going out of business. So it is going to be truly interesting to talk to these folks who, who may have been on top of the world last time we talked to them and now they may be on the bottom of the world or they could have been on the bottom of the world when we talked to them last and on top of the world now. So it's going to really. And if you, and if you're stagnant, if you're even. I don't know what to say. That might be a good thing. Right Jeff?

That's what I'm hoping for. I'm stagnant. But it is funny because when I've reached out to these dealers, none of those emails have bounced back yet. So I guess they're still paying the hosting on their dot com.

So maybe, maybe everyone we know a couple of stealing business.

Yeah, yeah, we know a couple of them have done really, really well. So we're really excited to hear those updates and based on some of the signature lines that they've responded, some of have pivoted and they're doing some new stuff. And so that's going to be kind of interesting as well. To wrap this up, Luke, with one of my final favorite things, and obviously a sponsor of the podcast is Tax Max. So we launched our fourth fourth quarter program today, which basically is for all of our current customers or recently paid off Buy Here Pay Here customers. We will estimate your fourth quarter taxes, like your upcoming tax return, based on your fourth quarter pay stub. So you bring me your most recent pay stub, I estimate what your tax return is going to be. And because you're such a good customer, I'm going to sell you a car today and defer that down payment all the way till February. So it's a cool program they run. It's great, great, great for your VIP customers because you already know them, you have a relationship, you'd sell them a car anyways. This just gives you an opportunity to sell them a slightly nicer car because you're committing some of that future tax return money.

Yeah, I mean, it's really neat program. And then you carry on into the first of the year and you really get all that tax money upfront quickly use the code podcast 2024 to get their VIP package. And it makes it so easy. I mean, you do nothing and it's there. It's money in your bank. So the last thing I'm thankful for, Jeff, is, is these repeat customers we get all the time. And I'm sure anybody out there that has a successful Buy here Pay here store sees the same customers over and over and over again. And if you treat them right, using programs like Tax Max, using programs like Blitzpay, using program or warranty companies like Buckeye with your reinsurance company, it really builds value to these customers. How many customers can go and buy this type of car and get a warranty on it? Not many. And so all these things allow you to keep your customers and get your customers engaged with you more often. And you know, our customers, they're unique and sometimes they can really be pains. But man, I'm so thankful for the great ones we have and wants to continue to buy from us that make our business great and made our business great for 40 years. And so I'm just, I'm very thankful for that.

Yeah, absolutely. Well, great, Luke. This has been fun, man. Happy Thanksgiving to you. Hope you and your family have a great time. And tons of Truduckin and Possum. What else do you guys eat out there?

Possum is usually on the menu first and then, you know, Truducking Then we have turkey.

Oh, what up with some raccoon and some, you know, just bright.

My turkey. Just brine my turkey this morning. I'll be smoking early on Thanksgiving morning, which y' all be listening to right now. If you're listening right now, I'm probably smoking my turkey. And hopefully it goes well. If not, we're gonna eat. If not, we're gonna be eating possums. So. Yeah, yeah, yeah.

I don't know. I guess if you. If you brine your possum for 48 hours, it might be so. All right, man. See ya.

See ya.

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