#365 - The 20 Group Takeaways

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, we are fresh off of 20 group, man. Bittersweet.

Yeah, it was, I've been doing 20 group for nine plus years, I think, and it was my last 20 group. Jeff and I moderated it and I hope hopefully I did well and, and people got something out of it. But I tell you, 20 Group's been the single most rewarding thing I've ever done in this industry. And yeah, I'm, it's bittersweet for me, but I'm glad, glad to have done it.

Yeah, well, you did better than you did in D.C. i'll say that.

You did.

You did a great job. You kept that, kept the conversation rolling. Everyone was very interested and engaged. So we had a great time. Again, the 20 group program, I've been in it for about the same time, probably 10 or 15, 13 years, something like that. And it's just, it always, it still blows my mind. I come away with at least a page full of notes. You know, we're going to go over those today and talk about some of the key takeaways that I'm still getting after. I mean, geez, that's 30 something meetings or more that I've been to. And on the flip side of that, it also blows my mind when you run into some dealers who don't get it and are still, they just, you don't know what you don't know. And that's the biggest danger in this business because dealers can be such a lonely little group that we just kind of put our heads down and we hustle and yet we don't know that somebody's already gone through this school of hard knocks. They've already figured it out. They already know what to do, what not to do. We just got to be plugged into the community where we can get that information.

That is what's great about 20 group because nine times out of 10, the issue you're having right now, another dealer is already having it and they've already figured it out. And I'm still learning things right now. And I've been doing this day to day for 29 years and I'm still learning things every day and, and now doing consulting and going into people's dealerships and man, I tell you, you don't know what you don't know. And there's a lot of dealers out there that don't know. And luckily I'm. I'm getting the opportunity to help those dealers now, which is really, really rewarding for me still. So let's go through those notes because there's still, there's a lot. I mean, and hopefully dealers are learning from us every week as well.

Yeah, that's debatable. One thing that was really stuck out, stuck out to me and one of my biggest takeaways that I've tried to tackle this year, and we talked about it in last week's epis or the week before, is just making sure I got the right processes in place for my employees and making sure those employees are prioritizing the most important tasks for them. So when we were, I got back from the meeting and I went to two of my key employees that I know are bogged down with a lot of stuff and I said, just get on this Google sheet and just write down everything you do that this week. Everything. Like, I want every task that you handle during this week. Put it down on this Google Sheet. And then we're going to go through and we're going to order these. We're going to number them all from A1 down to C5 or whatever, and we're going to put them in order of priority. And everything that drops down into a level B or C priority, we're just going to delegate that to someone else. We're going to find somebody else to handle the $10 an hour work so that my $50 an hour people are not doing stupid stuff.

That is such a great exercise for every dealer out there to do. Because a lot of y' all out there have. Let's say you have 10 employees and you probably don't have a written job description for each employee. And if you don't have that, you definitely need to do that. But this is the first step in that process, getting your employee to write down what they're doing every day. Because something they are doing every day that you may not even know may not be part of the description that you thought was part of their job description. So it helps you build that. And, and it also helps you take away things that they are just way over, way overqualified to do.

Yeah, that, that's. And, and we say that. And that leads directly into my. One of my second takeaways was using. This is the most cliche thing in the world, but using AI more in, in my business to, to, to accomplish those tasks. Right. So I, I keep my chat GPT open all the time. And when I have something like that description or a task list or even emails that I'm sending that I want to be more polished. All of my Google reviews are being done through an AI chatbot now just to make them funny or more interesting or, you know, something like that. But, but I really sat down with a lot of my policies as I'm building this out. And I say, you know, give me a framework for this policy. What's my cell phone policy, what's my days late policy? A lot of that stuff. I'm, I'm just running through chat GPT to get the bulk of it kind of written out. It's amazing what it can do. It's amazing what it can't do. You know, some of the stuff I think is so simple that it just totally gives up on.

So. So one of those things, like you can take with that exercise you did with your employees, you can take what they wrote down and say, chat, write me a job description based on what my employee gave me. Right. You can copy paste that in there, and all of a sudden you have a job description. So something that may be daunting to you as a, as an owner is made, made within 10 seconds of you getting your employee to do a majority of the work. And you just cut and paste into chat. And that saves you a ton of time. And it's, it just makes you feel better because now you go, okay, let's refine it. Let's talk to our employee about it. Let's train on that. And that's so key in chat. I mean, chat helps with the newsletter, Jeff. And you know, people out there, if you're not, if you're not looking at our newsletter, I really think it's good this year. It wasn't good last year. Jeff was doing it last year. But now I have, I've taken over it. And you know, we just talked about mission statement. And if you want to talk about what your employees are doing and if it's actually following your mission statement, you can't do that if you don't have a written mission statement. Right, Jeff? And so make sure that their job description is fitting within your mission statement.

Yep. And the whole point of the newsletter is at a 52 weeks to a better dealership. So join now. You're through week number four or five. You're going to miss a couple of the first weeks, but it's okay. They'll come back around next year. But it, each week is going to build on itself. So we're starting with the building blocks of your dealership you know, what is your mission statement? I think the week after that's going to be core values. We've got four core values here at my dealership because it's called Four Seasons. So it's very easy to have four core values that are an acronym for the letter 4, F O, U, R. And we talk about those every single week, you know, what our core values. And we try to find an example of an employee who used one of those core values. So it's. I think it's really, really important. And that also, it lends me to go back to the episode from a couple weeks ago again with Steve Levine is I'm doing all these things, but at the same time, I don't know what I don't know. And that's where it helps to talk to Steve to go to things like Compliance Unleashed and Buy Here, Pay Here United. That's coming up. Because then I even get the awareness, like with my employee policy. I didn't know that I should have a social media posting, you know, kind of disclaimer inside my employment agreement that says, hey, I've got all this stuff in my employment agreement that new hires sign when they come on. But when I heard that, I was like, oh, okay. Went to chat. GPT asked it to write me a, a social media post policy. And it gave me a tiny little paragraph that just said, hey, don't post stupid shit. You know, all right, cool. So I threw that in my employment agreement and. And now I'm building it, you know.

Well, what's great? Yeah, I mean, what's great with Steve, you can. As soon as you, you get your employee to write their, their task and you get Chat to help you with the job description, then you can send it to Steve and say, does this look legal? And, and all good to go. And Steve can help you with that. So make sure you reach out to him when you're building your training manual or your, your contract with your employees.

Yeah. And of course, he's going to be. The Ignite Compliance Unleash convention is in conjunction with Buy Here, Pay Here, United this year, which is going to be huge. I just looked at the agenda. I think we, we tried to keep Steve Luke off the agenda, but I think he got on somehow. I will be there, and there's a handful of dealers that are doing presentations that I'm actually excited to go to. You know, our good buddy Harry's doing something, of course, all of our friends, everyone's going to be there. And so the agenda looks really, really Good. This year. So make sure you get signed up April 22nd through the 24th at the Caesars in Las Vegas. Beautiful time to be in Las Vegas. If there is ever a time to be in Las Vegas, early spring is the time to do it. So, yeah, I'd be there. It's going to be a good time.

I'm going to be there, you're going to be there. We're going to have a good time and hopefully we're going to go. Jeff, can we go drive race cars on like Monday or Tuesday that week? Yeah.

You kind of got the need for speed in. In you now since that BMW driving school, huh?

Yeah, I'm ready to go anyway. What else you got?

One thing that was interesting to me too is I think maybe it was you that mentioned that they had a professional bdc. Not a pre. I don't know if it was a professional, but it was someone very, very skilled BDC age that went through and was. Was working previous accounts. Like, previous leads, like going way back into the database. Yeah, I've been in business for whatever, 20 years or something. I got a lot of people in my CRM, all my CRMs, my DMS, my CRM and previous customers that have paid off. But I very rarely make a good concerted effort to market to those people to try to get them back in my dealership.

Let me tell you this case study, and I'm undergoing this case study right now. We turned off every single ounce of our advertising on October 15th. Every. Every dime. Okay. All we have is a website, and we sold the exact same amount of cars that we would typically sell in December, in December with zero advertising. And I'm not telling everybody to do this, but what I'm getting to is this. Your advertising is way less important than the leads you currently have coming in and the leads you have in your database. And we've got to figure as an industry and especially as buy here, pay here dealers, what can we do to take the database and just mine it and mine it and mine it. And a dealer that I was referencing was a dealer down in Augusta who was selling a hundred cars a month and they were spending zero money on advertising. They hired someone who's just a professional customer service that, that knows how to cold call past clients and dig into their database. And if you can harness that, you can sell however many cards you want to a month and it really doesn't cost you a dime. So what they were doing was mining referrals from the current customer base. They had low balances and, and they were setting appointments and so their, their salespeople, all they were, were delivery people. Customer came in from the appointment, already knew what car they wanted, they were just signing them up. That's it. You spend way too much money on trying to do traditional Internet digital advertising when what you really need to focus on is the leads you currently have and the people in your, in your database.

Hand to hand combat, it's hand to hand.

It's hard. And this is what happens. This is what happens. Our, our current salespeople would rather take the new lead. And what the problem is is every day it's a new lead. What happens is you lose the lead from yesterday and you lose the lead, the new lead from the day before, then the day before, then the day before. So you're probably ended up losing most of your leads because you're working new leads. Yeah, there's no advantage to that.

And there are a lot of CRMs that are good with, you know, blast texts and emails and trying to get people back in the market, but not the same. Yeah. What I struggle with is who is that person? Right. I do. I, I am realizing that sales skills matter. You know, when you're hiring a BDC or a salesman. I was of the opinion, you know, six to 12 months ago that just a good customer service person is, is what you want talking to customers and getting them in because buy here, pay here is easy. But I am realizing now more that customer service is good and you want someone that's likable and that people like. But if they don't know how to ask for the sale and they don't know how to overcome objections and they don't know how to close somebody or if they're not ready to hustle, that just being a nice person to talk to is not always the best person to have in a sales position.

I think, I think you can train it. I'm going to disagree with you a little bit. I think you can train it into people. I'm not sure that you can train, follow up into people. You have to have almost a innate, just weird data type mind that says, okay, all I'm going to do today is call people and I'm gonna get them on the phone, I'm gonna ask, I'm gonna ask for a referral. And the salespeople, a lot of these salespeople we're hiring, they're younger for one. They don't like to talk to people on the phone. They'd rather text them. And it just doesn't work for one, you've got to have for this position, you've got to have a good referral program for your customers. And you got to have somebody that is great on the phone. And hiring somebody that's great on the phone, that's younger is getting harder and harder and harder. Yeah.

Who's also hungry and has that drive to dial constantly and get people on the phone and handle objections and rejections. And that, I'm telling you, is hard. It is closer, let's say. Or someone who's just hungry enough. I don't know. That's what I'm finding. And there's certain types that do gravitate and grasp that. And I found that there are others types who just as much as you teach them, they just don't get it. But yeah, one thing along those lines that I also wrote down was having all of my so for buy here pay here notes. If I get a payoff, whether it's a refi or someone has a clothes has paid to the end of their loan, I need to do a better job of routing those all through. Maybe my sales manager, that he's the one delivering titles, he's the one talking to that paid off account and really trying at that point to get them back into another car. Because we're losing, we're losing a lot of people who are paying off and maybe they don't think that we have an option for them to graduate. Because in my business model, I have all the banks and credit unions, I have places that will offer them a 7% interest rate if they built their credit with me through my buy here pay here program. So I don't want to lose those people. So I think instead of just having them pay it off online or pay it off at the desk and then my, my clerk just sends them a title. You know, I, I have all those payoffs now going through my sales manager who says, hey, you know, congratulations, you did great with us, you got great credit. Do you need another car? You know, try to resell them again at the time of payoff.

Yeah, you know, I, I get on.

My, if we didn't get to them sooner.

Yeah, I get on my sales people and I'll go back to that in a second. But I, it was very rare when a customer left my office when I was in my dealership for, with their title, it was very rare because I would flip them into another car, I would make a joke and you know, oh no, no, we don't let people leave with titles. And I would Go over there, you know, and start working them. And I was like, well, everybody can do this. Everybody can't do it, unfortunately. And especially when your collection staff and your, your sales staff aren't talking. So you've got to, you've got to create a process where your collection staff, when the customer walks in to pay that car off, that your collection staff is notifying your sales staff, your best person there, to try to get them in another car immediately. And you can even bonus your collection staff for doing that for, for when that happens. And now, you know, with, with services like Blitzpay, a lot of times you're. The customer is paying off and you never see the customer.

Yeah, that's a big issue. And you might not even know who they are really, because they've been playing it online the whole time or through autopay like clockwork. And those are the best ones. Those are the ones you want to keep. Those customers are gold.

So you've got to have a process for your collector because your collector knows those people paid off. Your collector has to alert your sales staff or your sales manager, hey, you know, these people made their last payment on Blitzpay. You need to make sure that you contact them. And your salespeople have to be commissioned for doing that. And your, your collection staff has to be commissioned for getting that person back into a new loan. And so it creates, I mean, it creates a bunch of layers. But those are your best customers. You can't lose them.

Yeah, that's funny. I need to bring that up to Robin and TJ and the team of Blitzpay. When we see them is I, I've had customers pay off through the Blitzpay portal and we don't ever see it because they just get paid off. There's no notification. It doesn't tell us they're just done. And all of a sudden, a couple months later they'll call and be like, hey, where's my title? And you're like, I had no idea you paid off. So, yeah, some sort of an email that goes out or something and says, hey, this customer paid off. I don't know. Or maybe. Well, I think in person, I don't know.

Well, I tell you something. I do. And we used to do that is I pull a, I pull a list of every payment made the day before. So I have it just set that every, every morning I have a, a payment post report that, that comes to me and I pull it and I pull out every paid off account every day. And so I can see who Is paid off every day. And it helps me keep track of. Of how our portfolio is shrinking, but it also allows me to say, hey, why do we not sell those new people car? And now we don't really offer that anymore. So. But it still lets me know how my. How my portfolio. Why is it shrinking? At what rate? It's shrinking anyway? These are all these things I can help dealers with when I'm consulting. But that's a. It's a really good thing to. To be on top of.

Yeah. Just a couple more things before you wrap up. The one thing that really hit me too, was someone said all their down payments are odd numbers. And I just thought, man, that is so interesting that I've always kind of had an opposite philosophy of just simplicity. You know, it's. It's. It's five, it's a thousand down, it's 1500 down, it's 2000 down. And they're like, no, no, no, it's. It's fifteen $75 down or 1625, because it is literally every dollar you can get. You know how much you got down? 1500 up to, well, maybe 1700. Okay. 1750. 1770. Could you come up with an extra 25 bucks? Like, that is. It's, It's. It's such a weird thing, but it's. The philosophy in it is important, and I, I need to be better at that. I need my sales manager to be better at pushing for every single dollar that they have as a down payment. Right.

Yeah. That is interesting. And there's, there's philosophy about pricing your cars.

Right.

Don't ever price your cars on the Edens. Right. Or, you know, because it's. I understand what somebody's trying to do here.

Yeah.

You're not trying to be arbitrary on your down payments. So, you know, as long as you're. You're getting as much as you can, I don't care how much you get. Because I think. I do think that, you know, down payment. Yeah. Down payment matters when it comes to performance of the loan. That's something I believe, but I do that. That's interesting. I don't know if I agree with. But it's interesting.

I think what, what, what. What I agree with is the philosophy that if I see an odd number down payment, I know that my team pushed for as much as they could get. Right. It wasn't just like, how much you got down? I got a thousand. Okay, great. I can get you proof with a thousand. You know, it's like, well, did you ask a Second time did you ask a third time? Like how many times did you try to bump them on down payment just to get the commitment, you know, like you said, if down payment matters, then it should matter, so why not ask for more?

Yeah, interesting.

Anyway, so one, one thing I did also that was, you know, we talk about CPI so much and of course the guys at Buckeye, they have my CPI policy and I start looking at the numbers and doing the math on what that looks like when you have, you know, 50% penetration or better on a portfolio like mine. It's a big, big deal. And so I, I put in a, a tiered bonus plan here at, at my office for my kind of clerk who handles all my CPI stuff. She's in charge of getting the policies enforced and putting them in the DMS and all that stuff. So, so I set up a bonus plan for her because to me it's such an important piece. It's a business inside your business. Right. So to think that it's just going to happen is kind of like me thinking that reviews are just going to happen. They should, but they don't. You put a bonus on it or some sort of an incentive. Now it happens, you know, you want, you want number of units to days in inventory to come down. Put a bonus on it, it'll happen. My collections, she gets bonused on recency and delinquency. That's what she focuses on. Right. And you could argue that if that's what they focus on, they don't focus on anything else. So yes, coming up with a balanced bonus plan is important and that's a whole nother topic. But anyways, for the CPI part of it, I just said hey, if we can double our penetration over the next, whatever time frame it takes, that's a big deal to me. So I put in together a kind of a tiered bonus plan that gives her a five thousand dollar bonus if she can get there right over steps. You know, if we get from 150 to 175 to 200 to 225, she'll get some bonuses along the way. So that's something I took away that I think is going to help me kind of get to that next level.

Yeah, I, it's something I instituted probably a year and a half ago. We were struggling to, to really get a grip on on cpi. And, and I think they'll tell you not to bonus on CPI because it gets a little, little gray there something Steve?

Yeah, for policy if you're not an insurance. So just talk about guy talk to ignite, make sure you're doing it.

But, but I think it's, it's a, you know, it's a pay plan, right? And the pay plan is this. I hired you. Well, you're, you're my insurance person. You handle all my people with regular insurance, you handle all my people with cpi. You handle all the total losses with regular insurance, you handle all the claims with cpi. And the more people that are on CPI and the more people that are, are paying that are on cpi, the more money you're going to make. And if you tear it so that every time they, they hit a number, a 5% gain in CPI penetration, you're going to make more money because you've got more work to do. And so stair step it, you will, you will see an immediate difference. And that's. I tell you, CPI is, is really great. I did not say this years ago, but I wish I would have done it 11 years ago and I would have retired five years earlier, I can tell you that. So people out there not using cpi, you need to use it. If you need a very specific plan on how to get penetration. I know a guy.

Yeah, that's all I got, man. You got anything else?

No, you know, I just looking forward to convention season and going around and having fun. So Jeff.

Yeah, yeah, awesome guys. Talk to you next week.

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