#4 - Hiring and Retaining Employees

Hello and welcome to episode number four. Is it number four, Luke?

I think so.

That sounds about right. Number four of the independent dealer podcast. Today we are going to be chatting about hiring, firing, best practices. What else, Luke?

Just about how dealers should operate when it comes to employees and what you should expect from your employees and how to make your company better through employees.

All right, here we go. So we're gonna talk to Luke today. We're gonna chat a bit about some of the hiring, firing, retaining key employees. Let's get right into it, Luke, tell me this. Let's start at the beginning. When you're needing someone at your lot, where do you go to? What would you recommend us dealers go to? Find a good qualified employee. Now, whether that's salesmen, service techs, lot, tax managers, clerks. Where have you found success?

Number one, get your wife involved. That's what I do. Because she is really good at that. She has a way when she, you know, interviews somebody that really, I don't know, brings out who they are. But that's after that process of finding. But does she work at you a lot? Is. She sits right in front of me. We share an office together.

Yeah, yeah.

She's here part time. She's not here all the time, but she's kind of our HR person. But, you know, she. She had her own business. And to me, maybe, I don't know, but women have a little better knack of figuring out who to hire and who to interview. So I think having someone on staff that has a little bit of experience in that can be very helpful. Now if you're not big enough for that, you kind of have to play it by ear. So what we do and what we found when I did it alone, and that's some of the first people we ever hired was when I hired them myself, we use Craigslist. I think that was maybe eight, nine years ago. That was what people did, and Craigslist was good. And you still can't find people on Craigslist. But that's not what we use. What we found is the best bang for the buck is indeed. Okay, that's it. That's where. That's probably the only place I would post if our. And we actually. We keep them. We keep job listings on there all the time. So that's. That's where I go.

Okay, so you're continually. You, You. You don't pay for it, but you leave the listing up there regardless and just kind of can slowly collect resumes.

We do, and we cut it off and cut on Depending what kind of needs coming up.

Right, right. Do you find that's the best place? Is it dependent on the type of job you're looking for or do you feel like you're getting all the whole spectrum of decent candidates through? Indeed.

We see Indeed working from ground level detailers up to comptrollers. I don't think there's a separation on how Indeed reaches the people they reach. They just, they bring qualified candidates you do have to sift through, but they are there.

Would you recommend we pay to boost that? You know, the sponsored ads in Indeed.

We do, but we don't spend a lot of money with Indeed. Maybe if we're hiring somebody, I think it ends up maybe 60, $100, maybe. It doesn't seem like it's a lot of money that we spend doing that.

Have you tried doing Facebook's jobs postings?

Yeah, and, you know, I'm just not, I'm not a fan of it. Not to say it won't work, but what I see, maybe what we've seen is that the more, more qualified candidates are actually with a job website like Indeed or the ones out there, maybe ZipRecruiter, those type of things.

Yeah. I think two interesting things I found through Indeed, I definitely get more applicants. I'm able to kind of use some of the questions to screen them a little bit better. If I need someone who's a Spanish speaker or some other qualification through Facebook, what I do like is it links to their profile so I can very quickly scan through their profile, kind of see who they are, what they're about, see if they're going to be a fit for our culture. Kind of right off the bat, I find myself even in Indeed, I copy and paste their name into Facebook to try to find a profile so that I can kind of, hey, is this, you know, is this the look of a salesman that I want in my dealership? You know, or does this person, you know, are their postings kind of in line with, you know, our culture?

For sure. I mean, we do the same thing. If we, if we find a candidate we like by their resume, the first thing we do is go to Facebook to verify who they are. You know, everybody kind of has an idea of what their culture is and the customers they're serving. You know, the. None of us should discriminate about any way anyone looks. But I think more than anything it's, is that customer, is that potential candidate, are they posting things that I don't want around my dealership? I think that is number one and so we spoke for that off the bat. I mean, that really matters to us.

Talk to me about this. I found that unfortunately, people who are looking for a job or who are either unemployed are not always the best candidates. If you found any success with what we'd say, poaching from similar industries like rent a center or waitresses or other dealerships, you know, any success with that?

I've never done that. I'm not saying that that can't happen, but I have found some dynamic people selling clothes, selling shoes.

Yeah.

And also waitresses and waiters that I thought would be wonderful in our business, but maybe I've never decided to go about hiring those people, but I think it can be successful. I do not hire people who have worked in other dealerships, period. I don't hire. That's an automatic disqualification for me.

Yeah, that makes a lot of sense. I could see the good, you know, the bad side to getting someone who's, let's say, tainted by a way of thinking, you know, or maybe a competitor that may still have loyalties to a previous dealership and, you know, stuff like that. What I found in hiring people who are currently employed but not wanting to work at a restaurant where it's nights and weekends and every holiday so you can come in and say, hey, you know, you're used to working on tips and not knowing what your income is. You know, come here and be a receptionist for us. And you're getting a solid hourly and you're working days and you got every major holiday off. And, you know.

I definitely think. Yeah, yeah, I definitely think that's the way to go when it comes to. I think waitstaff would be wonderful when it comes to two car sales and just a customer service type person, you know, I think it's a great idea. I've just. I've never done it.

Yeah. So tell me this, Luke. What do you do inside your dealership to make sure that you've got the right people in the right seats? You know, I mean, do you do a lot of internal moving around? Have you ever swapped people and said, hey, you know, you were a real great lot tech. You got to come be a salesman now, you know, it seems like the route to go. Right. Yeah.

And, you know, I think it's twofold. One, if you hire someone as a. And we like to call them dealership assistants, you pay them a very minimal wage to start. Not minimum wage, of course, but I think, you know, probably ends up being like $10, $11 an hour. What we start them at and they get in our dealership and we see how they work and see how they feel. They're on a 90 day probation. And if they're dynamic and we love what they do, then at that point we decide to put them on a path to success. Whether that's collections or sales or service, whatever that might be. We're going to find a way to make that person go from making $25,000 a year to making $50,000 a year. That's what you want to see. But I think also if you've got an employee that you don't think works good in a position, sometimes what we do is we go, well, let's move them to somewhere else, see if they fit there. Yeah, sometimes you gotta, you gotta break, you just gotta break loose. You get people just don't fit with you. And people, some people just don't like the work. So I think you can get, I think if you hire someone, you've got to have a plan for them then. And if they're not working out in that original position, sometimes you gotta cut bait.

Yeah, yeah. And sometimes it's, you move them out of one position into another and find out that, oh, you thought they would have been great as a, as a salesman or an office manager or something, but then you come back around and say, no, no, no, that person's got to go. You know, they're much better as a technician or a lot manager, dealer, assistant.

Yeah, but if you like the person, you're right. Find a spot for them. That's number one. You got to like the person. The person's got to have work ethic. If they have those two things, then, you know, we'll find a spot for them.

Great. So now how do you do it within that framework of finding someone, how do you get the best out of them? Do you find that most people that you have there, you're motivated by a good compensation plan or do you find that non monetary encouragement has been the best?

Each employee is different. Some employees are working for one thing and that's to make money. And if you find that employee, you're going to have to pay them. You're going to have to build your compensation plan for that. Some employees love to be told they're great and that's fine. I love that too. Now you got to pay them as well. But you know, I think what motivates people is themselves. And we do, you know, pay plans that fit the economy and that work well for our employees. We don't pay them as much as they can make because every time they're doing something good, they're making us money. So we like to give good time off, flexible hours. We like to pay them well, and we like to show them a path of improvement for themselves. And also we like to treat them like family. We want them to be here because they like to be here, not because they're making money. Yeah.

You know, I think there's kind of a different way of thinking. A lot of people read books like the E Myth, you know, and they think, oh, yeah, it's, you know, I need to create policies and procedures and then get the lowest paid person just to follow the process. You know, the McDonald's philosophy of just getting someone in here, and this is X and it leads to Y and then Z. And, you know, I don't think that that works in the real world. I think you find a lot more hassle. And maybe there's two or three positions you might have at your dealership or where you could get someone like that. It's maybe a high turnover, low pay type situation. But I think finding the right person who's skilled and then compensating them appropriately to keep them there, man, that saves a lot of brain damage from a dealer standpoint.

Doesn't does. And people get too tied to what they're paying an employee sometimes instead of what is that employee worth to them and how much have I spent to train this employee? Are they doing it right? That's what matters. It costs a lot of money to rehire a position.

Yep. And are you investing in the guy that's there? You know, hey, you don't like your collector's performance, but have you given them the right tools? Have you given them the training? Have you sent them to conferences and education to make sure they're the best possible version they can be? And if that's the case, then, yeah, maybe you don't have the right collector, but anything short of that, you got to look at yourself, right?

Sure. And that's the main thing. Are you educating yourself on how to train your employees? And have you given them that training? Have you asked them to read a book here lately? Get them to read a book that you like and sit down and talk with them about it, discuss it, have weekly meetings. These are things that you have to do for your employees to be what you want them to be?

Yeah. And that leads me to kind of my next point, I think, not only monetary compensation, but also giving them ownership. You know, I think as a dealer, it's good for you to know how to do, I would say, almost everything at your car lot. You know, there's not. I mean, with the exception of some. Some heavy mechanical work. You know, I can't say I know how to swap out engines, but, you know, I know how to do everything here, but I don't have to do it. And that's something that dealers need to really learn is that delegation, you know, this. That title clerk is not going to do the work the way you do it, but they're gonna do it 65% of the way you did it, and that's good enough. And you got to let them go and let them have ownership over it and have some checks and balances. You know, you don't want people getting carried away or being neglectful. But, man, if you think that these people are gonna care about your dealership as much as you do, you're. You're crazy, man. No one's gonna work as hard as you are or necessarily be as good as you are at it.

100% agree, Jeff. The. You know, the one thing that we started doing that really made a difference was writing procedures and policy manuals so that, you know, if you do like the way you do it. I'm a real stickler about how my pictures look on the Internet. Okay, well, I took time to write a procedure manager manual for that person that takes the pictures. So I know that every picture on every car is exactly the same. It's in the same spot, the same light. You know, everything. So, you know, we can take that to collections. We can take that to title work, we can take it to whatever we need to do and write a manual, train that manual. Then people do it the way you did it.

So that. Yeah, where is. Where is the room in that, Luke, for flexibility? Where is that room to say, hey, you know what? I want my pictures on the website. Get them on there, you know, and you say, hey, man, you know what? This one's at this angle. This one's dark. This one's light. This one's sideways. This one's upside down. Like, you know, where's that balance between, you know, the policies and procedures manual and the, hey, I got the right guy in the right seat, and he's gonna do what's best for the dealership?

Well, you know, I don't know if you're just asking about the. That one thing, but with that one thing, to me, it's only one way to do it, and that's because that's causing today's day and age when it comes to buying and selling cars, the only way to do it is online. And so you got to make that.

Impression because I want everybody listening to go to Luke's website right now and make sure that his photos for his cars and his website is on PointMotors.com.

Go check it out.

Who's your website provider?

Dealer fire.

Dealer fire. Okay. All right, so we're all going to go. We're going to bombard it and hopefully crash it today and make sure that he's got everything fine tuned on there.

Everything should look exactly the same.

Yeah. And so what I lead to, I lead to the point of. Yes. I mean, there are high level situations and when you beat build policy and procedures manual, whether it's for your, you know, your lot manager and your pictures or whoever's taking those, or your salesman and the way you want leads handled and, you know, the way you want the sales process to go, you build those policies and procedures manual. Then of course, within those, you know, guidelines, those employees have the ability to use their own personality, you know.

Sure, sure. Yep. And that's, you know, when it comes to taking a picture with a customer after the sale, you know, I had a way I wanted it done. And that process has evolved a little bit because salespeople have taken an initiative to go, you know what, I do like the way you did it, but I have a different idea. Their idea so much better than mine and look so much more like we care. Of course, we move to that. And of course every employee has an idea and that will make your business better. And that's what we have to listen to that and find it so we can do that.

Yeah. So talk to me about this within that area of feedback loop. What do you have in place for your employees as far as you have periodic reviews? Is it kind of willy nilly when they come in and want to talk to you? How do you set that up within your dealership?

Oh, it's both. I talk to every employee every day. If I'm out of, if I'm out of town, most of them will call me once or twice a day. The key employees, my salesman. I talk to my salesman probably ten times a day. But we do have reviews. My wife, Alexa, like I said, she's really involved in the HR part of it, but she makes sure those reviews get done. I don't like to do them, I'll tell you that, but I do understand how important they are. We do one month after the hire, I think 90 days after the hire, and then it goes to six months and a year, I believe, is how those roll after that. They're very important. You need to, you know, you need to give the employee feedback. If you're, if you're disappointed in the way employees performing but you haven't told them, you're disappointed. If you hadn't told them in the proper manner, then it's not, it's not your, you know, it's not your employees fault. It's your fault.

Yeah.

And you have to, you've got to bear some responsibility. If you had reviewed and trained and told that employee what's up, then you know you're at fault because that employee didn't make it.

Yeah, it's on you. And that leads me to think, you know, what we need to understand is that as a dealer, you know, if you're a single man operation, two man operation, I get it, you know, you're working tightly with the guy that's there. But when you start getting into the 4, 5, 6, 10, 20, 50 employees, you're no longer a car dealer. You know, you're a people manager, you know, you're a firefighter, you're solving people's issues. And unless you hire that out to your wife or someone who is better at that, you know, that needs to be your number one responsibility. If you're so busy behind your desk crunching numbers or, you know, checking the books or selling cars that you're not given your number one asset, which is your employees the attention they need, you know, reinforcement, encouragement, you know, just, just a 30 minutes every couple of days to sit down and just gnaw your ear about what they like and what they don't like, man, you're gonna neglect the number one thing, man. It's not our customers, man. And if you treat your customers better than your employees, you're gonna be in a world of hurt, man. Because it's. People don't quite get that, man. The customer is not always right, man. My employees are always right. And even if they do something I completely disagree with and they treat a customer badly, you know, in front of the customer, I'm going to back my employee, you know, and we'll talk about it afterwards. But man, just keeping them happy and knowing that you've always got their back is key.

Yeah, you definitely have their, you have to have their back. But you know, I'm a customer's always right type of person. And so, so we'll disagree a little bit on that. But you know, but I don't think you can't out your employee in front of a customer. But there's definitely times where you need to make sure that your employee knows you're backing them because you're right. They are a very important cog in the wheel.

Help me understand that. Lou, I don't want to put you on the spot with this, but give me maybe a situation where you feel like the customer is always right. So where it would supersede the philosophy of the employee is always right. Because I get it. I mean, yeah, the customer is number one when it comes to, you know, maybe the outward appearance or the customer service. But when it comes down to, like, employee, customer priority, what do you reconcile those two?

Well, the customer pays all of our bills. Okay, let's lay that out there. But, you know, I've had in the past, not with a current collector, but a past collector of mine who was. Who could really, you know, get a customer riled up. And sometimes the customer's right, you know, in that collection spot where, you know, maybe they. Maybe they did tell the collector something and the collector turned them off anyway or something to this effect. So, you know, it can happen.

Not.

That's not always what happens. But let's say you've got someone in the service department that maybe just didn't talk to the customer properly or put them off. Then that happens, man. Sometimes employees or sometimes customer service people don't like to call people back because they don't want to hear what they're going to say. So maybe they dropped the ball. So there are times where the. The customer wasn't taken care of well enough and your employee dropped the ball.

Okay. So obviously there's situations and like, you're speaking to maybe where you've got a customer, an employee that's not, generally speaking, isn't treating people right, not calling them back, not being courteous on the phone, not being friendly, you know? Yeah. I definitely think in those situations where it's chronic or proven itself time and time again. Yeah, you gotta. You got an employee situation.

Yeah.

Interesting. Yeah. I think I look at it and I say, if I ever have a situation where I have one employee who is here that is at odds with the customer, I'm probably going to fire that customer before I fired that employee.

You know, what I've done a lot of times is I've had to take over customers because for whatever reason, whether my customer is a problem or my employees a problem, they didn't see eye to eye. So what ended up happening is I had to take over that customer. And typically, in the end, that customer is fine. But, you know, who knows what it was?

They got sideways with an employee for some reason, because of a tone of voice. Oh, yeah, I've been there. And they might be the best employee and they handle 400 of their accounts perfectly. And this 401 just didn't mesh for some reason. Yeah, I've been there.

Oh, yes, I've had to take over customers and, you know, and then after a while, after you, you really had a good, you know, good rapport with this customer. You go, you know, she's really not that bad. You might have called her on a back day, a bad day. Would you like to start dealing with her again? And sometimes like, yeah, sometimes they're like, ah, no, I'm good.

Yeah, yeah, yeah, yeah, that's so funny. And that really comes down to, you know, I always tell all of our employees, if you're ever dealing with a hot K or you're on the phone with a customer and things are escalating, just tell them to hold. Tell them to hold and transfer them to someone else, whether that's me or the manager or the salesman that sold the car or back to a collector. You know, obviously sometimes it's just the frontline person who answers the phone gets the heat. And oftentimes that's our collectors and our receptionist and our salesman. And when they move on to the second person, they've already vented their frustrations. Now that next layer has the ability to say, yeah, you got it out, you know, and now let's talk about a resolution. So, so yeah, there's definitely opportunity when you're, you know, sometimes when the, when that first level employee is being the punching bag, you know, the next guy can step in with a little softer gloves and kind of solve the situation.

Oh yeah, oh, yeah.

Where do you find that in, in that situation with your relationship between your employees? I mean, I'm a very big fan and I've often kind of touted the mantra that I'm not going to ask them to do something that I wouldn't do. And then I've gotten, I've gotten into a little bit of a ethical conundrum when it. As I've kind of stepped away from the dealership a little bit more to have more of a life balance with my family situation. I'm not here on Saturdays anymore. I don't come in on Saturdays anymore. That's the thing. And so sometimes it's hard for me to go to my employees and say, hey, well, actually I do want you guys here on President's Day, or I do want you here on Black Friday when I don't want to be there. So I'm starting to have this internal battle of, hey, you know, I'm going to ask you guys to do things that I wouldn't do. Is that. Is that something you find or where do you. Where do you sit on that?

I do everything. So, you know, I work probably 30 Saturdays a year. I work Black Friday because there are certain, you know, employees that won't, you know, you know, but there is a time that I go, but I'm with you. I won't ask my employees to do. I work the most hours out of all of our employees. It's just the way I am. So. But, you know, as. As we. As we grow, I can see myself stepping further away and hopefully out of the picture at some point. But, you know, we. We're not there yet. We're probably at. I think we're at 15, 16 employees right now. But that's just the way. Yeah, it is. It's a lot of people, you know.

And on those lines of always knowing, hey, I'm not gonna ask you to do something I'm not willing to do. And also, hey, I know how to do your job as good or better than you do, because I'm an operator too, you know, I'm not just sitting up here in my corner office, you know, hanging out, counting my money. Like, I can. I can walk out there and sell a car. I can step into the back in detail. You know, I can diagnose a trade in and put a number on something just as good as any of my guys can. Also letting them know, like, hey, I'm gonna do what I say, and I'm gonna say what I do and have integrity that when they come to you and ask for something or you promise something, or you. You're a man of your word, right?

More than anything, the owner, operator, or the manager has to be a person of integrity. Without that, employees will not do their job well. They will not care about it. They will not treat your employees well. Their manager has to be a man of integrity or woman of integrity, and they have to demonstrate it. And you have to hire people with the same philosophy.

Yeah, that's so true, man. I think that's a great, great word of advice to leave on right there. I think that's a lot of good information we can all learn from hiring. You know, how to get the right person in the right seat and just, you know, try to fine tune our operation. I think that's what we're all kind of continually doing, just, you know, making everybody's life more enjoyable, making our dealership an enjoyable place to be more profitable at the end of the day. Anything you want to leave us with, Luke?

Man, this is a great topic. There's plenty of books out there to read on this and, you know, do your research. Task of Forward is a great book to read on this topic. Good to Great is a great book to read on this topic. But there's so much good things out there, so many resources that people need to reach out to and read and study and train your employees, because the better they are, the better you'll be.

Yep. Awesome. All right, guys, thanks for joining us.