Car Dealers: Don’t Get Stupid!

No matter what anyone has to say about car dealers, I for one, have always admired them. I admire their spirit and their guts. I admire their enthusiasm, passion, generosity and determination. And I admire their staying-power. Car dealers are the risk takers and the movers and shakers of this world and they are a big part of what made this country so great. As you can tell, I am not a pessimist. I believe that “this too will pass.” I believe that what doesn’t kill us makes us stronger. I believe everything happens for a good reason and I believe, whether we like it or not, we needed this economic adjustment. It had to happen.

What I don’t believe is that it is the end of the world. I don’t think the car business is doomed, in fact, I think there has never been a better time to roll-up our sleeves and go to work. I do think that the lucky, not so smart dealers, you know the ones…that were successful in the past in spite of them selves will go away. They weren’t good business men. They didn’t get the whole picture – the importance of a strong service and parts department, the real concept of customer satisfaction and loyalty, and they didn’t have to really run the business – the business kind of ran them. Well, for those weak dealers that weren’t really good business men, I have one thing to say – “Seeya.” However, for the smart ones, this could be the best time of your life. I know it isn’t easy but you have to go through some pain to feel better. That is true with anything isn’t it? If you are sick and you go to the doctor, he says for you to feel better he has to stick you with a sharp needle – Ouch! – but almost immediately you start to feel better and then you are healthy again, on solid ground.

For as long as I can remember, car dealers were always on solid ground. I mean, think about it – until recently, you never heard of a car dealer going out of business, ever! But today things are different. We are in a very challenging economic situation (I hate the word crisis), and some dealers are just not going to make it. Some have already gone out of business and many more will follow according to the talking heads. So, for what it is worth, this is my little bit of inspiration that will help dealers survive today – I call them “Don’t Get Stupid Hints.”

Don’t Get Stupid Hint #1 – Know where you are going. If you are convinced you are going out of business and there is no way to survive, just go ahead and grab all of the money you can and go hide in a hole somewhere until all of this bad stuff is over. If on the other hand, you are convinced you are going to stay in business, then keep that focus and make decisions based on both short term and long term survival. In other words, don’t fire everyone, cut everything, send the message out to the public that you are in trouble and don’t get stupid. Instead, do the opposite – do the stuff you always did before that made you successful in the first place – keep doing it and you will come through this when others won’t – and then you will be in even better shape when the weaklings are gone – does that make sense?

Don’t Get Stupid Hint #2 – Talk to your People. Now more than ever your people need to hear from their fearless leader (that’s you in case you forgot) that everything is going to be ok – that you are not going out of business, that their checks won’t bounce and that you are going to survive. Talk about future plans. Talk about how glad you are that you have a strong fixed operation to help pull you through. Keep the energy around your dealership positive, not negative. Get creative by asking everyone to help get the word out that your dealership is going to be ok, that no matter what has happened to the dealer down the road, you will be successful because you and your people are not going to Get Stupid.

Don’t Get Stupid Hint #3 – Advertise your service department more aggressively now than ever before. Get with service management and discuss customer retention, service traffic, up-selling, how to answer the phone to get more customers in, competitive service pricing and the need to get every single customer you can in for service. Remind everyone at your store how important it is to ‘wow’ every customer, every time. Constantly talk to your people about word-of-mouth advertising and get even more competitive with prices for oil changes and well-known services that drive traffic. Remember, you don’t make any money on the customers that go somewhere else for service.

Don’t Get Stupid Hint #4 – Don’t listen to Chicken Little. Remember Chicken Little, from the children’s story – you know, “The sky is falling, the sky is falling.” Everyone believed what Chicken Little said and the result was fear, a lack of confidence, hysteria and eventually a collapse that could be compared to the sky actually falling. Don’t let that happen to you. Fear is a terrible thing – squash it, squash it now. The economy isn’t really that bad – it is the fear and the talk and the lack of confidence that makes it bad…that is the real problem. Do what you know is right. Keep your head up. Don’t give up. Push through and keep your eye on the ball.

Don’t Get Stupid Hint #5 – Focus on retaining every single customer. Now is the time to get serious about customer retention – you have talked about it for years and now is the time to do something about it – before it’s too late. Give your customers real reasons to do business with you. Show them you care. Make sure you introduce new and used car buyers to your service department. Let customers know that they should bring their car in for a free 1000 mile break-in inspection that will only take about 5 minutes – which will give customers a good chance to experience just how nice and efficient your store really is. Make sure you meet with your sales staff and let them know how important it is to recommend your service department to all new and used car buyers (and not to send customer down to Jiffy-Lube) – don’t laugh, it happens everyday. Offer customers membership in your dealership’s loyalty club – 92% of Americans are a member of one or more rewards club – so why not have one at your store to increase owner loyalty? By rewarding them for their loyalty with earned discounts and points – you will be doing what every other business has found out – loyal customers spend more money – and it costs much less to retain existing customers than to go out and get new ones.

Ok, there you have it – 5 “Don’t Get Stupid Hints” that will help you to survive the car business today. Please don’t be offended by my use of the word stupid – what I mean is that I have seen some really smart dealers panic and do some stupid things and I just don’t want that to happen to you. As you push through these turbulent times remember the stuff you learned in pre-school – always do what is right, don’t lie, be honest, treat all people with respect and – you may have missed this one at your school – Don’t Get Stupid!