Your Daily Operations Magazine
Search Close Menu

Dealer Ops

Do Your Customers And Sales People Collide?

Auto dealerships spend an enormous amount of money attracting customers to their dealerships. The second or third largest expense of any dealership each year is usually advertising. So why is it we seem to do our best to drive the traffic away?

This month’s column was inspired by two separate managers that I had in my Special Finance workshops recently. They both had to work with common obstacles within their dealerships.

Those obstacles make up the “Great Train Wreck”. Two parties - the customer racing to respond to an ad from the dealership (you know, the new Expedition for $299 a month), and, the sales person, racing full speed from inside the store, ready to make their next sale – collide. One wants to buy (and could if worked properly), the other wants to sell, but the result is an absolute disaster.

Why is it that most dealerships feel that the way to the sale is first, and always through the “conventional side”? Come on. Yes, there are some dealerships where 75 – 80 percent of their traffic is indeed conventional credit. I assure you; however, they are in the minority today.

I have the utmost respect for most all of the sales training companies in the market today. I used some of them through the years in my own stores. I certainly do not argue their tenets … except for one. If at least a third of the credit bureaus you pull in your market are below a 600 Beacon, opportunities are being squandered if the sales staff is not being trained to find some way of inserting non-offensive qualifying questions into the dialogue shortly after the meet-and-greet.

Most dealerships are afraid of that situation. Yes, there is always the possibility that you may offend the customer if you don’t handle the situation properly (that’s why we train). There is an even bigger probability that you will offend the customer if you spend two hours “selling” them a vehicle that they cannot possibly get approved for, then throw them into finance hoping for a miracle … which seldom, if ever comes. Their next stop is Down-the-Road-Motors where they will start all over, never to darken your doorstep again.

One of the biggest causes for this is the “us versus them” mindset that tends to permeate many dealerships. The dealer and/or GM don’t intend for it to be that way, but they set up pay plans that essentially put the Finance Manager and Special Finance Manager at odds. An arbitrary line is drawn – either by the Beacon score or the lead source that brings the customer to the store – and the die is cast. Everyone loses, including the dealer.

Wouldn’t it be better if both the conventional and sub prime side were working together to deliver a vehicle? It starts with a pay plan that creates incentives for all sides (yes, the desk manager, too) to work together. It also should include the sales staff. I often hear of dealers that reduce pay to the sales person if they have a special finance customer and must involve the Special Finance Manager.

Many readers know that I profess the most important of the Eight Essential Elements of Special Finance is Commitment. For those that have the inventory, personnel, lenders, and more, the simple lack of a committed and coordinated sales management team can undermine the entire effort. I have seen many dealerships that have most of the essential elements on hand, but have failed to get Special Finance off the ground due to the conflict described above.

Does this mean that dealerships must have a Special Finance department, blended with the rest of the sales floor it to succeed; no, of course not. While the highest volume Special Finance departments do train their teams to “sell to any customer,” failure to do so will not doom your department to failure. What simply must take place is for the two teams to be able to coexist, and not sacrifice one for the other.

The whole point of advertising is to drive traffic to the dealership. Anyone that has signed the checks realizes all it is designed to do is to bring traffic to the door (or phone). What happens from there determines what type of return on investment the dealer will realize.

What happens in your dealership? Do the customer and sales person collide, or is the focus of the sales department to “find the deal” regardless of which side of the credit spectrum it falls under? Is your sales desk capable of looking at a customer statement and credit bureau and knowing whether or not a deal can be structured? Is your sales desk able to properly structure a deal to fit lender guidelines with maximum gross profit? If you cannot answer these questions positively, then even if you have the best Special Finance Manager at your helm, your results will never be more than mediocre. You also certainly know where to begin to look to find the key to success for Special Finance in your dealership.

Walk in step with a coordinated effort, and consistently execute a good plan, and the results will nearly always follow!

Vol 1, Issue 2



Remarketing by Element Joins NIADA Network

NIADA members stand to gain a number of benefits from the association’s new partnership with...

Remarketing by Element has joined the NIADA’s network of National Member Benefit partners and will offer prime lane placement, among other benefits, to the dealer association’s members.


Trump Wins China Auto Tariff Standoff

Vehicles exported to China from BMW’s Spartanburg, S.C., plant and other U.S. factories will no...

China has agreed to reduce import taxes on U.S.-built vehicles from 40% to 15% for the duration of a 90-day countdown to a new trade deal between the world’s two largest economies.


Used-Car Prices Fall 2.5% in November

Black Book reports prices for pre-owned compacts such as the Kia Forte fell by 3.3% in November,...

Black Book’s final depreciation report of 2018 finds prices for used cars and trucks decreased by 2.7% and 2.3%, respectively, with declines among compacts, minivans, and full-size utilities setting the pace.


Cox: Dealer Pessimism Grows With New Threats

Cox: Dealer Pessimism Grows With New Threats

Cox Automotive’s latest Dealer Sentiment Index finds a ‘notable negative turn’ among U.S. dealers, the majority of whom took a dim view of the fourth-quarter market and their 2019 prospects.

Dealer Job Finder

See more


Number of EVs to Double by 2021

U.S. electric-vehicle sales forecasted by the Edison Electric Institute would require the...

The number of electric vehicles on U.S. roads will double in the next three years, according to a new report from the Edison Electric Institute.