|It’s a great time to be a sports fan in New England! After an 86-year drought, the Red Sox have won two World Series championships in the past four years. As this article goes to press, the Patriots and the Celtics are dominating their respective sports again. Heck, even the New England Revolution made it to the finals, and I didn’t even know we had a soccer team! As Dennis Miller recently joked, “The last time the people of Boston got this cocky, King George sent over troops!”|
Well, I also believe that now is a great time to be a successful buy here pay here (BHPH) dealer, and not just in New England, but across the country. There are definitely some exciting times ahead for those BHPH dealers who are well positioned to take advantage of the opportunities that come available.
The amount of technology available now is staggering. Just consider the recent advancements made in dealer management systems, customer relationship management software, and collections tools such as starter interrupt devices and GPS locating systems. In addition to those advances, BHPH dealers now have access to staggering amounts of training resources: printed materials, industry experts and trainers devoted to BHPH, specialized Twenty Groups, and national organizations and conventions that are really dialed-in to the needs of today’s BHPH dealer.
Times of economic uncertainty, as many industries are currently experiencing, can undoubtedly be a double-edged sword, but these are also the times when the better dealers tend to thrive. It seems many BHPH dealers across the country have found themselves competing with aggressive finance sources that have reached deep into the sub-prime customer pool. Those that have been around the business for a while will recognize a familiar pattern here and realize that at some point soon, we could see a pull back as those companies retrench, leaving a vacuum that savvy BHPH dealers should be prepared to fill.
The BHPH industry has certainly attracted the interest of some major national players. Opinions are mixed as to how much of an impact consolidation will have on the BHPH world and as to whether or not it is in the best interest of the industry. There is no doubt that mainstream financial investors have the BHPH market squarely on their radar screens, and having access to that capital can definitely make things interesting for our industry in the days ahead!
Now, I made an analogy at the beginning of the article to the current state of New England sports. As any long-time, angst-ridden supporter of those teams realizes, things can change quickly both in sports and in business. So, even though things are looking good, we must also be prepared to thrive even if the market forces were to make a u-turn. Actually, many of the same principles that we should employ to prepare for a slow period will also help us maximize our operations, so we are in prime position to capitalize on opportunities that will inevitably arise during the good times.
Here are just a few thoughts to ponder in an effort to maximize our business:
Implement Policies to Do Things Right. Chances are if you are taking the time to read this publication, you are focused on doing things correctly. The challenge is ensuring everyone under you and throughout your entire organization feels that level of commitment. Don’t assume everyone knows “the right way to do things.” Put your policies in writing, make sure you review them often and “inspect what you expect” as frequently as necessary to ensure compliance.
Maximize Your Current Sales. Pretend there were no fresh ups walking through the door today. How would you generate sales? Wouldn’t you resort to really digging into your customer database? Well, don’t wait until there traffic gets slow! Work your database daily. Follow up on unsold customers. Mail, e-mail, call or visit some of your existing customers every day—not just the ones who come in to make a payment. Be proactive! Get aggressive! More than likely, you’ll have more prospects in your ups log (you do log ALL ups, right?!) than you could generate with a splashy new ad campaign!
Get Lean. Trim any unnecessary expenses. Have your vendors provide competitive bids and look for alternatives that would provide comparable services at a lower cost. Reassign unproductive employees to areas where they can add to the bottom line. Try eliminating an advertisement and see if it really affects your sales negatively. Remember, cutting expenses can be just as beneficial to your net profit as generating more sales.
Even though it’s hard to admit, New England sports fans realize that this run won’t last forever. However, if we BHPH dealers do what we need to, then our operations have the chance to become a dynasty for years to come. Have a great 2008!
A record year for dealer participation programs pushed CNA National past the $500 million mark in distributions since the company’s inception.