For two years in a row, U.S. dealers have sold more 17 million new vehicles. Experts predict 2017 will be another record-setting year. Good times in the auto industry have become the new norm. But the veterans in this business know something your newer, less tenured employees don’t: Everything is cyclical.
They also know that, in bad times, one builds good habits. The opposite is true as well. Bad habits can be easily developed during good times. When vehicles are flying over the curb, no one notices.
Let’s put a stop to this cycle. Here are five things you must focus on continuously to develop and maintain good habits in any market:
1. Employee Development
Great companies are created by great people. In many cases, those companies raise their own talent. Talented people will not stick around if they are not challenged. They need opportunities to grow and develop their skills.
It is also important to identify learning gaps. They may be found in the areas you least expect. In a recent survey of multiple dealership employees, we found that one-third of respondents chose “leadership skills” as the subject they wanted to learn about most. This comes as no surprise, since leadership and management skills training is often ignored in the automotive world.
To help your employees grow, you must focus on developing their capabilities. Provide great just-in-time training and a healthy regimen of skills-upgrading opportunities.
2. The Customer Experience
In this market, the customer is king. Those of you who were around for “Cash for Clunkers” might remember the lack of great customer experience during that time. Dealers still relied on the “first come, first serve” approach, and customers did not mind the time and brain damage it took to get the deal of a lifetime.
Well, those days did not last long. Today’s consumer expects a rewarding experience online, over the phone, and in person. They have a low tolerance for shenanigans and old-school games. The time it takes to complete their transaction has become more precious to them than ever before. You have to exceed their expectations.
3. Process Improvement
Before you can improve (and shorten) the customer experience, you have to reexamine your processes. Continuous process improvement will enable your business to grow at a steady and incremental pace. As the saying goes, “The best never rest.” Always be open to ideas for better ways to deliver your promise to your guests — and help your departments function at peak performance.
Pay attention to communication. In many dealerships, lack of communication is the harbinger of process breakdowns. Your employees’ feedback is another vital part of communication you must utilize to improve. Ask for it often and take it seriously.
4. Forecasting and Tracking
It is easy to slack off and not take time to put much thought into projecting your numbers. Does each department forecast production and track their progress? Do they truly do it daily? Does each department know and understand what the other departments’ goals and status are each day? Think of all the ways your departments could help each other if only they knew what everyone’s rate of travel is.
Too many dealers seem to have given up on the good, old-fashioned “make a deal” or “save a deal” meeting. How often do they happen at your dealership? Every meeting should generate at least a couple of sales, so every week is good, but every day is better.
5. Expense Control
There is a “creep” in every dealership. No, it is not a person, it is the expenses that creep up on you over time. You do not notice when your admin cost goes up or your monthly software fees increase. You might not even notice the difference when your BDC manager adds another rep to a busy shift or the parts manager decides to put in a big order to add to their obsolete collection.
All these might seem like fine and relatively inexpensive ideas at the time. But they end up driving your expense structure way out of control, and your retention suffers. Reviewing your expenses often and making necessary adjustments is critical to staying lean and healthy in any economy.
The keyword here is “discipline,” whether in spending money, measuring your ROI, or training employees. Discipline promotes accountability. If you are truly focused on employee development, the customer experience, process improvement, forecasting and tracking, and expense control, accountability will take care of itself.
Focus on those five components and you will stay ahead of the pack and dominate in any market.
Tony Troussov CSP is the director of training for Automotive Development Group (ADG). He is an auto retail and finance veteran, a nationally recognized trainer, and a frequent speaker at industry events. Contact him at [email protected].