In my recent conversations with dealers, the feedback I’m receiving is that despite the crazy year we’ve had, things are pretty good. Inventory shortages are a problem, but on the plus side, dealers are making higher profit-per-vehicle. They’re also operating with fewer employees, so staff-related expenses are down. Many dealers have also cut back on advertising and other operational expenses. These trends all add up to a healthy bottom line despite the circumstances.
The challenge going forward is how to maintain this level of profitability. As inventory levels normalize, how will you create more demand? Will you hire more staff and resume previous levels of marketing? You’ve already learned how to do more with less, so let’s keep that momentum rolling. Here are a few tips to keep profits coming in.
Become appointment driven. This happened naturally during the shutdown because only a few people were allowed in the store at one time. However, more dealers are continuing this model. The volume of internet and phone leads is high. The more appointments you can schedule, the more time salespeople will have for other tasks. Create new (or adjust current) processes to support this model.
Assign multiple responsibilities to employees. These days, if an employee doesn’t have several jobs or areas of responsibility within an organization, they probably won’t be with that organization much longer. For example, stores are reducing the size of BDCs and putting some of that responsibility on salespeople; or they’re assigning more responsibility to their current BDC staff. But note: this doesn’t mean staff has to work longer hours. In fact, many dealers are operating with modified hours, e.g. fewer evening hours, because more consumers are working from home and can come into the dealership during the day.
Get organized! In order to make the above two things happen, you have to be organized, both on the team level and on the individual level. Every individual should have their schedule aligned with the organization’s priorities. Schedule appointments in the afternoons, so you have mornings free for one-on-ones, responding to leads and doing follow up. Ultimately, schedules should be driven around a common goal, such as delivering a great experience to the customer.
Stay lean. I predict tougher times ahead (mostly due to inventory challenges), so it’s important to stay lean and save for a rainy day. Keep expenses down and keep your teams small. I’ve always been a fan of having smaller sales teams that do more. There are fewer people to manage and fewer people who need buy-in. Salespeople should want this too, as it means more sales and ultimately more money for them.
Automate processes. Leverage technology to help your teams automate and/or speed up as many processes as possible. Many emails can be automated in your CRM, which helps free up the time of your sales team. The use of tablets in F&I and service helps to eliminate double entry and reduce human error. Learn how to use your reporting system so you can eliminate having to manually create spreadsheets. Make this not just a goal but a challenge for every department.
Remember that a rising tide raises all boats. As the tide rolls in, make sure you have the best boat, so you can keep profits high. Automate processes, leverage technology and provide incentives to your team, so you can all keep doing more with less.