.biz.biz.biz

October 2003

Expense Control:Employee Effi ciency

Make Your DealershipWork for You

How to Seal the Dealin Seven Seconds

How to Overcome AnyObjection in Six Easy Steps

ENSURETYG R O U P, I N C .

Customer Retention:A Profi t Opportunity

“A key element to this slice cure is...” pg.9

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AutoSuccess Magazine is published monthly at 756 South First Street, Suite 202, Louisville, Kentucky, 40202; 502.588.3155, fax 502.588.3170. Direct all subscription and customer service inquiries to 877.818.6620 orinfo@autosuccess.biz. Subscription rate is $75 per year. AutoSuccess welcomes unsolicited editorials and graphics (not responsible for their return). All submitted editorials and graphics are subject to editing for grammar, content, and page length. AutoSuccess provides its contributing writers latitude in expressing advice and solutions; views expressed are not necessarily those of AutoSuccess and by no means reflect any guarantees. Always confer with legal counsel before implementing changes in procedures.© All contents copyrighted by AutoSuccess Magazine, a Division of Systems Marketing, Inc. All rights reserved. Reproduction in whole or part is prohibited without express written consent from AutoSuccess. AutoSuccess may occasionally make readers’ names available to other companies whose products and/or services may be of interest; readers may request that names be removed by calling 877.818.6620. Printed in the USA.Postmaster: Send address changes to AutoSuccess Magazine, 756 South First Street, Suite 202, Louisville, Kentucky 40202.

Transition From the Demo to the Desk Steve Hiatt Gaining Visibility Brian Tracy Developing an Effective Sales Training Program Terry L. Isaac Never Slice Again Brian Manzella Brand Yourself David Thomas Get More Bang for Your CRM Buck Brian Ankney Philosophy of Success Mark Tewart Implement Your Own Menu Presentation Frank Martin Leadership vs. Management Joe Verde Customer Retention: A Profi t Opportunity Kevin Smith Sales From the Internet: How to Limit Spam Dennis McDonough Expense Control: Employee Effi ciency Timothy Gilbert Make Your Dealership Work for You Mark Ludwig Achieve Successful Transitions Tony Ray Munson Making Manufacturer Certifi ed Used Cars Work for You Don Elliott How to Overcome Any Objection in Six Easy Steps George Jackson How to Seal the Deal in Seven Seconds Lydia Ramsey You Get What You Ask For Robert Westall Effective Sales Meetings Fran Taylor

I N S I D E

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Toll Free: 877.818.6620Facsimile: 502.588.3170

Web: autosuccess.biz

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4 www.autosuccess.biz4

Transition Fromthe Demo to the Desk

Steve HiattBy Steve Hiattsales and training solution

Everyone focuses on the steps to the sale. You should never skip steps, it costs you money. Nearly everyone has heard

about the dangers of skipping steps in all our car guy lingo, “A solo demo equals no dough.” and “Shortcuts equal throat cuts.” Since every step is important, why is the skill of how to get your customers from the demo to the desk skipped over so often?

The transition from the demo to the desk is where, all too often, a deal is made or lost. When you think about it, isn’t it really the customer’s last chance to back out and still save face? Once you get the customer to paper the levels of commitment in their mind skyrocket. Too many sales are missed, because there is no practiced plan at this stage. And if you are still using the old, “Should we go inside and see if we can make the terms and fi gures agreeable?” line, ditch it. That script is so old the customers have it down better than we do.

Momentum is the name of the game here, and at the same time, you want to keep the customer at ease so their defenses stay as low as possible. Let’s go through some simple techniques that will help. First, you must be on the demo ride with your customer. Second, you using a ‘sold line close’ coming in from the demo to the dealership. A quick review of a sold line close is:

1. A series of yes questions2. A positive statement 3. A sold line hook 4. An either/or closing question.

It works like this, as you are driving down the road, “Hey Sue, isn’t that air conditioning working great? Didn’t you love how the lumbar support felt on your back? And with the great fuel economy, isn’t it going to be great saving some money every month? Sue, it looks like we found the perfect car for you, as you pull into the dealership there are three open parking spots on the left, that are the sold line, just pull in there. Oh, I almost forgot to ask, is your insurance card with you, or do we need to get it out of your old car before we wrap things up?”

After the customer has parked in the sold line, do the following steps:

The rabbit’s foot: “Sue, could you pull the keys from the ignition there?” (She will pull them and start to hand them toward you.) “No Sue, those are for you, in fact, put them in your purse or your pocket right away, treat them like a lucky rabbits foot, and just rub ‘em every once in a while for good luck while we are wrapping this up.”

This is beautiful; your customer just took even more mental ownership. You aren’t getting those keys back now, which is just what you want. Plus, you have now created an emotional anchor for later when you are closing at the desk. I can’t tell you how many times I have left the desk, walked two steps, spun around and asked my customer if they still had the keys. Once they say yes, I say “Well start rubbing them before I go have this put in the computer.” For a second bump, sometimes I take the keys away and hand them to the kids while saying, “Mom, needs some help rubbing here. And mom, sometimes the best luck is being fl exible when the timing is right.”

Now that your customer has put the keys in their pocket, you need to transition from the car to your desk with as few hiccups as possible. Since people fear the unknown, make the process known to them. It will keep them comfortable, make the transition easier, and you will feel in ultimate control. “Sue, the next step is for us to go inside and for me to collect a little information from you, so you can start enjoying your new car as soon as possible. Are you going to enjoy it for a short drive to dinner, or are you just going to cruise the waterfront?” Waterfront. “Great, follow me.” Your customer now knows what is going on and

is much more comfortable, so get out of the car, and walk inside, they will follow.

One other way to keep the customer comfortable and impressed with you as a professional is to have everything ready to help with their purchase. Riffl ing through drawers, looking for pens and a write-up sheet while yelling, “Hey Bill, you got any credit apps?” doesn’t generally illicit high levels of trust.

Keep a plain manila folder on top of your desk with your write-up/four square, credit application and trade appraisal sheet right there. Also have a holder for pens right on top of your desk, so you aren’t scrounging for a pen. Move the folder over, open it up, and ask, “What is your middle initial? Do you use it legally? Great, let me make a note of that.” You are now successfully completing a write-up.

All of these techniques have been used by others and myself at our dealership and have a great level of success. It is so important, whether you use these techniques or others, that you use something. Get away from the big obvious trail closes that have been around for decades that every customer knows (and resents). Practice so that you are comfortable. Your comfort and confi dence will make or break you, because today’s customers are more sophisticated than ever.

Steve Hiatt is the General Sales Manager of Hiatt Pontiac GMC, Hiatt Outlet and Hiatt of Auburn. He can be contacted at 866.265.5616, or by email at shiatt@autosuccess.biz.

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6

Brian TracyBy Brian Tracy

Gaining Visibility

leadership solution

Have you noticed that some workers receive more promotions and greater pay than

their colleagues, this despite the fact that they are apparently not as competent as you? This doesn’t seem fair. Why should some people get ahead when others who seem to be working much harder and even longer hours get passed over for promotion and the additional rewards that go with it?

The fact is, to be a great success, it is important not only to be good at what you do but also to be perceived as being good at what you do. Human beings are creatures of perception. It is not what they see but what they think they see that determines how they think and act. If one person is perceived as being more promotable, then it is very likely that he/she will get additional responsibilities and more money, even though there are others that can do a better job, if given the chance.

Fortunately, there are several things that one can do to increase visibility and accelerate the speed at which they move ahead in their career.

Develop competence.Determine what parts of your job are most important to your boss and to your company and then make the decision to become very good in those areas. You must be perceived as being very competent at what you do. That perception alone will bring you to the attention of more people faster than you can imagine. The perception of excellent performance will open up opportunities for greater responsibilities, higher pay and better positions. Becoming good at what you do should be the foundation of your strategy for gaining higher visibility and rapid advancement in your career.

Pay attention to your overall image. How you appear to others makes a real difference. A recent survey of personnel executives found that the decision to hire or not to hire is made in the fi rst 30 seconds. There are many elements of your life over which you have no control. But

your external dress and appearance are totally a matter of personal preference. Through their choice of clothes, their grooming and their overall appearance, individuals deliberately make a statement about the kind of people they are. The way you look on the outside is a representation of the way you see yourself on the inside. It’s a good idea to dress the way the senior people in your company dress. Dress for the position two jobs above your own.

Join professional associations. Research professional associations connected with your business or fi eld. Begin by attending meetings as a guest to carefully assess whether or not a professional association can be of value to you. Determine if the members are the kind of people you would like to know and are well established in their careers. Then, if you have decided that becoming known to the key people in this association can advance your career, take out a membership and get involved. Pick a key committee and volunteer for service. Find out which committee seems to be the most active and the most infl uential in that organization and then step up to the plate. Volunteer your time, expertise and energy, and get busy. Attend every meeting. Take careful notes. Ask for assignments, and complete them on time and in an excellent fashion. This gives you an opportunity to perform for other key people in your profession in a non-threatening environment. You give them a chance to see what you can do and what kind of a person you are. You expand your range of valuable contacts in one of the most effective ways possible. The people you get to know on these committees can eventually be extremely helpful to you in your work and in your career.

Join a well-known,charitable organization. Become active by donating your services to its annual fund-raising programs. You may not be wealthy now, but you do have time, and your willingness to give of yourself will soon be noticed by people who are higher up. Many men and women with limited contacts and limited resources have risen to positions of great prominence as the result of getting to know the key community leaders who

participate in charitable organizations and professional associations.

Be able to set priorities.Learn how to separate the relevant from the irrelevant when facing the many tasks of the day. Managers place very high value on a person who can set priorities and move quickly to get the job fi nished. Dependability in job completion is one of the most valued traits in the American work force. When your employer can hand you a job and then walk away and never worry about it again, you have moved yourself onto the fast track, and your subsequent promotion and pay are virtually guaranteed.

Upgrade your work-related skills. Continually look for ways to keep your skills current, and make sure that your superiors know about it. Look for additional courses you can take to improve at your job, and discuss them with your boss. Ask him/her to pay for the courses, but make it clear that you’re going to take them anyway. Also, ask your boss for book and audio program recommendations. Then follow up by reading and listening to them and asking for further recommendations. Bosses are very impressed with people who are constantly striving to learn more in order to increase their value to their companies.

Develop a positive mental attitude. People like to be around people they like and tend to promote them. A consistent, persistent attitude of cheerfulness and optimism is quickly noticed by everybody. When you make an effort to cultivate an attitude of friendliness toward people, they, in turn, will go to extraordinary efforts to open doors for you.

In the fi nal analysis, taking the time to become an excellent human being will do more to raise your visibility and improve your chances for promotion than will any other single thing that you can do. You can do it if you really want to.

Brian Tracy is the Chairman & CEO of Brian Tracy International. He can be contacted at 866.300.9881, or by email at btracy@autosuccess.biz.

www.autosuccess.biz

7october 2003

Developing anEffective Sales Training Program

Terry L. IsaacBy Terry L. Isaacsales and training solution

It’s not how many sales people you have but how skilled they are that will determine your ROI. Having

a training program in place will not only increase your profi tability but the entire future of your dealership. Providing top customer service to your customers starts with the person you put in front of them. Assuring that you maintain a high level of CSI, as well as profi tability training is invaluable. The best way to develop the program is produce a fl owchart; this will give you a process to follow step-by-step. Analyze the job description.The job description of the sales person starts with a position description, when formatting this position you must have the input of all managers: the GSM, the GM and the Owner. If everyone is not on the same page, it will only reduce the results you’re aiming to achieve. Take each step that the sales person must achieve with the customer, and write them down, agree and disagree until you’re on the same page. Identify performance objectives. Identify the performance objectives that you want your sales people to achieve. Address each item on their job description thoroughly. Here are some examples of performance objectives:

1. Meet and greet – to give the customer a positive fi rst impression of the sales person and the dealership.2. Build a relationship with the customer - the customer must feel comfortable with the sales person they are working with. Establish a positive feeling between the sales person and the customer. People do business with the people they like.3. Select the right vehicle – fi nd the right vehicle to meet the customer’s needs. Ask the right questions and listen to their needs.4. Demonstrate the vehicle - show the features and benefi ts to establish value and justify cost. Find the hot points of the customer and sell the sizzle to motivate them into making the decision to buy.5. Ask for the sale – the sales person must ask the customer to give them the

opportunity to work for them and earn their business. Give the customer a reason for doing business now.6. Negotiation the terms - negotiate the terms between the buyer and the seller by establishing a neutral position between the parties. Achieve profi t, then close the sale.Add more performance objectives to the job description as needed.

Objections that the sales people will encounter along the way should be implemented into their performance objectives as well. If a sales person cannot handle objections he/she will become a clerk, and you’re training sales people. Design and format instructional materials.Format instructional material within a manual that details the job description and performance objectives to be implemented by every sales person hired. Review the instructional manual for soundness, effectiveness, wording and clarifi cation. Train the trainer.Selecting the right trainer is important to the success of your program. The individual you select must have the following:

1. Outstanding track record in above average sales.2. Good communication skills.3. Motivational speaking skills to inspire people. 4. The ability to master a process.

Develop an interview process.Format an interviewing process to select an employee that can perform all items on the job description. This will lead you to a qualifi ed candidate for the job. Deliver training.Start with classroom training by putting the training manual on overhead transparent sheets. Have the students take notes (they will retain 23 percent more with note taking). Teach one step at a time, students learn better with a step-by-step procedure. Role play each step; have the student perform the process over and over until they are comfortable. Film them implementing the process, this will give you a view of their progress in training.

Track the results: ROI.Develop a tracking program to determine

the results of the training. Track the following:

1. Prospects2. Demos3. Write-ups4. Sold5. Gross

This tracking will give you the information you need to show your ROI and to retrain the employee who will need further training. It’s easier to retrain than to hire a new employee.

Developing an effective training program will set the stage for the success and growth of your dealership today and into the future. It’s not an option.

Terry L. Isaac is the Corporate Sales Trainer for the Neil Huffman Auto Group. He can be contacted at 866.265.4680, or by email at tisaac@autosuccess.biz.

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8

Never Slice Again

Brian ManzellaBy Brian Manzellagolf tips

Do you slice? Most golfers do. Even some people who hit the ball right-to-left are just slicers with enough

compensation to turn the ball the other way. Believe it or not, fi xing a slice is usually pretty easy. Often, one can make a permanent improvement in the fi rst lesson. It’s easy, because there is only one thing that must be done correctly to correct the problem. Most golfers have no idea what it is or how to do it.

Why do you think you slice, because you come ‘over-the-top’? Reverse Pivot? Cut across the ball? ‘Hang back’ on your back foot, etc.?

Nope. You may do one or all of the above, but these ‘fl aws’ don’t cause the slice, you do them because you slice.

You slice, because the clubface is too open.

Period. Fix the clubface, and the slice goes bye-bye forever. The compensations will often also go away quickly when they are no longer needed.

The fi rst step is to take any compensation out of your grip. You want a classic neutral grip (see AutoSuccess Magazine Sept. 03). Once this is done, you want to learn the all-important motion of the right wrist. Holding the club out in front of you, with the shaft level to the ground and the score lines vertical to the ground (PIC 1), move the clubhead backward by bending the right wrist straight back while you bend the right elbow toward you. Your hands should stay directly in front of you as you do this (PIC 2). If you do this correctly, the shaft will stay parallel to the ground, and the clubface will remain vertical to the ground. This is exactly the motion your hands should do during the backswing.

Most golfers incorrectly ‘cock’ their right wrist, which immediately bends the left

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www.autosuccess.biz

9october 2003

wrist (PIC 3). This ‘double wristcock’ puts the clubface in a toe down position at the top, with a bent left wrist and a fl at right wrist (PIC 4), the exact opposite of the correct hand conditions at impact.

By bending the right wrist and twisting the clubface away from you as you swing the club to about chest high on the backswing (PIC 5), you put the clubface in a far less open position. The completed backswing should have a fl at left wrist and a bent right wrist, with the clubface ‘matching’ the angle of the left wrist and arm (PIC 6). Often, this ‘twist-away’, results in a slightly arched left wrist at the top. But that’s not a bad position to be in as you learn to make your hands do the opposite of what they were doing before.

A key element to this slice cure is to ‘hold the twist’ into the downswing. The clubface should look away from you halfway down, just as it did halfway back.

Often, these adjustments will fi x the slice by themselves. But, most golfers need the further ‘insurance’ of a proper swivel of the hands as the club travels to the fi nish after impact. Through impact your left wrist needs to remain fl at and your right

wrist bent (PIC 7). The clubface needs to turn toward the ground past the ball on the way to pointing toward the target. This swivel position should consist of a still fl at left wrist and a ‘fully rolled’ whole left arm (PIC 8). As the club nears the fi nish the left thumb should be under the club, and the left forearm should point straight toward the ground.

After making these adjustments, most slicers will be ex-slicers who need an improved impact position to keep from hitting the ball too right to left, a problem that most slicers would love to have.

Next month, we will learn to lag the clubhead and really compress the ball through impact, just like the pros.

Brian Manzella is a PGA Teaching Professional. He can be contacted at 866.873.0036, or by email at bmanzella@autosuccess.biz, or visit www.brianmanzella.com.

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sales tips with David Thomas David ThomasBy David Thomas

Brand YourselfHow would you like to brand yourself as the ‘Honda Guy’, the ‘Mercedes Lady’, or the ‘Ford Truck Guy’? How

would you like to be recognized and mentioned everywhere you go as ‘The Car Person’, the automotive ‘go to’ guy/ gal?

Branding yourself can make you more money than your name ever will. But do you know how to brand yourself? How do you become the expert? How do you become the topic of conversation at social events?

Here are some tips: 1. Be proud of your product and

occupation. If you don’t believe in your product and yourself, no one else will. 2. Eat, breathe and wear your logo.Do you proudly wear your company brand on your leisure time? 3. During social events, etc. Buy a couple of extra shirts and give them to key centers of infl uence to promote you and your product. 4. Drive what you sell.Consider using valet parking at key social functions and tipping a little extra to park your car in front for some great exposure. It’s a rolling billboard. 5. You must enjoy talking about cars. Even after a 12-hour day at the dealership, be enthusiastic and ready to discuss cars at dinner and social functions. This could be your best source of prospects and referrals. 6. Get involved. Give back to your community. Volunteer. Chose to involve yourself in an organization that you will enjoy participating in. You will be rewarded for your energy and efforts with exposure and recognition. 7. Show appreciation. Let everyone know that you really appreciate their referrals and that you need them.8. Budget for self-promotion. Set aside $50 to $100 per month for personal advertising and self-promotion expenses. Some examples are:• Ad in community bulletin• High school program • Church, PTA or Alumni Newsletter• Classifi ed ad• Radio traffi c spot sponsor• Charitable event or auction

Ask yourself, “What group can I identify with, that I will gain from repeated association with?”

Make an investment in your future sales. Above all, ask yourself every day, “What can I do to meet new people and promote my love of selling cars today?”

David Thomas is the Owner of Subaru of Dallas. He can be contacted at 866.429.6803, or by email at dthomas@autosuccess.biz.

www.autosuccess.biz

Get More Bangfor Your CRM Buck

Brian AnkneyBy Brian Ankneymarketing solution

Keeping in contact with your customers by using a CRM system is a good idea, but how

long will it take to notice a measurable benefi t? By the time the buying cycle repeats itself, the market and your business have changed. The benefi ts from CRM are too far in the future to accurately measure. The data collection and process changes associated with CRM offer many peripheral benefi ts that can be enjoyed in the short-term. Don’t miss out on the short-term benefi ts that come with implementing a CRM system.

The easiest and fastest benefi t to realize is showroom traffi c control. More important than bringing more customers into your store is selling those who are already there. This is achieved by getting a manager involved in every sales opportunity. By collecting customer information at the point of contact, a real-time log for phone, fl oor and Internet ups becomes a reality. Managers should be trained to use this log to maximize every customer contact. In the fi rst hour, managers should review every contact on the log and make sure that every avenue is exhausted with every customer. It is important to collect cell phone numbers to enable manager calls to customers who have just left the store. Grab sales that would have otherwise eluded you by second facing every sales opportunity.

A second benefi t is ensuring proper and consistent follow-up on all sales opportunities. Most sales people will strongly follow-up one third of the unsold traffi c, the ups they think they can sell easily. These are the people who are missing a spouse, a trade or maybe a cosigner. The other two thirds receive minimal follow-up and thus few return to purchase a vehicle. By enforcing the unsold follow-up rules set forth in a CRM system, all unsold traffi c will receive consistent follow-up and more can be brought back into the store to buy.

Another benefi t is the collection of customer information from both those who buy and those who do not. Traditional DMS systems collected only sales and service customers but ignored those

who only shopped. A CRM system will combine all who visit sales and service to produce a massive database for future marketing. Direct mail can be done in house with much lower expense and better results by marketing to those who already shop your store. Emails with current sales incentives can be sent to every person that did not buy a car in the past 120 days in less than fi ve minutes with absolutely no expense. Service specials and coupons can be emailed to every sales and service customer and shopper every month.

A commonly overlooked opportunity when implementing a new CRM system is skills improvement. There are many stores where the sales people are telephone handicapped, at best. Giving sales people a bunch of tasks to make calls will not bring more customers back unless you train them to make good follow-up calls. Work with your management team to develop some effective telephone scripts. Add phone training to your morning meetings.

Finally, the implementation of a CRM/showroom traffi c control system will change the tone of your showroom fl oor. Too often, sales people do nothing, because they don’t know where to start or what to do. By clearly defi ning your sales people’s daily activities and using a software package to direct and monitor their progress, your showroom fl oor will be transformed into a beehive of employees constantly working toward additional car deals.

The opportunities provided by a well-structured CRM/showroom traffi c control system within any store are infi nite. It is important to benefi t from as many as possible.

Next month, we will discuss using your CRM to raise gross profi t by improving walk arounds and overall sales processes.

Brian Ankney from AutoClick can be contacted at 866.247.9587, or by email at bankney@autosuccess.biz.

11october 2003

12

Philosophy of Success

Mark TewartBy Mark Tewartsales and training solution

Obtaining success always boils down to one thing – philosophy. The choices you make

under free will are usually based upon your own personal philosophy. Your philosophy is molded from education, experiences and relationships during the course of your life. Your philosophy is your belief system. If you are not successful, simply change your philosophy. It’s really that simple.

Success is based upon your philosophy. Have you ever heard this quote? “Watch your thoughts; they become your words. Watch your words; they become your actions. Watch your actions; they become your habits. Watch your habits; they become your character. Watch your character; it becomes your legacy.”

Learning what not to think or do can be as important as what you should think and do. Here are some examples of unenlightened, negative philosophies to avoid in order to gain success:

1. Placing blame.The “It’s not my fault syndrome.” It’s the dealers, managers, manufacturers. Somebody or something is keeping you down.2. Believing in luck.The “It’s not what you know, it’s who you know” excuse. Having the attitude that most people who have money or success inherited it or knew the right people.3. Creating falsemilestones and barriers.Example: “When ____ happens, then I will do _____.” or “I have to have _____ to get _____.”

4. Misunderstanding value.“If someone will give me a chance, then I can succeed.” “The marketplace cares about your seeds, not your needs” – Jim Rohn5. Being skeptical.Educated decisions are necessary, but skepticism obscures education. 6. Putting thecart before the horse.“If I were rich, then I would give.” 7. Ignoring the inß uence of others.“Who you associate with is how you and others value you.”8. Education stops at high school.Read is the root of ready. Education is a never-ending process. What you put into your mind always effects your life. 9. Perception of work.Most people believe their work is what they have to do, so they can be able to do what they want to do. “Make your vocation, your vacation”10. Practicing needsvs. wants gratiÞ cation.Your life is your choice. If you don’t like it, design a course to change it. You are always more successful living from choice and desire than from needs. You can spend your whole life trying to meet needs that are simply bad choices rather than living a successful life of choice.11. Negative associations to money.To make a lot of money, you have to be greedy or work all the time. Or, you believe you are not worthy or that people with money are different.

Your philosophy is your choice. What your mind focuses on is what you move toward. The most incredible thing you have as a human being is free will to choose your philosophy. Your philosophy always precedes any system or series of choices that produce failure or success.

Mark Tewart is the President of Tewart Enterprises. He can be contacted at 866.429.6844, or by email at mtewart@autosuccess.biz.

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13october 2003

Implement YourOwn Menu Presentation

Frank MartinBy Frank Martinf&i solution

Every dealership should be aware that there is a liability risk for not offering everyone the same ‘protection

package’ for their vehicle. To avoid this document each transaction with each customer, and make sure their choices are initialed by them so you have something to reference in the event they return with complaints.

The best tool for accomplishing this preventive measure happens to be the best tool for presenting all of the dealership’s products to all customers, all of the time, it’s called menu selling.

Many dealer service companies offer menus to their dealers, the same companies that provide the dealership with the mechanical breakdown insurance, life, disability, gap, etc.

With a menu, you can offer everything your dealership sells, explain all the features and benefi ts to the customer, and give them the choice to choose which benefi t is best for them. It can be a very helpful tool in step selling the customer from one option to another, and it’s also very non-confrontational. Once the customer initials the option they settle on, your whole presentation is documented. With this enclosed in the deal, you will never have to worry if all options were offered.

If your company has not already invested in a menu software program, then make your own.

First, take a regular 81/2 x 11 sheet of plain white paper. Fold the paper in half, twice, so you have a book that resembles a greeting card. On the front, draw one vertical line down the middle and two horizontal lines to make six squares. Each of these squares will have an option that you will offer to your customer. Before starting, ask all the pertinent questions to determine the terms of what you’re going to sell, like how many miles do you drive, are you married, do you have children, etc.

In the fi rst box, list all your products in order of most importance (highest gross potential), this is the box that you feature all of your products and explain the

benefi ts. Your fi rst box will also include the payment.

For example:“Mr/Ms Customer, your warranty will give you three years or 36,000 miles of comprehensive coverage, however, because your driving considerably more each year than your coverage allows, the manufacturer has made provisions to protect your investment tailored to your driving needs. In your situation, you can add an additional two years and 64,000 miles of full comprehensive coverage.” While you are talking write 6/100,000 as part of option one. Go on to give some of the benefi ts. “This coverage not only pays for any repairs, but it will also pay for labor, a car to drive while your vehicle is in the shop and, if needed, a tow truck to get it there. If you happen to be 100 miles or more out of town during a breakdown, it will also give you an allowance for meals, hotels and/or incidentals up to $100 per day.” You may also want to add, “Your warranty will also provide you with roadside assistance. That means if you have a fl at tire, run out of gas, lock your keys in your car or, for any other reason, you fi nd yourself stranded, you can call a number seven days a week, 24 hours a day, and someone will make sure that you’re back on the road safely. Another really nice feature is that you can transfer your warranty to someone else, should you decide to sell your car before it expires.”

Now, go to the back page and draw a diagram of two rectangles to represent cars, with a line in the middle to separate them. “Mr/Ms Customer, let’s say you had to go 60,000 miles on your vehicle (write 60K on top left of the rectangle). Under present circumstances, this would leave you with no warranty.” Now, write a 0 at the bottom of the left example. “With your additional coverage, you could have 60,000 miles on your vehicle (write 60K at the top of the right example) and still have 40,000 miles of full comprehensive coverage that you can transfer over to your prospective buyer.” Put 40K at the bottom of the right example. “Your vehicle is going to depreciate with or without a warranty.” Draw a line through the left example from top past the bottom with an arrow at the end, and draw a line half way through the right example with an arrow at the end. “I think that you’ll

agree that the vehicle that still has 40,000 miles of full comprehensive warranty will be worth any warranty at all. What I’m trying to say Mr/Ms Customer is that not only will this service agreement avoid the high costs of repair work, it will enhance the value of the investment you’ve made on your new vehicle.”

continued on page 29

14

To make it even tougher to be really effective, when you add ‘sales’ management to this mix, you now require this leader/manager to have the additional skills of a professional sales person. Why? Without those skills, this leader/manager can’t control, can’t train and certainly can’t be out front setting the selling example. The lists under sales and management are what you hire each group to do. The list under leadership is the additional skills/traits that a manager must also have to pull off management responsibilities.

Work the list from right to left to see a clear picture – we’ll use follow-up, as an example here.

1. (Lead) A leader develops the ‘vision’ to increase sales, gross and CSI by building a solid customer base of repeat business. 2. (Manage) As a manager, he/she then must develop the ‘procedures’ to make sure each customer is ‘sold’ correctly and ‘followed up’ effectively, so they can build that customer base. Then they must ‘track’ the sales people’s activities to make sure the process is followed.3. (Sales) And then, to be able to ‘train’ the sales force effectively, they’ll have to have a high personal skill level in follow-up, prospecting, using the telephone effectively and the organizational skills to show sales people how to set up their follow-up/prospecting systems.

A lot of great sales people have been promoted to management and failed miserably – we’ve all seen it happen. A lot of great process managers have failed to get any production from their sales team, too. And many a great leader has gone down in fl ames, because they

Sales

Follow the basicsClose the sale

Handle objectivesFollow-upProspect

Handle the phonesNegotiate (or set up)

Management

Establish selling proceduresRecruit and hireTrain effectively

Track and monitorMotivate the team

Set the goalsLead the team

Leadership

Develop a visionTake the lead

Set the exampleReward the team

Quickly adapt and adjustMake critical decisionsRequire people’s best

Joe VerdeBy Joe Verde

Leadership vs. Management

sales and training solution

What makes a sales manager really effective in this business?

The answer is complicated, because there is so much involved in being a good sales manager (leader). And to clear the air, when referring to sales managers, it’s every manager in the sales department … DLR, GM, GSM, SM, NCM, UCM, ASM, etc., because each one has the on-going responsibility to help manage and lead the sales team to more success, every month.

This is leadership and management simplifi ed:

You ‘lead’ people.You ‘manage’ things.

There are many great leaders or people with potential in this business, and there are many great managers or those with potential to become great managers, too.The problem is fi nding someone who can combine both the talents to become a great leader and a great manager at the same time. Why is that so diffi cult? Here are a couple synonyms for lead(er) and manag(er). Think about them for a second, and then we’ll talk about sales management.

Another catch is, you have to become good at both leadership and management before you can be good at either one of them. Anyone can ‘be fi rst’ (leadership), but you have to be in ‘control’ (management) or being out front doesn’t matter. That’s one of the challenges now; there are a lot of people in management who are out front doing their best to be a good leader, but they’re ineffective in management (processes/training/control), and they never have enough of a positive impact on unit production, gross profi ts, CSI or of building a solid customer base for your dealership. And the reverse of that is, great process managers who messed up everything, too, with their poor leadership skills.

couldn’t create the systems and processes and lacked the personal selling skills required to be able set the example to pull off their vision.

As a manager of the sales department, you’ve been given the most important, yet most complex position in your dealership. And your success or lack of success in this position determines the overall success or lack of success in your dealership.

Many sales people are poorly trained in

95 percent of dealerships. If there could be something worse than not training the sales force, it would be that the people who’ve been put in charge of those sales people have had even less training in how to manage and how to lead their selling team and the dealership to more success.

Every manager in your dealership who is involved in sales has to learn how to ‘sell’, they have to learn how to ‘manage’, and they have to become ‘leaders’ if you’re to have any real chance of competing effectively. You can succeed and grow every year in sales, and you’ll make it happen by developing both your management and leadership skills and qualities.

Joe Verde is the President of The Joe Verde Group. He can be contacted at 866.429.6689, or by email at jverde@autosuccess.biz, or visit www.joeverde.com.

Lead

Be FirstGuide

Manage

ControlSucceed

www.autosuccess.biz

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feature solution

Kevin SmithCustomer Retention:

A Profi t Opportunity

By Kevin Smith

16

Customer attrition is one of the biggest expenses in your dealership on an annual basis. It is estimated that you loose 25 percent of your total customer base annually due to customer attrition. This represents over two million dollars annually in lost opportunity cost for the average dealer.

On a daily basis, you identify the biggest opportunities and challenges within your business. You quantify nearly every major expense and profi t opportunity on your fi nancial statement. You measure it, develop a plan, monitor your plan and adjust your plan based on the data you receive.

What plan do you have in place to attack your biggest expense and opportunity cost?How do you measure and quantify its effectiveness?

Heightened awareness regarding customer retention is prevalent. It can be 10 times as expensive to solicit a new customer, as it is to retain a current customer. But how do you functionally facilitate improving customer retention within your dealership?

The answer is, the service department.

The customer is 17 times more likely to repurchase from your dealership if they use your service department on an ongoing basis throughout their ownership experience. Now, think about your current repeat customers, nearly every one comes from your service drive.

Let’s look at the average dealership. The challenge is that they only transition 15 - 25 percent of customers from the sales department into the service department and retain them on an ongoing basis. Your dealership numbers may be slightly higher or lower than average.

As a general rule, you will write six times the number of repair orders as you sell vehicles monthly. Therefore, if you sell 200 cars

per month, you would write 1,200 repair orders monthly. This equates roughly to 15 - 25 percent ongoing service retention and will provide you a gauge to measure your dealership regarding customer retention.

In order to improve your customer retention, you must fi rst evaluate where 80 percent of your customers are having their service work done. Are you losing their business to other franchise dealers, because they are closer or more convenient?

Over 75 percent of all service work done in the US is performed by independent quick lubes and tire stores. The perceived price and convenience lures them in and then they develop the habit of returning continually. Human nature says people would rather continue to do business at the same establishment. They eat at the same restaurants, shop as the same stores and have their hair cut at the same place.

But what else drives customer habits? The airlines, banks, grocery stores have it fi gured out, rewards programs. The more you utilize these businesses the more points, dollars, merchandize etc. you will receive. If you question the premise, look no further than the wallet or key chains of your next ten customers. Once more, look in your own wallet or your spouse’s wallet or key chain. Look for your airline card, Costco or Sam’s card, Blockbuster, Safeway or your local grocery store, etc.

Loyalty rewards programs are designed to transition your customers from your sales department into your service department and back to your sales department. They increase sales, increase front- and back- end gross, stop people from shopping and, most importantly, brand your dealership as a ‘cut above’ the rest of the stores in your market.

Think about your sales people, they usually do a good job selling themselves. Most do a good job selling the vehicle. How well do

most sales people do selling your dealership? What tools do you give your sales team to brand your service department?

At time of delivery, the customer is issued a dealer customized gift card. The sales person enters the customer information into a customized web site.

They simply enter the account number on the back of the card, name, address, phone number etc. (approximately a one minute process). The information is housed at a credit card-like dual redundancy server where it retains the data. The data is then transmitted to a dealer specifi c web location.

The card has a magnetic strip that is encoded with customer benefi ts and a total card value. Each time the customer comes in, they give the card to the cashier. The cashier swipes the card in a dedicated credit card machine, which is attached to both the Internet and the server.

The terminal prints a receipt that shows the amount of the discount, as well as how much the customer has accumulated toward their next vehicle purchase. The receipt is stapled to the repair order, and it is treated like any other coupon. This feels like real cash to the consumer, like an actual credit card transaction.

Each transaction is recorded in the system, and the data is available by an 800 number or via the Internet to the consumer. They can check, at any time, to see how much they have utilized or how much they have accumulated toward their next purchase.

Your management team can run numerous tracking and sorting reports to target market customers. For example, if you wanted to run a report of all of the customers who purchased a vehicle four to six months ago but who had not returned for service, you can pull that report then

www.autosuccess.biz

feature solution

17october 2003

target market the customer.

Dealer rewards programs increase front-end volume and gross profi t. If you are giving the customer $2,000 in perceived cash to use at your dealership, do you have to beat the dealers deal down the street by $100? Dealers utilizing dealership rewards programs have seen a seven to ten percent increase in their total sales volume. Dealers have also benefi ted from a $143 increase per car increase in front-end gross profi t.

How does a simple credit card tie them into your service department? It doesn’t, the card simply records and quantifi es the data, and serves as a constant marketing reminder each time the customer opens their wallet.

You must take credit for what you are already giving to the customer. Oil changes, shuttle services, car washes etc. Quantify the free or discounted services you provide to the customer and take credit for them, build value, brand your dealership and your service department.

Do what the tire stores and quick lubes do, get competitive on low cost repetitive service items, and make coming to your dealership a habit for your customers.

Make doing business at your service department like returning for other periodic business transactions. Like going to the same restaurant, bank, dry cleaners, airline or grocery store and then use the card to track it, and let the customer earn dollars for their future purchases.

Here is an example of how dealers accomplish this:

These are only an example card discounts and packages vary from dealer to dealer with as little as $500 packages up to $3,000 packages.

The premise is simple, if you had a $2,000

gift card to use, would you shop at the store that the gift certifi cate was from or its competitor.

What is the result on your service department? Dealers utilizing rewards programs have experienced as much as a 15-25 percent increase in hours per repair order. When you develop and ongoing and repetitive relationship with the customer, up sell is easy.

Dealers utilizing rewards programs have experienced a 15-25 percent increase in total repair orders over a two-year period.

What’s the bottom line? A 15-25 percent increase in hours per repair order and a 15-25 percent increase in total repair orders will mean over $200,000 to you annually in bottom line net profi t, as the average dealer.

As new car franchise dealers, it’s time to pay attention to where 80 percent of your

customer base is having their service done. Take a page from the quick lube and tire stores and offer the customer competitive prices on low end, repetitive maintenance items.

Then quantify the savings you’re giving them to increase front-end gross profi t and sales volume.

Customers are conditioned for rewards programs. The more they use at your dealership, the more they will earn toward their next purchase at your dealership.

Then track how much they are utilizing the card, and target market your customer accordingly.

Kevin Smith is Chief Operating OfÞ cer at the Ensurety Group, Inc. He can be contacted at 888.886.9394, or by email at ksmith@autosuccess.biz.

BeneÞ t Discount Amount Dollars toward next purchase

1st oil change N/C $29.95 $29.95

Every other oil change N/C $449.50 $449.25

(Must perform all recommended factory maintenance at dealership.)

(15x $29.95)

Every other 72 point $449.50 $449.50inspection N/C

(Must perform all recommended factory maintenance at dealership.)

(15x $29.95)

Every other tire rotation N/C $127.60 $127.60

(8x $15.95)

$200 off service contract $200 $200purchases

Car washes $243.55 $243.55

10 percent off all other service $500 $500

Total card value: $2,000 $2,000

Example of possible beneÞ ts

18

marketing solution Dennis McDonoughBy Dennis McDonough

Sales From the Internet:How to Limit Spam

The Internet has great tools for fi nding information about your customers, vendors and the competition.

There are applications like email and instant messengers that allow you to quickly communicate. There are a lot of benefi ts, but with the good also comes the bad: SPAM.

Spam is defi ned as fl ooding the Internet with multiple copies of the same message, in an attempt to force the message to people who would not otherwise choose to receive it. Most spam is junk advertising.

Spam is often for dubious products, get-rich-quick schemes, quasi-legal services and some are just hoaxes. Spam is easy to create, and it costs the sender very little to send, most of the costs are paid for by the recipient or the carriers rather than by the sender. Some spam is targeted for individual users with direct email messages.

Many spammers use spider programs to crawl the web and gather email addresses off of websites. Including an email address on your website is important. People will want to contact you. Special formatting can turn a generic text email address into an active hyperlink. By using this format a customer can click on your email link and automatically open up their email program.

While email addresses are a neccessity on every website, this mailto: link can be used against you. The spider engine can pick up an email address that is included in the text content, and your email address will fi nd its way on to countless mailing list which are then used by spammers.

Here is how to stop the spiders from picking up your email address:

A good place to start is to test to see what pages you need to change. Google.com is a text-reading spider, like spammers use to gather email addresses. Search for the complete email address and Google

will return a list of pages that need to be modifi ed.

Don’t use the mailto: hyperlink tag. Instead provide a contact form that your customer can complete, that is sent via email from the web server to you.

Use a graphic image instead of text to display your email address on your website.

Check the meta-tag within the code of your website. Meta-tags are hidden words used to describe your website, allowing your site to be indexed by search engines. If any email addresses are listed within the meta-tags, remove them.

These steps should help curb your unwanted spam emails that take up your time.

Dennis McDonough is a Consultant for eCarLots.com. He can be contacted at 877.354.1998, ext 202, or by email at dmcdonough@autosuccess.biz, or visit www.eCarLots.com.

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19october 2003

leadership solution Timothy GilbertBy Timothy Gilbert

Expense Control:Employee Effi ciency

All dealers have the opportunity to reduce the amount of ineffi ciency that reduces their profi t. A key

question every dealer should ask is, “How much profi t could I make if I treated my customers well and didn’t leave any money on the table?” The answer to that question will lead to a signifi cant improvement in both operating sales and net profi t.

Last month, we talked about making more money by adding just one more labor hour per repair order or by selling just one more vehicle per person per month. Now, we will focus on keeping more money in-house. That is, keeping excessive costs down to increase profi t. Look at expenses on a person-to-person basis and on a day-by-day basis.

Wasting money and excessive spending becomes habit. In order to get a good handle on expenses, you need to examine the daily activity and fi nd those habitual areas of wasteful ineffi ciency.

Possible wasteful habits:1. Employees getting to work just a little late2. Technicians leaving shop tools out instead of putting them back in the crib3. Employees making too many personal phone calls from the offi ce phone4. Technicians leaving vehicles a little messy5. Service writers not probing the customer for a more accurate description of the needed repair6. Employees leaving vehicles and other dealer assets outside in the weather7. Employees taking a little longer break than authorized8. Sales people spending too much time reading the newspaper

If one sales person arrives late to work by fi ve minutes, that’s lost time. By not tackling this challenge immediately, it sets a tone that says it’s all right to be late just a little. The next day, three or four sales people arrive a few minutes late. Sooner or later, all of the sales people are getting to work a little late. Some managers may take the position that it really does not matter since they are being paid by

commission only. Think of every minute as being either a productive minute or a non-productive minute. Increase the ratio of productive to non-productive minutes spent to increase profi t. Look at it this way, if the average time with a customer to close a sale is three hours, and you have 10 sales people on staff, then every day these sales people are costing the dealership 50 minutes of non-productive time. This translates into one lost sale every three or four days. That could mean as much as 10 less sales per month.

The result is that someone else has to clean up the mess or take responsibility for the one who slacks off. The only way to eliminate these kinds of challenges is to set a policy, and enforce it until the new policy becomes a habit. Track the activities of your employees and measure their performance.

Start tracking as much activity as you can. Do you know, for example, how long it takes to get a permanent plate for a customer or how many phone calls it took to track it down for the customer? Keep a log of time in and time out for vehicle registration. This may only save you a few minutes, but in a larger dealership, excessive ineffi ciency may result in additional and unnecessary employees.

Things that a dealer or general manger should be tracking include:

1. How long it takes to complete a deal with a customer and why2. How long it takes to get contracts-in-transit money from your lenders, which pay fastest and which are the slowest3. How long it takes to get a vehicle ready for sale4. How many phone calls the dealership receives per hour5. How many of those are repeat or follow-up phone calls by customers6. The average time a customer sits in the lounge waiting for his/her vehicle to be fi xed7. What are the most common customer complaints

Recognize that this is only a brief, partial list; add your own items to this list to make it unique for you.

Next month, we will discuss expense control in advertising and policy adjustments.

Timothy Gilbert is an Associate Professor and Chairman of the Automotive Marketing Department at Northwood University Florida Campus. He can be contacted at 866.274.3792, or by email at tgilbert@autosuccess.biz.

�AutoSuccess helps me stay on an edge of learning that excites my mind into action on a new level. The articles all have some angles on our business that give us the edge...but only if we use them.

The tips I pick up from the magazine make my job, now 19 years and counting, more exciting each day. If our mind can stay excited, our spirits lifted, then we can take care of all objections and obstacles that come our way.

Reading the magazine from cover to cover is the only innoculation against professional stagnancy. Status quo is a myth. If you are not getting smarter then you are getting dumber, no matter how many years in the business you have.

Don�t make your time in the business just a repetition of your previous year, make this year the best yet...and continue to improve...read AutoSuccess Magazine. It is the easiest way to offset the barage of customers who say, �The price is too high.� or �The payment is too high.� or �You�re not giving me enough for my car.�

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Another SatisÞ ed Subscriber...

20

Make YourDealership Work for You

Mark LudwigBy Mark Ludwigleadership solution

It is time to analyze how your dealership generates profi ts. Are you making the most of your time and effort? Being

a dealer isn’t an easy job, you must be able to market your dealership, supervise and lead a diverse group of employees, control a variety of inventories, deal with manufacturer issues, make your customers happy, retail vehicles, parts and service, etc.

It can be easy to get caught up in day-to-day operations, take a step back, and evaluate your performance: (chart 1)

This is a great way to look at your performance. All departments participate, and it doesn’t matter where dealer handling fees, holdback or advertising credits are recorded. Now, let’s look at where you want your dealership to be. (chart 2)

Now that you have quantifi ed how much additional income is needed, you must get there?

Send the message.A goal can’t be accomplished unless your team knows what it is. Talk to your managers about your expectations. In your next meeting, let everyone know how important it is to raise your net per retail from $500 per unit to $800 per unit. In the future, you will want to reach $1,200

or higher, but in the short-term begin with an attainable goal. Ask each manager how much they can contribute to the overall $39,000 (chart 2) monthly increase in profi ts. Get them involved. Display the monthly net per retail by month where all managers can see.

Calculate net per retail. Sample:

Year to date net proÞ t before income taxes: $________ $650,000

Year to date retail units: _________ 1,300

Net per retail (divide net proÞ t by retail units): $________ $500

Domestic / import: High Line:

0 - $200 Concerned 0 - $500$200 � $400 Needs improvement $500 - $1,000$400 - $800 Average $1,000 - $1,500$800 - $1,000 Above average $1,500 - $2,000$1,000+ Great job $2,000 +

Sell fewer units.The initial reaction is to sell fewer units and then income per unit will go up. This is incorrect, your overhead is already covered, and your incremental gross less selling expense is greater than your target, net per retail. If it isn’t, you need to

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chart 1

How much income do we need to Þ nd? Sample:

Net per retail you would like: $_________ $800

Net per retail from above: $_________ $500

Difference: $_________ $300

Year to date retail units from above: __________ 1,300

Additional income: $_________ $390,000

# of months in year to date: __________ 10

Additional income needed by month: $_________ $39,000

chart 2

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evaluate your vehicle gross, F&I gross and compensation. If you can increase your market share, it will do wonders for your net per retail. In addition to the additional gross, you will have additional income from advertising and fl oor plan credits, while reducing fl oor plan interest expense.

Discuss sales volume with parts and service. Are they marketing correctly and retaining customers. Are they up selling on the service drive? Are you losing customers to other dealerships? Discuss these items with your managers, and monitor their number of customer ROs, sales per RO and effective labor rate. Your effective labor rate should be similar to your posted labor rate.

Cut expenses.The second reaction is to cut expenses, but you will fi nd a greater opportunity focusing on gross. Dealerships leave thousands of dollars in gross on the table every month. Make sure you are asking for enough gross up front, you can always come down to make the sale, but ask for it up front. Nissan dealers, for years, couldn’t sell cars without huge factory incentives, and the attitude became that there is no gross on a Nissan. Now that Nissan is producing a great product with great gross potential, a number of dealers are still in the ‘$800 is a strong gross’ mode. Don’t get into that mindset, review your sales journal, and make sure you have some $5,000 grosses to offset your $200 grosses. Make sure your used gross including dealer handling fees are between $1,600 and $2,000 per retail. F&I gross should be from $800 to $1,400 per retail unit. If your dealership doesn’t fall into these parameters, analyze your results with your managers, and ask them why. Do not accept excuses, you need results and a plan to reach them.

Review your percentages in parts and service, you may not want to set the market, but you want to be close. One area to fi nd a lot of opportunity for gross is on internal work. Parts gross percent of sales internal should be at least 30 percent, and service internal should be at least 75 percent, while some dealers are getting 40 percent in parts and 80 percent in service, while maintaining their benchmarks in used vehicle gross. A change in internal percentages will have no effect on new and used car gross, since they are still working for the same gross.

Focus on expenses.Now that you have established sales and gross goals, you can work on expenses. The largest expense is personnel. In the majority of dealerships 50 percent of the gross goes to employees. Since this is such a key area, you need to take an employee inventory by department. Do you have too many employees? Are you paying overtime? What is your gross per employee? Divide total gross per employee, and you should be from $8,000 to $10,000 per employee.

Review the pay plans to make sure they are accomplishing your goals. Your pay plans should focus on market, gross and CSI. A manager will exploit their pay plan, so design it to be exploited. Look at personnel expense by department as it relates to gross. F&I compensation shouldn’t exceed 18 percent of gross, total parts compensation shouldn’t exceed 28 percent of gross and service compensation shouldn’t exceed 33

percent of gross. It is very important to stay within your guidelines in order to build the net per retail.

In measuring each expense, use a checklist. Does it effect sales, gross, employee satisfaction, customer satisfaction or provide a great place to do business. If not, you probably should eliminate it. Are you paying too much? Explore the market, and renegotiate your current contracts.

With interest rates being so low and the market staying relatively strong, it is very important to get your net per retail as high as possible. Keep your message strong, and structure your dealership to accomplish your goals.

Mark Ludwig is the Vice President of ACAR Report. He can be contacted at 866.247.9619, or by email at mludwig@autosuccess.biz.

21october 2003

continued

22

Achieve Successful Transitions

Tony Ray MunsonBy Tony Ray Munsonsales and training solution

There are a series of steps that take place with each customer to move through the process of selling a car.

Some of the areas, called transitions, cause the sales person to experience discomfort. Let’s cover how to achieve a successful transition for each part of the sale.

First, you have the greeting or welcoming of the customer to the dealership. Directly after this greeting, you should have the fi rst transition. You are trying to fi nd out exactly which direction you are going to lead the customer.

Here are a few possible questions for the fi rst transition:

What would you like to see today?How can I be of assistance?What can I get you information on?

These types of questions are not as likely to get the “Just looking” response. Also, depending on the answer, they may already have a good idea of what they want. That makes this transition easy. However some customers, at this point, have no idea what they want. In this case, you should start asking them choice or alternative type questions.

Here are a few examples:Are you thinking about a car or truck?Are you leaning toward a regular cab or extended?Would you like an automatic or a manual transmission?Would you prefer two or four wheel drive?

The next transition point is moving from the presentation of the automobile into a demo ride. The best way to make this transition is to lead the customer into the car during your presentation. Explain to the customer that there are several important features on the inside of the car that you would like to share with them. Many of the new vehicles you sell today are loaded with systems: stereos, DVD players, navigation and climate control systems to name a few. After you have spent some time setting the radio station to their station, setting the climate and showing the many features, benefi ts and advantages, it becomes natural to just drive off. You are already in the car, everything is set, the car is running and off you go.

The next transition is when you get back from your demo ride. This one is important, because you must try to write-up everyone. At this point, some sales people are afraid to ask for the sale. They want the customer to initialize moving forward. Many customers will think that if you aren’t confi dent enough to ask them for the sale, then something must be wrong. If you have been trial closing along the way, and even if you get a couple of objections which is normal, you should be assuming the natural next step. Be positive here. Picture the deal. Tell the customer to pull into the sold line, get out of the car, then follow with these steps:

• Let’s go ahead and see what your best price is. (This is for the buyer who has been beating you up on price.) That’s all you need to say, and start for your offi ce. This is what the customer wants, so give it to them.

• Let’s see if we can fi t this into your budget. (This one is for the payment buyer). Same thing here, just start for your offi ce.• Is there anything else you would like to add to your new car? Follow me.• It looks like we found your new car, am I right? Let’s go work out the details.

Anything positive you can say to move them forward is what you’re looking for here. This is a place where you will likely get resistance with the typical objections and stalls. Be prepared for them, take the pressure off with softening statements, and move forward.

Finally, you may need a transition during the close, use the summary close. A transition statement on a summary close might be:

• We have covered a lot of information in a short period of time. We should take a moment to review some of the key points we talked about.• We have talked about several features, so let’s step back and go over everything while it’s fresh in our minds.

Now you reconfi rm their needs, letting them know you were listening and summarize with them all the features and benefi ts that the car they chose has and how it fi ts their needs. Now you can go for the close.

Tony Ray Munson is the President of Sales Systems International, Inc. He can be contacted at 866.265.6575, or by email at tmunson@autosuccess.biz.

www.autosuccess.biz

23october 2003

Making Manufacturer Certifi edUsed Cars Work for You

Don ElliottBy Don Elliottmarketing solution

Don’t rely on your dictionary to discover what ‘certifi ed’ means in conjunction with a

used car. For the retail buyer, a ‘certifi ed used car’ generally means that the certifi ed used car is better than all the other used cars, because somebody has given it a thorough inspection.

Certifi ed used car buyers are willing to pay extra for the value and confi dence associated with certifi cation. Last year, consumers paid an estimated, overall average premium of $946 for a certifi ed used car. High-end cars and SUVs were at the top of the list for certifi ed used car perceived value with retail buyers paying as much as $2621 additional for cars in the luxury vehicle class.

Certifi cation is not new to the car business. Since the late fi fties, Ford dealerships would certify that all of their used cars were in good condition. Much has changed in the last fi fty years or so, but a clear defi nition of a certifi ed used car can still be confusing to the retail car buyer.

Today’s cars are more complex. Only a trained technician with the proper equipment can determine the physical and mechanical condition of a car, particularly if it has no repair history with your dealership. Even more importantly, when your customer is making a decision to spend $10,000, $20,000 or more on a used car, certifi cation can provide the assurance necessary to close the deal. Certifi cation fi lls the void between new car sales and the more traditional used car market.

It is very important to do some research about the certifi ed used cars at your dealership to avoid misrepresenting certifi cation to your customers. It is also necessary to understand what certifi ed used cars means at the dealership down the street. Certifi cation is not consistent from one dealership to the next. You may have a selling advantage or disadvantage depending on how your product is presented.

Almost all manufacturers have a certifi ed used car program. Most of those programs require a commitment from the franchise

dealer to support a certain level of inspection, repair and follow-up to qualify to sell that manufacturer’s used car brand as certifi ed.

Manufacturer or factory certifi ed programs vary from the certifi ed used car programs offered by independent car dealers in one signifi cant area. When setting up their program, the manufacturer is able to adjust the new car warranty policy to enhance the marketability or value of their brand of certifi ed used cars. Warranties are included as part of the vehicle, not as an option. The cost of the warranty is included in the price of the car and is usually transferable during the life of the warranty.

Service contracts are used to enhance the value of certifi ed used cars that do not have the benefi t of a manufacturer’s warranty. Service contracts are an option that can be negotiated, enhanced or removed, during the sales negotiations. However, service contracts are almost always sold through a third party and are often not transferable. Service contracts can be sold on cars that have a manufacturer certifi ed used car warranty, offering the ultimate advantage for retail customers who require maximum

protection from their used car purchase.

In addition to warranties and service contracts, all certifi ed used car programs require a multi-point inspection covering all major and most minor components of the vehicle. The quality of the inspection is the key to the reliability of the certifi cation process. Roadside assistance, cooperative advertising and adjustments to service deductibles are also available with most manufacturer certifi ed used car programs.

The growth of retail certifi cation is a profi t center in the car business. Approximately 1.3 million certifi ed used cars were sold in 2002. Through August of this year, sales of factory certifi ed used cars are up 10 percent to 40 percent over last year, depending on the manufacturer.

Are you taking advantage of the growth in manufacturer certifi ed used cars at your dealership?

Don Elliott is the Vice President of Marketing and Business Development at ADESA Corporation. He can be contacted at 866.429.6848, or by email at delliott@autosuccess.biz. AutoSuccess

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24

How to OvercomeAny Objection in Six Easy Steps

George JacksonBy George Jacksonf&i solution

The majority of sales professionals e x p e r i e n c e diffi culty in o v e r c o m i n g objections, because

they do not follow a process. They often rely on one-liners or make the mistake of hoping the customer just says ‘yes’ rather than really asking the customer to buy. This could result in lost sales.

Overcoming an objection is a presentation within a presentation. It requires the same professional preparation that is displayed in the product presentation. Before overcoming the objection, it is essential that you fi rst fi gure out what type of objection the customer has. There are two types of objections. The fi rst type of objection is broad and second is specifi c. A specifi c objection (I can’t afford the payment.) tells you exactly why they will not buy. A broad objection (I don’t need it.) does not tell why the purchase will not be made. It is diffi cult to overcome a broad objection until you turn it into a specifi c one. Saying to the customer, “I can appreciate that. What concerns you most about the coverage?” will work in the majority of the cases. Now, you are ready to proceed with overcoming the specifi c objection by following these six easy steps.

Step 1 � Support and isolate.It is important that you do not confront the customer or the objection. No matter how unreasonable the objection may seem, acknowledge it without being confrontational or agreeing with it. If you agree, how can you possibly offer a solution or an alternative point of view? Next, isolate the objection. This is important, because often the fi rst objection is not the real one. The customer may not provide the real objection for fear you will overcome it and then he/she would have to purchase the vehicle. Make sure it is the true objection before continuing.

Step 2 � Transition statement.A transition statement is one that bridges the objection and leads you to the process you will use to overcome the objection. The most common and most effective are: feel, felt, found.

Step 3 � Leading question.This is a question that leads to the next step and does so in a manner that obtains

permission from the customer to do so. As simple as it sounds, simply saying to the customer, “And do you know why?” works very well. It can also be used to create need by asking a question that you already know the answer to, such as, “Is protecting your budget important to you?”

Step 4 � Feature/beneÞ t presentation.This is the most important part of the presentation. Up to this point, your objection response can be the same for every objection that is received. You have to modify this step for each objection. As a sales person, you have two responsibilities with this step. First, whichever technique you use, use it well. People respect a good presentation. Therefore, give them one. Second, make sure that whichever technique you use actually addresses the objection. If it does not address the objection, it does not matter how well you do it. Use visuals and examples. Think of it as packaging the features and benefi ts of the product that you are attempting to sell.

Step 5 � Trial close.Now that you have overcome the customer’s objection, you are ready to close, but not so fast. You have to ask the customer if the feature/benefi t presentation that you just made, addressed his/her concern, and if you did it well enough. The most common way to ask for a trial close is to begin the question with one of these three phrases: “Can you see,…” “Doesn’t it make sense,…” or “Wouldn’t you agree?”

Step 6 � Choice close.Now that the customer has said ‘yes’ to your trial close, you are ready to ask for

the sale. Direct closes, such as, “Should I just include it in your payment then?” or “So, do you want it?” are weak and can easily lead to a ‘No’. Be more confi dent. Expect the customer to say ‘Yes’ and give him/her a choice close.

Let’s apply this technique to a customer who says he/she does not want a service contract, because he/she can’t afford the payment.

“That’s a good point. Is payment your only concern?” (Yes.)

“I can appreciate how you feel, and others have felt the same way. However, they found that even though the service contract may increase the payment, they still wanted to enroll in the protection. And do you know why? (No, why?)

Overcome the objection.

“Can you see how enrolling in the service contract would simply protect your budget? (Yes.)

“Then, would you like fi ve or six years worth of protection?” (6 years)

Practice this technique, and you will overcome more objections and remember to welcome objections, because in most cases, it is the only way to get the sale.

George Jackson is the Director of F&I Training for American Financial & Automotive Services, Inc. He can be contacted at 866.280.0301, or by email at gjackson@autosuccess.biz.

www.autosuccess.biz

www.jandlmarketing.com

profi t solution

How To Take Over YourMarket Through Conquest Sales!

Cheryl Cecil currently owns the car you sell. J&L Marketing

knows if she prefers to buy new or used. She only lives four miles from your dealership, and is looking for another car right now. We have her name, address, and phone number, along with thousands more just like her.

Will she choose your dealership to sell her the car she wants?

The implementation of the Shelby Bill in June 2000 prohibiting the use of registration information for direct marketing purposes led us to find a powerful alternative to registration data. After testing literally hundreds of other lists such as credit scores and niche lists, we have a new list that is producing outstanding results; much better than any other we have tested.

If you know who is ready to buy a new or used car, what stops you from selling them that car? Probably not much – the secret is knowing who is in the market now and what they want to buy!

What if we gave you a list of people just like our friend Cheryl that I mentioned earlier? We know that she is in the market, capable of buying, within miles of your dealership, and wants the type of vehicle you sell – right now! How difficult do you think she would be to sell if she heard

an offer from you that she couldn’t refuse?

Here is the secret – at this moment there are thousands of these people out there, waiting to be sold. But you can’t afford to wait and see if they will wander into your dealership. They are yours for the taking. But, you have to take action.

In short, we have developed and fi ne-tuned a highly-targeted list of buyers who have not bought from you in the past and are motivated to buy your product now.

And, we have paired this list with an incredible, high-impact verbiage that will be irresistible to anyone who is in the market. It is easy and painless for the customer, and delivers scores of quality traffi c for you the dealer.

Dealers who do not actively pursue this list will lose market share that they may never make up.

But, imagine the profit for your dealership if you sold twenty to thirty of these buyers every month? If you don’t take action, this profi t could go to the dealership down the street. The choice is yours. You have to give buyers like Cheryl a reason to come to your store and not your competitors.

If you know precisely when a person

is ready to get a new or used car, and all you need to do is make them an incredible offer, shouldn’t you do that?

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Call my office now at 800.346.9117 and ask for Lisa Wilson, or e-mail her at lwilson@jandlmarketing.com. And, as soon as we receive your reply we will immediately give you a FREE market analysis of your dealership, to see exactly how many thousands of customers like Cheryl are near your store and are waiting for you to sell them cars.

The Shelby Bill restrictions on vehicle registrations make the challenge of attracting quality traffi c (for conquest sales) to your showroom greater than ever. Today, I urge you to discover how powerful and effective this new list is - we have the results to prove it! Call or e-mail us immediately.

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Scott JosephBy Scott Joseph

26

How to Seal theDeal in Seven Seconds

Lydia RamseyBy Lydia Ramseysales and training solution

Can you close a sale in just seven seconds? If you make a great fi rst impression you

can do it even faster. Seven seconds is the average length of time you have to make a fi rst impression. If yours is not good, you won’t get another chance with that potential customer. If you make a great fi rst impression, you can bet that your customer is more likely to take you and your dealership seriously.

Whether your initial meeting is face-to-face, over the phone or via the Internet, you do not have time to waste. It pays for you to understand how people make their fi rst judgment and what you can do to be in control of the results.

1. Learn what peopleuse to form their Þ rst opinion. When you meet someone face-to-face, 93 percent of how you are judged is based on non-verbal data, your appearance and your body language. Only seven percent is infl uenced by the words that you speak. When your initial encounter is over the phone, 70 percent of how you are perceived is based on your tone of voice and 30 percent on your words. Clearly, it’s not what you say, it’s the way that you say it.

2. Choose your Þ rsttwelve words carefully. Although research shows that your words make up a mere seven percent of what people think of you in a one-on-one encounter, don’t leave them to chance. Express some form of thank you when you meet the client. Perhaps, it is “Thank you for taking your time to see me today.” or “Thank you for coming into the dealership.” Clients appreciate you when you appreciate them.

3. Use the otherperson�s name immediately. There is no sweeter sound than that of your own name. When you use the client’s name in conversation within your fi rst twelve words and the fi rst seven seconds, you are sending a message that you value that person and are focused on them. Nothing gets other people’s attention as

effectively as calling them by name.

4. Pay attention toyour hair (your customers will).They will notice your hair and face fi rst. Putting off that much-needed haircut or color job may cost you the deal. Very few people want to do business with someone who is unkempt or whose hairstyle does not look professional. Don’t let a bad hair day cost you the connection.

5. Keep your shoes in mint condition. People will look from your face to your feet. If your shoes aren’t well maintained, your customer will question whether you pay attention to other details. Shoes should be polished as well as appropriate for the business environment. They may be the last thing you put on before you walk out the door, but they are often the fi rst thing your customer sees.

6. Walk fast. Studies show that people who walk 10-20 percent faster than others are viewed as important and energetic, just the kind of person your customers want to do business with. Pick up the pace, and walk with purpose if you want to impress. You never know who may be watching.

7. Fine tune your handshake. The fi rst move you make when meeting your prospective customer is to put out your hand. There isn’t a sales person anywhere who can’t tell you that the good business handshake should be a fi rm one. Yet time and again, people offer up a limp hand to their customer. You’ll be assured of giving an impressive grip and getting off to a good start if you position your hand to make complete contact with the other person’s hand. Once you’ve connected, close your thumb over the back of the other person’s hand and give a slight squeeze. You’ll have the beginning of a good business relationship.

8. Make introductions with style. It does matter whose name you say fi rst and what words you use when making introductions in business. Because business etiquette is based on rank and hierarchy, you want to honor the senior or highest ranking person by saying their name fi rst. When the customer is present,

they are always the most important person. Say the customer’s name fi rst, and introduce other people to the client. The correct words to use are “I’d like to introduce...” or “I’d like to introduce to you...” followed by the name of the other person.

9. Never leave theofÞ ce without your business cards. Your business cards and how you handle them contribute to your total image. Have a good supply of them with you at all times, since you never know when and where you will encounter a potential client. How unimpressive is it to ask for a person’s card and have them say, “Oh, I’m sorry. I think I just gave my last one away.” You get the feeling that this person has already met everyone they want to know. Keep your cards in a card case or holder where they are protected from wear and tear. That way you will be able to fi nd them without a lot of fumbling around, and they will always be in pristine condition.

10. Match your bodylanguage to your verbal message. A smile or pleasant expression tells your customers that you are glad to be with them. Eye contact says you are paying attention and are interested in what is being said. Leaning in toward the client makes you appear engaged and involved in the conversation. Use as many signals as you can to look interested and interesting.

In the business environment, you plan your every move with potential customers. You arrange for the appointment, you prepare for the meeting, you rehearse for the presentation, but in spite of your best efforts, potential customers pop up in the most unexpected places and at the most bizarre times. For that reason, leave nothing to chance. Every time you walk out of your offi ce, be ready to make a powerful fi rst impression.

Lydia Ramsey is the President and Founder of Lydia Ramsey, Inc. She can be contacted at 912.598.9812, or by email at lydia@mannersthatsell.com.

www.autosuccess.biz

27october 2003

You GetWhat You Ask For

Robert WestallBy Robert Westallmarketing solution

Most dealers have read or heard about the three pieces of a successful a d v e r t i s i n g

campaign: people, product and promotion. Let’s focus on one of the key factors in any successful campaign - the message.

The message is probably the most important piece of your total advertising and marketing plan; some ads lack this powerful message. You need to say the right words in a pleasing manner to the right people is not necessarily the case. It’s much more than that. You need to sell your product to and ask for the sale from as many people as you can reach on your budget, in a manner that they will remember. Clearly explain your product, how it would be benefi cial to own and how easily it can be purchased. Words and sounds and pictures develop images in the brain, but it’s what you’re asking for that’s important. What are you asking for?

There are literally thousands of automotive ads running at this exact moment, and few actually communicate the message that the dealership needs to say. If you choose to use an advertising agency it should understand your product and sales structure and be capable of communicating your message to your target audience.

There is a huge difference between advertising and marketing. Advertising is defi ned as: building name awareness. You can build name awareness, but that doesn’t guarantee that a sale will take place. Building name awareness simply means that when people think ‘dealership’, whether it’s a positive thought or negative, they think of you.

Marketing on the other hand is defi ned as: placing a product for sale/asking for the sale. This is selling in ad form, and it starts with the script. Every ad campaign should act as an extension of the dealership’s sales force. The message should mirror your sales culture right down to the very last little detail, including the closing. Think about it… how many more cars would you sell if you asked more people to buy from you?

Marketing also means giving people a

reason to buy from you or a hook. When you talk about hooks, various ideas come to mind, most of which revolve around price or gifts. Prior bank asset sales, acquisition sales and gifts all work well with four-day events, but they don’t build your business. They simply talk to the thrifty price buyer that is in the market for the perception of a great deal. When traffi c comes in and starts grinding away at price, (remember, that’s what is being said to get them in) the sales people become frustrated, because the customers won’t get off of price and fall in love with the vehicle.

You will get what you ask for. If you don’t want to be the low-ball king, then stop talking about price. If you don’t want to sell loser deals, then stop advertising that you do. A store cannot put a huge price guarantee in place and then proceed to complain for the next six months about how cheap people are, and how they’d shop them for $50.

Does anything other than price sell vehicles? What happened to paying more for something that people really want? If you could tell everyone something about your store, what would it be? The answer is simple, offered value. Studies show that value ranks higher in the consumers mind than price, and value should not be confused with a good price. Value is the complete package: customer service, quality of the vehicle, the vehicle fi tting the customer’s needs, convenience and price. Also, including payments on ad vehicles is not the same as screaming lowest prices. Listing vehicles with payments will speak clearly to a larger portion of your potential market. Convenience contributes to value, because everyone has paid more for a product due to convenience. What value are you offering customers to earn their business?

Think about your message and how it relates to your potential buyers. Also, think about your advertising and marketing in general and then determine areas of concern.

Robert Westall is the CEO of Amp Advertising. He can be contacted at 888.878.4887, or by email atrwestall@autosuccess.biz.

28

sales and training solution

Effective Sales MeetingsMake your sales meetings enjoyable, and you will retain the attention of your sales team, and in

turn, they will become more successful, making your dealership more profi table.

Your meetings should be short yet extremely detailed, informative and benefi cial. Make sure your staff is at the meeting on time. If they do show up late make them stay outside until the meeting is over.

First, have your F&I manager go over all the deals that they have in the works. If there are any challenges, they should be reviewed. They should also go over any paperwork that needs corrections.

Second, update the used car sheets every

day. This only takes about two minutes.

Keep your meetings upbeat and fast paced, this way your sales team is forced to pay attention. If they miss out on something, because they weren’t paying attention, it is their loss or their embarrassment when they have to stop the meeting to ask questions they should already know the answer to.

Third, if you have any type of promotions going, explain them in detail so that your sales team knows exactly what is going on and will be prepared if a customer has any question regarding the promotion. This also ensures that your advertising dollars are well spent.

Fourth, go over the desklog. Only talk about what people are doing right. Always discuss why, when and how and the

benefi ts of what it is that these people are doing to be successful at selling.

Fifth, you should update your boards, your appointment board, gross board, etc. Don’t wait until the end or beginning of the month to do this, update them daily. By updating your boards daily, you will be able to detect if anyone is having any challenges and solve them right away.

Sixth is the training section of your meeting. Give each individual member of your sales team a topic to research and discuss (i.e. TO, closing, prospecting). Make sure that the topics that you give fi t your store and the needs of your sales team. Having members from your sales team do the training helps to keep the other members attention, especially if they are going to have to do it themselves.

Finally, give out money. Make the meeting worth going to. If you want results, give them incentives. If you want your sales team to know a specifi c word track or closing question, offer $5 to the fi rst one that can say it word for word, correctly. Spread money around the room, but make them work for it. If someone sold two cars the day before, give them extra money. The more times that you applaud someone for a job well done, the better they will continue to do. Give them an exciting environment, and your sales team will want to be at the meeting and want to listen and learn during the training sessions.

Remember to keep your meetings positive, focus on what people are doing and doing right. Keep the meetings short and fast paced to keep your teams attention. Talk about the important things and be serious but always have fun. Try these six techniques and your meetings will be much more effective and benefi cial to your dealership.

Fran Taylor is the President and CEO of Taylor Techniques, Inc. He can be contacted at 866.873.0041, or by email at ftaylor@autosuccess.biz.

Fran TaylorBy Fran Taylor

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continued

Now go back to the front page and under option one put another product. For example, write the word ‘gap’, for gap insurance. Again, a picture is worth a thousand words, so open the page and on the inside right draw a diagram. “Mr/Ms Customer, let’s say you had a balance on your loan for $15,000 six months from now. You had an accident and the insurance company values your car at $12,000.” Your diagram should show $15,000 on the left and $12,000 on the right and on the bottom, in the middle of both, like a triangle, put the difference or gap, plus the deductible amount. “That means you would have to come up with $3000 plus your deductible of $250 before your old car loan could be satisfi ed, and you could purchase another vehicle without having to absorb the loss. Your insurance company is only going to pay what they decide is the value of the car, and gap insurance will pay the difference plus the deductible.” Some gap will even pay $1,000 toward the purchase of their new car from the selling dealer. “Option one also includes credit life insurance. If needed, you won’t leave your family with any extra burden if they were to lose you. The premium is the same for you as an 18-year-old, usually there is no medical

examination required and for pennies a day, you can be sure your family will be protected, even before your estate is settled. Option one also includes disability or accident and health. This means that if for any reason your doctor tells you that you can’t work for an extended period of time, your payments will be made for you every month until you are able to work again. You don’t have to be hospitalized, but you do have to be out of work for a minimum of seven days, 30 days, whatever your schedule is set up for your insurance company, and the payment for option one is $X amount.”

Now that you’ve covered all of the products, features and benefi ts, your customer understands all you have to offer. At this point, drop down to the second box, and offer all the same products without the last product offered in option one. (Based on the example given, accident and health would not be offered in option two.) The next option down would be option three, and that would only have the 6/100,000 and the gap. The top right box is option four and should only include 6/100,000. Option fi ve would only offer gap, and option six would just be your base payment. Each box would show what the payment for that option is. You can offer

your dealerships products in whatever order suits your store best. Now let the customer choose their option. Before you let them initial that box, try to up sell them to the next box, and then let them initial the fi nal choice. If they come back with the charge that you didn’t offer every option, pull out your menu, and remind them which option they initialed.

Now you have complete documentation of everything you’ve offered the customer. You’ve explained all the features and benefi ts of all the products, and you have a format that is uniform and consistent in the way you present all your products to everyone all the time. This format seems more spontaneous than premeditated, and the customer follows your pen as you write down and explain the options with complete attention to what you are saying. You may fi nd that if your menu is all fi lled in before you speak with the customer, that they will try to read ahead of where you are trying to focus, so do it as you explain it.

Frank Martin is the CEO of F&I Solutions. He can be contacted at 866.247.9361, or by email at fmartin@autosuccess.biz

continued from page 13

29october 2003

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