re-invent the wheel?

[TheOne]

The reason I suggest it will probably be profitless is that in order to cause it to happen supply will have to be limited. Because the market is choked with so many sources of new vehicle, and because there is not a huge disparity in public perception, and the fact that used vehicle trade-ins are valued individually, mark to market pricing would have to be controlled by the manufacturer.

Example, Ram trucks aren't selling, drop wholesale prices incrementally until they do. Demand exceeds production, raise prices until demand falls. In order for this to work effectively the trade-in would have to be disconnected from the new vehicle purchase. I suppose the manufacturer could create a scenario in which the dealer was paid a flat fee per vehicle delivered, putting some semblance of profit back into the picture.

It should also be noted that the new vehicle inventories would have to be owned and floored by the manufacturers at their own expense. The would by virtue of the franchise have a right to a portion of the real estate of each dealer for the purpose of displaying vehicles. Something similar to a gracery store display.

Unhooking the trade-in from the transaction is somewhat problematic. Tax laws in various states would have to change to begin with. If unhooking the trade-in could be accomplished, then you could have two tiers of dealers. Those that run on the margins established by the manufacturers for new vehicle delivery, with no interest in used vehicles, and those with a second business/business license dealing in used vehicles. Put a firewall in place and those dealing in used would become the wholesale purchasers for the market......

This could work..

[calgm988]

TheOne

Mark to market pricing is an interesting concept that would require in essence, restructuring the dealer agreement as we see it today. The dealer body would essentially become a commodities dealer? Isn't that what the domestics have done by increasing rebates? In your Dodge truck example - isn't that whats going on right now? Chrysler is reducing the wholesale value by offering huge dealer cash and stairstep programs designed at "trying to reach the actual market based price.

My other thought is;where does the customer draw the line? Don't they just wait out demand for wholesale prices to drop? You know as well as I do, that the customers will still expect to negotiate that price, even at its lowest point. They've become accustomed to big box store pricing haven't they? I'm not trying to be negative about the theory or be pro old-school sales.

IF, the price were not negotiable...(no rebates and everyone paid the same) and the product supply was controlled - wouldn't we all win? I must admit I am not a proponant of the one-price philosophy.

I find it amazing that three or four people can has out an idea in hours (admitedly with holes) that other's haven't been able to accomplish in decades. Why?

I agree with Steve in one sense and that is the process needs to change! We need to evolve with the age of information. Mabye we should form our own 20-group and formulate a plan

[CARServices]

Wow! I am very impressed. Each of you guys had great points and as a trainer, I enjoyed reading them. In the last two decades, I've trained sales professionals around the globe. My primary clients are car dealers, but, what I learned by being in retail has gooten me paid by other industries as well. In those years, I have also written nine books on sales, management, and leadership. I only tell you this to help prove your points.

Unlike many trainers who have used the same books, talking points, and even stories, I've had to change with the rest of the world. The one constant is that principles are carved in stone, techniques can and must change. You still need to start by greetng a customer (Principle) but there are a thousand ways to say hello (technique).

One of the major problems out there is that the dealership food chain, from the dealer down, has turned their focus to results. My most common request for training is on closing the sale. I can teach monkeys to close deals. But, that won't increase sales by one unit. Selling is a process and to skip to the end, or get their too fast, will always result in less sales, even if you're the best monkey in the showroom.

All that said, in 2008 I worked with many dealers and actually met a half dozen sales professionals who topped six figures in commissions. Five of them worked in domestic stores and two worked for dealers delivering less than 75 cars per month.

What did they do differently?

They totally took advantage. Advantage of everything. They made sure they got their name out as often as possible. They took one idea from every training session they attended - THEN THEY USED IT! Their process recognized that some people will buy today, adn others will buy in the future. To make a lot of money, you need both. Each was a master at getting referrals. They didn't ask for them, they told the customer it was expected, if they did a fantastic job.

Lastly, they looked at selling as a career, their own business, something that required THEM to make certain investments.

Enough about the sales team. All of you made the point to talk about managers and how they fit into the puzzle. In my opinion, the least trained person in any dealership today is the sales manager. Most only know how to work a deal one way, the way it worked for them "back in the day." I don't even train the way I did just five years ago. Things change. Cars change. People change.

How do you deal with an untrained manager? Help them do your job. As a sales pro, you need to be the best in your market. Being the best will allow you to take more time with the customer before "desking a deal" is needed. That way, you'll provide more info to your manager which will actually guide him or her to the right decision.

If you come across good training material, share it with them. If you don't come across good training material, shame on you. Find some.

If they help you close a deal, thank them and discuss why they did what they did. You'll learn and they'll keep that method for another day.

Last, decide. Decide if this is what you want to do. I have been in this business since they put leaded gas in new cars. But, if I tried to sell now, like I did when I started, I'd be walking to work. My success as a trainer, writer, and consultant is a result of what selling cars taught me. Keep learning and keep investing in yourself.

Continued Success in 2009.

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John Fuhrman
Senior Trainer
Carolina Automotive Resource Services

[calgm988]

John

I couldn't agree more! It's not just a people problem but process problem. My belief has always been to focus on the purpose not the outcome. Training is just one step in improving the overall processs. We need to focus on improving the knowledge base ALONG with the attitudes. Customer's have access to pricing, comparison information, blogs and buying clubs! The end result is to get a good deal but most importantly they want to avoid the typical buying process!

Most people don't change their processes until its too late. They don't adapt to change they hope that change will adapt to them. Its really the true definition of insanity. You mentioned something about investing in yourself. Most sales people, and manager's don't go to training unless its paid for by the dealer. Then, they waste that training by not practicing, drilling and rehearsing.

Lastly, change will be forced down our throats whether we are ready or not. Sales Managers, sales people and dealers will have to decide if they're going to drive it or ride in it. I'm a driver not a rider~ as are most in this post. Good luck with your company and thank you for the feedback.


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"focus on the purpose, not the outcome."