4 square or what?

[dfhadley2]

Give me some in-put to increase your $$ per car average. We have seperate Ford/Toyota and Used Facilities and although we desk the same, our grosses vary a lot.

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[Pat]

Perhaps this suggestion is overly simplistic, but we instituted a daily product training program. we tracked the 3 month gross avg prior to the program, and compared it to our avg gross during the program. We saw our gross in each department level out to within $50 of each other, and an increase in avg gross overall of $257 per deal. We also noted a decrease in the amount of overall down payment, and an increase in monthly payment, a possible indicator that in knowing the product the customer was willing to pay the price.

After 3 months we then instituted our 2nd program of Sales Training in conjunction with the ongoing product knowledge. We are in the second month and have seen a slight increase again in Gross Profit. I dont feel the numbers are firm enough to post, however we are hoping we acheive the same results.

In closing I would like to say, even though it seems at the begining that this is over kill, we have learned to look at it like we are a professional team. Dan Marino, perhaps one of the best QuarterBacks of all time, has to practice plays like the flea flicker over and over again during practice, even though he may never use it during regular season, but when the Dolphins needed the play, they were comfortable in the knowledge that their offense was skilled in its execution.

[don.baker]

I have found that the greatest increase in overall profit per deal is to be had in the finance office. The biggest mistake most dealerships are making is to have salespeople work payments with customers. I know there are died in the wool 4-square supporters out there but it is time to realize how that frankly turns customers off.

Salespeople need to focus on selling the car and negotiating a "trade difference" then a STRONG F&I manager can close the customer on payments with all of the "back end" profit. If you work a 4-square and close on payments all you end up doing is limiting your back end money and cutting front end gross when the customer does not qualify for the "Preferred Bank Financing".

Usually, your most experienced salespeople are in the finance office anyway and they are better closers as well. I have found that this method reduces the amount of back and forth between salespeople and managers and customers seem to appreciate it more as well. Remember, everytime a salesperson walks away to go see a manager it costs gross profit.

Just a thought

[Matt Parsons]

I would challenge dealers to look beyond gross profit per unit and look at gross profit across a customers "life-time" experience with the dealership. All too often we see dealers who maximize the sales dollars and ultimately drive the customer away from spending additional dollars in the more lucrative parts and service areas of the business. Every dealer should be able to tell you who their best clients are in terms of "life time customer value". By that I mean the ones that have spent the most with the enterprise and at the highest profit margin - for all types of transactions. The key is to then try and figure out what factors affected that result. Not to long ago I visited a store where we ran this type of report, and much to the dealers dismay, he had fired the top producing salesman when you looked at lifetime value to the store of his customers. The salesman spent a great deal of time working with his clients after the sale to ensure they were returning for service and parts business, thus decreasing the number of pure units that he sold. And yet, this salesmans customers were more than 2x's as valueable to the dealership as the next closest salesman. It all depends on what you are trying to achieve...greatest gross per unit, or greates gross per customer.