STREET SMART
S TAT E A F F I L I AT E
MAGAZINE
O F F I C I A L P U B L I C AT I O N O F I I A D A A P R I L / M AY 2 0 17
MANAGEMENT GAMEPLAN
IS YOUR SALES PROCESS A HIT? OR HIT AND MISS? Increase Your Batting Average PAG E 10
DALLAS, TEXAS Permit No. 2079
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W W W.IO WA I A DA .C O M
INSIDE
06..............................................Time to Rethink Your Doc Fee 07................................................................. President’s Letter 08.............................................................................CarLawyer 10.................................................Is Your Sales Process a Hit? 12..........................................................Letter to Iowa Dealers 18................................... Automotive Floorplan Management
WHAT’S NEW
Tire Safety Week Dates Announced
The dates for National Tire Safety Week 2017 are May 28-June 3. An initiative of the Rubber Manufacturers Association, the event promotes tire safety among consumers. Auto dealers join the tire and auto industry to encourage drivers to “be tire smart.” For more information, or to request print materials, visit www.betiresmart.org.
ADVERTISER’S INDEX
AutoZone .............................................................................9 Black Book........................................................................... 3 CarMax Auctions .................................................................7 Manheim ............................................................................11 Manheim Omaha............................................................. IBC Manheim Pennsylvania......................................................13 NextGear Capital ...............................................................12 ProSource Financial.......................................................... IFC vAuto .................................................................. Back Cover
OFFICE
For information on how to become a member please contact Judy Wilson. iiada@netins.net • 641-755-4177
NIADA HEADQUARTERS
NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV 2521 BROWN BLVD. • ARLINGTON, TX 76006-5203 PHONE (817) 640-3838 Street Smart is published bimonthly by the National Independent Automobile Dealers Association Services Corporation, 2521 Brown Blvd., Arlington, TX 76006-5203. Periodicals postage paid at Dallas, TX and at additional offices. POSTMASTER: Send address changes to NIADA State Publications, 2521 Brown Blvd., Arlington, TX 76006-5203. The statements and opinions expressed herein are those of the authors and do not necessarily represent the views of Street Smart or NIADA. Likewise, the appearance of advertisers, or their identification as members of NIADA, does not constitute an endorsement of the products or services featured. Copyright© 2017 by NIADA Services, Inc.
RETAIL INSTALLMENT CONTRACTS
IIADA has two distributors who will provide the Wolters Kluwer Financial Services retail installment contracts for Iowa dealers. These retail installment contracts have a compliance warranty. In some cases, you will need to have your software provider reprogram for you. You may order by phone or online and these will be shipped directly to the dealership. Thank you for working with these distributors. PLEASE CONTACT: WILSON DISTRIBUTOR SERVICE • 1-800-634-0974 • www.wds-usa.com or Erikson Solutions Services, llc • 402-639-0664
KNOW WHERE TO LOOK FOR RECALL INFORMATION ON VEHICLES
Vehicle dealers needing information on factory recalls can visit www.recalls.gov or find manufacturer toll-free numbers by going to www.autopedia.com/html/HotLinks.html and making contact with the respective automaker. Know what recalls are pending on vehicles before you purchase them and give your customers peace of mind by checking out possible recalls before you retail the vehicle. For further info please visit www.safercar.gov or www.safercar.gov/vinlookup FIND ADDITIONAL RECALL INFORMATION AT THE FOLLOWING WEBSITES: www.recalls.gov and www.autosafety.org
INVESTIGATIONS INFORMATION LINE
NEW NUMBER! 515-237-3050
The hours of operation are Monday through Friday, 8:30 A.M. TO 3:30 P.M. This phone line receives numerous calls so the IDOT encourages the use of our email (invbureau@iowadot.us) if the phone line is busy. The bureau investigations information line provides a way for the public to request information, ask questions or file a complaint related to investigative duties and responsibilities. This line is the primary point of contact to reach an investigator who is responsible for investigations in a specific area of the state of Iowa. To ensure accurate information is provided, the bureau investigations information line is answered by a bureau of investigation and identity protection investigator.
STATE MAGAZINE MGR./SALES
BOARD MEMBERS
EDITORS
Jeff Schneider
Troy Graff • troy@niada.com
Jacinda Timmerman • jacinda@niada.com Andy Friedlander • andy@niada.com MAGAZINE LAYOUT
Christy Haynes • christy@niada.com PRINTING
Nieman Printing
PRESIDENT
Pocahontas Sales & Service PO Box 66 Pocahontas, Ia 50574 712-335-4470
CHAIRMAN OF THE BOARD
Douglas Livy, Jr.
Quality Motors of Ames PO Box 7 Ames, Ia 50010 515-290-2673
VICE PRESIDENT
Clay Winterboer
Carroll Car Credit Co. 409 E. 6th St., Box 805 Carroll, Ia 51401 712-792-0140
TREASURER
Judy Wilson, IIADA
409 E. Market Street P.O. Box 337 Panora, Ia 50216 641-755-4177
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REGIONAL REPRESENTATIVES
Roger Poulsen
The Car Guys 1301 S.W. 7th Street Atlantic, Ia 50022 712-243-6915
Tab Miller
Preowned Solutions 11010 Douglas Ave. Urbandale, Ia 50322 515-528-8180
Kim Nelson
Nelson Automotive, LLC 300 Sandpiper Court P.O. Box 466 Polk City, Ia 50226 515-984-9600
Craig Dam
Dam Auto Sales, Inc. 1021 Lewis Blvd. Sioux City, Ia 51105 712-522-2831
Rick Theilen
Marcus Hebert
Jay Muller
Merrill Hitchcock
Theilen Auto Sales 10536 265th Street Clear Lake, Ia 50428 641-424-3352 Best Auto, Inc. 900 S. Grand Avenue Spencer, Ia 51301 712-262-4581
David A. Farmer
David A. Farmer, Inc. 1613 Franklin Center Point, Ia 52213 319-849-2432
Doug Wilson
Lake Country Auto 409 East Market St. P.O. Box 341 Panora, Ia 50216 641-755-3048
CarsNow, LLC 2124 W. Broadway Council Bluffs, Ia 51501 712-256-6757 Merrill’s Motors 317 N. 8th Street Winterset, Iowa 50273 515-462-1683
ADMINISTRATIVE OFFICES
409 East Market Street P.O. Box 337 Panora, Ia 50216 Ph: 641-755-4177 Fax: 641-755-3247 Email: iiada@netins.net Toll Free: 866-962-9202
Diane Conroy
Jeb’s Affordable Trans. 1501 N. Elm Jefferson, Ia 50129 515-386-4731
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ASSOCIATION NEWS
TIDBITS FROM IIADA
try to work with the customer to return these as soon as possible. If you plan to keep the items for 30 days or less, please make sure this is clearly spelled out in your notification letter. Avoid hassling people over their personal belongings.
Used Auto Sales Complaints Top 2016 Consumer Complaint List For the second year in a row, used auto sales topped the list of complaints consumers filed with the Consumer Protection Division of the Iowa Attorney General’s Office, followed by home improvements and home mortgage complaints. Out of approximately 2,800 written complaints filed in 2016, 207 were related to used vehicle sales practices, which include credit issues.
Fraud Alert There is a crime ring working out of the Chicago area using Illinois fraudulent driver’s licenses and fraudulent Illinois checking accounts. We learned of this scam through an Iowa lender in mid-February. While this came to light a few months ago it is an important reminder that scenarios such as this are alive in the auto industry. The Iowa and Illinois DOTs are investigating over 300 similar cases. A central Iowa auto dealer had a visit from a buyer who had an Illinois driver’s license and an Illinois bank account. The buyer wanted to purchase a vehicle on credit. The dealer sold a $20,000 vehicle to the identity thief and took a $4,000 down payment with a fraudulent check. The dealer did not check with the bank the check was written upon to determine if the check was valid. The dealer obtained verbal approval from the lender the deal would be funded. The credit report pulled by the lender contained an “extended fraud alert” with instructions to call a phone number to verify identity, but the lender did not make the call, as they thought the identity would be verified
Industry News Briefs
Buy Here-Pay Here Dealers & Repossessions A Buy Here-Pay Here dealer has asked how long they should keep personal possessions taken from a repossessed vehicle. It is important to make an accounting of the personal possessions you box up and notify the customer in writing. Also, allow them adequate time to pick up any items left in the vehicle. Iowa does not have a personal belongings statute, but dealers should spell out in their communications how long they will keep the belongings and make sure the customer understands this policy. If there are tools or items an individual might need for their job,
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by the dealer. The lesson to be learned is for lenders to follow up on credit bureau fraud alerts 100 percent of the time, and for lenders and dealers to be extra cautious to verify identity, especially with out of state buyers. If you suspect identity theft involving a vehicle purchase, contact the Iowa Department of Transportation’s Bureau of Investigation and Identity Protection at 515-237-3050 or invbureau@iowadot.us.
April/May 2017 / STREET SMART
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ASSOCIATION NEWS
YOU’RE INVITED! IIADA Annual Meeting You are invited to the IIADA annual meeting! It will be held at Lake Panorama National Resort and Conference Center on Lake Panorama in Panora, Iowa April 28-29, 2017.
GUEST SPEAKERS: Michael Athey
• Interim Director • Bureau of Investigation & Identity Protection • Iowa Department of Transportation
Paul Steier
• Law Enforcement Program Manager • American Association of Motor Vehicle Administrators Come to meet IIADA approved benefit providers and visit with Midwest auction staff, fellow dealers and guests. Learn what’s going on in our industry! There will be entertainment, good food and networking. In addition there will be board installation and awards as well as scholarship awards and the scholarship auction. More information and registration materials may be found on the IIADA website: www.iowaiada.com. Lodging is available onsite. Call if you have any questions: 641755-4177.
ASSOCIATION NEWS
2017 NIADA & COX AUTOMOTIVE COMMUNITY SERVICE AWARD Nomination Deadline May 12
Nominations are now open for the 2017 NIADA & Cox Automotive Community Service Award, presented by Manheim. The deadline for submission is May 12. Reward your favorite charity with $10,000. Nominate a deserving independent dealership that works to find innovative and meaningful ways to collaborate with community partners. The winning dealership will be recognized at the 2017 NIADA Convention and will receive $10,000 for their local charity of choice, courtesy of Manheim. Dealerships must be a current member of NIADA to qualify. Nominate your dealership today at www.coxautoinc.com/communityservice-award.
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LEGAL MATTERS BY SHAUN PETERSEN
TIME TO RETHINK YOUR DOC FEE What’s in Your Wallet?
Is there a catchphrase more recognizable than “What’s in your wallet?” Whether it is Charles Barkley, Alec Baldwin, Samuel L. Jackson or Jennifer Garner delivering the tag line, the minute you hear it you know it’s a Capital One promo. It is not uncommon for me to hear consumer attorneys and even some regulators argue that doc fees are charged for no other reason than for dealers to “line their wallets.” That contention was the crux of a recent decision from the South Carolina Supreme Court in Freeman v. J.L.H. Investments, LP. South Carolina law permits a dealer to charge closing fees on each motor vehicle sales contract so long as the dealer pays an annual registration fee to the state. The dealer must then include the closing fee amount in the advertised price of the vehicle, disclose the cost on the sales contract and display the amount in a conspicuous place in the dealership. A South Carolina Honda dealer charged its customers a $299 closing fee, which was properly disclosed on its sales contract and in a conspicuous statement in the dealership. Moreover, the dealer filed the necessary paperwork with the state to charge the fee. When advertising the purchase of a vehicle, the $299 was included in the price of the vehicle. After purchasing a vehicle from that dealer (and after consulting with an attorney friend), a consumer filed a classaction lawsuit against the dealership, alleging the dealer had violated the South Carolina Dealers Act by charging closing fees that were not calculated to reimburse the dealership for the dealer’s actual expenses incurred in closing the transaction. The case proceeded to trial, where after a jury found in favor of the consumer and returned a verdict of nearly $1.5 million in actual damages, which equates to the total of closing fees charged by the dealership during the four years prior to the lawsuit. Both parties filed post-trial motions with the trial court. The judge denied the dealer’s attempt to overturn or reduce the jury’s verdict. The judge also granted the consumer’s motion to double the actual damages award – permissible under South Carolina law – and to award attorneys’ fees and costs. In arguments to the South Carolina Supreme Court, the dealership asserted it had fully complied with the aforementioned requirements of the statute pertaining to closing fees. The dealership believed its compliance with those provisions absolved
it of any liability to the consumer. The Supreme Court disagreed and ruled that compliance with the statute enabled the dealership to charge a closing fee but did not allow it to charge any amount it wanted for that fee. The court said if a dealership is going to charge a closing fee, it is required to account for the costs that comprise the fee, and those costs must be directly related to the expenses incurred in closing the motor vehicle sale. Perhaps recognizing that such a standard might make calculating the closing fee a compliance challenge, if not an all-out compliance nightmare, the Supreme Court said dealers may set a fee that represents the average of costs actually incurred by the dealer in all closings from the prior year. The decision in the Freeman case raises three important points dealers in South Carolina certainly need to be aware of – and are good ideas for dealers across the nation to consider. First, determine what items should be included in the closing fee (or doc fee) and the cost of each of those items up front – before you set the amount of the fee. Second, the closing fee (or doc fee) should be limited to costs directly related to the services rendered and expenses incurred in closing a transaction. Expenses related to salaries, building costs, utilities, vendors or other general operating expenses should not be included as part of the fee calculation. Third, there is now precedent that a closing fee calculated from an average of the costs the dealer actually incurred in all closings from the prior year is a “safe harbor” of sorts. Legislation pending in the South Carolina legislature would supersede and undo the court’s decision. However, I believe this case will be fodder for plaintiff’s attorneys across the country to pursue similar class-action cases against dealers if they haphazardly charge a closing/doc fee without sufficient rationale to justify the actual expenses behind it. I encourage dealers to undertake that analysis as soon as possible, or the answer to the question of “What’s in your wallet?” could end up being cobwebs. Shaun Petersen, a former Ohio deputy attorney general, is NIADA’s senior vice president of legal and government affairs.
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ASSOCIATION NEWS
PRESIDENT’S LETTER
How Do You Choose to React?
Fellow car warriors, What a great time to be alive! I hope this letter finds all of you healthy and profitable. Did you write down your 10 goals? If so, make sure you read them every day. If not, write them down and read them every day. I will start with an update on myself. I am striving toward my 2017 goals, and at this point I am on track. I still wake up in the morning looking forward to another adventure in the store. I get a kick out of the different kinds of people I run across every day. Most of you can relate. I spent my birthday in Jamaica. My granddaughter turned one year old. I am going desert racing this spring. My plans for 2017 include sleeping less, doing more, making more friends, reading more good books, catching more fish, selling more cars, and having more fun than I ever have. Most of you have heard or read stories that have a moral so here is one that just caught my attention. There are three pots of boiling water. In the first pot, you put potatoes. In the second pot, eggs. In the third pot, coffee beans. After 20 minutes, they are taken off the
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stove. The potatoes, eggs, and beans all faced the same adversity – the boiling water. However, each one reacted differently. The potato went in strong, hard, and unrelenting but in boiling water it became soft and weak. The eggs went in fragile with a thin exterior protecting its soft interior. After facing adversity, it came out with a hard interior. However, the coffee beans were unique. After they were exposed to the boiling water, they changed the water and created something new. Which one best describes you? In life, things happen to all of us. How we choose to react is what makes some people break and others break records. A good friend once told me your past is important. It shaped you into who you are. But it is not nearly as important as your future. Now for the joke. When I read this the first time, I laughed because it is something I would do. A cell phone on a bench in a gym locker room started ringing. The man next to it put it on speaker phone. Everyone else in the room stopped to listen. Man: “Hello.” Woman: “Hi, Honey, it’s me. Are you at the club?” Man: “Yep.” Woman: “Well, I’ve been shopping and found a beautiful leather coat. It’s only $2,000. Is it OK if I buy it?”
Man: “Sure, go ahead if you like it that much.” Woman: “I also stopped by the Lexus dealership and saw the new models. I found one that I really liked.” Man: “How much?” Woman: “$90,000.” Man: “OK, but for that price, I want it with all the options.” Woman: “Great! Oh, and one more thing… I was just talking to Janie and found out the house I wanted last year is back on the market. They are asking $980,000 for it.” Man: “Well then go ahead and make an offer of $900,000. They will probably take it. If not, we can go the extra $80,000 for it if it’s what you really want.” Woman: “OK. I’ll see you later. I love you so much!” Man: “Bye. I love you too.” The man hung up. The other men in the locker room were staring at him in astonishment with their mouths wide open. He turned and asked, “Does anyone know whose phone this is?” Well that’s all for now. Make this your best year ever. Thank you and best regards, Jeff Schneider President IIADA
April/May 2017 / STREET SMART
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LEGAL UPDATE
BY THOMAS B. HUDSON AND NICOLE FRUSH MUNRO
THE CARLAWYER Keeping You Informed with the Latest Governmental Issues and Activity in the Used Car Industry
Here’s our monthly report of legal developments in the auto sales, finance and lease world. This month, we feature developments from the Consumer Financial Protection Bureau, the Federal Trade Commission and a congressional committee, as well as our “Case of the Month.” Remember – we aren’t reporting every recent legal development, only those we think might be particularly important or interesting. Why do we include items from other states? We want to show you new legal developments and trends. Also, another state’s laws might be a lot like your state’s laws. If attorneys general or plaintiffs’ lawyers are pursuing particular types of claims in other states, those claims might soon appear in your state. Note this column does not offer legal advice. Always check with your own lawyer to learn how what we report might apply to you, or if you have questions. THIS MONTH’S CARLAWYER COMPLIANCE TIP Your dealership is probably a corporation or a partnership. If so, and the dealership is sued by a consumer or a regulator, it’s likely your adversary in the litigation will want to poke around your corporate records looking for ways to make or bolster its case. When that happens, what will the minutes of your board of directors or partnership meetings reveal? Will they show regular meetings, with reports by your compliance, red flags, and privacy officer(s), reports on customer complaints, root cause analysis, and the resolution of those complaints, an update of applicable laws and regulations affecting your operation, the effectiveness of your training program, and similar things? If not, maybe you ought to meet with your attorney and discuss the topics and operational issues that should be reflected in those minutes. FEDERAL DEVELOPMENTS The FTC and selling recalled vehicles: On December 16, the FTC announced CarMax, Inc., Asbury Automotive Group, Inc., and West-Herr Automotive Group, Inc. settled allegations that the dealerships advertised rigorous used car inspections, but failed to adequately disclose some cars were subject to unrepaired safety recalls. The proposed consent orders prohibit the dealerships from claiming their used vehicles are safe, have been repaired for safety issues, or have been subject to safety-related inspections unless the vehicles are free of open recalls or the companies clearly and conspicuously disclose the vehicles may be subject to unrepaired recalls for safety issues and explain how consumers can determine whether a vehicle is subject to such a recall that has not been
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repaired. The FTC also approved final consent orders in similar cases, settled earlier this year, against General Motors Company, Jim Koons Management Company, and Lithia Motors, Inc. Curbing debt collectors: Buy Here-Pay Here dealers need to keep a careful eye on the CFPB’s actions involving debt collectors. On January 9, the CFPB announced a consent order with two Oklahoma-based law firms, resolving allegations under the Fair Debt Collection Practices Act that the law firms’ debt collection letters and phone calls misrepresented that attorneys had reviewed consumers’ accounts before initiating collection efforts. The CFPB also alleged the law firms improperly notarized affidavits in collection lawsuits against consumers and furnished information to credit reporting agencies without written policies or procedures to ensure the information’s accuracy and integrity, in violation of the Fair Credit Reporting Act. The order requires the law firms to refund $577,135 to consumers harmed by the allegedly illegal debt collection actions and to pay a civil money penalty of $78,800. House Republicans hammer CFPB on discrimination actions – again: On January 18, the Republican staff of the House of Representatives’ Committee on Financial Services released a report titled “Unsafe at Any Bureaucracy, Part III: The CFPB’s Vitiated Legal Case Against Auto Lenders.” This is the third staff report released by committee Republicans over the last 14 months about the CFPB’s efforts to regulate auto financing and the CFPB’s Equal Credit Opportunity Act enforcement actions against indirect auto financers. This report makes public additional CFPB documents that discuss the CFPB’s disparate impact methodology in more detail and reveal potential legal problems with the CFPB’s 2015 rule authorizing it to supervise the larger participants of the auto finance market. The report also discusses whether the CFPB’s use of the disparate impact theory in enforcement actions against auto financers would survive judicial scrutiny. CASE OF THE MONTH Sale of extended warranty that did not cover consumer’s vehicle deemed unfair or deceptive trade practice: A consumer bought a used truck from a dealership. The truck’s odometer read 157,000 miles. The dealership sold the buyer a 3-month/3,000mile “deluxe extended warranty.” After the truck broke down twice within the first month, the buyer replaced the engine and transmission at a cost of $6,000. The warranty only covered half of that expense because the mileage on the truck exceeded the 125,000-mile limit for the full, deluxe extended coverage. The buyer sued the dealership, claiming it knew that the warranty would not provide
NOTE THIS COLUMN DOES NOT OFFER LEGAL ADVICE. ALWAYS CHECK WITH YOUR OWN LAWYER TO LEARN HOW WHAT WE REPORT MIGHT APPLY TO YOU, OR IF YOU HAVE QUESTIONS. full coverage when it sold the warranty. The trial court ruled for the buyer, and the Court of Appeals of Ohio affirmed. The appellate court explained the dealership engaged in an unfair or deceptive trade practice when it sold the warranty to the buyer because he paid for a warranty he did not get. The invoice showed the repair shop charged the buyer for parts the warranty supposedly covered. The sales contract, warranty, and invoice together were enough to convince the court the buyer did not get the benefit of the warranty. As a result, the court concluded the dealership made a false representation when it told the buyer the “deluxe extended warranty” covered the truck. Note that “extended warranty” is the term used in the court’s decision – the product sold was most likely a vehicle service contract or similar product. See Greenwood v. Quality Motor Cars by Butch Miller, 2016 Ohio App. LEXIS 5027 (Ohio App. December 15, 2016). So there’s this month’s roundup! Stay legal, and we’ll see you next month. Tom (thudson@hudco.com) is of Counsel and Nikki (nmunro@hudco.com) is a partner in the law firm of Hudson Cook, LLP. For information, visit www.counselorlibrary.com. © CounselorLibrary.com 2017, all rights reserved. Single publication rights only, to the Association. (2/17). HC# 4812-8548-3585 v.1
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INDUSTRY NEWS
PRODUCTS & SERVICES
BY PAUL STEIER
PAUL STEIER ACCEPTS NEW POSITION Keep in Touch After 25 years of service with the Iowa Department of Transportation, I have accepted a position as the law enforcement program manager with the American Association of Motor Vehicle Administrators. My first day with AAMVA was January 30. This is a new position for AAMVA responsible for fostering motor vehicle agency and law enforcement partnerships throughout the AAMVA membership in the U.S. and Canada. Having worked for the DOT as a law enforcement officer during the events of September 11, I witnessed the tremendous value and impact this DMV and law enforcement relationship is to our nation’s safety and security. As you may be aware, AAMVA plays a vital role in administering the National Motor Vehicle Title Information System as well as many other vehicle and identity programs that may impact the motor vehicle sales business. For example, AAMVA is helping member jurisdictions develop best practices
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for acceptance of electronic odometer statements, has provided guidance on vehicle branding as well as research on autonomous vehicle titling and operation, and this year will start a working group to address best practices for dealer Internet sales. AAMVA also provides numerous educational programs to its members through workshops, conferences, and webinars. I encourage you to visit AAMVA. org to learn more about what work AAMVA has done and continues to do. As the former director of the Iowa DOT’s Bureau of Investigation & Identity Protection, I am proud of the accomplishments from working with IIADA members and I intend to use that spirit of partnership as a model for future work with AAMVA. In my absence, bureau deputy director Mike Athey has been appointed as bureau interim director. Mike will do a great job continuing to work with IIADA on various issues. AAMVA is based in Arlington, Virginia, but I will maintain a residence and office in Iowa. If I can be assistance or if you have ideas you would like to share that may benefit motor vehicle agencies, please don’t hesitate to contact me. I look forward to keeping IIADA members up to date with happenings across the nation in the motor vehicle community. I can be contacted at psteier@aamva.org or 703-270-8932.
CARS.COM ADDS PRICING TOOL Tools Provide Greater Context Cars.com has introduced a new shopping tool - price comparison graphs - located on each vehicle detail page. These tools provide more context around the price of a used or new vehicle and help educate shoppers on how factors such as trim, mileage and certification impact the price of a vehicle in their market. The new price comparison graphs received strong positive feedback from Cars.com’s dealer’s circle community, with 74 percent of dealers saying the new tool will have a positive or neutral impact on their dealership. The new price comparison graphs are just the beginning of several pricing features anticipated to hit the site this year. The company expects to roll out deeper feature comparison by the end of the first quarter, which will incorporate additional qualifiers such as drivetrain, engine cylinders and transmission into the price comparison graphs. Local vehicle price comparisons are determined through a random sampling of all cars within 100 miles of the location of the vehicle. For used vehicles, comparison mileage and CPO status are also factored into the price.
April/May 2017 / STREET SMART
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MANAGEMENT GAMEPLAN BY SCOTT BERGERON
IS YOUR SALES PROCESS A HIT? OR HIT AND MISS? Increase Your Batting Average Louis Pasteur said, “Chance favors the prepared mind.” When it comes to sales, this is the most important driver to long term success. Selling a vehicle comes down to two essentials. First, having someone to talk to who can buy. Second, being prepared so you don’t ruin your chances when you do have someone to talk to. All this means being organized in how you manage your sales process. The ultimate goal is to turn every opportunity into a sale. But since a 100 percent closing ratio never happens, the goal is to increase your batting average by consistent and correct execution of the basics. Shooting from the hip strategies never work as a game plan for success. These offthe-cuff processes typically rely on force of personality, which can be hit and miss depending on the salesperson’s mood. Charm may captivate one prospect and turn off the next, who feels as if it’s a put on. It can enthrall and entertain people in short bursts, but will only seal the deal with a select number of people. Salespeople accustomed to this type of selling may achieve a certain level of success, but it won’t ultimately rival what a well-organized, prepared salesperson can accomplish over the long term. Another analogy helps drive home the point even further. I call Denver home. Here, the Denver Broncos are as close to a religion as a sports team can be. In January, the Broncos’ coach, Gary Kubiak, resigned, citing health issues creating an inability to put in the amount of preparation time necessary for his standards. For him, that was a 5 a.m. to 10 p.m. regimen. The results of this approach are significant – in his first year as head coach, the Broncos won Super Bowl 50, proof the guy knows his stuff. There are likely very few salespeople who want to spend 17 hours a day preparing to sell cars. So it’s important to find other ways to help sales teams achieve. Here are a few important tips to develop an effective preparedness plan that doesn’t micromanage salespeople or make them feel like they’re stuck doing unnecessary hours of “homework”: Clarify objectives and goals by quantifying a sales funnel featuring prospects, sales, and activities needed for both. While this can get really detailed, the basics are straightforward. First, look at the forecast. To hit a certain forecast, the initial
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step is to reverse-engineer the process. Second, determine the historical average of how many prospects (UPs) it takes to make a sale. Let’s say it’s 4:1, or a 25 percent closing ratio. If that’s the case, you’ll likely need 100 prospects to make 25 sales. Third, determine historically what you have averaged per sale in commission (or gross if you’re the dealer) to determine how many prospects (UPs) you would need to hit your forecast. In the real world a salesperson who wants to earn $5,000 consistently each month needs to know exactly how to do that. If a salesperson historically earns $280 per sale, then he needs to sell 18 cars to make over $5,000. If his closing ratio is historically 29 percent, he needs to talk to 62 prospects (UPs) to sell 18 cars. The key here is getting accurate data to be able to do the math. Look at how to improve on historical numbers. For example, sales training can improve closing ratios, as can listening and learning body language. The key is to be able to give the salespeople all the tools they need to be consistently successful. Many email prospecting campaigns, as an example, fail miserably because of overcommunication or coming across as pushy and self-serving. Today’s prospects want to know what’s in it for them and how you can help them get there. Use a CRM tool to track and help assess your sales team’s opportunities. I always try to get consistently better, whether I’m managing or selling directly, and to do that I need real data on my capabilities. Creating a doable plan is only half the battle. Fulfilling it is the other half. How many New Year’s resolutions are kept? Therein lies the difficulty, and the challenge. Keep the plan on track. Identify ways to improve it. Spot and repair weak links (e.g., sales team members not following through, either with their objective or reporting of it). Streamline processes further to make it even easier for your team to follow. Avoid the traps of assuming “there’s an APP for that.” When processes, especially sales processes, are overly complicated, technical, or not easily inspected, it almost always leads to failure. Sometimes, the simplest solutions are the best – particularly when they gain easy acceptance from the team. Two major considerations outweigh all others: A) Does the system provide basic key performance indicators (KPI) that managers can easily pull up and track? B) Is it easy for salespeople to learn, adopt and use consistently? Installing any new or exciting sales process can be tricky. The first step is to make sure it fits your dealership’s current selling style. There’s no need to reinvent the wheel here. Just make sure it fits. For example, older salespeople may be more inclined to use paper-based sales management systems, while digital processes via smartphones or workstations
SALES PROCESSES AND SYSTEMS ARE ALL ABOUT IMPROVING THE CUSTOMER AND SALESPERSON EXPERIENCE SO NOTHING IS LEFT TO CHANCE. OVERALL, MAKE SURE YOUR PROCESSES ARE WORKABLE AND WELL THOUGHT OUT, SO THEY CAN BECOME A CORNERSTONE OF YOUR SUCCESS. may be the overwhelming millennial preference. Keep your options open as both have strengths and weaknesses. Balance all this out by maintaining consistency. Sales processes and systems are all about improving the customer and salesperson experience so nothing is left to chance. Overall, make sure your processes are workable and well thought out, so they can become a cornerstone of your success. By deploying a consistent, balanced, and inspected sales system, you can steadily increase your bottom line and build a solid sales team for the long haul. Former dealer executive Scott Bergeron is the founder of Daily Gameplan.com, a sales team performance company. Scott can be reached at 303.918.3169 or scott@dailygameplan.com.
www.iowaiada.com
ASSOCIATION NEWS BY JUDY WILSON
LETTER TO IOWA INDEPENDENT DEALERS Special Invitation
Dear Iowa independent auto dealer: We would like to invite you to become a member of IIADA during 2017! At a recent IIADA board meeting we were talking about why dealers join IIADA and why some dealers are hesitant to join. Nearly 25 years ago IIADA came into being. Those who helped organize the association traveled many miles, attending auctions and inviting fellow dealers to become a part of the association. Many of those dealers are still members today and have contributed a great deal to the growth and viability of IIADA. Today our membership numbers are at an historic high, which is good, but we want more dealers to become part of IIADA and experience the value of association membership. Recently I had made a fresh batch of peanut butter cookies and my husband was having a cup of coffee. I asked, “Have you ever dunked your cookie in your coffee?” He said, “Absolutely not. I dip my toast into my coffee, but nothing else.” I was a little shocked over his reaction. “Didn’t your grandma teach you to dunk her cookies in coffee or hot tea?” “Nope,” he said, “Never did it.” I, on the other hand, grew up with a German grandmother who always had her homemade cookies available for us when we would visit and always encouraged us to dunk our cookies. I preferred hot tea with just a little sugar and cream to do my “dunking” and it was so good. A few days later my husband informed me he had dunked his cookie into his coffee and it was great. It proved to me one can always make adjustments in life and pursue new things. The point of my story is this: Just because you are not a member of IIADA presently doesn’t mean you should not strongly consider becoming a member. IIADA is composed of dealers of all sizes. Some of our members are highly sophisticated “selling machines” with service departments, sales departments, finance offices, and high tech websites. We have many members who are small to medium sized dealer operations – often with family members involved in the operation with community reputations of high regard. Other members are beginning dealers who strive to be the very best. IIADA members come in all sizes and we are very proud of each and every one. We have a code of ethics, shown in this magazine, and the association has worked very hard to help our members in many various ways. We help them with problems with online purchases, auction activities, regulatory matters and so much more. When you join IIADA you also become a member of our national association – NIADA.
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STREET SMART / April/May 2017
We have state associations throughout the 50 states and a national membership of nearly 16,000 dealers. When you travel it is always nice to know that should you have vehicle problems you can always call on an NIADA member to provide assistance. I know because there were times I needed them. We invite you to join IIADA by using the membership form provided in this magazine! You will definitely benefit from being a member of IIADA/NIADA and learning about all the areas these associations help you to grow your business with products and services that can help you make more money and become a more diversified dealer. We have asked some of our members to tell us why they joined IIADA. Their comments are on page 14. Take a look at the approved benefit provider page and see those businesses who want to work with you. NIADA has numerous ways for you to save money, have a retirement plan, health insurance and so many more benefits. Check out the NIADA website at www.niada.com for more. Do not hesitate to give us a call if you have questions about anything – we are here to help and look forward to you becoming a member. We know some of you don’t like to join a group, but consider first the benefits we have assembled for you – they are pretty impressive. IIADA is a nonprofit association established for the purpose of helping motor vehicle dealers in Iowa. Our membership is very diverse – we have conventional dealers, dealers who specialize in subprime sales as well as Buy Here-Pay Here operations. The one thing we have in common is we all just want to sell cars. Many of our members have been “car people” all their lives. Your consideration of joining IIADA is very much appreciated. We will ask little of you, except to be a good dealer and follow the rules, regulations and laws. We expect you to ask a lot of us – and we guarantee we will deliver. During the past 10 years we have had the privilege of developing and teaching dealer education classes and have met many of you. You have shared so much with us. We thank you for this valuable and enlightening experience – you are why we try so hard to make your experience as an independent used motor vehicle dealer in Iowa the absolute best. Let us serve you in any way we can. Sincerely, Judy Wilson and the rest of the IIADA board and staff CONTINUED ON PAGE 14 www.iowaiada.com
CONTINUED FROM PAGE 12
IIADA MEMBER COMMENTS “Today’s used car regulatory climate demands dealers stay abreast of pending legislation and regulator focus trends. I joined IIADA because of their commitment and hard work protecting the dealers of Iowa. I can’t think of an organization I belong to that does more for my business. If you utilize the information the association puts out, what better way to stay involved than to join. If you don’t take advantage of all the IIADA has to offer… you should.” -Marcus Hebert, CarsNow, Council Bluffs, Iowa “We opened our business in late 2000 in Spencer and we have been a member of IIADA since 2003. While I cannot recall the exact reason we joined IIADA, I have many reasons why we continue to be proud members of the association. “There isn’t a person who knows everything there is to know about the car business and there is no other place you will find a group of friendly business people who are so willing to share, explain and teach you what you need to know. I believe this association has your best interests in mind with everything you do. I would also like to say that through this association I have met other dealers who have helped me in so many ways. Our success as a dealer is directly attributed to these people and IIADA.” -Jay Muller, Best Auto, Spencer, Iowa “Having the honor to be a member of IIADA is one of the most important decisions an independent dealer will ever make for their business. The benefits will be endless. “Your dealership will have access to things like how to compete with franchise dealers, approved benefit providers, the CarLawyer articles, F&I services, conventions, discounts on lot insurance, educational classes, etc. There are a thousand reasons to be an IIADA member. There are zero reasons not to join such a great association. “Not the least of all, you get to talk to Judy Wilson, who is always in the IIADA office willing to help you with any situation you may have a question on. Just commit to being a member of the greatest dealer association we will ever have access to. Support your state dealer association. Call ASAP to find out more.” -Rick Theilen, Theilen Auto, Clear Lake, Iowa “When we started in the Buy Here-Pay Here business, we joined the new car dealer association, IADA, because of our ties to a new car store. I had known Doug and Judy Wilson for many years as wholesalers at our new car store. So, after several invitations from Doug and Judy to join IIADA, we did. In very short order, I discovered I learned way more and received considerably more useful
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STREET SMART / April/May 2017
SAFETY WATCH information through IIADA that was way more viable for an independent dealer and specifically a BHPH dealer than the benefits of the other organization. “Both organizations have benefits but IIADA was a much better fit for us. Also, I discovered the more I got involved the more I learned and benefited from my membership in IIADA. There is hardly a day that goes by I don’t learn something new and helpful by being a member of IIADA.” -Clay Winterboer, Carroll Car Credit Company, Carroll, Iowa “Our dealership has been a member of IIADA since 2003. I can’t believe Iowa dealers don’t join the association. It is very risky to be in business today without being a member of a dealer association to be kept abreast of all the rules and regulations dealers must be aware of. IIADA helps its members in so many ways. The membership dues are a small price to pay for the valuable assistance and guidance IIADA provides to its members.” -Steve Cooley, Cooley Auto Sales, North Liberty, Iowa “When we joined IIADA in 2001, we wanted to learn the laws and rules and to earn the respect of other dealers. We wanted to conduct our business with integrity and quality and also to have the confidence of the association being there to help and support us. I can’t begin to explain how very important it is to be a member of IIADA.” -Bev Timm, Timm’s Auto Sales, Webster City, Iowa
Great PB Cookie Recipe ½ cup butter ½ cup peanut butter ½ cup sugar ½ cup brown sugar (firmly packed) 1 egg 1 tsp. vanilla 1 tsp. soda 1-3/4 cup of flour • Cream butter, peanut butter, sugar and brown sugar. • Add egg and vanilla. Beat well. Then add soda and flour. • Shape dough into 1-inch balls. • Roll in sugar and place on ungreased cookie sheet. • Bake at 375 degrees for 8 minutes. • Press down the cookie before placing in oven. Cookie should be golden brown and slightly cracked. For fancy cookies, press a milk chocolate kiss in center of each cookie as soon as you take them from the oven. WARNING: These cookies might change your habits – to dunk or not! Take the leap and join IIADA – the rewards are highly beneficial. Payments plans for your annual dues are available to fit your budget.
VEHICLES WITH UNFIXED RECALLS ON THE RISE
One in Four Vehicles Americans Drive Has Open Recalls
This year, millions more lives may be at risk from people driving and buying vehicles with unfixed safety recalls. According to Carfax, more than 63 million recalled vehicles now are in use across the country, an alarming 34 percent increase from 2016. The annual research also suggests this issue affects nearly one in three vehicles in Texas, the highest rate in the nation. Behind Hawaii, the other Gulf Coast states of Mississippi, Louisiana and Alabama round out the top five. In addition, people in California, Texas, Florida, Pennsylvania and New York have the most vehicles with open recalls. “Reducing the number of open recalls on the road is an ongoing effort,” said Carfax communications director Larry Gamache. “Safety is our number one concern. Carfax, manufacturers and the government are working together to make it easier for drivers to get accurate information and timely alerts about open recalls. It may be inconvenient, but people driving recalled cars should make getting them fixed a high priority.” The new data also suggests family life may be a factor for some vehicle owners not knowing about a recall or getting it fixed. Minivans and SUVs – family-oriented vehicles – are the ones most likely to have unfixed recalls. With myCarfax.com, vehicle owners simply enter their license plate, a feature unique to the service, or VIN to get started. The service sends recall alerts to users’ mobile devices or email for up to five saved vehicles. In addition, anyone worried about buying a car with an unfixed recall can shop with confidence at carfax.com. Every vehicle listed for sale there comes with a free Carfax report, which includes open recall information reported to Carfax. To learn more visit www.carfax.com.
www.iowaiada.com
2017
&
When Christopher Columbus set out on his voyage in 1492, he didn’t have a map. And while Columbus’ journey landed him in the history books, the fact is he never did reach his intended destination. So what can we learn from this? To get where you’re going, it’s vital to know where you’re headed and what lies between you and that goal. And it helps immensely to have a map to guide you. Which brings us to our theme for 2017 NIADA Convention & Expo: Chart Your Course. Independent used vehicle dealers need maps (metaphorically speaking) to guide them through the obstacles in order to arrive at their ultimate destination – success. Our job at NIADA is to provide the maps and knowledge – through our educational content in the unmatched training of the NIADA Convention. So let’s get started and set sail toward your goals!
OVERVIEW OF CONVENTION EDUCATIONAL AREAS OF FOCUS:
ROOMS FOR ONLY $150 PER NIGHT!
RETAIL: NIADA director of dealer development and industry icon Joe Lescota is featured in multiple tracks that cover all aspects of retail operations, including sales, marketing, financing, inventory management, CPO and much more.
OPERATIONAL STANDARDS: NIADA senior vice
BUY HERE-PAY HERE: NIADA national director of 20 Groups Chuck Bonanno and the BHPH world’s best and brightest guide you through best practices in underwriting, collections and more, as well as the latest payment assurance technology.
CERTIFIED PRE-OWNED: Learn why CPO is the hottest
INDUSTRY EXCLUSIVE
president of legal and government affairs Shaun Petersen is among the legal and industry experts who will get you up to date on the ever-changing regulatory and legislative issues that affect your business, and offer strategies to stay on the good side of regulators.
item in the used vehicle industry and how you can get your share of the record-setting certified market from 2016 NIADA CPO Dealer of the Year Todd Hoagey and other top CPO dealers.
Presenting for the first time ever, 2017 Buy Here-Pay Here Industry Benchmarks, provided by NABD and powered by NIADA data.
Chuck Bonanno
Ken Shilson
KEYNOTE SPEAKER: CAPTAIN RICHARD PHILLIPS Keynote speaker sponsored by:
The inspiration for the hit movie Captain Phillips and author of A Captain’s Duty: Somali Pirates, Navy SEALS, and Dangerous Days at Sea, Captain Richard Phillips was at the center of a dangerous drama in 2009 when his merchant vessel, the MV Maersk Alabama, was seized by Somali pirates in the first hijacking of a U.S. ship in more than 200 years. Having risked his own life to protect his crew, Phillips was taken by the pirates as a hostage and held in a small lifeboat. After a five-day ordeal, he was rescued by members of the famed Navy Seal Team 6. He’ll offer his perspective on the power of leadership, teamwork, training, belief in self and an unyielding, never-give-up attitude.
Book rooms at The Mirage for only $150 per night including resort fee, in-room Internet and fitness center access!
REGISTER TO ATTEND BY APRIL 15 FOR A SPECIAL DISCOUNTED RATE OF $449 PER PERSON. A TOTAL SAVINGS OF $200!
*USE PROMO CODE: StateDealer
*DEALER ATTENDEES ONLY
www.niadaconvention.com • 800-682-3837 www.niadaconvention.com
APPROVED MEMBER BENEFIT PROVIDERS ADVANCED BUSINESS PRODUCTS, INC.
Printing, Promotional Products, & Wearables Contact: Scott Jayne PO Box 71547 Des Moines, IA 50325 Phone: 515-225-6343 Toll Free: 888-464-2274 Fax: 515-225-6510 Toll Free Fax: 877-987-3514 Website: www.go4abpi.com
ALLY SMART AUCTION
4300 SW Cambridge Avenue Topeka, Kansas 66610 785-249-4166 Iowa Rep: Seth Fair seth.fair@ally.com 515-777-4592
ASSOCIATIONS MARKETING GROUP INC Health Insurance Jesse and Lee Patton 1112 Maple Street West Des Moines, Iowa 50265 Toll Free: 800-798-6772 Phone: 515-270-8178 Fax: 515-270-0398 E-mail: leepatton@amgi-dsm.com
AUTO OWNERS INSURANCE 10% DISCOUNT TO ALL IIADA MEMBERS
AUTOJINI.COM
Websites for Dealers Contact: Syed Azam 310 Main Street Ste 201 Ames, IA 50010 Phone: 515-232-2024 E-mail: syed@octadyne.com
CITIZENS COMMUNITY CREDIT UNION
2012-1ST AVENUE SOUTH FORT DODGE, IOWA 50501 Phone: 515-955-5524, Ext. 202 Fax: 515-955-8241
CORCORAN & ASSOCIATES INC.
Various Types of Insurance Contact: Teresa Corcoran 18-2nd St., N.E. Mason City, Iowa 50401 Phone: 877-518-4051 Phone: 515-262-3141 Fax: 515-262-3086 Email: teresa@corcoranandassoc.com
CORCORAN & ASSOCIATES, INC. Dealer Insurance and Bonds Mick and Teresa Corcoran 2600 – 72nd Street, Suite C Urbandale, Iowa 50322 Phone: 515-262-3141 teresa@corcoranandassoc.com
CU DIRECT (CUDL)
DIAMOND OIL COMPANY
Lubricants, Diesel Fuel, Propane & DEF Contact: Jason Heiden 702 S.E. Raccoon Street Des Moines, Iowa 50309 Email: jheiden@diamondoilco.com www.diamondoilco.com
ERIKSON SOLUTIONS SERVICES, LLC
F & I Compliance & Sales Training Alpha Warranty Services Classic Essential GAP – Norman & Co. Frazer Computing Rep Motorsport Dealer Solutions www.motorsport-dealer-solutions.com Contact: Scott Erikson 15210 Castelar Circle Omaha, Nebraska 68144 P: 402-639-0664 F: 402-697-4937 eriksons@aol.com
FOLLOW-UP PLUS
“Customers for Life” Repeat Sales, Referrals & Customer Loyalty Contact: Terry & Sue Newell P.O. Box 294 Carthage IL 62321 Ph: 217-357-9032 Fax: 217-357-9076 E-mail: tlnewell@frontienet.net
FRAZER-DEALER MANAGEMENT SOFTWARE
6196 US Highway 11, PO Box 569 Canton, NY 13617 Phone: 888-963-5369 Fax: 888-963-3366 Website: www.Frazer.com Email: info@Frazer.com
GATEWAY ONE LENDING & FINANCE a tcf bank company Kim Freeborn 563-275-0057 387 Shuman Blvd., Suite 150E Naperville, Illinois 60593 www.gatewayonelending.com
GLOBE ACCEPTANCE INC
Sub-prime Lender Contact: Beth Dieter P.O. Box 65400 West Des Moines, Iowa 50265 Phone: 515-225-9067 globeaccepts@globeacceptance.com Website: www.GlobeAcceptance.com
GREATER IOWA CREDIT UNION 1630 22nd Street West Des Moines, Iowa 50266-1407 Jason Kolar, Dealer Direct Manager Ph: 515-954-1666 F: 515-956-6966 jkolar@greateriowacu.org
INNOVATIVE DEALER SERVICES, INC.
Contact: Paul Bejarno, Area Account Representative Phone: 515-988-0521 Email: paul.bejarno@cudirect.com Website: www.cudirect.com 2855 E. Guasti Road, Suite 500 Ontario, CA 91761
Dealer Software Management Systems P.O. Box 23189 Shawnee, Kansas 66283 913-312-7344 – Ext. 11 Fax: 810-821-1718 Website: innovativedealer.com Terry Webb twebb@innovativedealer.com
CYCLONE AUTOMOTIVE TRAINING INC.
PEOPLES INSURANCE AGENCY
F&I Training, Sales Training, Service Contracts Rob Miller and Chris Hochstein 515 N Jefferson Way Ste H Indianola, IA 50125 Phone: 515-962-0099 or 515-962-0100 Fax: 515-961-8400 Rob: 515-205-5900 cell Chris: 515-205-5800 cell E-mail: cycloneautomotive@ cycloneautomotive.com
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Auto Dealer Insurance Programs 1700 8th St., SW, PO Box 119 Waverly, Iowa 50677 Website: www.peoples-insurance.com Contact: Jason Whitinger/Kathy Mitchell Email: Jason@peopes-insurance.com Kathy@peoples-insurance.com Phone: 319-352-6327, Ext. 13
STREET SMART / April/May 2017
PREFERRED WARRANTIES, INC. 200 Pinebrook Place P.O. Box 278 Orwigsburg, PA 17961 Website: www.warrantys.com Iowa contact: Larry Bohlen Cell: 515-322-6397 Fax: 1-877-233-0298 Email: lbohlen@warrantys.com
PROSOURCE FINANCE
We Do F & I for You 2540 106TH Street, Suite 202 Urbandale, Iowa 50322 800-795-1765 jeff@prosourcefinance.com website: www.ProSourceFinance.net
REYNOLDS & REYNOLDS INC.
Dealer Bonds Long Term Care Insurance Various types of insurance Contact: Dean M Clark 300 Walnut Street Ste 200 Des Moines IA 50309 Phone: 515-243-1724 Toll Free: 800-767-1724 Fax: 515-243-6664 E-mail: d.m.clark@reynolds-reynolds.com
S & C AUTOMOTIVE, INC.
NIADA CPO Program & Training, F&I Products, Reinsurance Formation, Appearance Protection, Spray-on Bedliners, Accessory Installation 3828 70th Street Urbandale, Iowa 50322 P -515-276-9622 Fax: 515-276-8472 Contact: Doug Eckhart doug.eckhart@scautomotive.net Website: www.scautoia.com
U DRIVE ACCEPTANCE CORPORATION
An Iowa Sub-Prime Finance Company P.O. BOX 3107 Sioux City, Iowa 51102 620 S. Lewis Blvd., Sioux City, Iowa 51106 Neil Evans, Director of Originations Office: 712-258-0269 Cell: 402-517-6076 Fax: 712-293-2141 Email: neil@udriveac.com Website: www.udriveac.com
UNIVERSITY OF IOWA COMMUNITY CREDIT UNION
Doug White, Indirect Lending Manager 319-248-5855 dwhite@uiccu.org P.O. Box 800 North Liberty, IA 52317
VERIDIAN CREDIT UNION 1827 Ansborough Avenue P.O. Box 6000 Waterloo, Iowa 50704-6000 800-235-3228 Kara Van Wert –Tony McKillip
WILSON DISTRIBUTOR SERVICE IIADA DEALER CAP FORMS Car Brite Products Forms, Detail Supplies, Equipment & More Jason & Lisa Goody 105 N McCoy Mt. Pleasant IA 52641 Phone: 800-634-0974 Fax: 319-385-2927 E-mail: jasonwds@lisco.com Website: www.wds-usa.com
www.iowaiada.com
www.iowaiada.com
April/May 2017 / STREET SMART
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MIDWEST AUTO AUCTION DIRECTORY
135 AUTO AUCTION
4716 S. Santa Fe Street Wichita, Kansas 67216 316-351-5001 Dealer Consignment Sale Thursdays at 9:00 a.m. Free Breakfast, Free Car Wash
ADESA DES MOINES
1800 Gateway Drive Grimes, IA 50111 (515) 986-1200 Fax: (515) 986-1201 www.adesa.com General Manager: Jeff Lisle Fleet/Lease Manager: Lesa DeRoy Consignment Sale every Tuesday at 9:30 a.m. Fleet/Lease Sale Tuesday 10:30 a.m.
ADESA KANSAS CITY
15511 Adesa Drive Belton, Missouri 64012 (816) 525-1100 (800) 950-2350 Fax: (816) 525-4714 General Manager: Kevin Rhoads Tuesday 9:30 a.m.
ADESA MINNEAPOLIS
18270 Territorial Road Dayton, MN 55369 763-428-8777 763-428-8701 General Manager: Jay Fahrendorff Sale: Tuesday, 10 a.m. www.adesa.com
ADESA SIOUX FALLS
46893 271st Street P.O. Box 218 Tea, SD 57064 (605) 368-5364 Fax: (605) 368-2808 General Manager: Bob Holm Wednesday Sale 10:00 a.m. IAAI SALVAGE SALE EVERY OTHER WEDNESDAY – 8:30 A.M.
ADESA ST. LOUIS
7858 Highway 61-67 Barnhart, Missouri 63012 636-475-9311
ADESA WISCONSIN
W 10415 State Road 33 Portage, WI 53901 608-742-8245 608-742-4415 (f) Tony Manwarren, general manager Sale: Thursday, 9:30 a.m. www.adesa.com
CARMAX AUCTION – DES MOINES
10315 Hickman Road Urbandale, Iowa To Register: 888-804-6604 In House Auction – Every other Monday 9:30 A.M.
DEALERS CHOICE AUTO AUCTION, INC.
503 South Wapello Road Mediapolis, Iowa 52637 319-394-3510 (888) 771-6810 319-394-3511 (fax) www.dcaa.com President: Monte Delzell Nationwide Transportation: EZ Auto Shippers Steve Miller: 866-310-5936 Sale Every Tuesday – 6:00 p.m.
DES MOINES AUTO AUCTION 1530 S.E. McKinley Road Des Moines, Iowa 50320 (515) 285-8911 Fax: (515)256-9161 FRIDAY AT 9:30 A.M. Todd Givant, General Manager
GREATER QUAD CITY AUTO AUCTION
4015 78th Avenue Milan, Il 61264 (309) 787-6300 Fax: (309) 787-4541 Tuesday 10 a.m. – Thursday – 6 p.m. General Manager: Larry Anderson
GREATER ROCKFORD AUTO AUCTION
5937 Sandy Hollow Road Rockford, Il 61109 (815) 874-7800 (800) 830-4722 Fax: (815) 874-1325 General Manager: Chad Anderson Wednesday 10 A.m.
KCI AUTO AUCTION
11101 N. Congress Kansas City, MO 816-502-3318 816-801-8565 (f) Doug Doll Consignment Sale: Thursday, 9:30 a.m. www.kciaa.com
LINCOLN AUTO AUCTION, LTD 11909 US HWY 6 Waverly, Nebraska 68462 402-475-5500 www.lincolnautoauction.com Ryan Durst, Vice President Weds. 10:00 a.m.
MANHEIM CHICAGO
20401 COX AVENUE MATTESON, ILLINOIS 60443 815-806-4222 Mike Cesta, General Manager
MANHEIM KANSAS CITY
3901 North Skiles Road Kansas City, MO 64161 (800) 247-7163 Fax: (816) 452-2393 General Manager: Victor Ferlaino Wednesday 9:30 a.m.
MANHEIM MILWAUKEE
561 South Highway 41 - 27th Street Caledonia, WI 53108 (262) 835-4436 (800) 662-2947 Fax: (262) 835-2684 General Manager: Dennis Worthy Dealer Sales Manager: Kimberly Schure Wednesay 9 a.m.
MANHEIM MINNEAPOLIS
8001 Jefferson Highway Maple Grove, MN 55369-4924 (763) 425-7653 (800) 622-7653 Fax: (763) 493-0310 www.manheim.com General Manager: Tom Saldutte Assistant General Manager: Felix Hernandez Commercial Accounts Manager: Jennifer Etnier Open Sale Sale every Wednesday; 9am Ford Credit, 9:30 TD Auto Finance, Select Lane and Fleet/Lease/Rental Groups, 9:45am Dealer Consignment. Ford Factory Sale bi-weekly Wednesdays at 12 Noon; Fiat Chrysler Factory Sale bi-weekly Wednesdays at 12 Noon Total Resource Auction/Insurance Sale weekly, Tuesdays at 1:00pm.
MANHEIM NORTHSTAR MINNESOTA
4908 Valley Industrial Blvd. North Shakopee, MN 55379 (952) 445-5544 (888) 445-2277 Fax: (952) 445-6773 General Manager: Scott Maybee Assistant General Manager: Jon Eisenmann Commercial Accounts Manager: Rod Dubbe Open Sale Thursdays at 9am Total Resource Auction/Insurance Sale Thursdays at 1pm Specialty Sale (Heavy Truck/Equipment/ Powersports) every 2nd and 4th Thursday at 12:30pm $4k and Under Sale: Last Wednesday of the Month at 3pm
MANHEIM OMAHA
9201 S. 144th Street Exit 440 off of I-80 Omaha, NE 68138 (402) 896-8000 (800) 218-4192 Fax: (402) 896-6758 General Manager: Steve Robinson Assist. Gen Manager: Korey Grell Thursday 9:30am.
MANHEIM ST. LOUIS
13813 St Charles Rock Road Bridgeton, MO 63044 (314) 739-1300 (800) 533-5414 Fax: (314) 298-3347 General Manager: Jason Blake
MID-STATE AUTO AUCTION 100 Bach Ave. New York Mills, MN 218-385-3777 218-385-3232 (f) Rob Thompson, president Sale: Friday, 10 a.m. www.msaanym.com
NEBRASKA AUTO AUCTION, INC. 7500 N. 56th Lincoln, Nebraska 68514 402-466-8477 Contact: Mark Cooley Tuesday at 10:00 a.m. www.nebraskaautoauction.com
PLAZA AUTO AUCTION, INC. 320 Highway 30 West P.O. Box 147 Mt. Vernon, IA 52314 (319) 895-6232 Fax: (319) 895-6727 www.plazaaa.com Owner: Mark Greb Office Manager: Debbie Welsh Sales Manager: Becky McGinty Consignment Sale every Wednesday at 6:30pm. Fleet/Lease/Repo Sale Wednesday at 7pm.
TRI-STATE AUTO AUCTION Jct. Highway 11 & 80 P.O. Box 735 Cuba City, WI 53807 (608) 744-2020 (608) 744-3418 (800) 356-0625 Fax: (608) 744-7425 Owners/Managers: Gerald and Helen Brogley Thursday 6:30 p.m.
MANHEIM ARENA ILLINOIS 200 West Old Chicago Drive Bolingbrook, Il 60440 (630) 759-3800 (630) 759-9668 General Manager: John Olejniczak Dealer Sales Manager: Louis Palermo Tuesday 9 a.m.
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MANAGEMENT MATTERS BY NEXTGEAR CAPITAL
AUTOMOTIVE FLOORPLAN MANAGEMENT BEST PRACTICES Capitalize on Your New Capital
Once a dealer is cleared to use an automotive floorplan, they instantly have access to more capital to aid in purchasing inventory. However, along with that instant access to more capital is a new set of management responsibilities. Keeping these best practices in mind will help dealers integrate their new capital into their current business plans, allowing them to use their floorplan more effectively. Fit the floorplan to the dealership. Dealers need to be aware of their own business numbers to optimally manage an automotive floorplan. What is the dealership’s average inventory turn time? How many cars need to be sold to meet operating expenses? What is the average profit margin per car? Knowing the answers to questions like these can give dealers key insights to help establish where they are, where they are going and how long it will take for a dealer to reach their goals. The answers to those questions can also provide clarity on how an automotive floorplan can fit into the current shape of the business. Use floorplans for discipline. When a dealer uses cash or a regular business loan, there is no incentive to sell a car or profit quickly. Additionally, a dealer’s initial investment will depreciate depending on how long the vehicle stays on their lot. Floorplanning can help provide a dealership with discipline. Dealers have a given amount of time available until they have to pay a vehicle off. Use that deadline to the dealership’s favor. If a dealer hasn’t received a profitable offer on the vehicle due for payoff, that approaching deadline can jumpstart their inventory exit strategy process. Whether that exit strategy includes selling the car at auction, working with other local dealers, or holding out for a more profitable offer, the floorplan deadline ensures a dealer doesn’t just let their inventory, and their initial investment, depreciate. Always floorplan responsibly. A dealer’s business data combined with a floorplan can lead to excellent dealership profits. However, dealers need to make sure they floorplan responsibly. If a dealer uses their entire line of credit and those vehicles haven’t sold once payoff time arrives, that dealer is going to have a pretty hefty bill. Space out inventory purchases. That way, payoff dates are spaced appropriately for dealership cash flow, just in case inventory hasn’t sold before payoff time. Used together, these best practices allow dealers to purchase the inventory needed, provide incentive to profit and allow for manageable floorplan payments. www.iowaiada.com
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April/May 2017 / STREET SMART
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