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OPEN ROAD L O U I S I A N A

I N D E P E N D E N T

A U T O M O B I L E

MOBILE COMMERCE TAKES CENTER STAGE ALSO The Art and Science of Used Auto Inventory PLUS Online Sales Success: Let Your Listings Do the Talking

DALLAS, TEXAS Permit No. 2079

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V isit us at w w w.laiada.com

D E A L E R S

A S S O C I A T I O N

INSIDE

."(";*/&CONTENTS 4 Mobile Commerce Takes Center Stage 6 The Art and Science of Used Auto Inventory

14 Online Sales Success: Let Your Listings Do the Talking

NIADA/Manheim Community Service Award

Manheim, the world’s largest provider of vehicle remarketing services, cares about its employees, the environment and the communities it serves.

From fundraising drives and tutoring kids after school to supporting long-term conservation efforts, Manheim and its employees are dedicated to giving back to their communities and know independent vehicle dealerships across the country share in this commitment. For the first time this year, Manheim is recognizing and honoring those dealerships by awarding the 2011 National Manheim Community Service Award at the 65th NIADA Annual Convention and Expo. For more information, contact Georgia Brown, NIADA director of education, at 817-640-3838 or download the nomination form at niada.com (click on the Manheim Dealers Edge link under the Services tab).

ADVERTISERSINDEX ADESA ........................................................ 9 AutoTrader.com .......................... Back Cover First Consumers Financial ............................ 19 E: l *lm <ahb\^ :nmh :n\mbhg ...................... 13 FZga^bf'\hf ................... Inside Front Cover FZga^bf Ahnlmhg .......................................11 FZga^bf Fbllbllbiib ................................... 7 FZga^bf G^p Hke^Zgl ................................ 5 GB:=: <hgo^gmbhg .....................................17 SmartAuction ..................... Inside Back Cover Ngbm^] :\\^imZg\^ ......................................16 Western General / Protective ..................... 15

NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION 888 /*"%" $0. t 888 /*"%" 57 NIADA HEADQUARTERS: #308/ #-7% t "3-*/(50/ 59 1)0/& '03 "%7&35*4*/( */'03."5*0/ $0/5"$5 530: (3"'' 03 530:!/*"%" $0.

THE OPEN ROAD IS PUBLISHED BI-MONTHLY BY THE NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION SERVICES CORPORATION, 2521 BROWN BLVD., ARLINGTON, TX 76006-5203; PHONE 817-640-3838. 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 INDIVIDUAL AUTHORS AND DO NOT NECESSARILY REPRESENT THE VIEWS OF THE OPEN ROAD OR THE NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION. LIKEWISE, THE APPEARANCE OF ADVERTISERS, OR THEIR IDENTIFICATION AS MEMBERS OF NIADA, DOES NOT CONSTITUTE ANENDORSEMENT OF THE PRODUCTS OR SERVICES FEATURED. COPYRIGHT Š 2011 BY NIADA SERVICES, INC. ALL RIGHTS RESERVED. 45"5& ."(";*/& .(3 4"-&4 Mkhr @kZ__ mkhr9gbZ]Z'\hf EDITOR Fbd^ AZk[hnk faZk[hnk9gbZ]Z'\hf 130%6$5*0/ .(3 CZ\h[ D^kgl cZ\h[9gbZ]Z'\hf "35 130%6$5*0/ .(3 <akblmr AZrg^l \akblmr9gbZ]Z'\hf 13*/5*/( Gb^fZg Ikbgmbg`

" .&44"(& '30. 5)& 13&4*%&/5 Business is good with tax season here, Just a reminder to everyone that we have car prices and sales are all up, everyone is moved, our new address is LIADA 1630 trying to get as many cars on their lot as North Flannery Road Baton Rouge, LA possible so if managed to stay in business 70815. life is good right now. Join the LIADA and You can call LIADA at 1-800-960-5423

continue to make the right decisions. We or email us at LAASSOCIATION@aol.com will save you money with the check books if you have any questions. Don’t forget to that you can use at the auctions, forms that visit our web site at www.laiada.com. you need to run your business and we also offer garage liability. Thank you, Let us give you the peace of mind in knowing that you’re Insurance is worry Val Clary free. Call our Servicing Agents at 225-667LIADA President 4421 and get a quote today!

2011 LIADA BOARD OF DIRECTORS PRESIDENT

Val Clary Courtesy Auto Sales, Inc. 3570 Greenwood Road Shreveport, LA 71109 318-636-2577 318-635-8669 fx

PRESIDENT EMERITUS J.L. Richard P.O. Box 481 Carencro, LA 70520 337-258-2272 337-896-6278 fx

IMMEDIATE PAST PRESIDENT

Doug Perry Doug Perry Wholesale Cars 734 Bayou Shores Drive Monroe, LA 71203 318-372-7322 318-343-8611 fx

VICE PRESIDENT

Brad Saia SAIA Auto Consultant 7212 Goodwood Ave. Baton Rouge, LA 70806 225-445-5320 225-927-1426 fx bradsaia@cox.net

BOARD OF DIRECTORS:

Danny Moore D Moore Auctioneers 15481 Airline Hwy Baton Rouge, LA 70817 225-752-8630 Scott Ledet Ledet’s Auto Sales P.O. Box 1505 Gonzales, LA 70707 225-644-2886 225-644-2419 fx ledauto@eatel.net Steve Taylor Car Town of Monroe, Inc 319 North 3rd Street Monroe, LA 71201 318-323-6385 318-340-9489 fx Junior Gonzalez Pan-Am, LLC 201 Chalet Drive Lafayette, LA 70508 337-278-7682 337-234-7170fx

TREASURER

Kevin Rembert Manheim New Orleans P.O. Box 320 Slidell, LA 70459 985-643-2061 985-649-7455fx Kevin.rembert@manheim.com

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John Brakefield Blue Ribbon Motors, Inc. 8308 Airline Highway Baton Rouge, LA 70815 225-925-8931 225-926-0736 fx

John Poteet Louisiana 1st Choice Auto Auction 18310 Woodscale Road Hammond, LA 70401 985-345-3302 985-345-5735 fx Dino Taylor Freedom Motors, Inc. 601 Trenton Street West Monroe, LA 71291 318-503-3369 318-340-9489 fx

Philip Crain Ride Time LLC 319 North 3rd Street Monroe, LA 71201 318-410-9250 318-372-2555fx Wayne Patt Patt Enterprises 15150 Florida Blvd Baton Rouge, LA 70819 225-772-8417 Michael McCain Magic Motors 7960 Florida Blvd Baton Rouge, LA 70806 225-588-3404 Ricky Donnell Best Stop Auto Sales, LLC 6122 hwy 4 Winnsboro, LA 71295 318-435-7998

FOR INFORMATION ON HOW TO BECOME A MEMBER OF -*"%" 1-&"4& $0/5"$5 #:30/ 83*()5 "5 03 -""440$*"5*0/!"0- $0.

LIADA OFFICE: -*"%" /035) '-"/ /&3: 30"% #"50/ 306(& -"

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WEBSITE: WWW.LAIADA.COM

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MOBILE COMMERCE

WITH CONSUMERS LOOKING FOR VEHICLES, PARTS AND ACCES SORIES This past holiday season, surveys and statistics showed what many analysts and industry observers were thinking: mobile commerce is growing by leaps and bounds, and every industry is in on the trend, including automotive.

In 2011, smartphones are forecasted to account for half of the mobile phone market, according to The Nielsen Co. On top of that, an ABI Research report says mobile online shopping will generate $119 billion in sales by 2015, accounting for 8 percent of the e-commerce market. When car dealers make it easy for their business to be found through a mobile web browser, loyalty campaigns, marketing initiatives, text promotions and sales can attract and retain customers. What are consumers browsing with their smart phones? The same types of items they started browsing on computers: researching purchase decisions, cost comparisons and finding the location of physical items. Recently, eBay reported a substantial increase in mobile traffic, where sales more than tripled in 2010 to near $2 billion in gross merchandise volume. Last year, vehicle purchases led all categories on eBay mobile applications in terms of GMV, while parts and accessories were number two in terms of the total number of items purchased. Dealers know when they have a physical lot, customers still come to kick the tires when the sales office is closed. Now, today’s consumer might still come to the lot, but he or she will also pull out a smart phone, check the hours of the dealership and research the same make and model for competitive pricing. The same thing is happening even if the consumer doesn’t drive to a physical lot. A consumer may be in his garage working on a car and need to find a part or accessory. Instead of going inside and turning on the computer, he’s browsing his smart phone to find the part, price and local availability. Just as e-commerce has completely changed the way we do business, wireless devices and smartphones are again altering what we know about consumers’ purchasing behaviors. Seeing similarities in mobile commerce and e-commerce, auto dealers ask themselves a familiar question:

would anyone really buy a car from their smart phone? In 2010, more than $118 million in car and truck purchases were made via the eBay mobile application – more than 12,600 vehicles were sold. Parts were the second biggest category in mobile last year, with more than 911,722 parts purchased, and more than $60 million in sales. For independent dealers, mobile applications and mobile commerce are the must-have digital tools of 2011. With smartphones capable of surfing, downloading apps and co nnecting with coworkers and friends in an instant, researching and shopping for vehicles, parts and services is a natural extension. For example, a business traveler waiting at an airport may use that downtime to look for a needed part for his car or browse available vehicles for a new truck. If an independent dealer’s inventory is not readily available on a mobile app, chances are there’s an entire customer segment that may not see what’s for sale. A recent ForeSee Results survey found 30 percent of consumers used a mobile phone to research products on the Internet, compared with 11 percent in 2009. Those making a purchase through a mobile phoWWne increased from 2 percent in 2009 to 11 percent in 2010. For example, Tilo Steurer, founder and owner of Eurocar, the West Coast’s largest independent dealership of its kind, sells and buys vehicles and regularly uses eBay’s mobile app to buy cars, parts and accessories. “I purchase anywhere from five to 10 cars every month, most of the time through the eBay mobile app,” Steurer said. He also uses the eBay mobile app to keep track of his business while not in the office. With any form of sales – online, mobile or in-store – customers consider the credibility of the seller and business before making a purchase. Building that credibility takes consistent communication, which is made easier when dealers can keep in touch through mobile and online sources. “Communication is very important, especially when making an expensive online purchase such as a luxury car,” Steurer said. “With the eBay mobile app, I can re-

spond more quickly to customer questions, which builds credibility and increases the opportunity for a sale.” To accommodate this growing trend, eBay Motors is launching a mobile app that will provide a customizable buying experience optimized for vehicles, parts and accessories, as well as unique social and community features for the enthusiast.

FOR DEALERS, HAVING PARTS, ACCESSORIES AND VEHICLES AT A CONSUMER’S FINGERTIPS IS AN IDEAL WAY TO EXTEND MARKETING AND SALES WITHOUT A LOT OF DEVELOPMENT AND TECHNICAL EFFORT. Features include VIN scanning and a virtual garage to give enthusiasts personalized information. After searching for a vehicle, users can share it with friends and social networks or ask the seller a question. Users can create “car cards” for their vehicles which display photos and stats about the vehicle and can be used in searches for parts and accessories. On the garage tab, consumers can input and store the vehicles they own or scan the VIN barcode with the iPhone’s camera to populate information. In the garage, car owners can create to-do list for vehicle projects, store custom parts searches and share the garage with their social network. For dealers, having parts, accessories and vehicles at a consumer’s fingertips is an ideal way to extend marketing and sales without a lot of development and technical effort. Mobile commerce is still in its infancy but is growing at a faster pace than e-commerce. With the Internet available wherever consumers are with their smart phones, it’s only a matter of time before mobile commerce becomes a dominant form of purchasing. Because of the similarities to e-commerce, consumers are quickly adopting m-commerce and expecting businesses to be on board.

BY CLAYTO N STAN FI ELD, EBAY MOTO RS 4

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THE ART AND SCIENCE OF USED AUTO INVENTORY Building a profitable used auto inventory requires having the right information and the talent to know how to use it. Over the years, I’ve been blessed with tremendous mentors who have provided me with valuable insights, one of which is managing a used vehicle department is both a science and an art. While there are no

cookie-cutter solutions applicable to every scenario, there are tried and true blocking and tackling strategies that can help any department maximize results. When it comes to proper inventory mix, there are several ways a dealership can study information to improve volume,

USED CAR MANAGERS SHOULD BE AWARE, AT THE VERY LEAST, OF THE TOP-SELLING VEHICLES IN THEIR MARKET BY MAKE, MODEL, AND YEAR AS WELL AS THE TOP-SELLING VEHICLES AT THEIR STORE gross and ROI. However, before the information can be broken down, the store must have the information. While this may seem obvious to some, I am routinely presented with departments that fail to accomplish this seemingly simple task. Used car managers should be aware, at the very least, of the top-selling vehicles in their market by make, model, and year as well as the top-selling vehicles at their store. All too often when I ask used auto managers to name the three top-selling used vehicles in their markets, they look at me like a deer in headlights. Or, they automatically respond “Honda Accord” or “Toyota Camry.” That’s great! What year? What trim level? What mileage band? How

many of these have been sold at your store in the last 90 days? What was the average age when it was sold? There are several tools available to help managers accumulate this data, such as Auto Exchange for internal data and Cross Sell for external data. Once this data is collected, it is imperative management consistently identify which vehicles sell in their market (internal and external). That’s the science part of the equation; it’s not especially difficult to identify commodity type vehicles and, if you’re willing to travel or pay, to procure them. Further breakdown of historical internal and external trends is, however, necessary. Specifically, it would be beneficial to track sales volume, aging, and gross profit for specific COS bands. These could be broken down as follows:

$0 – $5000 $5,001 – $10,000 $10,001 – $12,500 $12,501 – $15,000 $15,000-plus The used auto dealer should be aware of and actively track each of the above categories for each price band in used cars, trucks, SUVs, and vans, comparing the current stocking mix to what has yielded the greatest success. The categories can be broken down further into import/domestic categories as well, if needed. This information, coupled with knowledge from external tools, is used to direct buying specific inventory at specific price points to generate specific results. The art of used vehicle inventory comes from identifying and procuring vehicles that put your store ahead of the curve. For example, a few years back fuel prices spiked and, as a result, highly economic, smaller pre-owned vehicles were suddenly at a premium, while large pickups and SUVs could be bought for a dime a dozen. The market was quickly flooded with these gas guzzlers, but few people had the vision or foresight to accumulate them. Those who did were those who had the knowledge and experience to understand the

ebb and flow of the used car market, so they loaded up on these vehicles at very cheap prices. It’s not difficult to guess what happened to their profits when the price of fuel went back down. Recognition of these opportunities is not always easy; often it comes from experience. I believe we are involved in one as I type this column. Thanks to the Cash for Clunkers program, new car inventories are generally low; there are fewer trades in most used inventories and the price of vehicles at auction has gotten higher. While this could mean several different things depending on your market, I would think the potential for increased gross profit, even on vehicles more traditionally thought of as commodity cars, is greater than ever. Hopefully, you’re tracking the trade capture rate. A normal benchmark for capturing trades is 55 percent of appraisals. Because of today’s market conditions, I would encourage all managers to aggressively get involved with customers and inquire about their desire to trade their vehicle, as well as ensure your store is appraising every vehicle possible. Further, I believe it’s imperative to improve the appraisal capture rate by 10 percent or more. Used autos are at a premium and the extra money put into a trade has never been a better investment. This type of forward thinking involves risk some dealers simply may not be willing to accept. Those who do so are more frequently ahead of the used vehicle game. The science of used inventory can be resolved by accumulating information, breaking it down (all the way to COS bands, if you really want to be detailed) and buying and trading aggressively according to trends. The art requires experience and guts. BY BI LL MOKRY

Bill Mokry is a sales and F&I specialist for Service Group, an insurance and financial services company that provides income development training and servicing solutions to auto dealerships. His many years of dealership experience include several as general manager of a successful used car operation. He can be reached at bmokry@sgifs.com.

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FEBRUARY 2011

FEDERAL ADVOCATES LOBBYING REPORT As part of the review, GAO is speaking with all of the stakeholders in the process such as dealerships and dealership representatives. 12th Congress Issues On Feb. 3, Federal Advocates met with NADA to discuss upcoming issues for the 112th Congress and various pending matters. As we jointly see it, the issues for Congress are fuel economy and green gas within the context of energy legislation, the Consumer Financial Protection Bureau and its mandates, the Toyota Safety Bill (which we both believe is dead), possible Congressional oversight that may impact the industry and the National Highway Traffic Safety Administration reauthorization effort (a priority of Sen. Jay Rockefeller, D-WV, who’s chairman of the Senate Commerce Committee). Harrington also mentioned a General Accounting Office study (see separate heading) which Rep. Ed Towns, D-NY, and chairman of the 111th Congress House Governmental Affairs Committee, requested on section 310 of the Senate Toyota bill. It would’ve required dealers to provide info to buyers on a vehicle’s history. Lastly, we both agreed it’s important to continue monitoring relevant activity of the FTC. Consumer Financial Protection Bureau Meetings On March 4, NIADA General Counsel Keith Whann and Federal Advocates will be meeting with Holly Petraeus, director of the Consumer Financial Protection Bureau’s Office of Service Member Affairs, to introduce NIADA and to discuss various auto industry issues related to the newlycreated CFPB. In addition, a meeting request is pending with Richard Cordray, CFPB general counsel, to discuss various consumer auto issues and the soon-to-be appointed Consumer Advisory Board.

SBA Floorplan Financing Program The federal government relaunched its suspended floorplan financing program for small dealerships, this time with loan limits of $5 million rather than $2 million. The Small Business Administration’s new rules, which addressed nuts-and-bolts questions of how the financing will work, were published online in the Federal Register on Feb. 8. The Obama administration began a pilot floorplan program in May 2009 during the depths of the recession, but it never got off the ground because of banks’ reluctance to extend credit. A law enacted in September 2010 increased the loan limits and in October, the SBA adopted a rule expanding eligibility for the program to the majority of dealerships. The SBA also suspended the program in October and has been working since with lenders in an attempt to increase their participation. The pilot program will continue through September 2013. To address various issues related to the program, a conference call was held with Whann, and the SBA’s Steven Smits, associate administrator, and Patrick Kelley, senior advisor, Office of Capital Access.

Department of Defense Pam McClelland, a DOD senior program analyst, has taken over for Dave Julian and Frank Emery in the Office of Military Community and Family Planning in the Office of the Deputy Undersecretary of Defense. Per a conversation with her on Feb. 15, NIADA will send information to her, at her request, on how the association can assist service members in purchasing pre-owned vehicles. Pending her review, a meeting or conference call will be scheduled with Whann.

GAO Study The GAO review was requested by Rep. Towns earlier last year that focused on the auto safety recall process. As part of the review, GAO is speaking with all of the stakeholders in the process such as dealerships and dealership representatives. GAO’s audit work is nearing its completion and GAO is due to issue the report on June 15. Pending that, Jim Leonard, an analyst with the GAO’s Physical Infrastructure Team, has discussed with NIADA its views on the issue and the role of pre-owned vehicle dealerships. NIADA’s Mike Linn and Whann discussed this issue with Jim Leonard and other analysts of the GAO earlier this month. White House Meeting Scheduled A March 4 meeting with Steve Croley, special assistant to the President for Justice and Regulatory Policy in the Office of Domestic Policy, has been scheduled to introduce the association to the administration and to provide a briefing on its views on auto consumer issues. FEDERAL ADVOCATES is NIADA’s governmental advocacy partner. To read past lobbying reports, visit www.niada.com/legislative_and_legal.php

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Q&A With NIADA President Anthony Underwood:

2011 Used Car Market Report

National Independent Automobile Dealers Association (NIADA)

Anthony Underwood was named president of NIADA in 2010. He started selling cars in Alabama in 1977, and he opened his first dealership in 1994 with five vehicles. Anthony’s two stores sell a combined total of 800 vehicles each year. He has been an active member of the NIADA and Alabama IADA for many years. Anthony has served on the boards of both NIADA and AIADA. He was named NIADA National Quality Dealer of the Year in 2003 and, that same year, earned his Certified Master Dealer certification. How have independent dealers adjusted their businesses in the last three years? Independent dealers have faced unprecedented challenges in the last three years. Even though the overall economy is improving, dealers are still struggling with limits on inventory and consumer credit. But dealers are resilient and have adjusted by stocking fewer vehicles and focusing on the types of vehicles that turn quickly. Solid inventory management underpins the successful dealer. Many dealers have retrained employees to ensure that everyone is contributing to the success of the business. Employee productivity has improved as staffs have been reduced to the current level of sales. In the process, we have learned to run our stores more efficiently. We have also seen a shift to the Buy-Here, Pay-Here model by dealers who have access to capital. In our store, we have cut in half both our staff and our inventory. We have also expanded the number of lenders we rely on to finance our customers. We are now sourcing some inventory online, buying vehicles that will sell quickly, and generating more sales based on specific customer orders.

How are independent dealers coping with the shortage of used vehicles? Independent dealers are confronting two challenges: higher prices and fewer pre-owned cars in the marketplace. Independent dealers are spending more time and effort to find the right inventory. Everyone is going to more auctions, both online and in person, as well as tapping local wholesale sources. Some dealers have been very successful in buying inventory directly from private owners. Three or four years ago, dealers were able to find plenty of vehicles under 70,000 miles and three or four years old at acceptable prices. But independent dealers have modified the age and condition guidelines to reflect what their customers can afford. As a result, dealers are doing more reconditioning to get vehicles frontline ready.

You are quoted as saying “We will never go back to business as it was in the past.” Can you explain what you meant by that? Our business model has changed. New car dealers are getting more into the pre-owned business, so we have to meet that challenge. Franchised dealers offer service departments, larger facilities, and access to newer inventory. NIADA members know that they have to continue to improve their business skills and adapt to this new competition. NIADA can teach dealers to run more efficient operations, but the business of selling cars is still about knowing your market and your customers and being responsive to their needs. Independent dealers need access to information to enable them to make quick decisions. NIADA helps independent dealers stay abreast of the national and local economic, regulatory, and business issues facing our industry and each dealer.

How is NIADA monitoring the potential rules under the new Consumer Financial Protection Bureau? We have encouraged members to stay connected with one another by attending local and national meetings and by contacting their legislators on issues that could impact our business, in particular Buy-Here, Pay-Here. The NIADA website includes a blog where dealers can find information on local and national issues and answers to their specific questions.

You are a strong advocate for dealer education. What resources does NIADA provide dealers? NIADA is serious about education, and we recognize that it is one of the strongest things we have to offer our members. Knowledge is power, and what you don’t know can hurt you. Our three-day Certified Master Dealer Program gives dealers the critical skills and information they need to meet the challenges of operating successfully in a challenging environment. NIADA and its industry partners provide dealers with online and in-person training that covers the full range of inventory and dealership management topics. For example, the NIADA/Manheim partnership teaches dealers how to buy and sell vehicles online through The Wholesale Institute training on NIADA TV.

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CRAIGSLIST 101: BEST PRAC TICES

Those who have discovered the power of Craigslist advertising will agree it’s a constant battle to keep up with the terms of service as well as keep their posts young, live and searchable to generate leads. If eBay were free, would you advertise your inventory on it? This should be a no

brainer! Craigslist and Ebay had equal amounts of unique visitors in the U.S. for the first time ever in May 2010, according to comScore data. Dealers who think Craigslist is not for them are missing the boat. It doesn’t matter if you’re selling dollar-cars or the high lines; customers of all ranges are going to the Craigslist marketplace to search for vehicles! A free site offers very little to no technical support, which is why I believe a lot of dealers are missing out on huge opportunities because they’re not educated on Craigslist and don’t have the right process in place to realize potential. Those who have discovered the power of Craigslist advertising will agree it’s a constant battle to keep up with the terms of service as well as keep their posts young, live and searchable to generate leads. The first thing I want to point out is Craigslist is the best ROI for lead generation out there. It is free to post, but to get maximum results requires knowledge of Craigslist terms, time and a dedicated process. With the amount of vehicles posted in the Denver Craigslist market, for example, you must have a daily presence on the site. For the longest time, we used to think that as long as your vehicle is live on Craigslist, it didn’t matter how recently you posted it. This could not be more wrong; the proof is in the pudding.

CRAIGSLIST IS IDEAL FOR THE DEALER BUDGET AND MANY RELY SOLELY ON THE SITE FOR ONLINE LEADS. ARE YOU GETTING YOUR PIECE OF THE PIE?

Every time dealers list a new ad on Craigslist, they get most of the calls the day they post and the day after. After an ad has been on the site more than three days, it gets a lot less calls. Craigslist searches are driven by date. For example, if a customer was to search for a Honda Accord in Denver, there’d be more than 1,000 results spread across 10 or more pages! If you posted your 2008 Honda Accord three days ago, it is most likely already on the fifth results page. Our recommendation is to delete each ad after 48 hours, then repost it to maintain its effectiveness and stay at the top of the list. Remember, the Craigslist consumer will look at the first search page results on craigslist, but they’ll usually find what they’re looking for there and never make it to the next page. A pair of actions you should be aware of is flagging and ghosting. Ghosting is when your ad appears to be live but can’t be found anywhere on Craigslist. It’s an action done by Craigslist administration that’s definitely the worst of the two because you have no idea it’s happened because the ad looks normal. Flagging is done by the Craigslist community. One thing to keep in mind is Craigslist is a community-based classified site. The majority rules and decides whether an ad is worthy enough to stay live. This is where the flagging system comes into play. Each Craigslist consumer has the right to flag your vehicle. One Craigslist visitor cannot take down your vehicle ad, but he can contribute towards it. That means it takes more than one person to flag and remove it from the site. So how many flags does it take? Well, it depends. Nobody really knows the exact figures except Craigslist; in metro Craigslist markets, it may take up to 20 flags to take down an ad. In smaller markets, where, for example, only 100 vehicle ads get posted per day, only two flags might take down an ad! Most importantly, flagging will result in ghosting and will eventually blow up your Craigslist account so none of your ads will stick. You’ll have to go through the Craig-

slist community forums and blogs to get back to good standing. That process will take a lot of time and reading; most dealers will be overwhelmed doing such a thing. So why do people flag? I believe 80 percent of it occurs because posters aren’t following the terms of service. For example, maybe you posted a 2008 Honda Accord ad on Monday and posted it again on Tuesday without deleting the earlier ad. The Craigslist community frowns upon this and is very click happy when it comes to flagging. If you have experienced this, you might want to consider automated postings that post ads more frequently with a fraction of your present efforts. The other 20 percent of flags, in my opinion, are your competition. Not fair? Perhaps not, but Craigslist is a free service (to post cars and trucks), so who can you complain to? The fact is Craigslist at some point really frustrates every car dealer, but we all have to deal with it. The good news is there are posting tools to take on this challenge as well as automated tools to post your entire inventory every day. If your competition is flagging your ads, they’ll eventually tire from doing so. Just don’t make it easy by attempting to post your entire inventory every day on your own as that effort will result in a high flag and ghosting rate. Craigslist is ideal for the dealer budget and many rely solely on the site for online leads. Are you getting your piece of the pie? BY DUSTI N JANSSO N Dustin Jansson provides consulting, Craigslist posting tools and automated Craigslist posting services, as well as other dealership products. Contact him at 303-232-3435 or dj@dealernetsolutions.com. For more information, visit www.dealernetsolutions.com.

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For details or questions about our sales, contact Georgianne Poteet, Marketing Manager, at 985-345-3302 XXX GBDFCPPL DPN -" TU$IPJDF"VUP"VDUJPO t XXX UXJUUFS DPN -"'$"" 8PPETDBMF 3PBE )BNNPOE -" t 1IPOF -JDFOTF "#

ONLINE SALE S SUCCE S S: LET YOUR LISTINGS DO THE TALKING Top dealers consistently get more leads because they pay attention to how their car listings appeal to online consumers. Almost anyone can start selling cars using the Internet today, but those who are most successful give buyers the right information during the shopping process. Sellers like you can break through

the clutter of online used car sales by giving consumers photos, compelling descriptions and vehicle history they want to see while they shop. If you’re not already online, you need to be. The best way to increase used car sales is to be where the most people shop. Eighty percent of consumers today use the Internet to help find their next car. Once your business is established online, you’ve got to make buyers take notice of your online listings. This is vital to online selling success. Consumers visit less than two dealerships on average before deciding to buy. Why so few? Most shoppers narrow their dealer choices down by doing extensive research online – listings, pricing, customer reviews, etc. In fact, when consumers finally do visit a dealership, they have specific cars and prices already in mind and are armed with details about each car. Typically, shoppers start by visiting thirdparty online automalls like AutoTrader.com and Cars.com. A quick search can return hundreds of dealer listings for vehicles similar in style and price. Internet managers and used car dealers with online inventory know the top concern is getting buyers to notice their cars and contact them. Since you can’t sell online shoppers face-to-face, you have to rely on your listings to do the talking. So how do you make them stand out from the rest? Focus your marketing efforts on two lead-generating areas that attract the most attention: Search Results Pages (SRPs) and Vehicle Details Pages (VDPs). Did you know only 4% of online shoppers that see your listing in their search results actually click through to the detail page for your contact information? For all the money you spend to post your cars for sale online, it’s in your best interest to highlight your inventory properly. The SRPs and VDPs are the most prominent places to communicate the value of your used car inventory online. When a

shopper clicks on an SRP listing, they go to the VDP to browse additional photos, read about features, see the vehicle history and locate the seller. The key is getting more shoppers to notice and click your SRP listings so you generate more leads from your VDPs. The vehicle description you provide on SRPs is your first opportunity to tell consumers what they should know. SRPs give you a limited amount of space to market your vehicles, so use that space wisely. Be brief but informative. A vehicle description should not be exclusively technical. Remember, shoppers don’t know as much about cars as you do and detailed features may not mean as much. Things like automatic transmission, power windows and air conditioning, which are standard on most vehicles, shouldn’t be the focus of your selling points. You don’t want potential customers glancing past your listings because they didn’t peak their interest. Generally, your listings also include a small photo when they appear on typical SRPs. It might sound obvious to seasoned sellers, but photos are one of the best ways to grab attention of shoppers during their online used car search. Use the best fulllength photo for the small ‘thumbnail’ image on your SRPs and save detailed images of the interior and other angles for consumers to browse while on the VDP. There are several quick improvements that can make your listings more attractive to online shoppers. One is to use relevant information to attract attention. The more details you can provide the better your listings look. For example, it’s easy to find hundreds of ‘2005 Ford Explorers’ with the same trim package for sale online, so make sure you tell potential customers why they should buy yours. Try to describe the car’s benefits unique to a specific customer – as if they were standing in front of you. For example, you might say, “this van comfortably fits up to eight people” or, “we offer low financing on all our cars” or, “this car shows no reported recalls and comes with a Carfax Vehicle History Report” in the vehicle descriptions on your SRPs.

SO HOW DO YOU MAKE THEM STAND OUT FROM THE REST? FOCUS YOUR MARKETING EFFORTS ON TWO LEAD-GENERATING AREAS THAT ATTRACT THE MOST ATTENTION: SEARCH RESULTS PAGES (SRPS) AND VEHICLE DETAILS PAGES (VDPS). To connect with more online shoppers, you need to think like one. You can compete online and sell cars faster by giving buyers relevant information to help them make an educated decision. Another great way to build confidence with online consumers, in addition to providing a good photo and description, is to link your Carfax Reports to your SRP and VDP listings. You’ll stand out on SRPs by offering these reports free. Plus, being open and up-front builds trust with online shoppers, making them more likely to buy from you. Top dealers consistently get more leads because they pay attention to how their car listings appeal to online consumers. Build consumer confidence by providing trusted information in your listings. Make your SRPs stand out in the crowded online marketplace and more shoppers will click through to your VDPs. More clicks equals more leads and ultimately, more sales. BY DALE PO LLAK AN D LAN CE VICKERY Dale Pollak, founder of vAuto, is a highly sought-after authority on maximizing profits from used vehicle operations, working extensively with Dealer 20 Groups, Dealer Associations and large dealer enterprises across the country. In addition to his regular contributions to auto industry publications like Dealer Magazine, Pollak is a published author of 2 books, Velocity: From the Front Line to the Bottom Line and Velocity 2.0: Paint, Pixels and Profitability. Lance Vickery is director of dealer business at Carfax and has spent more than 25 years in the auto industry.

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One of the new keys to the success of your business is your smart phone. You can

operate your dealership on-the-go, making fast, informed decisions that will ultimately improve your bottom line. More than 440,000 mobile sites and over 500,000 mobile apps exist today, including a growing number of auto-industry related apps. It may seem daunting to integrate this emerging technology into your business, but these tools are a must-have for both acquisition and retail.

What are ‘mobile apps’ and how do they help dealers?

An app is a software application that helps people accomplish tasks faster. Among other things, an app can use the hard drive of the mobile device to store data for faster recall and operation, perform calculations, access hardware features such as camera and GPS – and all without an Internet connection. At its core, the Internet revolution was about how technology harnessed the power of information to generate efficiencies, and this is exactly the opportunity mobile apps offer to dealerships today – providing information onthe-go and tying it all together to take action.

How can mobile apps streamline your business?

APPS

Going Mobile in Your Dealership

It’s no secret that the used car supply is decreasing due to rising demand, so the competition for quality units is getting tighter. Think about the top concerns your customers have when shopping for a used car: previous damage, maintenance, ownership history, and of course, price. Tools like Carfax Vehicle History Reports are readily-available through various mobile devices to verify this important information and bid with confidence. Having your mobile device handy helps you tie it all together quickly and successfully acquire the right cars for your lot. Today’s mobile devices provide access to information that brings transparency and process effi ciency to dealers. The possibilities mobile is opening up for our industry are truly extraordinary – and in the current economic climate, leveraging new and user-friendly technology is key to moving more cars and saving money in the process.

Mobile browser-based tools provide dealerships with more on-the-go visibility but lack a built-in ability to act in realtime on information organically across the dealership. But, just as a mobile app enables on-the-go stock trading, for example, an app such as eCarList’s ‘True Target Mobile’ allows dealerships to take a massive dataset and a complex, multi-step, -vendor and -personnel process and make it all work from a single handheld device. The ‘True Target Mobile’ app gives dealerships mobile access to pricing data from multiple books, current data from top online marketplaces and the ability to filter, organize and view the data geographically for territory (including vehicle pricing from competitive dealerships). Other functions include VIN scans, taking/adding/removing photos, integrating Carfax Vehicle History Reports and sharing appraisals and pricinsg with other BY LEN CRITCH ER AN D LANCE VICKERY mobile devices. Len Critcher is CEO of eCarList, provider of award-winning Are there other benefits to going mobile? inventory management and online marketing solutions that On the acquisition side, smart phones make it easy for dealerships to fully own and control the merchandising process through one unified platform. provide access to information you need to vehicle Lance Vickery is director of dealer business at Carfax and has stock your lot with cars that customers want. spent more than 25 years in the auto industry.

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NEW MEMBERS: AM Auto Mart LLC Aref Mansour 6405 Westbank Expressway Marrero, LA 70072 504-340-8688 E & F Auto Sales Emad Zayed 1415 Veterans Blvd Kenner, LA 70062 504-469-8107 First Choice Preowned Auto Sales Erica Bradford 1066 North Carrollton Ave Baton Rouge, LA 70806 225-923-2600 Lars, LLC dba Ace’s Used Cars Anthony Dimatia 15062 Club Deluxe Road Hammond, LA 70403 985-345-4333 Mack Johnson Holdings, LLC Mack Johnson 5545 Georgetown Ave Baton Rouge, LA 70808 225-772-6070 RCA Used Auto Alvin Soileau 2613 E. Opelousas Street Lake Charles, LA 70601 337-990-3392 Ultimate Auto Body, Inc Kevin Scheinefus 1317 Glenwood Drive West Monroe, LA 71291 318-387-8795 Gonzales Motors Jorgbe Novoa-Perez 14534 Airline Hwy Gonzales, LA 70737 225-673-5064 State Line Auto Mart Ken Johnston 11428 Hwy 80 Greenwood, LA 71033 318-938-1600 D & B Auto Wholesale Market, LLC Diana Edwards 17159 Hwy 16 East Amite, LA 70422 985-748-7400 HD Motors, LLC Hall Davis 1150 Louisiana Ave Port Allen, LA 70767 225-381-8441 Thurston Holt Auto Sales Thurston Holt 7160 Plank Road Baton Rouge, LA 70805 225-272-3520

3&/&8*/( .&.#&34 Dwight W. Andrus Insurance Bonnie Dozier P.O. Box 60970 Lafayette, LA 70598 337-981-7300 American Potential Inc James Adams 229 Fontana Monroe, LA 71203 318-345-2006

R E N E W I N G

M E M B E R S

Angelo & Son, LLC Christine Tobey 182 Hwy 107 Centerpoint, LA 71323 318-443-9591

Top Dogs Used Cars & Detailing Timothy Huggins 2222 N. Ardenwood Baton Rouge, LA 70805 225-355-3620

L. Dyer Autoplex, LLC Lonnie Dyer 7315 Airline Hwy Baton Rouge, LA 70805 225-955-9599

Dixieland Autoplex, Inc Kevin Reeves 15745 Florida Blvd Baton Rouge, LA 70819 225-273-2070

ASAP Motors Denise Broussard P.O. Box 448 Carencro, LA 70520 337-896-0367

US Used Cars Murlene Deville 3901 First South Street Jena, LA 71342 318-992-2449

Landmark Motors Melvin McLaughlin 6541 Hwy 112 Elmer, LA 71424 318-447-9089

Eagle Auto Sales Rame Abusaada 1450 E. Laurel Ave Eunice, LA 70535 225-288-5523

Baton Rouge Sports & Imports Chad Reeves 9735 Airline Hwy Baton Rouge, LA 70816 225-218-9354

Bayou Auto Sales, Inc Donnie Cochran P.O. Box 9511 New Iberia, LA 70562 337-365-6500

Lee’s Auto World Marion Lee 2025 Scenic Hwy Baton Rouge, LA 70802 225-357-5600

G.D. Auto Sales, LLC Gary Dunbar 41016 Black Bayou Road Ste. 2 Gonzales, LA 70737 225-258-0206

Cargo Auto Sales, LLC Alvin Cargo, Jr 1079 N. Donmoor Ave Baton Rouge, LA 70806 225-923-1725

A & K Auto Sales Paul Kelly 9274 Springfield Road Denham Springs, LA 70706 225-667-3200

Northeast Louisiana Auto Sales, Inc Jerry Rester 411 Louisville Ave Monroe, LA 71201 318-325-6637

LMR Auto, Inc Pete Crifasi, IV 14435 Airline Hwy Gonzales, LA 70737 225-677-8924

Christian Sports & Imports Ross Bajon 9545 Airline Hwy Baton Rouge, LA 70815 225-288-8877

Alpine Motors James Stewart, Jr 3021 MacArthur Drive Alexandria, LA 71315 318-487-0780

Creekside Classic & Import Cars, LLC Frank Favalora, Jr 11622 Hwy 1064 Ste. 1 Tickfaw, LA 70466 985-542-7399

Auto Plus, LLC Cody Papizan 18450 LA Hwy 16 Port Vincent, LA 70726 225-698-1187

D. Moore Auctioneers, Inc Danny Moore 15481 Airline Hwy Baton Rouge, LA 70817 225-752-8630 Danny Joy Car Sales, Inc Danny Joy 9749 St. Vincent Shreveport, LA 71106 318-219-2499

Bottner Industries, LLC Julian Bottner 400 Garrett Road Slidell, LA 70458 985-326-0750 Brothers Used Cars Melvin Vernell 2701 Plank Road Baton Rouge, LA 70805 225-355-8591

McNeese Auto Outlet Thomas Derouen 803 E. McNeese Street Lake Charles, LA 70607 337-562-9211

Phillip’s Auto Works Phillip Ho 7964 Airline Hwy Baton Rouge, LA 70815 225-930-6312

New To You Auto Sales, Inc Alex Lodgen 1602 Farmerville Hwy Ruston, LA 71270 318-255-9474

Rocket Auto Sales, LLC Paul Hickman 3309 Baker Blvd Baker, LA 70714 225-774-2468 Acadiana Discount Sales, LLC Sheldon White 3225 A Hwy 90 East Broussard, LA 70518 985-966-3831 Affordable Imports, LLC Beau Guidry 3655 Oneal Lane Ste. 8 Baton Rouge, LA 70816 225-615-7124

Don’s Used Cars Freddie Mullins 239 Davidson Road Arcadia, LA 71001 318-263-2200

Cross Enterprises of Louisiana, LLC Charles Tessier 5475 Essen Lane Baton Rouge, LA 70809 225-767-2750

Airline Auto Sales Brian Perritt 14492 Hwy 44 Gonzales, LA 70737 225-677-9771

G Smith Motorsports, LLC Gary Smith 10567 W Airline Hwy St. Rose, LA 70087 504-737-1600

Country Auto Sales John Torres 8811 Hwy 71 South Lecompte, LA 71346 318-641-3067

Amigo’s Auto Sales James Brown 1821 Franklin Ave Gretna, LA 70053 504-361-4067

Hardway Automotive Willie Carter 31405 LA Hwy 22 West Springfield, LA 70462 985-687-5372

Dee’s Auto Sales Urksine Wilson 8700 Florida Blvd Baton Rouge, LA 70815 225-235-8825

Barnes Auto Sales Anita Barnes 3234 Hwy 10 Jackson, LA 70748 225-634-7705

J & K Trading Post, LLC Donna Rarick 21330 Plank Road Zachary, LA 70791 225-939-0368

Eddie’s Used Car Sales Eddie Graves 23318 Hwy 442 Holden, LA 70744 225-567-6769

Bayou State Autoplex Shedrick Fields 3842 Victoria Drive Ste. B Baton Rouge, LA 70812 225-355-4552

Kevz Carz & Parts, LLC Kevin Spencer 13865 Florida Blvd Baton Rouge, LA 70819 225-333-1049

Finance Motors of Crowley, LLC Tiffany Young 1318 N. Parkerson Ave Crowley, LA 70527 337-783-2574

C & S Motors Charles Carr 230 Rundell Loop Delhi, LA 71232 318-878-1972

Swain’s Auto Sales, Inc Kyle Swain 807 Shreveport Road Minden, LA 71055 318-377-7115

Gustos Customs George Gustos 5535 Greenwell Springs Rd Baton Rouge, LA 70806 225-654-0230

Cash Auto Sales, LLC George Staley 12418 Hwy 44 Gonzales, LA 70737 225-647-6400

Tiger Trax Auto Sales Ribhi Sarameh 557 East Tunica Marksville, LA 71351 318-253-5354

Jackson Quality Used Cars Leo Jackson 751 N. Claiborne Ave New Orleans, LA 70122 504-821-7433

Crain Auto Sales, LLC Ricky Crain 26488 Hwy 62 Franklinton, LA 70438 985-848-5415

Pan-Am, LLC Junior Gonzalez 4009 Cameron Street Lafayette, LA 70508 337-233-1807 Rick’s Seafood, LLC Rick Klapish 13501 Florida Blvd Baton Rouge, LA 70819 225-955-6139 Stang-Hi Performance, LLC Cody Cutforth 11124 Cedar Park, Ste C & D Baton Rouge, LA 70809 225-751-4321 The V Shop, Inc Bill Cutforth 10120 Daradelle Ave Baton Rouge, LA 70816 225-292-6555 Today’s Automotive David D’Aubin 8056 Airline Hwy Baton Rouge, LA 70815 225-927-1878 Truck City Auto Sales, LLC Vanissa Kelly 5265 Airline Hwy Baton Rouge, LA 70805 225-357-4602 Victory Motors, Inc Greg Storr 1917 Airline Drive Kenner, LA 70062 504-467-3650

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A U C T I O N

D I R E C T O R Y

ADESA Shreveport 7666 Greenwood Road Shreveport, LA 71119 318-938-4400 Phone 800-673-2240 Toll Free 318-938-7623 Fax www.adesa.com Every Wednesday In-Op sale at 8:45 am GM/GMAC sale at 9 am Fleet/Lease sale at 10 am Consignment sale at 10 am Every Other Thursday GM Factory Closed sale at 10 am Alexandria Auto Auction 515 N 3rd Street Alexandria, LA 71301 318-484-9672 Phone 318-484-9699 Fax Sale every Tuesday at 5:30 pm Dealer’s Auto Auction, Inc. 136 Gregory Drive Monroe, LA 71202 318-343-8200 Phone 318-343-8259 Fax www.manta.com Consignment Sale at 11:00 am Sale every Tuesday at 12 noon Greater Shreveport-Bossier Auto Auction 1315 Grimmett Drive, Shreveport, LA 71107 318- 221-3362 Phone 318- 221-3372 Fax www.gsbautoauction.com Every Tuesday at 6:00 pm Insurers Auction

406 Almedia Road St. Rose, LA 70087 504-468-6995 Phone 866-468-6995 Toll Free www.insurers-auction.com Sale every other Wednesday at 9:00 am Long Beach Auto Auction 8494 County Farm Road Long Beach, MS 39560 228-452-2030 Phone 228-452-9588 Fax www.lbautoauction.com Sale Every Wednesday at 1:30 pm Disabled and Damaged Units is the 4th Wednesday each Month @ 11:00am Capital One Auto Finance Runs the 4th Wednesday Each Month Louisiana’s 1st Choice Auto Auction 18310 Woodscale Road Hammond, LA 70401 985-345-3302 Phone 985-345-5735 Fax www.lafcaa.com Consignment Sale every Tuesday at 8:30 am

Manheim Houston 14450 West Rd Houston, TX 77041-1103 281-890-4300 Phone 800-444-2444 Toll Free 281-890-7953 Fax TRA Sale - Every Tuesday morning at 8:15AM Consignment Sales - Tuesday, 9AM Hertz - Weekly, Tuesdays Manheim Lafayette 1611 Saint Mary Street Scott, LA 70583 337-237-5620 Phone 337-237-0762 Fax www.manheim.com Sale every Thursday at 10 am Manheim New Orleans 61077 St. Tammany Avenue Slidell, LA 70460 985-643-2061 Phone 800-783-2062 Toll Free 985-643-2122 Fax www.manheim.com Dealer Consignment Sale every Wednesday at 9:00 am. Fleet/Lease Sale Wednesday 9:00 am. Total Resource Auctions every Wednesday at 11:00 am

Manheim Texas Hobby 8215 Kopman Rd Houston, TX 77061-5405 713-649-8233 Phone 713-640-8395 Fax Closed Ford Factory Sale - Every Other Wed. 10AM CT FMC/Fleet Lease/Dealer OPEN Sale - Tuesday 3:00PM CST, Thursdays 9:00AM CT Mechanically Challenged Sale Tuesday 2:00PM CST Total Recourse Auction – Texas Hobby Tuesdays @ 9:30 AM Oak View Auto Auction 13451 Florida Blvd. Baton Rouge, LA 70815 225-272-5139 Phone 225-272-5314 Fax www.oakviewautoauction.com Consignment Sale every Friday at 10 am Fleet/Lease Sale Friday 10 am. Salvage Sale Friday 9 am. Rea-Brother’s Mid-South Auction 800-261-2671 1657 Old Whitfield Road Jackson/Pearl, MS 39208 www.rbmsa.com Sale every Tuesday 9:00 am SmartAuction You’re online Auto Auction 1-877-273-5572 www.smartauction.biz

CMD Classes Dealers who demonstrate commitment and support the principles and ethical business standards of the CMD® designation complete a four-day seminar that addresses Business Management, Merchandising, Financial Management, Human Resources, and Business Planning. Northwood University provides the instructor and awards four Continuing Education units for this course. Visit niada.com for more information.

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vAUTO HELPS DEALERS FIND MANHEIM INVENTORY vAuto’s proprietary stocking module can now allow its customers to quickly and efficiently source used vehicles at Manheim auctions as well as access Manheim run lists.

“Partnering with Manheim is the first of many exciting integrations with our new AutoTrader. com relationship,” said Keith Jezek, vAuto president, in an early February announcement. “Combining vAuto’s stocking tool with Manheim’s comprehensive list of vehicles is a huge win for our customers. Manheim is a key player in facilitating the buying and selling of

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used vehicles for automotive dealers, providing vAuto’s customers the best resources to stock vehicles.” vAuto’s stocking module allows dealers to make their decisions for purchasing vehicles based on what the customers are actually buying in their own marketplace at that exact time, down to the level of year, make, model, trim and equipment configuration. In the past, dealers had to rely on historical data, not current trends, when making stocking decisions.

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Sorting Through Exceptions to the Risk-Based Pricing Notice The FTC’s risk-based pricing notice requirements became effective Jan. 1. To comply with these requirements, dealers

must alert consumers when they are getting different credit terms than others based on credit information. The good news is the requirements give options for how and when you provide the notice. That’s also the bad news because the options and exceptions can make it difficult to figure out if you’re in compliance. To help you sort through the maze, here are some of the important exceptions and how they apply to you.

Your dealership doesn’t need to provide a notice if: t You don’t do risk-based pricing of credit terms. This applies if every consumer whose application is approved is offered credit on the same terms. t You don’t use credit reports in any way to make a credit decision. If your dealership directly contacts employers and other references and is not otherwise using any third party information, then the risk-based pricing notice is not required (it sounds rare, but there are dealers who qualify for this exception).

A notice isn’t required for a specific transaction if: t The credit requested is not for a consumer purpose (personal, family or household use). t The transaction is a consumer lease. t The consumer applies for a specific credit product and is approved for those terms. t You offer specific terms to a pre-screened group and extend credit on the offered terms to one of them. t The consumer is a co-signer (which is different from a coborrower), guarantor, surety or endorser in the transaction.

Independents Remain Profitable in Challenging Environment Our team at Manheim Consulting had the pleasure of interviewing NIADA President Anthony Underwood for a question and answer session discussing the state of the used vehicle market from the perspective of independent dealers as we compiled the recently released, 16th annual Used Car Market Report (UCMR).

Underwood framed the challenges facing independent dealers in a way that confirmed what our data was telling us: independents are encountering higher prices for inventory at the wholesale level and finding fewer pre-owned vehicles in the marketplace. In response, these dealers are focusing on sound inventory management practices, and using all available sales channels – including online – to source just the right inventory to meet their customers’ needs. We examined these and other trends in the UCMR, which is Manheim’s annual analysis of the forces shaping the used auto industry. As part of the ManheimNIADA Dealer’s Edge partnership, I’m happy to let you know you can download the entire report free of charge by taking a very brief survey at www.surveymonkey.com/s/manheim. As a comprehensive analysis of the trends shaping the automotive industry, the 2011 UCMR contains much more valuable information pertaining to independent dealers, as well as chapters on other aspects of the industry, including rental, leasing, fleets, repossessions and salvage. I encourage NIADA members to download their free copy of the UCMR, and as always, please e-mail me any time with your questions. BY TOM WEBB Tom Webb is chief economist for Manheim Consulting. Contact him at Thomas. webb@manheim.com, follow him via Twitter at www.twitter.com/TomWebb_ Manheim and read his blog at www.manheimconsulting.typepad.com.

t The consumer’s application is denied and you provide an adverse action notice. t You provide the consumer with the credit score disclosure instead of the risk-based pricing notice. The disclosure is an alternative form authorized by the regulations. If you use it, you must provide it to all consumer applicants instead of providing a risk-based pricing notice only to the portion of applicants who are not receiving your most favorable credit terms. It is likely some of these exceptions apply to your dealership and its transactions. Before relying on an exception, review the regulation or discuss it with your legal counsel to be sure you implement it correctly. The regulation can be found at 16 CFR §§ 640.1-.6. BY CH I P ZYVO LOSKI Chip Zyvoloski is senior attorney for indirect lending at Wolters Kluwer Financial Services. For more information, visit www. wolterskluwerfs.com/indirect.

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