OHIO INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION
DEALER INDEPENDENT
JULY/AUGUS T 2019
NEWS
WORLD AUTOMOBILE AUCTIONEERS CHAMPIONSHIP RECAP CODY SHELLEY CLAIMS 2019 TITLE | PAGE 10 |
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WASHINGTON UPDATE
NIADA GOVERNMENT UPDATE | By Shaun Petersen
LATEST
GOVERNMENT
ISSUES
AND
Sen. Marsha Blackburn
LEGISLATIVE Sen. Thom Tillis (R-N.C.) has introduced a bill to delay the new accounting standards for financial institutions – including Buy Here-Pay Here dealers – scheduled to take effect in 2020. The current expected credit loss (CECL) standard, which was issued by the Financial Accounting Standards Board in 2016, relies on an estimation of expected losses over the life of loans. The current standard, known as allowance for loan and lease losses, is based on losses already incurred. S.1564, which has six cosponsors, would stop implementation of the new standard while the Securities and Exchange Commission and other financial regulators study the potential impact of switching to CECL, including its effect on small financial institutions such as credit unions, the availability of credit and the risks to the U.S. economy. The proposal would also require a costbenefit study to determine the impact of CECL on nonfinancial institutions, insurers and government-sponsored enterprises. The Senate bill was introduced after a letter co-written by Rep. Roger Williams (R-Texas) and signed by a bipartisan group of 25 legislators – including Rep. Henry Cuellar (D-Texas) – was sent to the SEC expressing concerns that the new standard would adversely affect the availability and cost of credit. The bill was quickly endorsed by finance industry associations, including the American Bankers Association and the Credit Union National Association. REGULATORY CFPB proposes Debt Collection Rule: Debt collection, which has been on the Consumer Financial Protection Bureau regulatory radar for the past year, is now on center stage after the CFPB issued a notice of proposed rulemaking to update Fair Debt Collection Practices Act. The proposed rule is designed to account for recent advances in communications
NIADA is your voice in Washington D.C., advocating for independent dealers, the used vehicle industry and small business. Here’s a look at the latest news and NIADA efforts regarding legislative, regulatory, PAC and grass roots activities.
ACTIVITY
Sen. Thom Tillis
technology that didn’t exist when the law was enacted in 1977, such as text messaging, email and voicemail. The bureau said the rule would set “clear, bright-line” limits on the number of calls debt collectors can make to consumers per week and clarify how debt collectors can communicate with consumers through various technologies – including allowing them to opt out of various methods. It also spells out disclosures collectors must make to consumers about their debt, limits lawsuits and threats to sue, and requires a debt collector to notify consumers before providing information about a debt to a consumer reporting agency. While the CFPB’s proposed rule would apply only to third-party collectors and would not affect independent dealers collecting their own debt, NIADA is seeking to avoid having this proposal set a precedent for future rulemaking governing first-party creditors servicing their own accounts. NIADA, working with the Buy Here-Pay Here Commission, is considering filing comments. FTC revises Safeguards Rule: The Federal Trade Commission has proposed amendments to revise its Safeguards Rule, which requires financial institutions to protect the security of their customers’ information. The revisions include significant changes, tightening the requirements to be included in the comprehensive information security program mandated by the rule and requiring encryption of all customer data as well as access controls and multifactor authentication to help prevent unauthorized users from accessing customer data. The proposed amendments are not without controversy, having been approved by the commission by a narrow 3-2 vote, and there has been talk about adding an exemption for small businesses. Commissioners Noah Phillips and Christine Wilson issued a dissenting statement, expressing concerns about, among other things, the “one size fits all” approach taken
by the proposed rules, noting the cost of implementing them and how that could disproportionately affect small businesses. The FTC is accepting public comment through August. NIADA is in the process of studying the amendments and their impact on independent dealers and plans to submit comments.
PAC NIADA met with freshman Sen. Marsha Blackburn (R-Tenn.) during her recent visit to Dallas to discuss issues affecting the used vehicle industry – notably the much-debated issue of open recalls. It was the association’s first meeting with Blackburn as a Senator. In November, the former eight-term U.S. Representative became the first woman elected to the U.S. Senate from Tennessee. She is a member of the Senate Committee on Commerce, Science and Transportation – a key committee that has jurisdiction over the recall issue. We look forward to more conversations with Sen. Blackburn in the future. GRASS ROOTS Bills have been introduced in both houses of New York’s state legislature that would ban the use of starter-interrupt devices by auto dealers. In response, NIADA and the New York IADA met with the sponsors of both bills – Assemblyman Michael DenDekker (D), author of Assembly Bill 3897, and Sen. Timothy Kennedy (D), who introduced SB 758 – to educate them on how the devices are used, what they can and cannot do, and their benefits to consumers and the subprime industry. Both legislators agreed to engage NIADA and NYIADA in additional conversations to further discuss best practices and potential model legislation. Shaun Petersen is NIADA’s senior vice president of legal and government affairs.
WWW.OHIADA.ORG JULY/AUGUST 2019 INDEPENDENT DEALER NEWS 3
ASSOCIATION NEWS
PREFERRED PARTNERS
JULY/AUGUST INSIDE
2019
06...................................To Break or Not to Break 07................................New & Renewing Members 08........................................... Director’s Message 09......................... Repossession and Collections 10..............World Auto Auctioneer Championship 14............... Building a Successful (Sales) Culture
ADVERTISERS INDEX
AutoZone............................................................. 9 Columbus Fair AA ............................................IFC Corry Auto Dealers Exchange.......................... BC Manheim ............................................................. 11 Micro 21................................................................4 NextGear Capital .............................................6-7 Value Auto Auction ......................................... IBC vAuto ................................................................... 5
WHAT’S NEW
NABD SUBPRIME CONFERENCE S AV E T H E DAT E : OCTOBER 7-9 Save the date for the 2019 NABD Fall Buy Here-Pay Here Subprime Conference! It will be held October 7-9 at the Marriott Marquis Chicago. Stay tuned for more details!
700 Credit ACV Auctions ADESA Cincinnati / Dayton, Inc. ADESA Cleveland Auto Auction ADESA Mercer AFC-Automotive Finance Corp - Columbus AFC-Automotive Finance Corp - Franklin AFC-Automotive Finance Corp - Ohio AFC-Automotive Finance Corp - Perrysburg AFC-Automotive Finance Corp - Cleveland AFC-Automotive Finance Corp - Corporate American Guardian Group of Companies AutoZone AutoTrader CARFAX Car-Ware
Comsoft Columbus Fair Auto Auction Electronic Merchant Systems Frazer Computing, Inc. Integrity Warranty LLC Manheim Cincinnati Auto Auction Manheim Ohio Auto Auction NextGear Capital PASSTIME Phoenix Financial Solutions Inc. Pro Credit Express / ProMax ProGuard Warranty Inc. Protective Asset Protection Stolly Insurance Group The Milby Group Insurance Agency, Inc. UIS Insurance & Investments
BOARD OF DIRECTORS Executive Director Wendy Rinehart OIADA 614-863-5800
Past Chairman
Mark Meadows Miracle Motor Mart 614-337-0037
Chairman
David Adkins Wilmington Auto Sales, Inc. 937-382-7714
OFFICE
For more information, contact OIADA at (614) 863-5800 or www.ohiada.org
NIADA HEADQUARTERS
NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV 2521 BROWN BLVD. • ARLINGTON, TX 76006-5203 PHONE (817) 640-3838
For advertising information contact: Troy Graff (800) 682-3837 or troy@niada.com. Independent Dealer News 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 the Ohio Independent Automobile Dealers Association 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 © 2019 by NIADA Services, Inc.
STATE MAGAZINE MGR./SALES Troy Graff • troy@niada.com EDITORS Jacinda Timmerman • jacinda@niada.com Andy Friedlander • andy@niada.com MAGAZINE LAYOUT Jeffrey McQuirk • jeffrey@niada.com PRINTING Nieman Printing
4 INDEPENDENT DEALER NEWS JULY/AUGUST 2019 WWW.OHIADA.ORG
President
Scott Welch Lock 20 Auto, Ltd 740-498-8811
Treasurer
Craig Leitwein Gahanna Auto Sales 614-475-7148
Secretary
Scott Shook Shook Auto Inc. 330-339-5711
Board Members Jay North Jay North, Llc 937-325-3748
Lev Shafer Shafer Auto Group Columbus, OH 614-654-2525 Lisa Dugger Madison Motors London, OH 740-490-0028 Randy Shirk Randy Shirk’s Northpointe Auto 419-729-2688
Robert Fahey Fairdale Auto Sales 740-432-4185 Thomas Onesti Car Port 330-726-6633 Thomas Smith Smitty’s Auto Sales 937-981-4317
LEGAL MATTERS | By Mark Turner
TO BREAK OR NOT TO BREAK
EMPLOYER REQUIREMENTS RELATING TO EMPLOYEE BREAKS Many Ohio employers find themselves asking “Am I required to provide my employees with breaks during a work shift?” Most employers are surprised to discover that neither federal nor Ohio law requires employers to provide employees 18 years old and older with any breaks (lunch or otherwise) during a work shift. Ohio law does, however, require employers provide employees under the age of 18 a 30 minute uninterrupted break when working five or more consecutive hours (this may be an unpaid break). Despite the lack of a legal requirement, most employers opt to provide their employees with breaks for more practical reasons – company morale, employee efficiency, etc. For those employers, the next question that usually arises is “Am I required to pay employees during breaks?” Federal law provides guidance as to whether an employee should be paid during
these times, which can be broken down into one of the following two categories: •E mployers who provide employee breaks in excess of 20 minutes do not have to pay an employee during such break if the employee actually takes the break and the employer releases control of the employee – i.e. the employee is free to leave the worksite and does not actually perform work. If the employee is required to do any duties (even minor duties such as making copies), it does not constitute a break and employers are required to pay the employee for such time. •E mployers who provide breaks 20 minutes or shorter generally must pay employees for such break periods. If you decide to provide unpaid breaks, here are a few tips to follow: •A ll employees should be treated equally. In other words, if you provide one employee a break, all employees should
be entitled to a break of equal time. •R equire employees to clock out at the start of a break and clock in upon return. This will allow you to track employees for purposes of time worked and wages owed. In turn, tracking breaks may reduce the chance of a dispute about unpaid overtime and whether an employee actually spent more than 40 hours working per week.
This article is meant to be utilized as a general guideline for management of employee break periods. Nothing in it is intended to create an attorney-client relationship or to provide legal advice on which you should rely without talking to your own retained attorney first. If you have questions about your particular legal situation, you should contact a legal professional. Mark Turner is a partner at The Gertsburg Law Firm. He can be reached at (440) 571-7773 or mt@gertsburglaw.com
THANK
YOU
ASSOCIATION NEWS
NEW AND RENEWING MEMBERS
1st Choice Financial Services LLC 3 Digit Auto Sales 521 Auto Brokers Absolute Auto LLC Action Motors, Inc. Agree Auto Sales Inc. Allies Auto Sales American Recovery Association America’s Auto Auction - Toledo ARJS Auto Sales Auto Boutique Limited Auto Central Sales Inc. Auto Motion Design & Fabrication LLC Auto Plus Sales & Service LLC Auto World USA, Inc. Bartley Traditions dba Low Cost Cars Bates Auto Isle Bigg Deal Sales Bill Wright Automotive LLC Binegar’s Truck Auto & Camper Sales BJ Auto Sales & Service, LTD Black Car LLC Bob Snyder Auto Exchange Brady Ware Dealership Advisors Buckeye Auto Network LLC Buckeye City Motorsports LLC C&N Motor Cars LLC Candy’s Auto World Car $mart Car 1 Car Nation LLC CarGuys USA LLC Carlisle Cars LLC CarSmart Inc. Carville Auto Sale LLC Car-Ware Cavallino Investments LLC
Chen’s Imports LLC dba Import Auto Pro Chris Haus Auto Sales Columbus Finance Inc. Correct Car Company Craft Motor Company LLC Dave’s Supreme Auto Sales LLC Dealertech LLC Denny Dotson Automotive Inc. Dillon Lake Motors Downtown Bedford Auto Dreer’s Auto Sales Drive 1 Car and Truck LLC East Richland Sales ER’s LLC ECAUTOCLUB LLC Electronic Merchant Systems EQUIPT INC Estle Chevrolet of Hamler LLC Exceptional Motorcar LLC Extreme Auto Mart LLC EZ Motors LLC Finley Truck Sales, Inc. First Commonwealth Bank Fitzgerald Auto Sales Freedom Motors Cleveland Friedman Auto Lease Gahanna Auto Sales Garner Sales Godard Auto Sales & Leasing Co. LLC Grahams Auto Resale LLC Grand Lake Motors LLC Great City Cars H & C Automotive Group, Inc. Heritage Motorcar Collection Higher Ground Farm Auto Sales Hovater Motors LLC Huber Automotive, Inc. Imports Auto Group
J & Estevez Auto Sales LLC J W Auto Sales Inc. Jay North LLC JC’S Autos Johnson Automotive Sales LLC dba Peak Auto Sales KGMG, LLC Knox Motor Group LLC Lorain Wholesale LLC Mac Management Inc. Maxtown Motor Car Company Maysan Auto Sales LLC Mighty of Central Ohio Mike Jones Motors Inc. Mike’s Car Corner National Auto Acceptance National Auto Lenders National Auto Sales LLC New 2 You Auto Group LLC Next Step Auto Sales LLC Nicholas Financial Inc. Nile Auto Sales & Services, Inc. Northcoast Auto Direct LLC NRD Auto LLC Ohio Car Country, LLC Ohio Limo Ohio Motor Group One Stop Auto Care LLC PASSTIME Patriot Auto Sales Phil Steinle Chev Buick Inc. Physicians Auto Group Pleasant Corners Auto, LLC Precision Automotive Group LLC ProGuard Warranty Inc. Quality Motorland of Logan Inc. Rallye Motors
Ram Motors Remy’s Used Cars Riceland Motors INC Rick’s Place Auto Sales Inc. Rick’s R & R Wholesale LLC Risner Auto Group LLC Road 16 Motors LLC RPM Auto Sales LLC S3 Enterprises LLC. dba Vice Powersports Sarchione Inc. Scott’s Auto Sales LLC Shook Auto, Inc. Smiley Automotive Inc. Starfleet Cars LLC Starkey Automotive Inc. Street Motor Sports, Inc. Summit Motorcars Super Deal Auto Group Superior Used Cars Inc. Taucher Brothers, LLC. Tempest Motors Inc. The Auto Barn of Hartsgrove LLC The Carriage Company The Milby Group Insurance Agency, Inc. Top Tier Auto Group LLC Tradewinds Motor Center LLC TRL Rents LLC Two Bald Guys Automart Upper Valley Sales LLC Victoria Motors, LLC Vintage Motor Cars LLC Walas Autos Inc. Way 2 Go Auto Sales LLC Wayne Reaves Computer Systems Wheelz & Dealz LLC Zimmy’s Auto Sales LLC Zombie John’s Killer Deals, LLC
ASSOCIATION NEWS | By Wendy Rinehart
DIRECTOR’S MESSAGE
D E A L E R P L AT E S , S P E C I A L P L AT E S A N D I N T R A N S I T TA G S
Have you noticed how many dealer tags are on the road today? It seems like everybody has a dealer plate and they’re being used in ways they shouldn’t be. I recently noticed a Ford F150 with a business contractor sign on the side of it while I was driving. At the next traffic light, the truck ended up ahead of me and I saw it was being driven on a dealer plate. What? How does that happen? Why is a business driving around on a dealer tag? I immediately started thinking about the liability the dealer who owned the tag and the contractor had opened themselves up to and wondered if either of them had a clue. If your dealer tag is on a vehicle, you are assuming responsibility and liability for anything that happens with that vehicle. It doesn’t matter if the driver has insurance or not. In Ohio, insurance follows the owner of the vehicle – if your tag is on there, you’re liable. The business who’s driving on the plate is not only using a dealer tag illegally for commercial purposes, but if anything happens their insurance will not cover them since they’re driving on fictitious plates. Sounds like a lawsuit waiting to happen. Here’s a breakdown on how the plates should be used.
DEALER LICENSE PLATES (ORC 4503.30): •D ealer license plates may be used on any motor vehicle, other than commercial cars, owned by the dealer (titled for resale in the dealership name). •D ealer plates may be displayed on any motor vehicle owned by or lawfully in the possession of the dealer or the agent or employee of the dealer and shall be displayed on no other motor vehicle. •D ealer plates may be displayed on a motor vehicle when the vehicle is in transit from the dealer to the purchaser, when the vehicle is being demonstrated for sale or lease or when the vehicle is being otherwise utilized by the dealer, a prospective purchaser or a third party
operating the vehicle with the permission of the dealer. •D ealer plates may not be used for delivery, hauling, transporting or any commercial purpose. You may be wondering about the other plates you see on the road – the ones that have “special” or “in-transit” at the bottom. There are laws about those plates, too.
SPECIAL REGISTRATION PLATES/SPECIAL PLATES (ORC 4503.31): There are several legal uses for special Ohio registration, including the following: •O n motor vehicles owned and being used in testing or demonstrating for the purpose of sale or lease (leasing dealer license required). •O n motor vehicles subject to the rights and remedies of a secured party (repossession). •O n motor vehicles being held or transported by any insurance company for the purpose of salvage disposition. •O n motor vehicles being transported by any persons regularly engaged in salvage operations or scrap metal processing from the point of acquisition to their established place of business (salvage dealer license required). •O n motor vehicles owned or in lawful possession of an Ohio non-profit corporation while being used in testing. •B y persons regularly and primarily engaged in the business of rustproofing, reconditioning, or installing equipment or trim for motor vehicle dealers (transporting dealer owned motor vehicles to and from the dealer’s place of business). •B y persons engaged in manufacturing articles for attachment to motor vehicles when being transported to and from places where mechanical equipment is attached to the chassis of new motor vehicles. •O n motor vehicles being towed by any person regularly and primarily engaged in
8 INDEPENDENT DEALER NEWS JULY/AUGUST 2019 WWW.OHIADA.ORG
the business of towing motor vehicles to a point of storage. •O n trailers being transported by persons engaged in the business of selling tangible personal property other than motor vehicles.
NOTE: O.R.C. Section 4503.32 prohibits any person from using special plates for any reason except the reason they were obtained. Some dealers who also have a lease license or detail shop – which is very specific to rustproofing, reconditioning, or installing equipment or trim for motor vehicle dealers – apply for special tags and use those tags in those businesses. (NOTE: the special plate applicant must have a contract with dealerships to qualify for this reason.) Please make sure your insurance company knows what types of plates and how many plates you have so you have the proper insurance coverage. The third type of business plate you may see on the road is the in-transit tag. These tags are to be used exclusively for taking a vehicle from point A to point B by a third-party business who is a drive-away operator or trailer transporter. You should never see an in-transit tag being driven to the grocery store or shopping mall. The auctions are assigned these tags for their drivers to deliver vehicles to and from dealers. IN-TRANSIT TAGS (ORC 4503.33): These are to be used by a person, firm, or corporation engaged in this state as a driveaway operator or trailer transporter, or both, for transporting or delivering new motor vehicles from the manufacturer or any other point of origin to any point of destination, or used motor vehicles from any individual, firm, or corporation to any point of destination. No matter which plates you’re using, have the proper insurance coverage and make sure they’re being used for the correct purpose. The BMV has the ability to revoke your dealer plates, special tags, and in-transit plates if they find you’re using them incorrectly.
COMPLIANCE MATTERS | By Allison Harrison
REPOSSESSION AND COLLECTIONS REFRESH
I M P O RTA N T R E M I N D E R
I have seen an uptick in the number of complaints related to repossessions done incorrectly. To help dealers avoid a complaint – or worse, a lawsuit – I thought a refresher would be helpful. The retail installment contract or lease agreement will outline what constitutes default. Typically, default is failure to make a payment or failure to adequately insure the vehicle. Once any event of default occurs, the lien holder can repossess the vehicle. Only the lien holder can repossess the vehicle. Once the vehicle has been repossessed, the lien holder must send notice to the consumer within five days. The notice provides the consumer the opportunity to “cure” his/her default by bringing the loan current. The statute does not require this notice to be sent in any particular manner. A best practice is to send by certified mail so you have proof it was mailed and on what date. The “cure” period is 15 days from the date
of notice or 20 days for date of repo. Clear? The best practice is to provide 30 days to cure from the date of repo. Under the “cure” statute, the lien holder can require (a) all past due payments, (b) a security deposit in cash or bond equal to two periodic payments, (c) $25 for repossession fees, and (d) any other delinquency charges. Any repossession fees in excess of $25 can be added to the time balance of the loan and cannot be demanded to cure. The vehicle must next be sold at a public sale. The lien holder must provide the consumer with 10 days’ notice of the time, place, location, and minimum sale price of the vehicle. His notice must be sent by certified mail. The same information must also be advertised in a newspaper of general circulation in the county where the vehicle is being sold for 10 days prior to the sale. A public sale is generally not considered re-selling it on your own lot but is typically
an auction. Some dealers want to utilize online auctions such as eBay. If you are considering such options, consult with legal counsel to ensure you are doing it properly. After the vehicle is liquidated, the lien holder must notify the consumer of the deficiency (or surplus) balance. If the vehicle sells for a surplus, the customer is entitled to the surplus. This notice must be sent prior to making any collections attempts. After all of the above steps are complete, the lien holder is to start to collect on the deficiency balance. It is extremely important that any Buy Here-Pay Here dealers know and understand the steps outline above. If not, the dealer could be creating significant and unnecessary liability. If you have questions about the repossession process, contact myself or the OIADA! Allison L. Harrison, Esq. is from Allison L. Harrison Law, LLC. She can be reached at 614-440-1395 or aharrison@ alharrisonlaw.com.
WWW.OHIADA.ORG JULY/AUGUST 2019 INDEPENDENT DEALER NEWS 9
COVER STORY
AUCTION NEWS
WORLD AUTOMOBILE AUCTIONEERS CHAMPIONSHIP RECAP
CODY SHELLEY FOLLOWS HIS MENTOR WITH A VICTORY AT THE 2019 WORLD AUTOMOBILE AUCTIONEERS CHAMPIONSHIP
Photos by Myers Jackson ceo@myersjackson.com
World champion ringman Landon Waddle
WAAC president Paul C. Behr (left) and 2018 champion auctioneer Casey Enlow (right) flank the 2019 world champs: Blake McDaniel and Chris Elliott (team), Cody Shelley (auctioneer) and Landon Waddle (ringman)
Winning a world championship was a special moment for Cody Shelley. There was only one way it could be even more special. When 2018 champion Casey Enlow handed his fellow Oklahoman the trophy at the 2019 World Automobile Auctioneers Championship, Shelley couldn’t help getting emotional – especially since he knew it took Enlow, his longtime mentor, 17 tries before he won his title. “I don’t feel worthy or deserving of this,” Shelley said. “He’s taught me so much.” Shelley, who won in his sixth appearance in the contest, credited Enlow and Oklahoma auctioneer John Gary Collins as being instrumental in turning a high school rodeo star with dreams of going pro into a world champion auctioneer. “This means so much, especially coming from Casey – and from the other people who have won it in the past,” Shelley said. Shelley’s score of 91.5833 edged 2017 runner-up Matt Moravec for the victory in the 31st annual event, held May 10 at
Charleston Auto Auction in Charleston, S.C. Landon Waddle of Lago Vista, Texas claimed the title of world champion ringman, while Blake McDaniel won his second team title, this time pairing with defending champion ringman Chris Elliott to take top honors. Shelley, who turned 30 the day before the contest, looked very much like a rising star when he finished third in his first WAAC appearance in 2013. But he missed the finals the next two years, then skipped the event the next year before returning in 2017. In fact, Shelley almost missed this year’s WAAC as well, after a delayed flight turned what should have been a relatively easy trip into an all-night odyssey. He had rushed back from Dallas that day, stopping at his home near Tulsa just long enough to pick up the bag his wife Ashley had packed for him before heading to the airport. But when a flight delay caused him to miss his connection to Charleston, Shelley said, he thought about turning around and going home.
10 INDEPENDENT DEALER NEWS JULY/AUGUST 2019 WWW.OHIADA.ORG
World champion auctioneer Cody Shelley
He didn’t – not because he wanted to compete as much as because of his friendships with his fellow auctioneers. “I’ve met so many unbelievable people here,” he explained. “I was just going to go home. And then I got to thinking I just wanted to see everybody. … That’s what made me go.” It was nearly midnight when Shelley arrived in Atlanta. He tried to talk his way onto another flight to Charleston, but it was full, forcing him to rent a car and drive. “I said, ‘I understand the flight was overbooked, but since it’s been delayed, some people didn’t make it. Can you let me on?’ ” he recalled in an interview on Mike “McGavel” Jones’ podcast. “ ‘Nope.’ The pilot was standing there at the gate and he said, ‘I’ll race you.’ ” Needless to say, the pilot won the race. Shelley arrived in Charleston at 4:45 a.m., took a quick shower and got to the auction at 6:30 to get ready to compete. “It was a long day,” he said. “It didn’t go as planned, but I got here.”
ACCELERATE |
By GWC Warranty
MAKE IT A BIG YEAR WITH A MENU
LAND
MORE
VSC
SALES
Selling more service contracts and higher quality F&I products all starts with how you present them to customers. If you do it right and do it often, you stand to make big gains in the F&I office. It’s been proven time and again that running through your menu of service contract options in a strategic way is the best way to land more VSC sales. Stick to the plan and you can look forward to a profitable uptick in F&I business. Consistency Is Key A menu sell is going to work if you do it every time with every customer. Anything less and it’s nothing more than a shot in the dark. You won’t land a VSC sale every time, but your chances only improve with each time you go through the full presentation – not to mention the practice you get along the way. Start From the Top Executing a masterful menu sell starts at the highest level of coverage you offer. Working your way backwards through the menu highlights the components and coverages that
drop off as you decrease the coverage level. This points customers in the direction of making a decision on what certain components and coverage perks are worth to them. And when a customer makes the decision on their own they’re more likely to feel they bought something rather than being sold something. Ask the Right Questions It’s important to tell a story to help customers understand why they need a VSC. The best way to go about this is to ask questions to understand what matters to a customer. Are they looking for a commuter car? Or maybe it’s a customer who prioritizes style and image. Whatever it is, digging in to understand what customers find important about their
vehicles can shape your story. For the commuter, you can sell practicality and protecting their job. For the imageconscious buyer, a VSC helps protect their investment and get the vehicle back on the road quickly.
INDUSTRY WATCH | By Auto Remarketing Staff
LATEST SAFETY FEATURES PIQUING INTEREST
RECENT
SURVEY
BY
While your used inventory probably doesn’t have any self-driving cars – yet – your store already might have models containing the latest safety features a large number of consumers surveyed by CarGurus want. Along with gauging interest in vehicles having features such as a rear-view camera or blind-spot monitoring, the company’s newest automotive consumer research findings showed that over the past year there was a perception shift regarding self-driving cars. CarGurus learned consumers expressed greater enthusiasm for self-driving car development overall, and also showed a stronger likelihood of owning a self-driving car in the next 10 years. Specifically, the survey found: •R espondents excited about the development of self-driving cars increased from 21 percent in 2018 to 32 percent in 2019, and the respondents concerned about them decreased from 47 percent to 37 percent. •2 8 percent of respondents specified they could own a self-driving car in the next 10 years, more than double the 13 percent from last year. “Consumer sentiment around self-driving cars is changing fast, with enthusiasm rapidly replacing skepticism,” said CarGurus director of customer insights Madison Gross. “These benchmarked results demonstrate that today’s consumers are becoming more comfortable
CARGURUS
with the idea of either owning an autonomous vehicle, or having them on the road, and it will be fascinating to continue to monitor this perception shift.” While dealers cannot yet go to the wholesale market and find self-driving vehicles heading down the lanes, managers can offer vehicles that have advanced safety features some owners already have or hope to get in their next vehicle. CarGurus’ survey delved into that topic, too: •R ear-view camera: 34 percent already own and 43 percent extremely interested. •B lind-spot monitor: 11 percent already own and 61 percent extremely interested. •S urround-view camera: 4 percent already own and 51 percent extremely interested. •A utomatic emergency braking: 8 percent own and 45 percent extremely interested. •A daptive cruise control: 14 percent already own and 38 percent extremely interested. •L ane-keep assist: 8 percent already own and 41 percent extremely interested. •D river-attention monitor: 5 percent already own and 37 percent extremely interested. •A utomatic parking: 2 percent already own and 37 percent extremely interested. When looking into which companies consumers trust the most to develop selfdriving cars, the survey found Tesla remains atop the most trusted, and increased its lead
12 INDEPENDENT DEALER NEWS JULY/AUGUST 2019 WWW.OHIADA.ORG
over last year. The next-most-trusted companies to produce a self-driving car are Toyota and Waymo. Seventeen percent of respondents selected “None” for which company they trust, which is a shift from the 27 percent in last year’s survey. CarGurus’ research looked into which vehicle owners would consider buying a self-driving car from their current brand, if it were available. Survey orchestrators found: •5 6 percent of Honda owners would consider buying a self-driving car from Honda. •5 1 percent of Toyota owners would consider buying a self-driving car from Toyota. •4 3 percent of Chevrolet owners would consider buying a self-driving car from Chevrolet. •4 1 percent of Ford owners would consider buying a self-driving car from Ford. CarGurus asked respondents whether they were ready to take a ride in self-driving cars provided by services such as Uber and Lyft. The survey showed: •3 5 percent of people who currently use ride hailing services are likely to take a ride from these services in a self-driving car. •O f those who currently use ride hailing services, 22 percent trust Uber the most to develop a self-driving car and 13 percent trust Lyft.
SOCIAL MEDIA | By Kathi Kruse
TOP SUCCESS OBJECTIVES & SOCIAL MEDIA METRICS
OPTIMIZE
YOUR
ROI
One of the best things about social media marketing is that it’s measurable. I’m still caught off guard when I hear some dealers don’t track their social media metrics or review their data. But I do understand, because so many dealers truly aren’t sure what metrics to track or what the data might indicate. Defining the right social media metrics is key to meeting dealership business objectives and makes it so much easier to measure ROI (return on investment). Two factors weigh heavily in computing ROI: costs and metrics. Costs are the investments required to meet dealership objectives. Many dealers don’t measure and analyze each cost associated with social media marketing: •A ttention (there’s a reason it’s called “paying attention”) • Labor/Human Resources • Financial • Training • Organizational Development • Social Technology • Agencies and/or Consultants • Paid Media (i.e. Facebook ads) • Employee Engagement Metrics are how you measure the result of your investments. One accurate measurement is worth a thousand expert opinions. Tracking the right social media metrics to determine ROI is challenging. With real-time data providing cues to re-work certain tactics, it’s crucial to designate someone whose job is to track and analyze. Restructure of the dealership’s organizational framework may be required. A marketing team’s comfort in working with data and analytics is critical. Tracking the right metrics is important but so is knowing what to do once you have the data, especially when things aren’t going as planned. Measuring metrics and analyzing results is formidable and you should take careful consideration. Sometimes a social media audit is called for. Due to the unique nature of the data, and the social aspect of the medium, it’s essential to isolate issues and determine true success. Achieving dealership objectives with social media requires experiential knowledge to make metrics meaningful. If you need guidance, seek out trusted advisors who can help you accurately measure and analyze your results. Tracking and auditing results is most beneficial when you know the right metrics to measure. Here are the top five dealership business objectives we encounter at Kruse Control,
including the relevant social media metrics you’ll want to track. Retain Current Customers •R each. Reach is an important social metric for all business objectives. However, it’s far easier to sell to existing customers than it is to strangers. •E ngagement (comments, likes, shares, retweets, re-grams). Engagement is the kingpin of everything social. How are existing customers engaging with your content? •R eviews. Customers do not consume in silence. What common words or themes are customers saying? •R eturn visits from social media. How are you tracking visitors to your website? What tactics are you using to engage them on an ongoing basis? Engage New Potential Customers • I ncrease in likes and followers. Is there a specific plan to increase your audience? Which platform, by how much and by when? •C ontent. What types of content are getting most engagement? •N ew opt-ins from social media. Are you offering valuable information at no-charge in exchange for contact info? •C ustomer acquisition. How many, at what cost, over what period of time? •A udience demographics. Are the people you’re reaching actually your target customers? Improve Customer Satisfaction •R esponsiveness to messages and reviews. Everyone likes to be heard. Responsiveness gives prospective customers a glimpse of how you handle concerns, issues and questions. •R esponse time. Forty-two percent of social customers expect a response within 60 minutes. Is your store prepared to handle social media inquiries within the hour? •O nline reviews. What’s the company’s practice for building a successful review funnel? •N egative feedback (reviews, hide posts, unlike page, unfollows). How often is it happening? How is this handled within the organization? Establish Earned Authority and Trust •T raffic and time on your website from social media. “Social signals” let Google know your site is being talked about. Hopefully, there’s a live human managing your social channels to keep the engagement high. •L inks to your site from social media. When
social signals (traffic from social sites) turn into social shares, further value comes into play. People share good content and link to your site. Social media then becomes a huge win for SEO. •A mplification (shares by others). This is evidence your content resonates. Sharing provides “social proof,” which is a psychological phenomenon where people assume the actions of others in an attempt to reflect correct behavior for a given situation. We view a behavior as more correct in a given situation to the degree we see others performing it. •O pt-ins for “free helpful content.” One of the best ways to develop trust is to offer valuable tips/information at no charge in exchange for an email address. Have you explored this tactic? Have you considered a putting together a PDF with car buying tips? •V ideo views. How much time did people spend viewing your videos (such as walkaround or “how-to” videos)? How many watched each video all the way through? Increase Sales •F acebook ad spend vs results. Are you setting goals for Facebook ads? Does your vendor track these goals? How did each ad achieve its intended goal? •F acebook ad relevance. How did your offer resonate with the intended audience? •O rganic vs paid engagement. Are your posts resonating with your audience before you pay to promote them? •G rowth of audience who visited your website from social. Which campaigns brought the most visitors? •L eads. Are you tracking results using dedicated landing pages and lead forms? •C onversions. How many sales converted from Facebook ads? •R evenue generated. What is your monthly revenue earned from Facebook ads? Determining the costs and tracking the right social media metrics will provide the data to measure your actual return on investment. Use these recommendations to put optimal processes in place. Your marketing decisions will become better informed, your social media will be more successful and the puzzle pieces will finally fit together on social media ROI. Kathi Kruse is an automotive social media marketing expert, blogger, consultant, author, speaker and founder of Kruse Control Inc., which coaches, trains and delivers webinars focused on integrating social media and online reputation management into dealership operations. She can be reached at kathi@ krusecontrolinc.com.
WWW.OHIADA.ORG JULY/AUGUST 2019 INDEPENDENT DEALER NEWS 13
SALES MATTERS |
By John Chapin
BUILDING A SUCCESSFUL (SALES) CULTURE
FOUR
FEATURES
OF
You just hired the perfect person: great work ethic, positive and upbeat. They show up early, leave late, take 10 minutes of a 15-minute break, and do more than expected and more than you ask for. Now let’s take that person and put them into an environment where people are negative, aren’t held accountable, take three days off for a hang-nail, show up at 8:05 then spend 45 minutes “getting ready” for their day, start preparing to leave at 3:30 and leave at 5:00 like there’s a fire drill. What happens to that perfect hire? One of two things: they either become just like everyone else after about a month, or they leave. Whatever your culture is, it has a substantial impact on performance. There is significant peer pressure to conform to the culture, be it good or bad. This peer pressure is one of the four main motivators for people who belong to any group. Positive peer pressure is what took my grades from C’s in public high school to A’s and B’s in private high school. It’s also what ensured I made over 200 phone calls per day in my first job as a stockbroker. If you’re a great team or organization with a great culture, fantastic. Unfortunately, most organizations have negative cultures, or at least elements of them.
F EATUR ES O F GR E AT C ULT UR E S Great Leadership Culture is top down. It begins at the top and flows down through the entire organization. Whatever the leadership team eats, breathes, walks and talks related to culture will become the culture. As a leader, you don’t get what you want, you get what you tolerate and allow. And what you tolerate and allow you tacitly condone and get more of. If you allow people to miss their numbers year after year, when it’s evident they aren’t making the calls and doing the necessary work, you’ll get more of that. If you allow negativity in the workplace and don’t hold people accountable, you’ll get more negativity and more people not doing their job. On the flip side, if you lead by example, walk your talk, believe in people more than they believe in themselves, empower them, listen to them, give them all necessary tools and resources, and hold them to a higher standard, you’ll get more of that. Rules and Decrees The culture in an organization is how people treat other people, how they treat work, and how they treat the work environment. Great cultures have rules and decrees regarding these three items – written rules and decrees.
A
GREAT
WORK
CULTURE
Here are a few examples: • E veryone is expected to show up on time, work until the end of the day, finish what they start, be honest, have integrity, and put in a full day’s work for a full day’s pay. • E veryone will be held to the highest professional and ethical standards. There is no place in the workplace for negativity or unprofessionalism. You will be respectful to all employees and clients. Gossip, talking, and otherwise communicating behind someone’s back won’t be tolerated. • W e are a great organization with a great product. We take better care of our clients than the competition because we care more. Your rules and decrees, totaling about eight to 15 in number, should be framed and prominently posted in several highly-visible areas in the workplace on a document titled: Rules and Decrees of the Workplace. Prospective employees should also receive a copy of these during the interview process and you should have a conversation with them about how they feel about these. By the way, full acceptance of the rules and decrees is a non-negotiable prerequisite to being hired. Everyone is on Board with “All In” Commitment When Malcolm Butler was limited to a few special teams plays in Super Bowl 52, many people said that move cost the Patriots the Super Bowl. Maybe. My contention is that had they let him play and won Super Bowl 52, the Patriots would not have been back to play in Super Bowl 53. No one who breaks the rules gets a pass. If this is allowed even once, people inside the organization start to question the integrity of the culture, and the culture starts to crumble. When you’re more interested in winning, or making a sale, than living by your values, it’s the beginning of the end. Again, no one gets a pass on the rules, not even your top sales rep.
14 INDEPENDENT DEALER NEWS JULY/AUGUST 2019 WWW.OHIADA.ORG
This doesn’t mean people don’t get a mulligan. You can allow a mistake or two, but address it immediately, and keep the leash short. Don’t allow chronic offenders who are making blatant and/or repetitive mistakes. While an occasional mistake may be inevitable, carelessness, ignorance, and apathy aren’t. Culture is a Living, Breathing Organism A great culture can’t simply be written out, placed on the wall, and left to die. It needs to be kept alive and well by visiting it often, talking about it, and reviewing it. Repetition is important, because like any new habit it will take time to imbed the culture into the consciousness and sub-consciousness of everyone in the organization. Once it’s locked in and habitually followed, discussing the culture keeps it on everyone’s radar and ensures it is remembered and adhered to. Also, it may be necessary to tweak some rules or decrees from time to time. Though many rules and decrees aren’t likely to change, there may be times when changes in people, technology, and other unforeseen future events make an edit necessary. Finally, you build a great sales culture by building a great overall company culture. As part of the organization, the sales department is included in all rules and decrees. Everyone, from leadership to the mailroom, must be on the same page when it comes to culture. So, while the sales department may have some additional rules and decrees related to activity, quotas, and other items, building an all-in, solid organizational culture is what will ensure the success of the sales culture. John Chapin is a sales and motivational speaker and trainer. He has over 31 years of sales experience as a number one sales rep and is the author of the 2010 sales book of the year: Sales Encyclopedia. For more information, visit www. completeselling.com or email johnchapin@completeselling.com.