DEALER NEWS
S TAT E A F F I L I AT E
R E P R E S E N T I N G A L L A U T O, T R U C K , TRAILER, RV AND POWER SPORT DE ALERS OF OREGON
THE OFFICIAL MAGA ZINE OF OREGON IADA A U G U S T 2 0 17
ASSOCIATION NEWS
OREGON’S ERIC FREEMAN HONORED AMONG NATION’S TOP 3 DEALERS
DALLAS, TEXAS Permit No. 2079
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06................................................NIADA Convention Highlight 08................................................. NIADA Government Report 09......................................................No Compliance Training? 09..............................................Add Structure and Scalability 12..............................A Longer-Term View of Digital Retailing 13..................Oregon Dealer Honored Among Nation’s Top 3
WHAT’S NEW NIADA.TV
Once again NIADA.TV presents the NIADA Online Convention, a website that includes every session and special event of the 2017 NIADA Convention and Expo, held in June in Las Vegas. The NIADA Online Convention, available at www.niadaconvention.tv, is free for convention attendees. Dealers and others who did not attend can access the site for a one-time yearly fee of $149. In addition, the NIADA Virtual Trade Show is available free at NIADA.TV. Viewers can see videos of convention exhibitors’ product and service offerings from the vendors’ Expo Hall booths.
ADVERTISERS INDEX
ADESA ......................................................................................7 BMW Group Direct................................................................... 5 DAA Northwest/Seattle........................................................IFC Lobel Financial ......................................................................... 3 Manheim .................................................................................11 Manheim Portland ...................................................Back Cover NextGear Capital ....................................................................12 VAuto ....................................................................................IBC
OFFICE
Oregon Independent Auto Dealers Association 9150 SW Pioneer Ct Ste. H Wilsonville, OR 97070 800-447-0302
NIADA HEADQUARTERS NATIONAL INDEPENDENT AUTOMOBILE
DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV 2521 BROWN BLVD. • ARLINGTON, TX 76006-5203 PHONE (817) 640-3838 OIADA Dealer News is published monthly 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 6006-5203. The statements and opinions expressed herein are those of the authors and do not necessarily represent the views of OIADA Dealer News or NIADA. Likewise, the appearance of advertisers, or their identification as members of NIADA , does not constitute an endorsement of the products or services featured. Copyright © 2017 by NIADA Services, Inc. Inc.
STATE MAGAZINE MGR./SALES
Troy Graff • troy@niada.com EDITORS
Jacinda Timmerman • jacinda@niada.com Andy Friedlander • andy@niada.com MAGAZINE LAYOUT
Christy Haynes • christy@niada.com PRINTING
Nieman Printing
ASSOCIATE MEMBERS ADVERTISING /MARKETING
Autotrader.com 866-836-1455 Used Cars.Com by Dealix 650-599-5616 Cars.com James Lynch 312-601-5052 Carsforsale.com Grant Lockner 605-306-3492 Interactive financial Marketing Group Travis Weisieder 804-248-0892 ATTORNEY
Byrd Cabrera LLP Robert (Scott) Byrd 310-365-1954 AUTO PARTS
AutoZone, Inc. Daniel Narvaez 971-218-2300 AutoZone Inc Ray Curry 503-964-9420 BOND & INSURANCE
Hecht & Hecht Insurance Agency Larry Hecht 503-542-1130 Shepard & Shepard Business Solutions Todd Shepard 1-855-396-0488 #8 Kelly Martin Insurance Agency Kelly Martin 503-625-2615
DEALER AUCTION
Manheim Seattle Auto Auction Ray Priest 206-762-1600 Manheim Portland Auto Auction Alex Fraser 503-286-3000 ADESA Seattle Auto Auction Mark Dumbler 253-735-1600 DAA Seattle Dave Blake 253-737-2200 United Vehicle Auctions Lori Jacoby 503-380-1927 ADESA Northwest Auto Auction Mark Melton 541-689-3901 ADESA Portland Auto Auction Jerry Hinton 503-492-9200 Crosspoint NW Dealer Auction Brian Hardy 503-594-2800 DAA Northwest (Dealers Auto Auction) Mitzi VanVoorhis 509-244-4500 CarMax Sean McDonald 804-747-0422 DEALER SOFTWARE
Frazer Computing Inc Jake Morley 888-963-5369 Motor Vehicle Software John Brueggeman 546-270-6699 FINANCING
Credit Acceptance John Bragg 360-980-2214
Lobel Financial David Lobel 714-816-1301 Oregon Auto Finance Gary Veum 541-868-0472 The Equitable Finance Co. Brandon Fox 503-808-7939 Pac West Credit LLC John Kiefer 541-868-2595 United Finance Todd May 503-238-6488 Oregon Community Credit Union Rich Black 541-681-6311 Nationwide Insurance Mark Tischer 503-339-4165 Credit Concepts Inc Jason Moon 541-342-8545 Veros Credit John Pierce 714-415-6125 x21131 Reliable Credit Associations David Marx 503-462-3022 Ted Investment LLC Tom Garza 503-213-1109 FLOORPLAN
Lobel Financial David Lobel 714-816-1301 NextGear Capital Robert Torbet 503-358-3911
OIADA BOARD OF DIRECTORS
INSIDE
Floorplan Xpress Josh Chandler 503-621-9260 Auto Cap Services (ACS) Michael Smith 800-800-6494 ONLINE REVIEW MANAGEMENT
Podium Kaylie Smart 801-376-0677
PUBLIC AUCTION
Woodburn Auto Auction Steve Morin 503-981-8185 Petersen Auction Group of Oregon Curt & Susan Davis 541-689-6824 SECURITY
Pro-Vigil Kris Brackin 210-858-1105 SERVICE CONTRACTS
AUL Corporation Jacqueline Swank 800-826-3207 Elite Warranty, Inc Al Ham 503-530-0912 Automotive Business Developers Shannon Meany 541-944-9186 Benchmark Dealer Services Jacob Bangert 360-834-3333 Protective Asset Dylan Doran 818-836-1455
PRESIDENT Siamak Lotfi
EXECUTIVE VICE PRESIDENT Jim Weaver
1ST VICE PRESIDENT Gary Brooks
SECRETARY/ TREASURER Salvador Alvarez Herrera Zamora Auto Sales
CHAIRMAN OF THE BOARD Gary Sargent
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OIADA / August 2017
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ASSOCIATION NEWS
NIADA CONVENTION AND EXPO 2017 71st Annual Event Draws Another Record Turnout
The voyage to success is not always smooth sailing. In fact, it is often anything but. But for the record number of independent used vehicle dealers who attended the 2017 NIADA Convention and Expo, the course to that ultimate destination of success might be just a bit less stormy. The theme of the association’s 71st annual Convention was “Chart Your Course,” and an education agenda featuring more sessions on more topics than ever before provided tools and ideas designed to allow dealers to do just that – chart a course to their unique definition of success for their dealership. Not to mention a sold-out Expo Hall filled with products and services aimed at enhancing all areas of dealership operations. “An awesome investment in my business,” Larry Schmidt of Countryside Auto and Cycle in Fond du Lac, Wis., called the Convention. “Four days of industryspecific training along with trade vendors to improve my business – that’s an investment every dealer should be making.” As it turns out, more dealers are making that investment. The 2017 Convention drew more attendees than any other NIADA Convention in history, breaking the record set by the 2016 event. In fact, overall attendance was up for the fifth consecutive year, and the number of dealers was also up from last year. And just as in 2016, nearly 20 percent of those attending the 2017 convention did so for the first time. In addition to the used vehicle industry’s strongest dealer training program, there was plenty more available for all those dealers. For example, keynote speaker Captain Richard Phillips, whose amazing story of survival in a dangerous encounter with Somali pirates in 2009 inspired the hit movie Captain Phillips, recounted his five-day ordeal and the lessons learned from it. Phillips stressed the importance of preparation and offered three takeaways that can apply in any difficult situation, telling the overflow crowd, “You are much stronger than you know. … Nothing is truly lost until you choose to give up. … And a dedicated and motivated professional team, working together, can overcome almost any obstacle or solve almost any problem.” Attendees also had a chance to celebrate, dance and loosen up at the Cigars and Martinis welcome reception in a lush, tropical setting at poolside, and at a pirate-themed After Party following the crowning of Texas’ Robert Blankenship as the 2017 National Quality Dealer of the Year. In addition to the NQD ceremony – webcast live as always on NIADA.TV – the previous night’s National Leadership Awards Banquet introduced new NIADA president David Andrews as well as honoring NIADA scholarship recipients and the winners of awards for the top performers within the association and the used vehicle industry. For 2018, the NIADA Convention and Expo will be moving away from Las Vegas for the first time since 2009 – it’s scheduled for June 18-21, 2018 at the Rosen Shingle Creek Resort in Orlando, Fla. Save the date and don’t miss your chance to be part of the used vehicle industry’s biggest event of the year!
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WASHINGTON UPDATE BY SHAUN PETERSEN
NIADA GOVERNMENT UPDATE Latest Government Issues and Activity
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. REGULATORY The Consumer Financial Protection Bureau issued a final rule prohibiting the use of class-action waivers in arbitration agreements. The ill-conceived rule is disappointing and shows the CFPB has decided to put the interests of class-action lawyers above those of the very consumers the bureau is mandated to protect. Arbitration has proven to be a faster, less expensive and more effective way of resolving consumer disputes than classaction lawsuits. Consumers who receive an award in arbitration almost always receive more than they would in a class-action suit. That was the conclusion of the CFPB’s own study, which found consumers receive on average more than $5,000 in arbitration hearings compared to roughly $32 in classaction litigation. The new rule will force small businesses to bear additional costs in defending classaction litigation, particularly meritless suits. Those costs will ultimately be borne by consumers, and in the case of those who are credit-challenged, it could prove to be too much. From the beginning of the rulemaking process, NIADA voiced concern about the proposal’s poor policy to both the CFPB and to members of Congress. As Congress considers CFPB reform, we will be urging lawmakers to overturn this anti-consumer rule. LEGISLATIVE NIADA’s Legislative and Regulatory Committee has identified tax reform as one of its key priorities to monitor and engage on to protect the interests of independent dealers and other small business owners. Among the priorities for comprehensive tax reform outlined by House Republicans last fall was a border adjustment tax – a tax on goods manufactured in whole or in part overseas and imported into the U.S. A significant number of retailers, including auto manufacturers and parts suppliers, have pushed back against the concept, as have many members of Congress from both parties. For the auto industry, a tax on imported goods, including autos and auto parts,
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would lead to increased costs and could be devastating for dealers, employees and communities across the nation. On April 26, President Trump announced his tax plan, which does not include a border tax. House Ways and Means Committee chairman Kevin Brady (R-Texas) proposed a five-year transition period for the border adjustment tax after previously indicating a phased-in border adjustment provision seemed to be a plan to tamp down opposition. The House Freedom Caucus remains divided over its approach to tax reform. The group has debated its official stance in recent weeks, with caucus chairman Mark Meadows (R-N.C.) and former chairman Jim Jordan (R-Ohio) attempting to steer the group toward unified opposition to the plan favored by Speaker Paul Ryan, which includes a border adjustment tax, and in favor of tying welfare reform to tax reform. NIADA will continue to monitor the debate. GRASS ROOTS The Colorado IADA’s lobbying efforts in the state house have impacted three recent bills that affect the used vehicle industry. In the 2017 session, CIADA was the primary force behind a new law that requires any total loss vehicle, except for hail or theft, to be branded with a “salvage” title, preventing dealers from suffering a monetary loss by purchasing a clean-titled vehicles that turned out to have suffered a total loss. It also prevents the problem of a consumer finding out after a sale that a purchased vehicle was a total loss. In addition, CIADA worked with legislators on a bill that included proposals recommended by a Department of Regulatory Agencies review. The recommendations included a repeal of the state’s prohibition on Sunday sales, but CIADA, with the help of other associations and the Senate Business, Labor and Technology Committee’s understanding of the auto industry, successfully worked to pull that recommendation from the final legislation. And last year CIADA was instrumental in the passage of a bill that allows dealers an affirmative defense if they are unable to provide title within 30 days, provided they took the necessary steps to obtain the title – removing the threat of severe penalties. That bill also clarifies that a lien can be perfected without the title if necessary, using just the title application, financing document and payment of fees. PAC Rep. Mike Kelly (R-Penn.), co-chairman of the Congressional Automotive Caucus and an auto dealer himself, held a fundraising event July 17 in Washington, D.C., and NIADA was on hand to present him with a check for $995 – a campaign contribution
FROM THE BEGINNING OF THE RULEMAKING PROCESS, NIADA VOICED CONCERN ABOUT THE PROPOSAL’S POOR POLICY TO BOTH THE CFPB AND TO MEMBERS OF CONGRESS. from the NIADA-PAC. Rep. Kelly, a member of the powerful House Ways and Means Committee, is a strong advocate for the auto industry and small business. He was a featured speaker at the 2015 NIADA National Leadership Conference in Washington. The PAC got a boost from some additional donations from attendees of the NIADA Convention and Expo in June, which included a maximum $5,000 contribution from Shawn Richardson of Express Credit Auto in Oklahoma City. The additional funds brought the amount raised from the Convention to $20,000. SHAUN PETERSEN is NIADA’s senior vice president of legal and government affairs.
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SAFETY WATCH
GM RECALLS SS VEHICLES Corrosion May Affect Power Steering
General Motors LLC is recalling 6,204 2014-2016 Chevrolet SS vehicles. Corrosion of the connector between the electric power steering module and the torque sensor connector may cause a loss of electric power steering assist. GM will notify owners, and dealers will inspect the steering gear assembly, replacing it as necessary, free of charge. The manufacturer has not yet provided a notification schedule. GM’s number for this recall is 17248.
BHPH MATTERS BY SCOTT BATES
ADD STRUCTURE & SCALABILITY TO YOUR BHPH DEALERSHIP Key Advantages
There are three key advantages for Buy Here-Pay Here auto dealers to establish a strong partnership with their CPA firm: maintaining compliance on bank financing, filing an accurate and clean tax return, and operating at a profit. When these three advantages are realized, the dealership is set up properly to sustain cash flow and avoid costly penalties by state or federal agencies like the IRS. In this article, we explore common accounting mistakes made in BHPH dealerships in the areas of discounting, reporting, remitting sales tax and customer service – and how to add more structure to efficiently scale up your operation. Used cars are in high demand – and not just by people with no credit or bad credit. Debtaverse consumers of all stripes are shopping a wide variety of used inventory online or with their favorite dealer. Subprime lenders also view used cars as
a hot commodity again, and have become competition for Buy Here-Pay Here dealers and their related finance corporations. As the industry saying goes, “Now is the best time…” for BHPH dealers to make sure their systems and records are efficient and clean to compete in this competitive landscape. There are three distinct advantages to operating a clean and efficient BHPH dealership. Dealers can more easily document and satisfy bank financing terms during an audit. They can plan ahead and file an accurate tax return and remit accurate sales tax. They can also attract and keep more customers in vehicles for a longer period of time. In our experience, problems with accounting, collections or sales tax remittance often don’t come to light until an audit or tax return preparation. That timing may lead to a costlier process to fix problems, including potential penalties by the IRS, state department of revenue or even the Consumer Financial Protection Bureau. For a few hours a month – and the right knowledge about which data to record and which reports to review – your dealership can be efficient, competitive and scalable. SCOTT BATES, CPA, is a partner in the audit practice Cornwell Jackson. Contact Scott at scott.bates@cornwelljackson.com or 972-202-8000.
ACCELERATE
BY GWC WARRANTY
NO COMPLIANCE TRAINING? It’s All Risk, No Reward
Few things in the automotive industry can be more fluid than federal regulations and their corresponding compliance requirements. It’s so complicated and confusing that – according to Total Dealer Compliance – just 37 percent of dealers offer comprehensive compliance training to their employees. Furthermore, the same survey found just 23 percent of dealerships employ a dedicated compliance officer. This means nearly two thirds of dealers are putting their entire businesses at risk by not implementing a formal employee compliance training program. How, you might ask? The same research we mentioned earlier found that lack of compliance costs dealerships an average of $792,000 in lost profit. Could your dealership withstand such a blow? Rather than talking about the potential cost of penalties, let’s talk about the profit you’re putting at risk by not enlisting compliance experts in your dealership. There are plenty of dealers out there who do it on their own. They research regulations, build out processes to
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IF YOU’RE NOT UTILIZING COMPLIANCE TRAINING, YOU’RE NOT ONLY PUTTING YOUR BUSINESS AT SERIOUS FINANCIAL RISK, YOU’RE ALSO TAKING AWAY FROM PROFITABLE TIME SPENT ELSEWHERE IN THE DEALERSHIP AND LOSING OUT ON A SERIOUS AMOUNT OF REFERRAL BUSINESS. remain compliant and stay on top of changes to laws. But this takes up countless hours of your time – hours you could be spending on your lot, selling cars and attracting new business. If you’re one of these dealers, the time you’re losing acquiring and moving inventory could easily outweigh any money spent on compliance training. Let’s not forget about customer perception. Total Dealer Compliance also found 77 percent of customers would refer a friend or family member to a dealership that makes compliance a priority. That is a lot of potential repeat and referral business. So let’s recap. If you’re not utilizing compliance training, you’re not only putting your business at serious financial risk, you’re also taking away from profitable time spent elsewhere in the dealership and losing out on a serious amount of referral business. If you haven’t already, it’s time to make compliance a priority – a top one.
August 2017 / OIADA
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MANAGEMENT GAMEPLAN BY SCOTT BERGERON
SEX APPEAL STILL SELLS, BUT NOT IN THE WAY YOU’D THINK New Meaning for Today’s Consumer
Sex appeal has taken on a whole new meaning in dealerships, with female consumers dictating a new definition of what constitutes sexy. In part, this is because we are now, whether or not you want to admit it, living in a female decision-maker world, especially in the car business. So, the sex being appealed to is increasingly women – turning the stereotypical female sex symbol paradigm on its ear. Sure, you’ll still see female models next to this year’s new vehicles at the car show, and I really think that’s because most dealers are used to it. On the showroom floor, though, males still make up a larger percentage of salespeople. Working with clients is now very much a business transaction. Engaging the customer and respectfulness are absolute musts, no matter who you’re working with. Priorities are what they probably should always have been, but now it’s critical salespeople demonstrate an appreciation of how a prospect thinks instead of how they look. Yes, there may be exceptions – but I wouldn’t place a bet on testing it out. Smart consultants will be best served by prioritizing the business end of the deal over any flirtations, harmless or otherwise. Do good looks even matter on the showroom? That’s actually a trick question. It’s logical to assume an attractive salesperson will have a natural selling advantage because humans naturally are attracted to good looks. However, I wouldn’t put a lot of time into how a sales consultant looks but how they perform, and how they treat their customers and meet their performance goals. So, while good looking people shouldn’t be excluded from sales job considerations at all, it just shouldn’t be a priority. Instead, prioritize hires first and foremost for as many of the following attributes as possible: intelligence, integrity, common sense, good instincts, product knowledge, communication skills, closing ability or inability, likeability and the ability to serve with a smart, consultative approach. While each dealership’s priorities will be dictated by their specific situations, make sure job candidates get at least a passing score on each attribute. And for existing sales reps, reinforce solid performance in each of these areas as often as possible. As part of this, make sure they’re tuned into
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WHEN A DEALERSHIP SALES FLOOR AND SERVICE AREA EXUDE CLEANLINESS AND CLASS, IT REASSURES CONSUMERS. IN CONTRAST, DINGY AND DIRTY ENVIRONMENTS CAN IN AND OF THEMSELVES BE DEAL-BREAKERS. the “little things” that can make or break a deal. For example, when the salesperson greets a prospect couple, he or she should be very deliberate about engaging both equally, shaking both of their hands. If a male salesperson only engages the man, he’s likely lost all credibility with the couple. Decision-makers have shifted from sexy figures to solid facts. Today’s car-buying culture has clearly shifted from shapely figures to solid facts. While sexy winks and stellar bodies may carry influence, buyers are much more about the facts behind pricing and performance. The majority of prospects have already made decisions about the makes and models they’re interested in and what the price point needs to be. They likely also know about performance plusses and minuses. They’ve checked reviews from multiple sources, and often know many details about key performance indicators and specific model idiosyncrasies. So, salespeople not only need to be well-informed about each make and model, but be able to add something to the conversation to help a prospect confirm their predetermined choice. For example, last year’s Consumer Reports – a respected and supposedly unbiased review authority – gave the Subaru Crosstrek less than stellar ratings about everything from lack of power to noise inside the vehicle. Yet consumers seem to love the brand, borne out by anecdotes detailing their three-word response when asked about it: “I love it.” This is a case where “facts” take on a new dimension – adding personal accounts and preferences to a long list of specs, performance ratings and reviews. The enterprising salesperson can direct consumers to some of this information and ask key questions, which can help cement decisions. One such question is the powertrain issue. If a prospect prioritizes power over handling in the snow, another make and model may crystallize as the best choice. If,
however, snow maneuverability is a must, the Crosstrek may be just the right choice. As far as pricing, the days of pricing “car sharks” are all but gone, a concept reinforced by recent CarMax commercials. The slap-on-the-back, hard-negotiating sales processes are fewer and further between than ever before. Now, instead of base price, negotiation may revolve around such value-added options as premium interior extras like high-end car mats, or wheel and tire combinations to further customize a buyer’s selection. Also more than ever before, consumers are savvy about sales clearly aimed at liquidating inventory quickly, and are likely to push for the max. Salespeople need to be prepared to provide answers beyond, “Let me speak to my manager.” Emphasize sexy surroundings instead of people. One area where looks matter is the dealership décor itself. Dynamic and dramatic displays, conspicuous cleanliness, and a clear commitment to an upscale environment all contribute to a more effective selling stage. In facilities ranging from hospitals to government buildings, consumers have become accustomed to fancier, more contemporary and elegant surroundings. To the extent possible, your dealership should emulate this approach. When a dealership sales floor and service area exude cleanliness and class, it reassures consumers. In contrast, dingy and dirty environments can in and of themselves be deal-breakers. Bottom line, looks definitely matter, but not in the way they used to. Make the physical plant sexy while emphasizing smarts and sensitivity with your salespeople. Your bottom line will thank you for it. Former dealer executive SCOTT BERGERON is the founder of Daily Gameplan, a sales team performance company. Scott can be reached at 303.918.3169 or scott@dailygameplan.com.
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ONLINE MARKETING BY DALE POLLAK
M RE 2
ND
LOCATION
INDUSTRY EXPERTISE FOCUSED ON HELPING ME EXPAND MY BUSINESS* OTTO HAHNE CITY OF CARS, INC. TROY, MI
Smart. Simple. Fast. Learn how Otto gets MORE at nextgearcapital.com
*This testimonial was received via interview, audio and/or video submission. This testimonial is based on this dealer’s individual experiences, reflecting real life experiences of a NextGear Capital dealer. NextGear Capital does not claim they are typical results that dealers generally will achieve. This dealer’s experiences may not be indicative of future performance or success of any other dealers. Some of the testimonial has been shortened so the whole message is not displayed due to length and/or relevance.
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A LONGER-TERM VIEW OF DIGITAL RETAILING FOR DEALERS Don’t be Short-Sighted Dealers often have an “all or nothing” view of digital retailing. That is, to them, digital retailing represents the full monty of selling a vehicle online. You’d have a “buy it now” button on every vehicle details page for every vehicle, customers would work their deals, and dealers would deliver sold cars to customers at their homes. These dealers also often dismiss this concept of digital retailing as unrealistic – as something too few customers are willing to do today. In turn, dealers make a critical mistake: They put the whole idea of digital retailing on the shelf until the time comes when they’re fully convinced more customers would actually “buy it now” for their next vehicle. This viewpoint isn’t necessarily wrong. In fact, these dealers are absolutely correct that a majority of vehicle buyers today wouldn’t want to buy their next vehicle completely online. Studies show that maybe 10 to 15 out of every 100 people might be ready for this kind of vehicle purchase experience. It does seem a bit ill-advised to invest in an end-to-end digital retailing experience when the vast majority of buyers wouldn’t use it. But here’s the big miss for dealers who shelve digital retailing on these grounds: The “all or nothing” view is a bit short-sighted. It undercuts your ability to serve the remaining 85 percent to 90 percent of customers who are, in fact, receptive right now to taking part in at least a piece or two of a digital retailing experience. These are customers who want more convenience and a greater sense of control as they purchase a vehicle. They don’t want to spend hours in a dealership to complete a purchase transaction. They might even pay more for the privilege of completing some part of a deal – such as negotiating a payment, purchase price or trade-in value – from the comfort of their own homes. “I’m getting an additional eight to 10 deals a month because I offer the option of working out deal terms online,” said the general manager of a Southeast Volkswagen store. “We do things differently than other dealers and we’re getting better at telling
the world about it.” I hear similar stories from other dealers. Even if they aren’t adding a “buy it now” option to their website, they are fostering a different type of engagement that speaks to the needs of today’s increasingly me-focused and time-addled buyers. In other words, they’re working deals while “all or nothing” dealers aren’t getting any of the action. The general manager for a Midwest Lexus store noted his dealership continues to see a growing number of customers take advantage of his digital retail offerings. He added every one of the customers who negotiates a payment or trade-in value online still wants to “come in and take delivery in person.”
THE TAKEAWAY HERE FOR DEALERS IS THAT DIGITAL RETAILING SHOULDN’T BE VIEWED AS AN “ALL OR NOTHING” PROPOSITION. RATHER, IT’S MORE OF A “HAVE IT YOUR WAY” APPROACH, WHEREIN DEALERS PROVIDE THE DIGITAL RETAILING TOOLS, AND CUSTOMERS USE AS MUCH, OR AS LITTLE, OF THEM AS THEY PREFER. Such is the nature of digital retailing today. The vast majority of vehicle buyers aren’t really looking for a “buy it now”based, end-to-end digital car deal. They simply want to carve out the parts of buying a car they perceive as potentially problematic and time-consuming, and complete them in a way that’s more convenient and easier for them. The takeaway here for dealers is that digital retailing shouldn’t be viewed as an “all or nothing” proposition. Rather, it’s more of a “have it your way” approach, wherein dealers provide the digital retailing tools, and customers use as much, or as little, of them as they prefer. I understand how and why some dealers have landed on an “all or nothing” view of digital retailing. I would simply encourage them to consider the business they’re probably missing as they hold out for a complete, end-to-end digital retailing solution the majority of buyers may never want, and might never arrive. DALE POLLAK is founder of vAuto and has published several books on his Velocity Method of Management.
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ASSOCIATION NEWS
OREGON’S ERIC FREEMAN HONORED AMONG NATION’S TOP 3 DEALERS First Runner-Up
Congratulations to Oregon’s Eric Freeman for being named NIADA’s National Quality Dealer First Runner-Up! Eric was honored among the top three dealers in the nation at the National Quality Dealer awards banquet, held during the NIADA Convention and Expo. Actively involved in his state association for many years, Freeman has been twice named Oregon’s State Quality Dealer. Eric Freeman started his car business at the family horse farm in 1990 while he was in high school. He loved cars and the challenges associated with selling. Though Eric started college intending to follow his father into teaching, his mind kept wandering to car deals. Eric decided to follow his dream and establish Freeman Motor Company. He still has a passion for education,
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however. In addition to developing his own employees, Eric has been instrumental in the OIADA education committee’s Driven to Learn Series. He is a Certified Master Dealer and 20 Group member with a reputation for excellence and making his community a better place. At Freeman Motor Company extreme attention to detail is on full display as each vehicle makes its way through the AUTOSPA in a new standard for reconditioning. Freeman said, “We are not interested in the norm of the marketplace when it comes to the car business, we are interested in exceeding expectations and elevating standards. So every morning we search all over the nation to find your next car. When you sit in one of our vehicles, you’re not just sitting in a used car, you’re experiencing a premium European motorcar at a substantial discount. The question that drives the customer experience – What if excellence wasn’t a luxury, but a simple reality?” On investing in his community, Freeman said, “Sure we set aside a portion to give back, but it’s not just money, it’s also about time. We’re super excited not only to be writing a check but to also physically be there to help children and families in our community.”
Eric Freeman accepts award from President of Cox Automotive Financial Solutions Shane O’Dell (left) and Vice-President & General Manager of NADA Used Car Guide Mike Stanton (right).
August 2017 / OIADA
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OIADA CONTINUING EDUCATION PROGRAM sponsored by onstar .com / trialon
READ & RESPOND AND CERTIFY BELOW OIADA CONTINUING E D U C AT I O N P R O G R A M
COMPL E T E T HIS T EST A ND CERT IF Y BELOW T H AT YOU H AV E RE A D T HE A RT ICL ES FOR AUGUST 2017.
“NIADA Government Update” True/False: The Consumer Financial Protection Bureau issued a final rule prohibiting the use of class-action waivers in arbitration agreements. True/False: NIADA’s Legislative and Regulatory Committee has identified tax reform as one of its key priorities to monitor and engage on to protect the interests of independent dealers and other small business owners. “Add Structure and Scalability to your BHPH Dealership” What is a key advantage for Buy Here-Pay Here auto dealers to establish a strong partnership with their CPA firm? a) Maintaining compliance on bank financing. b) Filing an accurate and clean tax return. c) Operating at a profit. d) All of the above. “A Longer-Term View of Digital Retailing for Dealers” True/False: A majority of vehicle buyers today wouldn’t want to buy their next vehicle completely online.
ASSOCIATION NEWS
CHANGE SOMETIMES HAPPENS! OIADA Conference New Location OIADA has had to make a small change in the 2017 Conference plans. It will still be held October 21, 2017, but at a new venue. We are pleased to announce the new location will be:
Monarch Hotel and Conference Center 12566 SE 93rd Ave. Clackamas, OR 97015
The hotel is located off I-205. Contact OIADA at 503-362-6829 for more details. Make Plans to Attend • 6 hours of continued education. • Trade show throughout the day. • General membership meeting. • Scholarships. • OIADA’s Quality Dealer of the Year award. • Live auction. • Breakfast, lunch and cocktail hour. This is all packed into a one day event, from 8 a.m. to 5:30 p.m. Registration is only $95 per person for members and $145 for non-members. All meals and cocktail hour are included.
According to studies, how many customers are receptive to taking part in at least a piece or two of a digital retailing experience? a) 15-20% b) 40-45% c) 60-65% d) 85-90% “No Compliance Training?” True/False: Most dealerships employ a dedicated compliance officer. True/False: If you’re not utilizing compliance training, you’re not only putting your business at serious financial risk, you’re also taking away from profitable time spent elsewhere in the dealership and losing out on a serious amount of referral business. I certify to OIADA that I have personally read these articles in The Oregon Dealer News Magazine for August 2017. STOP!! Before you sign and send this form, make sure you have answered and completed all the quiz questions to receive Continued Education Credits.
My Name ____________________________________________________________ ____________________________________________________________________ Dealership Name ______________________________________________________ Dealership # __________________________________________________________ Dealer License Expiration Date: (Month)_____________________________________ (Year)________________ Signed: _________________________________________ Date _________________________________________________________________
FAX TO: 503-364-7331 MAIL TO OIADA at 9150 SW Pioneer Ct Ste H, Wilsonville, OR 97070
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OIADA / August 2017
www.oiada.com