Tennessee Dealer News Sep 07 by TNIADA

Official Publication Of The Tennessee Independent Automobile Dealers Association

Utilize Your Most Valuable Asset â&#x20AC;&#x201C;

THE CUSTOMER also in this issue

Retain Your Top Talent With Five Easy Steps plus

The Top Used Cars With Best Fuel Mileage

NEWS

DEALER Tennessee

09/10.2007

PAID

PRSRT Standard U.S. Postage

FORT WORTH, TX Permit No. 1122

National Independent Automobile Dealers Association www.niada.com • www.niada.tv NIADA Headquarters 2521 Brown Blvd. • Arlington, TX 76006-5203 phone (817) 640-3838 TN Dealer News 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 Tennessee Independent Automobile Dealers Association or the National Independent Automobile Dealers Association. Likewise, the appearance of advertisers, or their identification as members of TNIADA or NIADA, does not constitute an endorsement of the products or services featured. Copyright 2007 by NIADA Services, Inc. All rights reserved. Visit the TNIADA Web site at www.tniada.com. For advertising information contact: Troy Graff (800) 682-3837 or troy@niada.com. For information on how to become a member of TNIADA, please contact Darryl Noble at (615) 506-4968 or dnoble@tniada.com. State Publications Manager/Sales: Troy Graff • troy@niada.com State Publications Editor: Laura Patterson • laura@niada.com State Publications Production Manager: Christy Haynes • christy@niada.com State Publications Graphic Artist: Amy Moore • amy@niada.com Printing: Southwestern ColorGraphics Printing & Mailing Specialists

contents FEATURES

Legal, Legislative And Regulatory Summary

Your Most Valuable Asset

Spend more money, time and effort on your customers. MARK TEWART

Addressing Curbstoning

Get up to date on the latest legal issues facing the industry. KEITH WHANN

Protect yourself by reporting curbstoners.

What Smart Dealers Know About Developing, Retaining Top Talent

BOB MCKEE

Get the most out of your “A” team. JIM JACOBUS

TNIADA INFO 6 6 18

President’s Message Auto Auction Directory On The Road

20 24 26

Vendor Expo Supply Order Form Membership Application

BOARD OF DIRECTORS David Andrews – President City Auto Sales 4932 Elmore Road Memphis, TN 38128 Phone: (901) 377-9502 Phone: (901) 333-0103 dsa@cityauto.com Danny England – Vice President Danny England Motors P.O. Box 1620 New Tazwell, TN 37825 Phone: (423) 626-9500 Fax: (423) 626-9543 Cell: (423) 526-7190 dannyenglandmotors88@hotmail.com

John Niven, Jr. – Secretary/ Treasurer Auto Agency, Inc P.O. Box 382664 Germantown, TN 38183 Phone: (800) 325-5440 Phone: (901) 756-8557 niven@bellsouth.net Tony Moorby 141 Woodward Hills Place Brentwood, TN 37027 Cell: (615) 714-7991 Fax: (615) 866-5511 tonymoorby@aol.com

John Taylor Taylor Auto Sales & Rental 3832 Clarksville Pike Nashville, TN 37218 Phone: (615) 259-3797 Fax: (615) 259-8969

Sam Chaple Manheim’s Nashville Auto Auction 8400 Eastgate Blvd. Mt. Juliet, TN 37122 Phone: (615) 773-3808 sam.chaple@cox.com

Don Flanders Guardian Warranty 1800 Colonial Shores Drive Hixson, TN 37343 Phone: (423) 596-7601 Fax: (423) 842-3906 donflan@bellsouth.net

Darryl Noble – Executive Director P.O. Box 2219 Lebanon, TN 37088 Cell: (615) 506-4968 Office: (866) 5-TNIADA Fax: (615) 443-7486 dnoble@tniada.com lnoble@tniada.com

www.tniada.com Visit www.tniada.com for information on becoming a member.

TUNE IN

www.niada.tv

Access Educational Sessions On

Tune in for all the latest industry news from NIADA’s experts.

I N D E X

T O

A D V E R T I S E R S

ADESA Knoxville . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19 Aircept / Cal Amp . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21 Auto Trader Publishing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Inside Front Cover AUTOSAVE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18 AutoTrader.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Back Cover CAR Financial Services, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17 Cars.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15 Credit Acceptance Corporation . . . . . . . . . . . . . . . . . . . . . . . .Inside Back Cover Dealer Funding, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5 Frazer Computing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23 Georgia-Carolina Auto Auction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4 Guardian Warranty Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3 Manheim’s Nashville Auto Auction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9 Manheim’s Tennessee Auto Auction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13 McNutt Auto Transport Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18 Preferred Warranties, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7 United Acceptance Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11

T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007

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President’s Message

By David Andrews,

■

TNIADA President

An Association Leading The Industry ::::

Fellow Dealers,

::::

Now is the time for all independent dealers, not just those in Tennessee but every independent dealer, to say thanks. Thanks to your National Independent Auto Dealers Association for leading our industry into the 21st century. The best example is the recent national convention held in Nashville. For those who attended, you know what was available for all our members. For those who did not attend, you missed a first-class convention in every respect. Our national association, led by Mike Linn and staff, know how to put on a convention. Everything an independent dealer wants or needs was at the convention, from offering the Certified Master Dealers Course, multiple educational seminars and a vendor fair. Everyone who attended came away with many ideas about how to improve their business. Topping this off was the National Quality Dealer award ceremony. This was an unbelievable event broadcasted live by NIADA to more than 50,000 viewers via the Internet. We all congratulate Robert Mulkey of Oklahoma for winning the National Quality Dealer award. From my viewpoint, this event was produced with the same quality as any television awards ceremony. Thanks again to your NIADA association. As your state President, I would like to update all our members on the changes to your association. We have a new executive director, Darryl Noble. Darryl is a long time used car dealer based in Nashville. With his experience in our industry, he is extremely qualified to serve you, the independent dealer. He is very knowledgeable of the rules and regulations of the Tennessee Motor Vehicle Commission.

AUCTION CALENDAR

You also have a very active and dedicated board of directors. They are: Darryl Noble David Andrews Danny England John Niven, Jr. Sam Chaple Don Flanders Tony Moorby John Taylor

Executive Director State President Vice President Secretary/Treasurer Board Member Board Member Board Member Board Member

It is our immediate goal to double the size of your state association. In addition, as a board, we invite everyone to call us with your ideas, suggestions, and questions. I am certain I speak for all of the board members in saying we are available to help all of our members with guidance and direction. I can be reached at (901) 377-9502, or at dsa@cityauto.com. Thanks again for supporting your state association. With best regards,

David Andrews

MONDAY

TUESDAY

Manheim’s

ADESA Memphis 9:00

Nashville Auto Auction

Tennessee Auto Auction

4:00

WEDNESDAY THURSDAY

9:00

ADESA Knoxville 9:30

Chattanooga Auto Auction 9:30

Memphis Auto Auction 9:30

East TN Auto Auction 10:00

Jackson Area Auto Auction 10:00

Manheim’s

ABC Murfreesboro 3:00

Airport Auto Auction 5:30

Bristol Auto Auction 10:30

10:30

Manheim’s

Cookeville Auto Auction 6:00

Clarksville Auto Auction 12:00

Fax 615-443-7486 P.O. Box 2219 Lebanon, TN 37088

FRIDAY

ABC Nashville 10:00

Tennessee Auto Auction

1-866-5TNIADA (586-4232)

City Auto Sales, LLC Danny England Motors Auto Agency, Inc. Manheim’s Nashville Auto Auction Guardian Warranty Acacia Automotive Taylor Auto Sales & Retail

Jackson Area Auto Auction 4:00 ADESA Knoxville 5.30

Out of State Sales (Members of TNIADA) Tallahassee Auto Auction Tallahassee, FL 6:00

VISIT OUR WEB SITE FOR updates, Association highlights and information, legislative news, and much more!

T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007

Dealer's Auto Auction Huntsville, AL 9:30

ADESA Atlanta 9:30

Dealer’s Auto Auction Horn Lake, MS 9:30

Manheim’s Bishop Brothers Alabama Auto Auction Manheim’s Moody, AL Atlanta, GA Atlanta Auto Auction 10:00 1:00 9:30 Kelly Auto Auction Gadsden, AL 6:30

ADESA Lexington 10:00

HADA Auto Auction Huntsville, AL 10:00 3rd Friday Only

your most

A VALUABLE S S E T

Go on a mission to convert your inactive customers into active customers. Create sequenced campaigns using as many methods as you can to get them back.

Your balance sheet is missing a place for your most valuable asset – Your customer base. If everything were taken away from you tomorrow except for your customer database, you could replace everything that was lost. Your customer database and the relationships you create with your customers are the human capital that allows the other assets to work and grow. Let’s look at the five ways to increase the bottom line of a business: #1 – Sell More #2 – Increase your margins #3 – Repeats #4 – Shorten the cycle for repeats #5 – Continuity programs

All businesses naturally look to increase their sales as a way to prosper. Usually you may look to increase your advertising budget or number of salespeople and hope to get a correlating boost in sales that will translate to the bottom line. Certainly a good advertising plan can make a big difference in your customer traffic. However, in the last several years, many businesses have seen a dramatic drop in response from conventional and institutional advertising. In 1950, the average consumer would get hit with 100 messages or images a day and maybe 10 percent of them were asking them to buy or take action on something. Fast forward to today and the average person is getting bombarded with 10,000 images and messages a day and maybe 1,000 of those messages are asking them to buy or take action on something. People are overwhelmed, confused, and are shutting out all but the most clever and emotional advertising. In other words, a great advertising campaign that gets results is still doable but much tougher than ever before and is costing more per customer. Even in the case where you are successful, your advertising campaign that creates more sales is merely replenishing your lost customers. Most businesses face an attrition rate of 70 percent or more. Therefore instead of exponentially increasing your sales, you merely seem to be running on a treadmill and paying more to do it. To increase your sales with great advertising campaigns will take either you getting a massive education in emotional direct response marketing or you hiring a great advertising agent. Your expertise is selling cars and most likely you are not going to spend the years and trial and error necessary to become an advertising wizard. The sad part is the most of the so-called advertising wizards don’t have much more of a clue than you do about what it takes to increase sales. The next option to increase bottom line profit is to increase margins. Having a precise and fine tuned sales approach can definitely increase your bottom line quickly. If you have a strong and consistent desking approach that has full disclosure but emphasizes payment/down payment options on every deal along with knowing how to handle objections, you will see large and quick results. Every dealership should work daily to tighten their sales and desking process.

By Mark Tewart, Tewart Enterprises, Inc.

continued on page 10

Your customer database and the relationships you create with your customers are the human capital that allows the other assets to work and grow. 8

T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007

YOUR MOST VALUABLE ASSET 10

Now let’s get to the real payoff. Your bottom line can and will be most affected by numbers three, four and five. Your repeats, the cycle of your repeats and an effective continuity program pay the most dividends. Everyone has heard that it costs up to seven times more to get a new customer than it does to keep an existing one. What are you doing to maximize your repeat business? If your answer is that you are really nice to your customers and that you “take care of them,” I wish you luck. Those things are expected not extras. Most customers do not do business with you again because they are neglected. They are not being contacted in a continuous and personable way and given a chance to build a relationship. Your customers are not being contacted continually with multiple different media to create these relationships. Let’s look at a game plan. After your customer buys from you, they should be getting contacts from you that will involve postcards, letters, voice broadcast, personal telephone calls, e-mail newsletters, sequential e-mails, creative mail packages, gifts, special event announcements, holiday tie in promotions, memberships or VIP clubs, etc. Most of these can be planned with a marketing calendar up to a year in advance, and most can be sequenced and executed in an automated fashion. Start with one of these methods and create a year campaign. When you finish, add another method and so on until you have a completely planned and sequenced campaign to create a relationship with your customers and bring them back to you continually. The great news is that most of these things can be done easily on the Internet today. An average high school student could execute most of these approaches once you have created the messages you want to send. To create e-mail messages, e-mail newsletters, sequential e-mail automatic responders, etc., you can use www.aweber.com. To create and send cards and postcards that are sent to your database, you can use www.sendoutcards.com. To create personalized follow up voice broadcasts that can be sent to your database, you can use www.automaticresponse.com. For Web based letters, there are several sources that can be found by just doing a google search. For VIP, Customer for Life Membership programs, go to www.viptewart.com.

These are just a few of the services that make it easier to sequence and execute your personalized relationship building program with your customers. You will either have to put someone in charge of executing these programs or do it yourself. They are not nearly as hard or time consuming as most people tend to believe. Just like everything worth-while, these things have a learning cycle to them and it takes time and work. The upside is that once you begin to understand how to do these things it becomes easy and highly automated. You can execute your relationship building processes with one person that years ago it would have taken many people and tons of money to do.

Most businesses face an attrition rate of 70 percent or more. Therefore instead of exponentially increasing your sales, you merely seem to be running on a treadmill and paying more to do it. Next, let’s talk about your messages that you are going to be sending to your customers. Forget the sappy, boring, institutional same old, same old messages that I get every day from businesses. If you do this, you are being lazy and you are insulting your customers. You will actually harm your business more than help it. The worst thing you can do in your relationship based marketing plan is be boring and spew impersonal messages. I’m talking about the “You are our valued customer” type drivel that you get in the mail and throw away immediately. Instead use you, your staff, your kids, your customers, your customer’s kids or grandkids in the pictures and messages you send. Example, if you took a picture at delivery of every customer at delivery and you sent them a postcard with that picture on the front, what are the chances that they will read the message on the other side? Create a series of letters using pictures of your staff members or you in the pieces that offer humorous or story based contacts and offers. Creating quasi-celebrity status of you, your

T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007

kids, your staff or your customers, etc., is a quick and easy way to be creative in creating relationships with your customers and branding your business. Be outrageous. I have used photos of me in a straight jacket, jumping out of airplanes and other wacky stunts to stand out, create themes and have fun. Don’t get caught up in your so-called straight laced image. Usually that’s more ego-driven and is not nearly as effective as you think. Whatever you do, make sure to create a continuity program that promotes your customer to go continually to your service department or if you don’t have a service department to make continual small purchases from you after they buy the vehicle. The average dealership only retains 19 percent of their customers into their service department. This means Jiffy Lube and the other quickie places are kicking your butts and taking your customers. When people continually come to, service from you and hear from you, the Law of Familiarity kicks in and people feel connected to you. The customer’s brain is being hard wired to think and act with you in mind. BIG IDEA: Of the five ways to increase your bottom line, creating a continuity program is the only one that automatically increases the other four. A continuity program will help you increase repeat sales, speed up the buying cycle, increase margins and increase sales numbers exponentially. Continuity is the magic in your business. Think of your current customers as either active or inactive. Active customers have bought from you and are continuing to do business with you in service or some other way. Inactive customers have bought from you and you are hoping they will repeat several years from now. Good luck. Go on a mission to convert your inactive customers into active customers. Create sequenced campaigns using as many methods as you can to get them back. Your business has two life bloods – new customers and retained customers. When you become less dependent on new customers, you begin to acquire more of them. The world rewards you with what you deserve not what you need. Spend more money, time and effort on your current customers and you will utilize your most valuable asset of all, YOUR CUSTOMERS.

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TMVC Department

Addressing Curbstoning

By Bob McKee, TMVC Executive Director

We strive to improve our communications with dealers and help the general public to make informed decisions. Two areas that need the industry’s attention are the issues of curbstoning and open titles.

The Tennessee Motor Vehicle Commission’s goal is to provide a level field for dealer competition, while protecting consumers from illegal activities and empowering them to make wise decisions. The more informed you and your customers are, the likelihood of a misunderstanding decreases, and the result will be a better customer relationship. We strive to improve our communications with dealers and help the general public to make informed decisions. Two areas that need the industry’s attention are the issues of curbstoning and open titles. Major concerns for dealers and the Commission are the practices of curbstoning and unlicensed individual sales. No one is advocating that an individual be restricted from selling their own vehicle, and personal property rights make it difficult to restrict where an individual can sell their vehicle. An individual may sell legally up to five vehicles per year as private sales, so long as the vehicles are titled to that person. However, any sale above that five vehicle limit is considered a dealer sale and requires the seller to obtain a dealer’s license. An individual cannot sell a vehicle belonging to another person without a dealer’s license. Other states are facing the same problems and are developing different approaches to address it. One approach has been to develop and use a uniform reporting method for suspected unlicensed activity. Dealer associations have found this useful and make these forms available to their members. The Motor Vehicle Commission is willing to participate in such a program and would conduct investigations into the reported activity to the best of our abilities. Illegal sales often involve other local and state government agencies, due to lost sales tax revenue, local business tax revenue and possible insurance issues. One of our best tools in stopping unlicensed activity, and also one that will benefit the consumer is strong and vigorous enforcement of the title laws. State law requires the vehicle be

T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007

titled to the person who has lawful possession of it. Possession of an open title is against the law and can result in disciplinary action being taken against a dealer. With dealer sales, closing the title will help ensure that consumers get their vehicle registered properly and in a timely fashion. Dealers who do their own financing should title the vehicle to the customer and register their self as a lien holder within 20 days of the sale. Closing in the title with the name of the current owner promptly after the sale will also address one of the most common complaints against a dealer that we receive at the Commission, a consumer cannot obtain permanent tags. For unlicensed sales, if a title is documented properly it will help provide a paper trail for enforcement, if a person is selling more than five vehicles in a year. In the case of legitimate individual sales if the title is documented properly, it will help ensure the end buyer gets their vehicle properly registered. It is to the benefit of the consumer for them to purchase a vehicle that has a clear title history, whether they are buying from a dealer or an individual. Reducing complaints about open titles will allow the Commission to focus on other regulatory matters, such as illegal individual sales. Please ensure your dealerships are titling vehicles properly and providing the title to the consumer within the proper time frame. Such action will build a better customer relationship for you. For more information about this or any other issue related to the Motor Vehicle Commission, please access our Web site at: http://state.tn.us/ commerce/boards/mvc/index.html. State of Tennessee Department of Commerce and Insurance, Division of Regulatory Boards, Motor Vehicle Commission, 500 James Robertson Parkway, 2nd Floor, Nashville, TN 37243-1153, Phone: (615) 741-2711, Fax (615) 741-0651

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Auto Reports

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Go Green with Gasoline Green is the new color in the automotive world. Everybody's talking about Hybrid vehicles (or Green Cars as they're commonly known). But, what seems to be getting lost in all of the buzz is the fact that some gasoline vehicles save on fuel and ultimately the environment as well. The experts at NADAguides.com are talking Green by providing a list of fuel economical used vehicles on their Web site. The list reveals that seven of the 10 most economical used cars are gasoline-powered vehicles. “Even though there are less Hybrids produced on the market today than standard gas-powered cars, these numbers are still

extremely significant,” says Don Christy, Jr., president and CEO, NADAguides.com. “This analysis demonstrates that car buyers have options when it comes to buying an economical car, whether it's a Hybrid or a standard gas-powered vehicle.” Of the seven most economical gas-powered vehicles in the used car category, the average EPA Highway estimate was about 50 MPG (roughly seven miles less than the top three Hybrids), and the average EPA City estimate was 42 MPG (about 14 miles less). Results of the fuel efficiency analysis for used vehicles follow. For more information on the list, go to www.nadaguides.com.

Green is the new color in the automotive world.

Used Cars With Best Fuel Mileage 1. 2000 Honda Insight Hybrid 70 Highway/61 City 2. 2006 Toyota Prius Hybrid 51 Highway/60 City 3. 2006 Honda Civic Hybrid 51 Highway/49 City 4. 2004 Honda Civic 51 Highway/49 City 5. 2002 Volkswagen Jetta Wagon 50 Highway/42 City 6. 1998 Volkswagen Passat 50 Highway/39 City 7. 1999 Volkswagen New Beetle 49 Highway/42 City 8. 1999 Volkswagen New Golf 49 Highway/42 City 9. 1998 Chevrolet Metro 49 Highway/41 City 10.1999 Volkswagen Jetta Sedan 49 Highway/40 City

✁ CURBSTONE REPORT TN Motor Vehicle Commission

FAX (615) 741-0651 DEALER INFORMATION (Confidential) Date/Time Observed: ______________________________________ Reported By: _____________________________________ Fax Number: ________________________ Phone Number: ___________________________ (Bus.)_________________________ (Cell) ____________________________________ LOCATION OF VEHICLE Name of Location: _________________________________________________________________________________________ Address: ________________________________________________________________________________________________ Business_______Shopping Center_______Private Property_______Other_______ CONTACT AND VEHICLE INFORMATION Vehicle #1 Contact Name: ________________________________ Year _______ Make_____________ Model_______________ Color __________ VIN _______________________________ Comments: _______________________________________________________________________________________________ ________________________________________________________________________________________________________ Vehicle #2 Contact Name: _________________________________________________________ Year _______ Make_____________ Model_______________ Color __________ VIN _____________________________________________________ Comments: _______________________________________________________________________________________________ ________________________________________________________________________________________________________ Please attach an additional sheet(s) if more than 2 cars are displayed. Please enclose photographs of displayed cars if possible. Mail completed information to: TNIADA * P.O. Box 2219 * Lebanon, TN 37088 • FAX (615) 443-7486 14

T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007

Legal Report

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By Keith Whann,

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NIADA General Counsel

NIADA Legal, Legislative, and Regulatory Summary

egal, legislative and regulatory compliance should be on every dealer’s mind today. Never before has such an emphasis been put on the sales and F & I process, as opposed to the end result. Hopefully, you have developed a compliance program and have abandoned relying upon a lucky streak and a couple of aspirin to avoid compliance headaches. I have said it before, and it’s truer today, the benefits of developing and maintaining a compliance program are many and will have a positive impact on your bottom line. Admittedly, there are an overwhelming number of federal and state laws that impact a motor vehicle dealership. On top of that, regulators and courts are continually modifying these laws and their interpretations of dealers’ obligations under them. Consider for a moment the items on the Agenda from the recent LLR Update at the NIADA Convention in Nashville. Hopefully you are familiar with most of the areas discussed. For those areas where you are not, check out www.NIADA.TV and watch the Convention presentation. And remember, if you’re not staying current, you’re falling behind.

2007 NIADA ANNUAL CONVENTION LEGAL, LEGISLATIVE, AND REGULATORY UPDATE

3. Creation of Vehicle Emissions Standards 4. Alternative Energy Sources for Vehicles

Filed - August, 2004) b. FTC Interim Report to Congress on Credit Report Accuracy and Completeness (Published-December, 2004)

B. Passenger Vehicle Loss Disclosure Act C. Privacy Legislation D. Industrial Loan Charters E. Miscellaneous Legislation Impacting Small Businesses & Motor Vehicle Dealers 1. Bankruptcy Reform 2. Minimum Wage and Tax Related Legislation IV. FEDERAL REGULATORY ACTIVITY

c. Procedures to Enhance the Accuracy and Integrity of Information Furnished to Consumer Reporting Agencies (Comments -May, 2006) d. FTC Second Interim Report to Congress on Credit Report Accuracy and Completeness (Published-December, 2006) D. FTC Enforcement of Federal Privacy Laws E. FTC Addresses Advertising and Internet Activity

A. FTC Rule Review B. REAL ID Act C. Regulations Implementing The Fair and Accurate Credit Transactions Act

I. RECENT INDUSTRY DEVELOPMENTS & INDUSTRY OUTLOOK FOR 2007 II. NCCUSL UNIFORM STATE LAW DRAFTING PROJECTS A. State Implementation of Revised UCC Article 2 (Sales) B. Uniform Certificate of Title Act

1. The Affiliate Marketing Rule (Comments Filed-August, 2004)

A. Energy & Vehicle Emissions (National Policy and Legislative Regulation) 1. Increase of CAFE Mileage Standards 2. Revisions to CAFE Vehicle Classifications and Measurement Standards T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007

V. LEGAL, LEGISLATIVE AND REGULATORY AT THE STATE LEVEL A. Vehicle Fuel Economy, Vehicle Emissions and Gas Prices B. Case decisions on Internet Jurisdiction C. Car Buyer’s Bill of Rights Legislation

2. The Disposal Rule (Effective-June, 2005) 3. The Prescreen Rule (EffectiveAugust, 2005) 4. Restrictions: Obtaining, Using & Sharing Medical Info (EffectiveMarch, 2006)

III. FEDERAL LEGISLATIVE ACTIVITY

LLR

5. Red Flag Rules (Comments FiledSeptember, 2006)

D. Spot Deliveries VI. NATIONAL LEGAL AND REGULATORY ISSUES AND ACTIVITY A. Dealership Activity on the Internet B. Dealership Paperwork, F & I Practices, Access to Financing - Independent Dealers C. Dealership Marketing and Advertising

6. Activity Concerning Credit Reporting and Credit Scores a. Study on the Effects of Credit Scores on the Availability-Affordability of Financial Products (Comments

D. How Consumer Protection Cases Are Litigated

Go to www.niada.tv to view discussions on all of the above agenda items.

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TNIADA News

On The

Road Darryl Noble, TNIADA executive director, and Lisa Noble, TNIADA membership director, has taken their association marketing on the road. TNIADA purchased a company Honda Mini Van. But this isn't just an ordinary Mini Van, as you can see from the pictures it is covered in marketing logos. TNIADA partnered with Honda Remarketing and Chattanooga Auto Auction to put together this traveling marketing piece. “I think this is a brilliant idea,” says Mike Linn, NIADA executive vice president and CEO. “It is just like NASCAR.” The Chattanooga Auto Auction pays a marketing fee every month to

TNIADA and in turn TNIADA puts their logo on the van. This gives the auction statewide advertising, and it also advertises TNIADA and NIADA.TV. “We have had great success by partnering with the Chattanooga Auto Auction and Honda Remarketing,” says Noble. “We drive all over the state to different auctions and our marketing efforts have definitely not gone unnoticed.”

T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007

Attention TENNESSEE

DEALERS

Buy or Sell 10 cars in September at either ADESA Memphis

$295 value

or ADESA Knoxville and ADESA will pay for your TNIADA membership

New Members Only - Not Good For Renewals

Join us at ADESA Knoxville! Weekly Consignment Sales Every Tuesday Night - 5:30 PM â&#x20AC;˘ Every Friday - 9:30 AM

Call now to reserve your numbers 865/988-8000

1011 Adesa Parkway Lenoir City, TN 3771 865/988-8000 - 865/988-5674 Fax T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007

Online Traffic

By Jonathan Edwards,

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One I consistently urge dealers, general managers and sales managers to monitor the volume of traffic coming to their own Web site(s) monthly. By doing this, you will see that this is where your customers are. This is why it is so important to take an active role in what is happening. By the time a customer is visiting your Web site, the majority have already completed their research online. They are looking for a dealer who will handle them in the manner in which they expect. They can immediately tell if “you get it” by the experience they receive when they visit. You can spend a lot of time and money trying to wow them with neat “Flash” videos and online chat, but you need to understand that a visit to the dealer Web site is at the bottom of the proverbial purchase funnel. This means that shoppers are most likely looking for the quickest access to your new or pre-owned inventory, specials and financing in that order. Sure some are simply looking for your phone number to contact service or parts, but the vast majority wants a “don't make me think” experience. With this in mind, you should be seriously considering whether you are making a good first

VP of Training at KainAutomotive.com

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Impressions

My advice is not to get so caught up in trying to impress shoppers that you forget the core reason that the majority are visiting your site.

impression or not. Does your Web site provide an experience that would motivate you? Today's Internet shoppers are not necessarily “techno geeks.” Use of the Internet has become a mainstream activity. I encourage dealers to use the latest tools in video and chat, but just because you have some of the latest technical innovations does not mean that you are satisfying their shopping needs. My advice is not to get so caught up in trying to impress shoppers that you forget the core reason that the majority are visiting your site. Definitely use the latest technologies to enhance the experience, but make sure you give a good first impression by providing them with quick, “one click access” to your inventory, and that you populate your “specials” with something other than a message I see a lot, “Please call (555) 123-4567 for our latest incentives and specials.” This definitely will send the wrong impression. If I can answer any questions about this article or any others you may have please contact me at jonathan@kainautomotive.com. I'll respond promptly.

Good Internet Selling!

T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007

What Smart Dealers Know About Developing, Retaining Top Talent

By Jim Jacobus, DealerExecs.com (source, AutoRemarketing)

e have a solid idea of what it takes for someone to be successful and productive in our dealership. We have done a great job of executing a selection process that is filling our bench with talented “A” players who can get it done. We are home free, right? Not hardly! We are really only halfway home. The task ahead is how do we get the most out of our new team members (and existing ones), and how do we keep the ones we want, and need, to be successful on board for the long haul? Without a solid plan that includes development and retention as part of the “A” players equation, we are only training and preparing people for success in someone else's operation. We are constantly working with and consulting with dealers whose turnover rates run in the 50 percent to 80 percent range and even higher. The first step in cutting turnover is to get the right people on board to begin with. But not looking downstream to the keys to retention makes improving selection an ineffective bandage in stopping the flow of lifeblood and profitability from our dealerships. So, what are the real keys to retention? Here is what we know, in reverse order: Money: Last on the list of the top five retention items. Yet, it is the No. 1 item decision-makers try to throw at high turnover numbers or valued employees who want to jump ship. Just throw more money at them and they will stay.

Growth opportunity: People want to know that they work for someone who will reward them for performance by providing an opportunity to take on more and grow within the dealership. Development: Organizations who invest in the professional and personal growth of their employees see a return on that investment in higher productivity and long-term commitment. Knowing that they matter: Understanding how their day-to-day duties connect with and impact the bottom line is something every employee wants so they can connect the dots. Being recognized, in various forms, for that impact is critical. Leadership: The No. 1 factor in employee retention and productivity is the relationship they have with their immediate supervisor. Many a happy employee has left or become unproductive simply because the person they are directly responsible to is less than a compelling leader.

Let's explore each a little more deeply.

Money Money is not the cure-all or end-all to employee productivity or turnover issues. What people want is to be paid a fair amount of money for the work they do. Pay too little in sales commissions, hourly wages or annual salaries and you can lose the game. Ask for an unreasonable exchange of hours on the job for even a great wage or commission and you lose the game. The car business is still years behind when it comes to understanding it can't ask people to give their lives and quality of life away, even

for an above-average compensation package. What we end up doing is eliminating quality people from the available selection pool and diluting overall quality to a point where we struggle to call ourselves a professional organization. Compensation is about benefits, quality of life, hours worked and money paid. If we keep all of these in mind, we can compete for the type of individuals we need to win.

Growth Opportunity People were designed to want to succeed. Sometimes it is a little difficult to look at some of our employees and believe that, but they do. To be successful, we have to provide an opportunity for our folks to experience what it means to “move to the next level.” It doesn't have to mean they have a career path to own the place. What it does mean is they just need to know if they perform to a predefined quality of performances they will have more responsibility, recognition, money or other motivation to repeat the process. From front line employee to group leader, group leader to supervisor, supervisor to manager…or, salesperson to sales team leader, team leader to sales supervisor, supervisor to sales manager, night sales manager, weekend sales manager, truck sales manager…you get the picture! If we give them a chance to grow, they will. If we give them a chance to lead, they will.

Personal Development Personal development is much the same as growth opportunity but it is focused on the individual. The question is: What are we doing to help our employees grow both professionally and personally? We have clients in the car business that spend large six-figure budgets every continued on next page

T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007

What Smart Dealers Know About Developing, Retaining Top Talent year to invest in the growth of every individual in their organization. A little bit for front-line employees, a lot more for front-line supervisors and managers, still even more for mid-level and upper management contributors. We also have smaller organizations whose annual budget for developing their team members barely has a comma in it. The size of the budget isn't as important as the commitment to the employee. The bad, and sad, news is that the large majority of dealers we work with have a zero budget and commitment to the growth of anyone in their employ. That is a red flag when it comes to a serious focus on developing and retaining a high-performance team.

Knowing They Matter Another fundamental need every human being has is to know that they matter or that they make a difference. Smart leaders understand how important it is to help their people connect the dots between their jobs and any number of bottom line items in an organization. We can easily get the picture between some performers and how they make a difference. How about a janitor? Someone in accounting? A receptionist? I have always believed that a janitor who regularly forgets to put clean toilet paper in the

bathrooms can bring any organization to its knees. Or someone in accounting who screws up accounts payable or the weekly paychecks. Or, how much damage can a receptionist with a bad attitude do to your customer's experience? Helping people connect their efforts to the bottom line is a critical function of our development and retention efforts as leaders.

Relationship With Immediate Supervisors Relationship with supervisors is the No. 1 cause of employee turnover and/or employee productivity. In the course of our coaching or consulting with a client, when we come across poor retention statistics, our first area of focus is on the quality of leadership, no matter what level the turnover issue is at. We start with the immediate supervisor for that area and work our way up the ladder. The secret to the retention issue is usually found in the quality, or lack thereof, of leadership. That shouldn't be much of a surprise. Consider the following: ■ The poorest employee group in any organization is front-line supervisors. They are generally promoted because they are “best in class” at their front-line job and get the opportunity to

move into an area where the skill sets needed for success are totally different. ■ Front-line supervisors are rarely trained, coached or mentored - before or after they get promoted - on how to be a leader/manager. ■ The front-line supervisor generally has few role models to look to for guidance unless the dealer or organization has a formal leadership training or commitment to grow their leaders/managers. ■ Most front-line supervisors or managers are also challenged with the difficult task of being responsible for directing a group of their peers and both struggle to define the parameters of the new relationship. So, is it hard to imagine how important the impact of front-line supervisors and all other levels of leadership have on employee development? When putting together development plans for dealers, large and small, we always recommend the biggest bang for the buck in spending development dollars will be in growing the management team. So, there we have it. To maximize profits, compete in the marketplace and win the game, we have to direct our attention to the people side of our business. Focus on and commitment to selection, development and retention of employees will be the critical keys to our success in the future.

T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007

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T E N N E S S E E D E A L E R N E W S | SEPTEMBER/OCTOBER 2007