MM Podcast Episode 003: Selling More Cars and Running an Efficient Dealership with Dennis Wagner (transcript)
This is a transcript of MM Podcast Episode 003: Selling More Cars and Running an Efficient Dealership with Dennis Wagner.
Welcome to episode 3 of the motorcarmarketing podcast.
In this episode’s main segment I’m going to be interviewing Dennis Wagner. Dennis started out as a car salesman and worked his way up to managing multi-store dealerships. His been hired to come in and fix dealerships and get them back on track. He’s got a tone of great tips, war stories and useful information for anyone working in the car business, from the salesman on the front lines all the way up to the sales manager and even general managers. So stay tuned for that;
If you find this episode valuable please help us out by giving us review on ITunes or leaving a comment on YouTube or re-tweeting podcast on Twitter or liking it on Facebook. These social media shares really do help spread the word about the podcast;
If you have any questions or comments fell free to send us an email at info@ motorcarmatketing.com. We want to improve this podcast so some honest constructive feedback is very much appreciated.
You can find all the podcast show notes at www.motor carmarketing.com /podcast. Also if you’d like to get some free video ‘Selling your cars’ on Craig’s list just go to www.motorcarmarketing.com and put in your name and email address into the form in the side bar .This guide goes to all the recent Craig’s list changes and shows you some actual statistics from dealerships who post heavily on Craig’s list both now and late last year before the big changes were rolled out. So if you’re wondering if you should still be posting your car on Craig’s list or wondering how to get more value out of Craig’s list dates definitely check out this free video.
So now let’s get into the main segment; today I’m interviewing Dennis Wagner; he’s a burst of energy and has great insight into the car business. Here’s the interview;
Ashley: Welcome Dennis to the motorcarmarketing podcast. I really appreciate you coming on the show.
Dennis: Thanks Ashley. I appreciate you having me.
Ashley: Thank you, so thanks for coming. So to start out I wonder if you could give us a quick overview of your career and how you got into the car industry.
Dennis: Well I’m not sure if I could make it real quick because it’s been a long time but my family was in automobile industry when I was a young child. So I pretty much grew up in ‘used car’, the ‘used car’ business; from early memories I can remember back to, when I was 6 or 7 years old; all the way up-sold my first car when I was 10 with the help of my uncle which is a pretty good accomplishment; don’t think a lot of people can say that. And I grew up and started to flourish from there; but I’m originally from a very small family, south-eastern Kentucky. The opportunities there are vast as they are and a larger market. So I’ve decided to head north a little bit, to Lexington, Kentucky and that’s where my career absolutely exploded.
Everybody down home told me – ‘You can’t do it, you won’t succeed on the big stage’. But I not only succeeded I went forward ever since and I’m very proud of.
Ashley: So maybe you can give us some specifics; you know; what exactly did you do? When you said your career exploded what does that actually mean?
Dennis: Well, when I came up here to Lexington, Kentucky, I got a job at the biggest car dealer in the state of Kentucky and mandatory was to have a training period for all of us. A lot of places still do it. They knew that I’ve been in the automotive industry pretty much all of my life; I grew up in it but still they had techniques and training techniques and sources and they do things a little bit differently than we would do down here.
So it was not a problem. I went to the training class, and I actually was one of few that paid attention and I observed the nodge just like a sponge. They let us hit the sales floor; there’s about two and a half weeks left in the month, and I saw about 22 cars in the last two and a half weeks in the month.
And I was able to move up, I was very proud of that; my first couple of weeks in the big store and I did really well. And from there I..; that path continued for a couple of years and then when people, news travel fast they say in the automotive industry, and when people start hearing that you’re doing great things they want to know you, they want to know more about you; and more opportunities become available.
So I learned up to be a sales manager and one of the biggest things that I had in advantage over most is my dad and my uncle as well as their friend which was the owner; and still in my head every sales manager in automotive industry if you don’t know finance, that’s the first thing you have to learn in automotive industry if you’re going to manage above, if you’re going to be more than a sales person. You have to learn ‘FI’ inside and out. Finance and insurances is the backbone of the automotive industry. That’s where the money comes from. They’re the gate keeper.
So I learned inside and out before jumping up to sales manager and they gave me a huge leg in the ass up to this very day. Most people don’t know anything about being said and there’s a big number of people who don’t get numbers; and in today’s market you have to be more of a hybrid version of a sales manager; in nowadays you have to be everything in order to be special.
Ashley: So, sure, sure. Let’s keep the specific to your story. So you were a sales manager for a while and what was your next move after that?
Dennis: I’ve always been a very knowledgably used car guy. That’s probably my hitch – the used car market; very strong knowledge of it and as we discussed a little bit of the air I’m not only, have sold cars, 1000 cars in my career, I also build cars; very knowledgably mechanics of the cars.
And that gives you, once again, leg up on the competition because most of the car dealer, or used car managers, and that was my next step in the business, was taking over the used car department for a while; when you take over that it’s a huge responsibility. I was providing inventory, good quality inventory because if you provide bad quality inventory than you don’t last very long.
The auctions would start around 9:30 I would pull up a list the night before and I would go through that for the next day. I’d highlight the stuff that I’m interested in and I’ll pull car faxes, I’ll write a number down beside it, pretty close for what I want to pay for and it doesn’t get closer.
And it works but I’ll show up at 7 o’clock, the auction starts at 9:30. If the facial looks good doesn’t mean that all the windows work in that car, or the warrant and it may cost $2000 to fix it; $2000 on repair on a car like that can cross you right out of the market. So you have to be very careful about that stuff.
Ashley: So, let’s go through all the game in auto dealers and selling cars. Let’s start with some tips for sales people. Obviously, you’re successful at selling cars so maybe you just have a list of 2-3 really good tips that a new salesman could use to sell more cars every month.
Dennis: The biggest thing that I had always stressed and I did that myself, every day, every week, every month make yourself self a plan of your goals and put it in writing; if you’re don’t it’s not real-you’re not looking at it. If you put it in writing every day and you go through it every day..; I used to have a check list for daily and I would have my good checks and my bad checks. At the end of the day I would compare my checks and if good checks waged it was a successful day. If not, then I had some work to do.
And each one of those times I would get a check for properly meeting and greeting the customer, giving them a test ride for a vehicle, so on, so on..; those would get check marks.
If I let a customer walk without a TO I didn’t do it; I did it only 1-2 in my career because my manager was really tough. He told me the next time I did it I could go with them. So I didn’t do that any further. So I had to turn my demo with folks because I wouldn’t be working any more if I do that again.
Ashley: So this is a self-imposed thing; this is something your manager wasn’t saying – ‘do this check box every day’, this is something you decided to do just to make sure you were doing proper things to sell more cars..;
Dennis: Absolutely, absolutely. And if you don’t hold yourself accountable the manager will hold you accountable and if you do hold yourself accountable you teach yourself self-discipline. And you’ll go long ways, you have a positive attitude. I cannot stress that enough.
I don’t care if you’ve been in the biggest fight in the world with your wife, or you’re disappointed because you’re not getting the promotion, whatever..; you have to come to work with a positive attitude in a way that I do that each and every day.
I would to, what they call, ‘a checkup from neck up’; I’m sure you heard that phrase before and everybody is happy to hear that –it’s an old one. Every morning in the mirror when I was stand and getting ready I would tell myself – ‘you’re the man, you’re the best.’ And you have to believe that. If you don’t believe in yourself no one else will believe in you.
But you do your checkups to neck ups, you build yourself up, you get prompt up for the day and when you hit the lot it’s on! You’re like a tire that they make loose with positivity and that’s very important. People can tell even over the phone if you’re in a negative mind set; because of that I say to the people that answer the phone they should better answer it with a smile on their face because if they don’t the customers can tell. And a positive reaction or positive action causes a positive reaction. If you have a negative action it’s going to get a negative reaction.
So be positive! It’s easy; have fun at what you’re doing.
Ashley: So are there common mistakes you see sales persons making? Obviously, other than having a negative attitude; are there some common mistakes that you see salesmen make and how can the fix those mistakes?
Dennis: One of the biggest problems I see the sales people make in today’s market, and it is nation-wide, so I travel a lot, doing training and being one-on-one so people can develop, and one of the biggest problems that I see – you have to know your inventory in this business. You have to know your inventory as well as your product.
Every sales person who is certified should know his product inside and out as well as the inventory. Each and every day, the first thing I did when I got there and I always got to work usually, 30, 40 sometimes an hour early, and I would walk the lot; the lot walk; I would walk to trading road to see what was trading the day before. And I would write down some stuff that was really interesting because for some cars you know you’re going to sell them quicker than others; there’s a hot market for them.
And then I would also walk over to the detail department to see which ones are ready to hit the lot; I would go to service department to see which ones are in service;
Then if somebody’s looking for a car usually I knew the inventory better than my managers did. If somebody was looking for a car I knew where it is; if it’s ready, exactly what needs to be done and usually which ones are in the service.
I stayed on top of that. That is so important – if you know that stuff, when your customer calls in or you set up an appointment with him it’s so much easier to sell. If you spend time with your product, get to know it, and following up with all the knowledge that you need to learn about it you believe in that product. You have to believe in the product that you sell. If you don’t believe in the product that you sell, if you’re not all way in – you can’t be half way in in the car business. You’re either all in or you’re in the wrong business.
Ashley: So let’s move on to the sales managers. Obviously, that was your next step in your career – do you have some tips how to be a successful sales manager?
Dennis: Yes, absolutely. The thing that I always did before I moved up the ranks, is I was a leader by example. And good thing about it it’s a win-win situation because you gain your employees respect, than to just point and tell them what to do, – the sales people do not, and I promise you when I say this – they do not respect their managers.
A fact that a lot of people don’t know, one in three people in the automotive industry and these sales managers need to look at their employees at their force, one in three people on your sales force is thinking of leaving their job and the reason is because of poor management. You have to lead by example, you don’t ever tell anyone to do anything that you wouldn’t want to do yourself. When I was a sales manager, I would not only tell them what to do, I would tell them what we were going to do and then we were going to do it together. Therefore they would get to see me in action and they gain respect, so much respect for you by doing that and you teach them how to do it the correct way the first time. If you teach them the correct way to do it the first time, the second time they might need a little help but after a few times they’ve got it and their a much better sales person for it.
Another thing that I see I mean it’s just everywhere that when sales managers—when you go froms sales to sales managers—it’s a great honor, they usually, some people make a little bit more money, I don’t know, when I was selling cars I made more money than managing because I sold a lot of cars but that’s just the natural escalation through the car business. As long as your job title has sales in it–like sales manager–that means that you’re still a sales person yet you’re a manager also. You have to do everything that a sales person does and do it a very high level plus you have to be a leader and a manager of your people and keep them in a positive mantra at all times so they will do their job at a very high level. If you do that you will be successful because, and that’s the thing that a lot of people miss, is that if your sales people are successful then you will be successful, your dealership will be successful. It’s not all about one person you guys are working as a team and anytime that anybody breaks that or strays away from it; it causes big problems because if you’re not working as a team you’re working against each other and if you’re working against each other in this business the competition is so tough out there that the people who are working together will absolutely destroy you, they will dominate you.
Ashley: I wonder if you could take even one step further, let’s talk about multi store dealerships. What are some of the problems you’ve seen with the bigger dealerships that have multiple stores and how can they fix some of those problems?
Dennis: Well I was actually a general manager for a seven store dealer group. We had seven different roof tops running at all times and we have a lot of different personalities at every different rooftop and it is hard to get them to all work in perfect harmony. What you have to do is you have to set forth processess and you put them in stone, your processess are put in stone, the way you want things done and there’s no straying from that once it’s set in stone.
Unfortunately a lot of times I’ve went into some dealerships over the years that, I went into a dodge restored and nissan dealership that we had acquired and the environment was so toxic and everybody in the place was negative from top to bottom. Due to the leadership, they had no leadership what so ever it was like a country club that they were selling about fifty units per month at a store that previously under the prior ownership sold over two hundred units a month. They were selling about sixty units a month at about twelve hundred dollars per unit gross profit which is not gonna pay the bills, I mean that’s only 72 thousand dollars; so nobody makes paycheck.
The big thing is you have to have processess that are proven to work, you have to implement those processess and yes, they do take a little bit of time to take effect. We’re not talking six months, we’re talking two or three months. You’ll see improvements within the first two or three months. They might be small ones at first but the more that the people do it and they see it working, when they see those processess that you put in place begin to work and the way that the sales people especially the sales managers get to see it works, they’ll see their paychecks growing. When they see those paychecks start growing and the processess that are working, they’re all in. They go all in. When they go all in that’s when it really explodes.
Ashley: Let’s talk about some of these, what are some specific processess that you implemented and you know the effect that they have? Let’s talk, let’s dive in to that a little bit
Dennis: One of the biggest processess I have implemented pretty much everywhere and it goes from top to bottom is meetings and continuous trainings, those two go hand in hand. A lot of the dealerships that are struggling, you’ll find that they don’t meet very often. Most dealerships that are successful meet two or three times a week and the managers usually meet everyday. The managers know exactly what’s going on at all times, they know what they need to do. The general managers can tell them so on and so forth, they go over their sales people’s performance to see how—you got a sales person that’s taking a hundred ups and he’s only sold two cars and ten five ups and so on and so forth they got struggling so you need to reach out and touch them and do some one on ones with that person to try to get them railed back in and get them back on board successful or their not gonna make it. If they can’t make a living for their family then their going to leave and turn over in the United States, they cost–anually– about 11 million dollars in employee turn over. The meetings and the one on ones are one of the biggest things.
You have to sit down with that person and find out their strengths, their weaknesses and build upon that. Whatever their weaknesses are. I used too, when I was a sales manager, I would stay out there with my sales people. Some of them were scared or nervous to do the meet and greet, I’d help them. I would go straight out there with them and I would have them listen to me do it and after I’d say why don’t you try one and that’s when they do it infront of you three or four times they get more and more comfortable with it. You can pat them on the back and say, “you nailed that one”. Once they know that they did a good one, and they would replicate that over and over and if they do they’ll do really well.
Ashley: That brings up an interesting question, you’ve obviously trained a lot of guys. In salesmanship there’s certainly some sort of aptitude and some people are just born with more salesmanship than others. If somebody reasonably intelligent and and reasonably hardworking, do you think that there are some people that are just not cut out for being a car salesman or do you think anybody, again assuming they’re reasonably intelligent and willing to do the work, do you think anybody is trainable?
Dennis: No, everybody is not trainable. There are certain things that you can teach, hard work and a great work ethic is not one of them, people either have them or they don’t. Some people, I mean I’ve met so many people over the years, there are some people that have a problem with authority. They do not like to be structured, discipline that it takes to be successful in the automotive industry. It’s not—everybody says it—it’s our job, they don’t—people don’t realize—they’re like, “well they just sit around all day and they go out and talk to customers and they right with ink hands—,”yes that’s part of them but they’re not there when you’re out walking on the inventory and moving the cars and you’re doing all the other stuff and it’s mentally draining. It’s such a mentally draining job, it’s very hard and most people do not realize that until they get in to it or they try it and when they do they’re like, “this is ten times harder than what I thought it was going to be”
Ashley: It’s not just salesmanship, it’s really more about work ethic and willingness to do the work from your perspective at least.
Dennis: I can tell you this, when I first, when I started working at one of the big lots in Lexington,I was not as talented as the other guys. I did not have all the word tracks and so on and so forth that they had at the time but I worked harder than they did and that’s why I beat them every month. You can’t teach work ethic, work ethic I would take–any day of the week–I would take a hundred people that are willing to work hard and learn as they go over a hundred people that are talented and are lazy. I’ll take those people that want to learn, that are brand new any day of the week.
Ashley: I wonder, you gave us a great story about that dealership, the larger dealership but I wonder if you can give us maybe another specific story about a dealership that you came in and had a lot of problems. Tell us about those problems and how you fixed those problems..;
Dennis: Probably the—I won’t name any names—probably the…
Ashley: Just generic it doesn’t have to be any specific names. Specific problems is really good, I think people will get some real value out of that.
Dennis: Probably the biggest challeng that I’ve ever ran into and it was a complete nightmare. I went into a very large, several agency [inaudible 26:15] they had funny back in the old days nose mobiles well they had seven different franchises under three different roofs and when I went in there the store was being ran by a general sales manager, they didn’t really have a GM before I got there. The general sales manager had no previous auto experience, he was a good leader, I mean he was a great manager but he had no automotive sales experience so he didn’t know how to hold people accountable. I walked in to the store and one of the first things I do is I do an evaluation when I take over a store and I’ll get a copy of their inventory and I’ll sit down and look at the contracts, and transit, the financial reports in the inventory and I can tell just by looking at the inventory, just by looking at those things right there whether the dealership is successful or not.
I can actually go on—if I’m talking to somebody about their dealership—I can go on their website and look at their vehicles, the used vehicles that their keeping in stock and I can tell the banks and the lenders that their doing the most business with and how profitable they are just by looking at their inventories, the millage the year models and so on and so forth and all that comes with experience. The store was being ran by a general sales manager that had no automotive sales experience, he had pretty much, he had a couple special finance manager that did some financing. They were really the ones that were running the whole place and when I walked in there I looked at contracts and transits; I looked at the inventory. They had some inventory that had been in stock for 500 days and that’s just totally unacceptable. You want to keep your used car inventory on a 60-day or less term. If it get over 60 days you will lose money on it. When you take it back to the auction it doesn’t go real well after it gets the 60-day mark. They also had cars that they had bought from the auction that were stood in behind the service area, back in the service base that had been sitting there for two weeks. They hadn’t been serviced, they hadn’t been touched, they hadn’t been detailed, I’m like ‘what is going on here’, so I dug into it a little deeper. They had closed down their detail department and hired a mobile detail company to come along and do the cars but they only came along once a month.
The service department, the general manager didn’t know that he was supposed to check the cars and the service. When he got back from the auction he just turned in the papers to the ladies in the office and they would set it up on the floor plan and the cars would just sit there until somebody decided that they wanted to sell it. They would want to get that specific car and take it to the service department and then have them service it and that they have to wait to have somebody come and detail it or they have to go back there and watch themselves.
The way I fixed that was real easy and I do this at every place that I go and I’d take a minute for everyone. From the time that you buy that vehicle to the time that it is delivered to your lot, it has 48 hours to go through service, be repaired and ready to sell mechanically and to be detailed. It has to be in your front line and ready to go within 48 hours. Every day that wait, you’re losing money. Those cars—I’m not sure if everybody knows this—but cars do not, if you look through an ADA book. The cars their not going up in value, their declining. There are specific vehicles that do every now and then go up in value but as a whole, each month they go down in value. What that affects is the amount of money the banks will own on the vehicles.
The banks control our industry, they really do. A very small percentage of people can afford to walk in to your dealership and pay and just check by vehicle. You have to take that consideration any time about vehicles, me being very well versed on the finance side of it I’m thinking in my head when I buy that vehicle. Here’s something that I stress and people, they make this mistake so many times, the profit is not made on the vehicle when you go to sell it. The profit is made on that vehicle when you trade for it or when you buy at the auction. By doing the things that I said, that I talked about doing earlier. Going to the auction two hours earlier and knowing that I’m about to break someone’s cars and his tires and you know a number in your head and your adding the stuff up and I’m going to spend fifteen hundred dollars in this car.
I know that I have to buy at least another fifteen hundred dollars back of book value in order for me to make a good profit off it. Then you figure out, you go out, you go through you learn in all your bank programs in your head and you go through and I’ve even got an app on the phone. Most people would get them through your CRM companies, they have mobile apps now that you can click on it and it’ll pull up the bin number, you can pull a car factory, it’ll tell you which advantage on them. It shows you gross profit on this vehicle. If you’re not doing that, you’re kidding yourself.
Ashley: Let’s take a step back to this 48-hours from the time you get the car, is there some processes that you put in place? How can you actually make sure that the car gets through all these various steps and gets out in the lot in 48 hours?
Dennis: Well what I did is I had a meeting with all the service managers and I had to take, there were four lot—they call them lot porters, lot technicians whatever—they were actually just out there moving lot around. They would drive the vans for the service people to take them to and from work and so on and so forth. I had to take two of those people temporarily until I could hire somebody and put them in the detail department. I had a meeting with them, I told them this is what I expect and it’s not something that’s impossible because I’ve dont it everywhere else that I’ve been and every place can do it.
Is it easy? Absolutely not. It takes a lot of discipline, I hold them accountable. You have to be back there every day, numerous times each day saying ‘hey what’s going on? What’s up with this car? When’s it going to be ready? Our 48 hours’ almost up’. You have to get everybody to buy in to that and you create a culture of synergy. If everybody is working towards one common goal and that is that 48 hours window that you get everybody towards that one common goal, it’s easy. I mean it just happens naturally, now if you have people that are bucking the system and their not buying in to that then you’re probably going to have to replace those people. Negativity, there is no place in the car business for negativity. I don’t care what level it’s at, from the people from the operator that answers the phone, to the very top; there’s no place for negativity in the car business. Negativity creates negativity, it breeds and it is horrible once it starts, once you spew some of that negativity out you can’t pull it back in.
Ashley: So Dennis you’ve been very generous with your time today. Let’s go ahead and wrap this up. What’s the best way for people to kind of keep up with you and to follow what you’re doing?
Dennis: Anybody that wants to get in touch with me, they google me, I’m all over google. Everybody in the world know my cellphone number. Also on twitter @thedenniswagner, just like it sounds @thedenniswagner. I’m sorry?
Ashley: I’ll go ahead and I’ll link to that, I’ll put that on the show notes so people can link directly. Do you have an email address too that you want to give out?
Dennis: I do, they can contact me—I’ll give them a couple—they can contact me at dennis@dennisautosalesandservice.com or they can contact me on my personal email. That’s the one that I usually get the quickest because it’s tied in directly to my phone and that is denniswagner1974@gmail.com
Ashley: Okay, perfect. Once again Dennis you’ve been very generous with your time. I really do appreciate it, this has been really enlightening. I thank you very much for coming on the show
Dennis: It’s my pleasure and I hope that this can help some dealerships out there sell more cars and do it more eficiently and most importantly make more profit.
Ashley: Yes, I think it definitely can;
Dennis: Sounds great.
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On the next episode of the motorcar marketing podcast I’m going to be interviewing Rachel Herald, she’s an expert at social media marketing for car dealerships. If you’re struggling to get a handle on twitter, Facebook and YouTube you’re not going to want to miss the next episode. That’s our show I hope you got some value out of it and can help you grow your business, thanks for listening.