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	<title>Profit by Action</title>
	
	<link>http://profitbyaction.com/blog</link>
	<description>Analyze.  Learn.  Improve.</description>
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		<title>Empire Building</title>
		<link>http://feedproxy.google.com/~r/ProfitByAction/~3/KzRqy4gG9eI/</link>
		<comments>http://profitbyaction.com/blog/2009/06/empire-building/#comments</comments>
		<pubDate>Mon, 22 Jun 2009 14:21:11 +0000</pubDate>
		<dc:creator>robp</dc:creator>
				<category><![CDATA[Business Management]]></category>
		<category><![CDATA[managements]]></category>
		<category><![CDATA[Parts]]></category>
		<category><![CDATA[Sales]]></category>
		<category><![CDATA[service]]></category>

		<guid isPermaLink="false">http://profitbyaction.com/blog/?p=146</guid>
		<description><![CDATA[It never ceases to amaze me that we still have dealership staff clinging to old behaviors in a time where economic uncertainties run rampant, sales are down, and the business’ survival is either on, or close to, life support.
Let me be a bit more specific:
I will not identify a dealer specifically in this example; it [...]]]></description>
			<content:encoded><![CDATA[<p>It never ceases to amaze me that we still have dealership staff clinging to old behaviors in a time where economic uncertainties run rampant, sales are down, and the business’ survival is either on, or close to, life support.</p>
<p>Let me be a bit more specific:</p>
<p>I will not identify a dealer specifically in this example; it is far better that I describe the behavior as fictional amalgam of dealers I have seen over the past couple of years, and call it “Happytown Motors”.</p>
<p>Happytown Motors is anything but happy right now. The economic downturn has caused a slump in new and pre-owned sales because customers are not buying in spite of a massive advertising campaign via mail. Service and Parts sales are also down, although customers are keeping their cars longer.</p>
<p>The Pre-Owned Manager has fresh inventory from the auctions which he runs through the shop for an initial check-over; after he finds out what the vehicle needs, he either fixes it after a client has closed on the sale, or he farms the vehicle out to an independent shop to get the work done less expensively than in the dealer’s facility.</p>
<p>The Parts Manager stocks a small inventory, and uses daily or overnight ordering rarely, if ever. His two largest motivators are obtaining as much return credit as possible, and doing as little paperwork as possible. He would rather lose a sale than lose his buyback credit.</p>
<p>The Service Manager has been fighting with lower-than-usual daily car counts. In an attempt to improve this condition, he has asked the Office Manager to run an 18 month “no transaction” report, and the Office Manager has told him she will get to it…after closing month end…reconciling payables…and filing quarterly taxes.</p>
<p>The Technicians have been squabbling amongst each other regarding the type, kind, and ease of work they have been getting. One Tech has been a “buddy” of the dispatcher, and it seems he gets most of the gravy work.</p>
<p>Does any of this sound familiar to you? I could go on…</p>
<p>The term describing cause and effect of this behavior is called “Empire Building”; namely, a person holding responsibility or control of others seeks to reinforce their power by granting use of their role under circumstances which are of most benefit to securing or expanding their power base.</p>
<p>Um…excuse me…how about some common sense, here:</p>
<p>Aren’t we in business to make a profit and grow the business?<br />
Haven’t you figured out that the rules have changed?<br />
How is this toxic behavior going to keep the doors open?</p>
<p>It would be too easy and too simple to boil this down to a lack of leadership. Managers are paid to lead, whether the Dealer Principal explicitly states it (or not). The focus must shift from “My department first” to “What will secure the business and grow our GP”?</p>
<p>Common sense says no customers = no revenue.<br />
Common sense says no parts = no service sales.<br />
Common sense says broken cars for sale = no cars sold.</p>
<p>Fix it:</p>
<p>Pre-owned: Fix what’s broken. Use your dealership’s shop. Going outside = stealing from the Dealer Principal. You know better…stop doing it.</p>
<p>Parts: Stock what sells. Use daily orders. Sacrifice a few “virtual” dollars for some real sales and GP. Listen to your best customer (the Service Department) and stock what they need.</p>
<p>Service: Eliminate the favoritism. Treat all Techs equally (be it good, fair or bad…just be consistent). Work it out with the Pre-Owned and Parts Managers. Press your Office Manager to either provide the call list, or tell you another way to get it.</p>
<p>Collectively:</p>
<p>Get a dose of reality…being “king of your castle” with no concern for the kingdom will result in your downfall. Drop the artificial barriers and work together for the common goal of keeping the business alive. As managers, you are responsible for the income security of at least two non-employees (dependants) for each person working either with or for you.</p>
<p>What can you do right now…today…to ensure your business’ continued financial success?</p>
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		<item>
		<title>What Just Happened?</title>
		<link>http://feedproxy.google.com/~r/ProfitByAction/~3/h_LX7im31oo/</link>
		<comments>http://profitbyaction.com/blog/2009/06/happened/#comments</comments>
		<pubDate>Mon, 15 Jun 2009 15:34:36 +0000</pubDate>
		<dc:creator>robp</dc:creator>
				<category><![CDATA[Business Management]]></category>
		<category><![CDATA[Parts & Service Department]]></category>

		<guid isPermaLink="false">http://profitbyaction.com/blog/?p=144</guid>
		<description><![CDATA[The news is out…GM has filed bankruptcy, Chrysler has just sealed the deal with Fiat, and absolute carnage (in the form of dealer terminations) has ensued.
What just happened?
Many pundits are pointing the finger squarely at two industry giants, and the list of criminal indictments run the gamut:

An alleged culture of arrogance and greed became their [...]]]></description>
			<content:encoded><![CDATA[<p>The news is out…GM has filed bankruptcy, Chrysler has just sealed the deal with Fiat, and absolute carnage (in the form of dealer terminations) has ensued.</p>
<p>What just happened?</p>
<p>Many pundits are pointing the finger squarely at two industry giants, and the list of criminal indictments run the gamut:</p>
<ul>
<li>An alleged culture of arrogance and greed became their downfall;</li>
<li>Products were designed which consumers found lackluster, disinteresting, or not competitive with other vehicles in the marketplace;</li>
<li> Consumers willing to purchase GM and Chrysler products were rewarded with poor reliability and long-term product quality issues;</li>
<li> Labor cost (with blame squarely laid at the feet of autoworkers’ unions) unnecessarily drove product sales prices skyward;</li>
<li> Dealer locations are/were developed at a time when there was no import competition; dilution of the available prospect base (by other brands) resulted in oversaturation of dealerships in a given area;</li>
<li> Domestic manufacturers paid no attention to state franchise protection laws, making dealer termination virtually impossible.</li>
</ul>
<p>There are plenty more, and not enough time or space in the blogosphere to present and analyze each one.<br />
We here at ODS continually look forward, so the question must move from “What just happened”? to “What must be done”?<br />
Remember: You may be working in a successful franchise not affected by these events. There is no guarantee this could never happen to you, and (in truth) what affects one of us truly does affect us all.<br />
I have no solution for the manufacturers other than:</p>
<ul>
<li> Design products people want;</li>
<li>Build them with quality and integrity</li>
<li>Sell them for a reasonable price;</li>
<li>Support the product after the sale well beyond the warranty expiration date;</li>
<li> Never, ever, ever think your product or brand is irreplaceable.</li>
</ul>
<p>For the rest of this audience (most of you being in retail franchises), here are my thoughts:<br />
In the form of a cautionary tale, there is much to be learned from watching your local area deal with franchise closures. Many owners are either picking up new brands or becoming stand-alone pre-owned centers.  Some are cashing out…they’ve had enough.<br />
The one thing getting a great deal more attention is Fixed Operations. Non-warranty service of the product line sold before termination is being stepped up (along with “all makes service”); some dealers are offering to shuttle clients’ vehicles to a franchised dealer for warranty repairs while keeping the CP work and loyalty.<br />
In short, it took the collapse of the “Front End” to convince many businessmen that money can be made in the “Back End” in such a manner that the bills get paid and the lights remain on while digging out of this mess.<br />
My question for those dealers in the audience not affected by a termination:<br />
If you’re not following suit to build the “Back End”(while you still have “Front End” profits)…why not?</p>
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		<title>Eating Our Lunch</title>
		<link>http://feedproxy.google.com/~r/ProfitByAction/~3/a_kRmiLARgM/</link>
		<comments>http://profitbyaction.com/blog/2009/06/eating-lunch/#comments</comments>
		<pubDate>Wed, 10 Jun 2009 14:16:04 +0000</pubDate>
		<dc:creator>robp</dc:creator>
				<category><![CDATA[Service Department]]></category>

		<guid isPermaLink="false">http://profitbyaction.com/blog/?p=140</guid>
		<description><![CDATA[Take a look at the most current version of your local business directory, and count the number of new mechanical repair shops which have opened up in your community recently.
I’ll bet you can count more than three; some being sole proprietors, while others are national chains.
Ask yourself: “Why”?
More importantly, really think it through. Ask yourself [...]]]></description>
			<content:encoded><![CDATA[<p>Take a look at the most current version of your local business directory, and count the number of new mechanical repair shops which have opened up in your community recently.</p>
<p>I’ll bet you can count more than three; some being sole proprietors, while others are national chains.<br />
Ask yourself: “Why”?<br />
More importantly, really think it through. Ask yourself the same question, but in a more reflective manner: “What is going on in my community which justifies an additional repair shop”? It could be your area has seen increased growth, so a larger vehicle population demands an increase in service providers.<br />
If you truly wish to be hard-nosed and critical about it, you could ask yourself the following questions:<br />
“If my shop is not completely stuffed to the gills every day, how could I allow a competitor to open his doors and steal work from me”?<br />
“How did I drop the ball so he could eat my lunch”?<br />
The answer can be (basically) broken down into four categories:<br />
1.	Wishful self-limitation: You are a franchised dealer. You specialize in your franchise’s brand. You target market solely to your brand audience, hope they will do business with you, and reach no further. After all, your only competition is other dealer franchises selling your brand…not the<br />
aftermarket; You additionally dislike the complication which comes with setting up and using different vendors, pricing, accounting, and pay plans required to be both competitive and profitable – it’s too much work for such a limited market share;<br />
2.	 You didn’t see it coming: While development in your area has increased, you are hoping for “converts” to purchase new vehicles from your brand at your place of business;<br />
3.	Fear of misdiagnosis: Your techs are brand specialists. They might misdiagnose another manufacturer’s product simply because they don’t know it well;<br />
4.	Poor return – on – investment perception: “I won’t do general repairs on other brands that much, so why should I invest in the tools and technology required to capture that market share?<br />
Get this in your head: The world is different now.<br />
•	If it has lug nuts and some sort of propulsion system (be it diesel, gas, hybrid, or all-electric) you’d better be able to fix it if you want to keep your doors open.<br />
•	Few clients are concurrently product-loyal; ask any client about the other vehicles in their driveway…there’s a high probability they don’t carry the same name badge as the one they brought to you for service today. The other vehicles will still need maintenance and repair. Why can’t your shop do this?<br />
•	Your techs all learned the same mechanical principles during their trade school training. They simply need the infrastructure (read: information and occasional tool resources) to effect a proper repair. There is no excuse…a good tech can fix anything.<br />
•	Clients open their wallets where they are well-treated. In this economy, clients will spend a thousand dollars today to avoid a three – to – five year car payment;<br />
•	You don’t just want your client’s branded vehicle in your shop. You want ALL of their vehicles…and their family’s…and their neighbors.<br />
•	The shop that sells tires (meaning, gets the wheels up in the air, off the vehicle, and performs a free safety inspection) wins. All of it. Everything. Sales, gross profit, client loyalty and retention. The whole bag. Don’t want to sell tires? Your client will go somewhere else to get them…along with their brakes, shocks, exhaust work, and oil changes. Let one thing go, and you might as well let it all go.<br />
•	It’s time for “empire building” to end between your service and parts departments regarding aftermarket repairs and “who gets what” as far as profit margins are concerned. Adopt weighted-cost average pricing models for aftermarket work, structure your pricing to be competitive in the marketplace, and go after your “unfair share” of the pie.<br />
•	It is not a sin to take a little less gross profit in order to capture every possible vehicle in your market area. You must be profitable, but consider your investment in “all makes service” to be just that – an investment in  building your store as a brand in the community while capturing and keeping clients away from your competitors.</p>
<p>It’s now three o’clock on Tuesday afternoon, and your service bays are empty…what are you going to do about it?</p>
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		<item>
		<title>Clogs to Clogs in Three Generations</title>
		<link>http://feedproxy.google.com/~r/ProfitByAction/~3/hn5FFFZmkF0/</link>
		<comments>http://profitbyaction.com/blog/2009/05/clogs-clogs-generations/#comments</comments>
		<pubDate>Wed, 27 May 2009 00:22:52 +0000</pubDate>
		<dc:creator>robp</dc:creator>
				<category><![CDATA[Business Management]]></category>
		<category><![CDATA[job]]></category>
		<category><![CDATA[money]]></category>
		<category><![CDATA[Sales]]></category>

		<guid isPermaLink="false">http://profitbyaction.com/blog/?p=136</guid>
		<description><![CDATA[A good friend introduced me to the above statement when we were discussing the concept of building a family fortune. For those not familiar, clogs (for this discussion) are traditional carved-wood shoes of northern Europe, and the phrase describes the following process:
•	An individual (the first generation) with little to no money scrapes and claws his [...]]]></description>
			<content:encoded><![CDATA[<p>A good friend introduced me to the above statement when we were discussing the concept of building a family fortune. For those not familiar, clogs (for this discussion) are traditional carved-wood shoes of northern Europe, and the phrase describes the following process:</p>
<p>•	An individual (the first generation) with little to no money scrapes and claws his way to success through nothing other than will and determination;<br />
•	His son/daughter (second generation) elevates the “family business” to “the next level” through a combination of understanding the parent’s “hunger” and applying his or her education and experience to move the business forward because he/she remembers “those hardscrabble days” of watching mom and dad “sweat it out” about meeting payroll or taking out yet another mortgage on the property to keep the business going. While this is going on, the second generation is giving “the best life possible” to his/her children (the third generation) to both secure the business and keep their promise to provide the child with a better life than the second generation ever had;<br />
•	The third generation destroys the business through acts of self-entitlement.</p>
<p>This hit me a little close to home as one of my grandfathers was an immigrant who (in the classic story) immigrated to the US through Ellis Island, NY in 1901, settled in upstate New York, scraped, saved, and owned a grocery store, then (ultimately) purchased and operated a “family vacation ranch” in the Catskill Mountains (similar to that portrayed in the ‘80’s movie Dirty Dancing).</p>
<p>My grandfather had only one child; a son. My father was provided with a life my grandfather only dreamt about in terms of material objects, education and opportunity. My grandfather had the best of intentions…to elevate his progeny’s economic and social class through taking calculated risks.</p>
<p>My father, on the other hand, held a keenly developed sense of self-entitlement. He did not continue to run the family business, opting to take a government job in research (less risk, more security), sold the ranch, and used the proceeds to support my grandmother until she passed away. In our home, he was the first to eat, the first to speak, and the only opinion presented as fact (be it right or wrong).</p>
<p>In my family, the business never got to “second generation” level, much less third.</p>
<p>Some of you reading this are now second generation dealer operators; and, like all of us, you want nothing but the best for your children. The following thoughts are offered with the predication your child(ren) will follow in your footsteps and continue your family dynasty:</p>
<p>•	If your child’s passion does not follow the business, do not force it upon him/her.<br />
•	Some family members were not cut out to be “Car Guys”, and never will be (no matter how hard you try to shape them);<br />
•	Education was not enough for your dad (or you) to either acquire (or take over) the franchise. You earned it through hard work and determination, and it should be no different for your child.<br />
•	“Working your way up” while having an income, security, and lifestyle beyond that of an incumbent who is not a family member guarantees failure. Give him/her the same pay plan and living conditions as anyone else who would hold the same job, and do not allow him/her to advance within the company until he/she can demonstrate absolute success in the role being currently held. Do not use a time line (eg. Three months in sales, three moths in parts, etc.).        If  this means “kick ‘em out” so they make decisions and pay their own way, so be it…you are considering the transition of a multimillion dollar company to another individual, and it should be no different whether that individual is a private party or your child.<br />
•	Teach your child to accrue…in all things…save, save, save…accrue for all expenses, save enough to become self-insured, become cash-heavy and solvent. This financial independence will be an absolute necessity for the third generation to pass onto the fourth…or to get out if the manufacturer terminates.</p>
<p>The business is changing right before our eyes for better or worse. Survivors always have vision, a plan, and the cash to back it up. We here at ODS are always ready to help either develop or evaluate your plan forward. Please contact us if we may be of assistance.</p>
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		<title>On Leadership</title>
		<link>http://feedproxy.google.com/~r/ProfitByAction/~3/1dRyN5RIhtU/</link>
		<comments>http://profitbyaction.com/blog/2009/03/leadership/#comments</comments>
		<pubDate>Wed, 04 Mar 2009 17:59:07 +0000</pubDate>
		<dc:creator>robp</dc:creator>
				<category><![CDATA[Business Management]]></category>

		<guid isPermaLink="false">http://profitbyaction.com/blog/?p=133</guid>
		<description><![CDATA[I just finished my fourth viewing of Paramount&#8217;s &#8220;We Were Soldiers Once&#8230;and Young&#8221;. Before I comment further, I want to make two points clear:
1. This blog is not a debate about who won, lost, or why.
2. For anyone confused about the subject matter, please refer to the blog title.
I am not one for war movies [...]]]></description>
			<content:encoded><![CDATA[<p>I just finished my fourth viewing of Paramount&#8217;s &#8220;We Were Soldiers Once&#8230;and Young&#8221;. Before I comment further, I want to make two points clear:</p>
<p>1. This blog is not a debate about who won, lost, or why.<br />
2. For anyone confused about the subject matter, please refer to the blog title.</p>
<p>I am not one for war movies as entertainment. Cinematographers and screenwriters have historically participated little in actual combat; if they did, few war movies would be made, if any.</p>
<p>This movie tells many stories on multiple levels, and I highly recommend viewing it as a learning tool in spite of the graphic realism of combat.</p>
<p>For those not familiar, the story centers around development of airmobile cavalry (helicopter-based combat troops) in the Vietnam war. The man tasked with developing this concept is Lt. Colonel (now retired Lt. General) Harold G. &#8220;Hal&#8221; Moore, portrayed by Mel Gibson.</p>
<p>Col. Moore developed the aircavalry combat technique, trained his men, and also led them in battle during the first direct fight between US Army forces and those of the Peoples’ Army of Vietnam during November, 1965.</p>
<p>Col. Moore&#8217;s leadership, combined with solid planning and extensive training, resulted in battlefield survival for the US troops in what otherwise would have been a slaughter. Although both sides saw this event as a victory, Moore&#8217;s troops were outmatched by a ratio of 5 to 1.</p>
<p>Col. Moore had an axiom which he would instill in his troops:<br />
&#8220;There is always one more thing you can do to improve your odds of success&#8221;.</p>
<p>And it&#8217;s true. But it means nothing to the individual unless the message inspires them to reach for that goal.</p>
<p>So&#8230;how do you inspire?</p>
<p>Ask yourself these questions:</p>
<ul>
<li>Do I lead by example?</li>
<li>Do I show up on time for work, ready to go, properly dressed &amp; with the right attitude?</li>
<li>Will I do anything I would ask my staff to do for me?</li>
<li>Have I done it, and have they seen me do it?</li>
<li>Do I check on the welfare of my staff, and let them know I appreciate them?</li>
<li>Does each member of my staff have clearly defined job objectives?</li>
<li>Does each member of my staff understand the focus of our overall objectives?</li>
<li>Does each member of my staff fully understand where they &#8220;fit&#8221;?</li>
<li>Does each member of my staff understand how both what they do (and what they fail to do) effects the accomplishment of our overall objective?</li>
<li>Does my staff receive ongoing training to ensure fluid accomplishment of our objectives?</li>
<li>Are my staff&#8217;s Key Performance Indicators (KPI) measured and communicated every day?</li>
<li>Are my staff&#8217;s thoughts and ideas included when making process improvements?</li>
</ul>
<p>If you answered &#8220;yes&#8221; to every question above, congratulations on your insight and leadership ability. Keep up the good work.</p>
<p>If you answered &#8220;no&#8221; to any&#8230;just one&#8230;you have some work to do&#8230;starting with yourself.</p>
<p>Whether you know it or not, you set the example anyway&#8230;be it at work, with your friends, or at home with your family. In short, you are THE role model&#8230;like it or not.</p>
<p>Does what you are doing now reflect how you want things to be? If not, what are YOU either doing or failing to do which has things as they are right now?</p>
<p>Leadership is not a &#8220;once in a while thing&#8221;&#8230;it&#8217;s an &#8220;all the time&#8221; thing. You should want an organized, empowered staff. You should want cross-training. You should want job security for your team not out of fear and compartmentalization, but out of job efficiency and fraternity. Your environmental culture should be a great place in which to work, with little chaos to face after a week&#8217;s vacation.</p>
<p>How do you stack up?</p>
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		<title>10 Tips for Service and Parts This Challenging Year</title>
		<link>http://feedproxy.google.com/~r/ProfitByAction/~3/it579C5i9jQ/</link>
		<comments>http://profitbyaction.com/blog/2009/02/10-tips-service-parts-challenging-year/#comments</comments>
		<pubDate>Wed, 18 Feb 2009 17:05:15 +0000</pubDate>
		<dc:creator>robp</dc:creator>
				<category><![CDATA[Business Management]]></category>
		<category><![CDATA[Parts]]></category>
		<category><![CDATA[Sales]]></category>
		<category><![CDATA[Service Department]]></category>
		<category><![CDATA[marketing]]></category>
		<category><![CDATA[Add new tag]]></category>
		<category><![CDATA[automotive industry]]></category>
		<category><![CDATA[franchise holders]]></category>
		<category><![CDATA[new vehicles]]></category>

		<guid isPermaLink="false">http://profitbyaction.com/blog/?p=127</guid>
		<description><![CDATA[As I write this, news is being released regarding massive job cuts across industry around the world.  More specifically for this audience, the automotive industry is going through twists and turns never before seen. Once-secure manufacturers are seeking government assistance, and generational dynasties of franchise holders are locking the doors and walking away.  [...]]]></description>
			<content:encoded><![CDATA[<p>As I write this, news is being released regarding massive job cuts across industry around the world.  More specifically for this audience, the automotive industry is going through twists and turns never before seen. Once-secure manufacturers are seeking government assistance, and generational dynasties of franchise holders are locking the doors and walking away.  I will leave the “how and why” this happened to the economists and historians. What I offer is “DO”; a few solid thoughts on positive actions you can take in your own business and hometown community.</p>
<p>I am optimistic. Yes, you read that correctly. My reasoning for this viewpoint is rooted in another dark time of US history: World War II.</p>
<p>Prior to United States involvement, my grandfather was an assembly line worker for one of the “big three”, and like every able-bodied male, he attempted military enlistment immediately after Pearl Harbor. Having been determined medically ineligible, he went back to the assembly line and found out new vehicle manufacturing had ceased to produce war material.</p>
<p>My grandfather saw an opportunity; namely, no new vehicles being manufactured meant present vehicles on the street would be kept longer and require more maintenance and repair. Sacrifice, both personal and financial, would also come. He took his savings, opened a repair shop, and was extremely prosperous in his hometown. At it’s peak, he had twelve bays and three “counter people” (they were not called “service advisors” at that time). The shop took in everything (and anything) with some sort of engine needing repairs.</p>
<p>If you couldn’t get it to the shop, he would either come get it, or come to you and work on-site; if he didn’t have the resources, he would find them; if he couldn’t do it (which was rare), he wouldn’t charge you.</p>
<p>He also had a large sign he had created from a rough-cut plank from the center section of a hickory tree which hung above his front counter. The sign’s message faced away from customers, but was readable by staff. Carving wood signs with a router was a popular hobby at the time, and my grandfather cut this inscription:</p>
<p><strong>“If you make their phone ring, yours will ring. If you don’t, yours won’t”.</strong></p>
<p>Sound words of advice which remain unchanged from almost seventy years ago.</p>
<p>The US is now in a similar situation; a country in military conflict not selling new vehicles. The paradigm of Fixed Operations (meaning, Service and Parts) being a necessary evil in order to sell vehicles is rapidly being replaced with the “romantic understanding” these business units keep the lights on and doors open.</p>
<p>To those not involved in Fixed Operations who have finally learned the truth about this concept, I make two simple requests:</p>
<ol>
<li> Don’t forget the friends who stuck with you when times were hard.</li>
<li> Give us the resources we need.</li>
</ol>
<p>For those of you “in the trenches” of Service and Parts, I make these suggestions to do your part for the overall success of your store:</p>
<ol>
<li>Time for a mental overhaul. Being successful in this situation is going to require more sacrifice and dedication than you are used to. This means more everything; more hours at work, more market research, more pricing analysis, more, more, more. Get used to this idea. Put in the time.        Remember: right now, you have a job while many do not.                                                                       The same goes for your staff.</li>
<li>Square your house. Parts inventory aging towards 180 days? Fix it, free up the cash, and buy items that sell. Dirty cores? Send them back. Outstanding receivables? Collect them. Uncollectable? Turn over to a collection agency.                                                                                                                                          Outstanding warranty claims? Get them paid or write them to policy. Nothing past 30 days on the schedule. Work in Process? Get it done or close the RO. Once again, nothing past 30 days.   Open ROs? Nothing over 5 days. Take the pain and get it over with, then vow never to go there again.</li>
<li>Understand your clients.  Fast food chains have customers. You have clients. Value them. Remind them of what they need. Remind them of what they choose to decline.                           Tell them you appreciate their business. Call and follow-up, follow-up, follow-up.                                                                                       Ask yourself: “Why should they do business with us over someone else”?                                        Improve on your strengths and work on your challenges while remembering you need them…not the other way around.</li>
<li>Do your homework. Do your market research. Get your pricing right.</li>
<li>Enforce controls. No discounting without authorization; similarly, cut expenses wherever and whenever you can.</li>
<li>Quit whining, and kill the sacred cows. There is no “entitlement” to any one person or department for profit, time, expenses, or compensation (except where required by law).                                                Remember: part of something is far better than all of nothing.</li>
<li>Set goals and communicate them. Learn how much your facility is capable of generating (facility utilization). Determine what you can do with your current resources (clients, people, parts, processes) and maximize your opportunities.</li>
<li>Measure, measure, measure everything. Adjust your sails with the wind.</li>
<li>Share your successes and challenges. Meet with your staff every day. LISTEN. Praise success and discuss challenges. Blame never fixed a problem; action does.</li>
<li>Embrace your inner (phone) voice. See my grandfather’s message above. Build trusted relationships with your clients.</li>
</ol>
<p>We at ODS live by the creed of “Profit by Action” which may be summed up in one word: DO. What appears above may look like a mountain to climb; feel free to contact us if you would like help reaching the summit.</p>
<p style="text-align: right;"><em>Rob Palumbo is a Senior Consultant for <a href="http://www.consultods.com/index.htm" target="_blank">ODS LCC</a></em></p>
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		<title>Perception</title>
		<link>http://feedproxy.google.com/~r/ProfitByAction/~3/nXSQej8b80Y/</link>
		<comments>http://profitbyaction.com/blog/2009/01/perception/#comments</comments>
		<pubDate>Tue, 27 Jan 2009 18:25:43 +0000</pubDate>
		<dc:creator>robp</dc:creator>
				<category><![CDATA[Customer Care]]></category>
		<category><![CDATA[marketing]]></category>
		<category><![CDATA[consumer satisfaction]]></category>
		<category><![CDATA[networking]]></category>
		<category><![CDATA[public opinion]]></category>
		<category><![CDATA[relationships]]></category>
		<category><![CDATA[true perception]]></category>

		<guid isPermaLink="false">http://profitbyaction.com/blog/?p=124</guid>
		<description><![CDATA[We all know how important consumer satisfaction is to overall success.
Apparently, there are some in our industry who only pay lip service to it, thinking the disgruntled consumer will merely &#8220;go away&#8221; with no further complication.
Right.
We now live in a world where information is as close as an internet connection, and anyone with access to [...]]]></description>
			<content:encoded><![CDATA[<p>We all know how important consumer satisfaction is to overall success.</p>
<p>Apparently, there are some in our industry who only pay lip service to it, thinking the disgruntled consumer will merely &#8220;go away&#8221; with no further complication.</p>
<p>Right.</p>
<p>We now live in a world where information is as close as an internet connection, and anyone with access to a web camera and multimedia publishing software (available for free) can voice their opinion about anything and find a place to display it (or buy a website and do it themselves).</p>
<p>The power of this influence must not be overestimated. Recently, a woman plead &#8220;not guilty&#8221; to her culpability in the suicide of a teen girl after allegedly having created the online persona of a teen boy who showed interest in a relationship. This &#8220;persona&#8221; ultimately rejected the girl in a very harsh manner, and the girl took her life as a result of the rejection.</p>
<p>It is alleged that the teen boy was a work of pure fiction brought about by the accused, her daughter, and several friends as means of revenge for comments made on a social networking website.</p>
<p>Regardless of your opinion on this matter, one fact rings true:</p>
<p><em>Perception is a strong motivator</em>.</p>
<p>Consumers are also harnessing this power to sway public opinion against businesses which (in the consumer&#8217;s eyes) have wronged them. Our industry is a prime target because the historical perception has not been a good one. All a disgruntled consumer need do is buy a web address (usually less than $10), write their story in a multimedia program, upload to the web, and get listed on a web search engine.</p>
<p>I have viewed more than a few of these sites, and (factual or not) some common threads emerge:</p>
<ol>
<li>The consumer patronized the business looking for a product or service;</li>
<li>Something went terribly wrong.</li>
<li>In the consumer&#8217;s eyes, a satisfactory resolution either did not happen, or did happen only after excess time lapsed or additional expense was incurred;</li>
<li>The consumer developed a perception that their patronage was not valued by the business;</li>
<li>The consumer obtained no assistance from the product manufacturer;</li>
<li>The consumer sought and obtained help from a competitor;</li>
<li>The consumer publishes their experience in a public forum and excoriates the business who (in their opinion) &#8220;did them wrong&#8221;.</li>
</ol>
<p>Can your business afford this &#8220;bad PR&#8221;? Of course not.</p>
<p>Can you keep it from happening? Not &#8220;100 percent&#8221; of the time, but you can minimize it by:</p>
<ul>
<li>Establishing a robust problem resolution process in your business, with clear guidelines for levels of responsibility, decision authority, and empowerment at all levels;</li>
<li>Ensure this process is seamless and transparent to the consumer. &#8220;Own&#8221; the problem (as you own the consumer relationship) until either the problem is resolved or your level of empowerment has been exhausted (at which time the problem&#8212;not the consumer&#8212;is escalated);</li>
<li>Give absolute priority to consumers requiring problem resolution. Further delays will only make matters worse;</li>
<li>Never, ever leave consumer voicemail or e-mail messages which are less than professional, even if you think they are deserved. Remember: there is no &#8220;off the record&#8221;, and &#8220;anything you say can and will be used against you in the worst way possible&#8221; in the court of public opinion;</li>
<li>Be honest. Admit your mistakes. Apologize, move forward, and gain the respect of the person you are trying to assist;</li>
<li>Analyze &#8220;where the ball got dropped&#8221; and correct any shortcomings for the future;</li>
<li>Let the consumer know you appreciate their patronage;</li>
<li>Follow up with at least two phone calls spaced two weeks apart to ensure the problem is permanently resolved.</li>
</ul>
<p>This is not &#8220;giving up&#8221; or &#8220;giving in&#8221;, and I do not endorse making concessions where both parties don&#8217;t emerge with a &#8220;win&#8221;. There will always be that &#8220;less than one percent&#8221; believing the world owes them a favor.</p>
<p>Characterizing all &#8220;problem consumers&#8221; in this manner can have strong repercussions when (in actuality) the &#8220;99 percent&#8221; are merely seeking to have their needs met and move on with their lives.</p>
<p>What can you proactively do to ensure your business is never the subject of hostile web site?</p>
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		<title>The Pen Is Mightier Than The Computer?</title>
		<link>http://feedproxy.google.com/~r/ProfitByAction/~3/Fz6qS8dWASg/</link>
		<comments>http://profitbyaction.com/blog/2008/12/pen-mightier-computer/#comments</comments>
		<pubDate>Mon, 01 Dec 2008 19:05:48 +0000</pubDate>
		<dc:creator>danielp</dc:creator>
				<category><![CDATA[Service Department]]></category>
		<category><![CDATA[Add new tag]]></category>
		<category><![CDATA[after]]></category>
		<category><![CDATA[attitude]]></category>
		<category><![CDATA[marketing]]></category>
		<category><![CDATA[money]]></category>
		<category><![CDATA[technician]]></category>

		<guid isPermaLink="false">http://profitbyaction.com/blog/?p=122</guid>
		<description><![CDATA[I am quite frankly fed up with all the doom and gloom merchants telling dealers and staff that “all is lost”, “we are all doomed” and “the end of the world is nigh”.  Yes times are going to get tough, yes the guys and girls in the sales departments will be full of doom [...]]]></description>
			<content:encoded><![CDATA[<p>I am quite frankly fed up with all the doom and gloom merchants telling dealers and staff that “all is lost”, “we are all doomed” and “the end of the world is nigh”.  Yes times are going to get tough, yes the guys and girls in the sales departments will be full of doom and gloom, but now is the time for the Service and Parts Departments to step up and prove once and for all that in the current market conditions – ‘Sales for Show, AfterSales for Dough’.  Having now written, or in your case read this ‘truth that cannot be said’ here is my reasoning for such bullishness.</p>
<p>Let’s look at some facts; according to NADA in 2007 it is likely that there was some $20,000,000,000 in unclaimed, but identifiable work that went through our workshops without being recognized by our businesses.  There is no reason to think that 2008 will be any different.  That’s right 20 Billion Dollars left on the table, and it’s up to you in 2009 to stop this and add serious money to your bottom line.  The average US Dealers share of that would be more than enough to offset the predicted vehicle sales downturn in 2009. </p>
<p>When talking about the 20 Billion, the reason I use the term “unclaimed, but identifiable’ is that we had these cars in our workshops and did nothing to identify this opportunity.  In most incidents the car and customer left in a state of ignorance as to the true mechanical safety or condition of their car.  If we had just looked in a systematic way, two things could have happened.  First, and at worst, the customer would have been advised of exactly what needed to be attended to on their car.  Second, and more importantly for us, they may have asked us to fix what was identified.  </p>
<p>Ask most shop managers if their staff actually does inspect vehicles for extra (necessary) work and you will get the politically correct answer “of course we do” – the truth however is different.  Most shops just concentrated on doing what the customer asked for and few cars receive an organized inspection and in many cases, even if the technician does spot something, it is often not acted upon by the Service Advisor which causes the tech to take the attitude of ‘why bother to report it’.  </p>
<p>As professional Fixed Operations Managers, if we make a simple commitment that we will ensure that 100% of all vehicles entering our shop will get a structured inspection by the Technician and all the relevant check points will be graded either OK, needs repair now or needs repair in the next few months.  Having done that we put the process’s in place to measure its compliance.  After that we put in place a further process for our Advisors that ensures every customer is informed (immediately following the tech inspection) of any issues.  Finally your process will deliver to you, The Manager, a regular status report of:</p>
<p>1.	How good your Technicians are at identifying work that needs doing.<br />
2.	How good your Advisors are at selling the work found.  </p>
<p>OK – let’s now wake up from this dream….  For that’s what the above is – a dream.  Yes we want all that but technology has let us down in trying to get it.  Here is what we need, something that techs can use to write down what they see wrong, something that magically sends that to the right Advisor and then automatically analyzes whether the Advisor sold it, for how much and if not why not.  Well all those computer whiz kids have tried ‘Note Books’, ‘Tablets’ and various PDA’s, but all share two things in common.  First they are expensive to use and second they don’t like oil, grease, hot coffee or being dropped.  But don’t worry help is at hand.</p>
<p>I was in Europe last year and whilst visiting some workshops I saw a company was testing a remarkable piece of technology – it was called a ‘Pen’.  In fairness it was a digital pen, but it wrote with ink, felt like and looked like a pen, more importantly it cost more like a pen than a computer and you could drop it and it still wrote!  But to be serious for a minute this pen was doing remarkable things.  Each technician used the pen to complete the inspection form (exactly as they had been doing before) and then in the blink of an eye, when they put the cap back on the pen, it transmitted the form data from the Pen to the appropriate Advisor and it appeared via a neat piece of software on the Advisors terminal.  As this data had been transformed (by software magic) to a digital format it interacted automatically with CRM and scheduling systems build into the software.  The upshots being that Dealers were seeing an incredible increase in CP work being put through the shop, and not just the work that needed doing now, but also the work that needed to be done in several months time.  In essence, they were getting their share of the 20 Billion Dollars.  On checking, I found that this was truly a pennies solution to a dollars issue.</p>
<p>Fascinated by this I spent some time talking with the software designers who built the system and the Technicians and Advisors who were piloting it.  It appears the pen was made by Logitech and is called the ‘Digi-Pen’.  The clever software came from a European based software house.  Everybody was impressed by its simplicity, low cost and usability, but above all its performance.  </p>
<p>This system is now here in the USA, I don’t wish to sound like the guy from that famous electric razor company who said “I was so impressed with the razor that I bought the company”, but the company I work for did buy the rights for Digi-Pen.  The software has been redesigned to suit the American market and already several major manufacturers are trialing it.   The results have been even better here than in Europe.  So, here we have it, technology has finally given the AfterSales department the tools to pick up its share of the 20 Billion, simply by picking up a different Pen.     </p>
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		<title>What’s a Sales person to do? Continued…</title>
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		<comments>http://profitbyaction.com/blog/2008/10/sales-person-continued-2/#comments</comments>
		<pubDate>Fri, 17 Oct 2008 09:00:12 +0000</pubDate>
		<dc:creator>andyfc</dc:creator>
				<category><![CDATA[Customer Care]]></category>
		<category><![CDATA[Service Department]]></category>
		<category><![CDATA[customer service]]></category>
		<category><![CDATA[Sales]]></category>

		<guid isPermaLink="false">http://profitbyaction.com/blog/?p=121</guid>
		<description><![CDATA[You remember from yesterday I was talking about Sales people talking to Service customers 2 days after they pick up their vehicle. Here&#8217;s what to do if the Sales person who sold them the vehicle no longer works at the store. You have a couple of options here.
1. Give these customers to the newest Sales [...]]]></description>
			<content:encoded><![CDATA[<p>You remember from yesterday I was talking about Sales people talking to Service customers 2 days after they pick up their vehicle. Here&#8217;s what to do if the Sales person who sold them the vehicle no longer works at the store. You have a couple of options here.</p>
<p>1. Give these customers to the newest Sales person<br />
2. Round Robin them to the Sales team.</p>
<p>What a great excuse to call &#8220;Hi, my name is Tom and I just wanted to introduce myself as Bob is no longer with us&#8230;&#8221;</p>
<p>Now when a Sales person complains about traffic, just say &#8220;Have you talked to your customers today?&#8221;</p>
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		<title>What’s a Sales person to do?</title>
		<link>http://feedproxy.google.com/~r/ProfitByAction/~3/gnBLhziwF1w/</link>
		<comments>http://profitbyaction.com/blog/2008/10/sales-person/#comments</comments>
		<pubDate>Thu, 16 Oct 2008 17:38:11 +0000</pubDate>
		<dc:creator>andyfc</dc:creator>
				<category><![CDATA[Customer Care]]></category>
		<category><![CDATA[prospects]]></category>
		<category><![CDATA[relationships]]></category>
		<category><![CDATA[traffic]]></category>

		<guid isPermaLink="false">http://profitbyaction.com/blog/?p=119</guid>
		<description><![CDATA[As I have traveled around North America over the past month the news is the same Sales Departments are having a tough time of it. Traffic is low, internet request are slower than usual, and Sales people are asking what to do all day?
How about talk to customers. When was the last time your Sales [...]]]></description>
			<content:encoded><![CDATA[<p>As I have traveled around North America over the past month the news is the same Sales Departments are having a tough time of it. Traffic is low, internet request are slower than usual, and Sales people are asking what to do all day?</p>
<p>How about talk to customers. When was the last time your Sales people talked to an existing customer instead of a prospect? Let&#8217;s remember all customers started out as prospects and will once again be a prospect for a repeat purchase. Here&#8217;s the easiest way to ensure Sales People talk to customers and build strong relationships, call them.</p>
<p>Want to make it really easy look to the Service drive where many people are still coming everyday. Sales people should be working the drive in the morning helping get customers in and out quick, while &#8220;catching up&#8221; with their customers. 2 Days after a Service customer leaves, the Sales person who sold the vehicle to them should use the visit as an excuse to call them. This shouldn&#8217;t be a CSI call but rather a call to strengthen the relationship, see where they are in the buying process, ask for referrals, invite them to an upcoming event or test drive anything just talk to them!</p>
<p>This simple yet effective solution will increase your prospects and ultimately Sales, besides what else is a Sales person to do&#8230;    </p>
<p>Tomorrow what to do with Orphan customers</p>
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