True, human resource management must be addressed as part of any dealer’s profit improvement process; and, you must have professional and dedicated personnel. But what’s more important is how your people perform and execute the plan. What seems to be the answer is the environment in which the personnel operate.

Most dealers operate in markets where there is competition from several same-franchise dealers as well as competitive dealers with other franchises. Long gone are the days when customers only supported their “local” dealer.

So how is it that some dealers can be so successful when many of their competitors are having issues?

Most of them are hands-on and pro-active dealers. Without exception, successful dealers have processes and plans in place that everyone in their dealerships must follow, and all employees are accountable for their area of responsibility.

One example is the inventory-management standards with regard to unit-count, aging and model composition that have been established, and on which there is no compromise. The successful dealer insists that no used vehicle remain in inventory past 60 days, if that is his aging standard.

He also insists that used vehicles meet the dealership’s inventory profile. If a vehicle doesn’t, it goes to auction or is wholesaled sooner rather than later so that capital and space is freed up for a vehicle that has historically sold well.

The successful dealer monitors his monthly new-vehicle sales rate by individual model and knows by month what the average sales have been. If he sees a change in the market, he adjusts the selling price to avert any inventory and turn-rate stagnations.

If he senses an opportunity to gain market share in an area, he creates a plan in advance of ordering the vehicles. There is a written plan to sell these vehicles that includes the advertising message and campaign.

In his fixed operations, the same types of plans are created as well as game plans outlining the required execution. He knows, for example, his car parc and monitors the penetration of certain types of mechanical services such as menu-related items.

Obviously, service department and technician productivity and efficiency are monitored daily, as well as individual service advisor performance in areas such as hours per-repair order, effective labour rate and parts-to-labour ratio. He prints a list of open RO’s each day and meets with his service manager to go over each one and finds out why it is still open.
He monitors his gross and true turn of parts, plus his day’s supply level and his level of service to ensure the department operates at the highest level.

Accounts receivable are reviewed monthly to ensure that customer credit limits are appropriate. Overdue accounts are investigated and cut off if necessary until the account is brought back to current.

Non-parts-department employees are used for doing bin counts on a regular basis and they submit a written report to the dealer.

The successful dealer holds manager meetings daily to review the previous day’s performance as well as the dealership’s month-to-date results compared with the business plan.

And more importantly, the successful dealer is passionate about his business. When you realise what it takes to be successful and refuse to relax your standards, you too can achieve the results that successful dealers are achieving.

Important: This is not advice. Clients should not act solely on the basis of the material contained in this bulletin. Items herein are general comments only and do not constitute or convey advice per se.
Also changes in legislation may occur quickly. We therefore recommend that Asides’ formal advice be sought before acting in any of the areas. This bulletin is issued as a helpful guide to clients and for their private information. Therefore it should be regarded as confidential and not be made available to any person without prior approval.

Your Workshop through its team have the responsibility of controlling and selling time. Time…..is an intangible commodity that cannot be stored and discounted for sale tomorrow nor can it be sent back to the manufacturer in the next parts return. It can also be one of the most expensive resources for the Workshop to acquire and maintain.

50 % of the available selling hours for 2010 have already gone. Your service manager and his/her team’s ability to plan, measure, control and market the remaining 50% of hours available for sale in 2010 can have a dramatic effect on the success or failure and profitability of your Workshop.

To meet the challenges and to take advantage of the many opportunities in 2010 and beyond, there needs be a change in the culture in Workshops.

Owners spend large amounts of money building new premises and branding their businesses to attract customers and to instil the perception that they are customer orientated and that they are a professional business to deal with.
So why is it that after investing huge amounts of money to promote the business, the Workshop area is still referred to as the “back end” of the business? The perception of being the back end of anything is not an inspiring or a pleasant one for the service staff or the customers.

First impressions, perception and relationships are the tools the Workshop use to sell time – what sort of first impression or perception do you create when introducing the customer to the back end of your business? Do 5 star restaurants refer to the kitchens as the back end of their business? The successful ones don’t !

Perhaps a more accurate description of the Workshop should be the “back bone” of the business.

The following are some strategies you may want to consider:

• Customer retention strategies – make use of the “kiss” system.
• “Pretend that every single person you meet has a sign around his or her neck that says, ‘Make me feel important.´ Not only will you succeed in sales, you will succeed in life.” Mary Kay Ash.
• You can create loyalty programs much more cheaply than you may expect. Simply by using your customer’s name when they come into your Workshop is a great place to start.
• The only time that the workshop has 100 % customer retention is at the time of the service. Introduce the service team and the many services they provide at the time of delivery.
• Implement consistent and innovative service marketing programs together with increased training for all front line service counter staff.
• Offer appointment times that are most convenient for the customer and confirm appointments.
• Prioritise the customer’s needs; attend to the “primary” concern first. Ensure the vehicle is fixed right – the first time – on time.
• How many of your current employees use your Workshop for recommended vehicle servicing or repairs?

“People tend to live up to what’s expected of them and they tend to do better when treated as if they are capable of success.”

Important: This is not advice. Clients should not act solely on the basis of the material contained in this bulletin. Items herein are general comments only and do not constitute or convey advice per se. Also changes in legislation may occur quickly. We therefore recommend that our formal advice be sought before acting in any of the areas. This bulletin is issued as a helpful guide to clients and for their private information. Therefore it should be regarded as confidential and not be made available to any person without prior approval.

Len recently introduced our Workshop Mate Software into his Dealership and is tickled pink with the results.

He has documented his setup experience below.

This is a must read for all Workshops considering purchasing Workshop Mate and, for all existing users looking to save more time with a bar code scanner.

“Just a quick note to tell you of our progress with the Workmate system.

In the beginning the whole task was a bit daunting…..but with perseverance and getting all the customers, vehicles, parts, services etc. into the system, it has drastically reduced our times taken to produce repair orders, invoices for our customers and job cards for our staff. Importantly, for the mechanic working on the job, what the customer requests can be given exactly to the staff member doing the job, they are unable to miss any of the customers concerns so the job goes out right the first time, with nothing missed or overlooked. From the customers perspective that is one of the most important aspects of vehicle service or repair.

With the latest development such as the bar code scanner it saves us heaps of time and it is just a matter of gathering up the parts required, a quick “pip” and the mechanic can get started on the job. Saving further employee down time. It’s a great idea and saves additional time and effort through every step of the job. Again, it does take some time to get all the parts into the system but once it’s in there, it is a breeze to add the parts into a repair order and get the job underway.

The email facility to send our customers either repair orders or invoices will also save plenty of time. It’s a great feature and as we add in the customers email addresses it will save postage, stationary etc. It will also be handy if a customer has lost an invoice, rather than printing and faxing or printing and posting it can be emailed almost instantaneously. Saving time, money and effort.

Overall, I think it has saved me a day a week in paperwork and administration to operate the workshop successfully. It produces accurate and professional looking invoices for our customers and numerous reports that can be used as business tools to improve our service to the customer.

As an example the end of the month of June, I had all the invoices in

Workmate up to date and just had to wait for the final jobs completed on the 30th and was able to charge out the last few into MYOB and printed out our statements on the 1st July and got them into the post by the 2-30pm cut off time. Something that we haven’t been able to manage…….ever!! Once our customers received the account in the mail they begin to come in and pay us which improves our cash flow position because the accounts are out earlier in the month and we are paid earlier in the month. Another saving…..another bonus.

So overall, it’s a great system, it saves time and money and gives our business a professional look and feel.

I thank you for being available at all times to listen to (and fix) any

issues that I have had. As you know I am “electronically challenged” but even with my limited computer skills, I can operate the system with confidence and accuracy. It has given our business an edge and made us look and act much more professionally.

Keep up the good work, it’s been a pleasure to deal with you.

Kind regards,
Len MacFarlane
Dealer Principal
MacFarlane Mitsubishi.
(02) 69722131.

What is this about?

With the latest trend of buyers no matter what industry people tend to look online prior to going to the location and looking at the stock. Consumers tend to try get a rough idea of how a product, in this case a car, will look before they will pickup there keys and start driving.

What you want to do is grab these customers and get them to look at your own online website with LIVE car listings that you have added to your EasyCars software. Sounds complicates? Well it’s not, you don’t need to do anything from your side of things let us do this for you and create the latest and modern style website with your vehicles automatically uploaded each time you add/remove or even update your stock.

How do i get this implemented

The EasyCars software we sell has a inbuilt functionality which we can grab your existing stock list from your database and dynamically display this onto the internet. Basically all you have to do is identify what you want to list in EasyCars and it will automatically appear on your website!

• Won’t require maintenance
• Don’t require development skills
• Unlimited changes to your web site
• Web hosting for up to 1GB
• Unlimited telephone support
• Your own domain name
• Vehicle list updated Automatically

If you are interested on implementing this please give our team a call on (02) 9623 6403 or email sales@jeal.com.au.

For more information on this please checkout the Website Integration Page which will have all the information or Websites Made Easy website.

Example

Imagine you have a car dealership along Parramatta Road with say 50 Cars which vehicles continuously change due to selling and new stock. You want some online presence but don’t want to pay $50 a car to advertise on say Carsales.com.au also having the hassle of adding/removing or updating EACH car.

You decided you want a website of your own and want your car stock automatically listed on the internet from your car dealership database. Are you using EasyCars? In 1 hour you can have your car list of 50+ cars stock in your database automatically uploaded on the internet and updated to your website as you update it in EasyCars. Yes that is correct! That simple!

Below is a handful of customers who already using the magnificent intergration

• Glenns Quality Cars – http://www.glennsqualitycars.com.au/
• Wayne Stewarts Quality Cars – http://www.wsqc.com.au/
• Central Wholesale Clearance – http://www.centralwholesaleclearance.com.au/
• Sutherland Motors – http://www.sutherlandmotors.com.au/
• Wholesale Direct Cars – http://www.wdcars.com.au/
• Ezy Cars Homebush – http://www.ezycarshomebush.com.au/
• Buy and Sell Autos – http://www.buyandsellautos.com.au/
• & more….

There is increasing interest in the use of milk as a rehydration
drink since milk naturally provides water, sugar and electrolytes.
A recent study found that drinking milk after exercise may promote rehydration better than water or sports drink. The athletes exercised until they lost 1.8% of their body weight through sweat (a sign of dehydration).
They were then given a different test drink to re-hydrate. The results clearly showed that milk was more effective than water or sports drink at replacing the fluid loss. The researchers said it was likely that the naturally high electrolyte content of milk helped restore the body’s fluid balance after exercise.

Whats New?

New features added to EasyVend that could save you hours.

The sales graphs now have an option to include rebates when graphing Profit $. The new check box is in the top right of the screen.
When the box is checked, the different rebates (margin/%/cartage) are all added up and added to the sales. The grand total should be the same as the total at the very bottom of the Sales/rebate sales summary report.
Previously, the graphs did not include Fee for Service customers. However, as these customers can have rebates, they are now included in the graphs, unless they are specifically excluded in the graph options.
Also, the Rebate/cartage Claim Form now has an option to list individual products rather than grouping them by rebate type.

Read more in our PDF newsletter – Click Here to download

New features added to EasyVend that could save you hours

The sales graphs now have an option to include rebates when graphing Profit $. The new check box is in the top right of the screen.
When the box is checked, the different rebates (margin/%/cartage) are all added up and added to the sales. The grand total should be the same as the total at the very bottom of the Sales/rebate sales summary report.
Previously, the graphs did not include Fee for Service customers. However, as these customers can have rebates, they are now included in the graphs, unless they are specifically excluded in the graph options.
Also, the Rebate/cartage Claim Form now has an option to list individual products rather than grouping them by rebate type.

Read more in our PDF newsletter – Click Here to download

Wages Manager

A New Payroll Package from JCS
Your Wages, PAYG tax withholding and superannuation obligations are so simple with Wages Manager. It is uniquely designed to protect employers by automating as much of the payroll function as possible in strict accordance with the Tax Laws.
And the best part about it is if you purchase EasyCash Pro, Wages Manager links directly into it! It’s that easy!

Read more in our PDF newsletter – Click Here to download

What does Hunting for “New” Customers mean?

The “hunter’s” preferred method of securing new customers to their Workshop is to use what we called the HOPE Sales and Marketing Plan.

Stage One
A large number of advertisements promoting the Workshops “special offers” are placed in newspapers or flyers over specific time periods. This method of marketing called Shot Gun Marketing usually generates a higher income for media outlets than your workshop.

Stage Two
The business owner HOPES customers will show up and book-in a job, resulting in spare parts sales and services. This happens, they believe, as a direct result of their “Special Offers” advertisements. Often, the jobs coming from these types of advertising campaigns usually end up being low grossing deals after evaluting advertising and promotional costs.

Workshops relying solely on attracting new customers for additional vehicle services have been and still are successful; they do book more services but achieve a lower return on investment (ROI).

Attracting a new customer costs up to 5 times as much as pleasing an existing customer. It can cost 16 times as much to bring a new customer to the same level of profitability as an existing customer.

What are the Rewards for Farming Existing Customers?

Customer Retention is as important as attracting new customers. The smart business operator builds a fence around existing customers before someone else makes them a better offer. One intersesting statistic shows, that over a period, 70 % of customers become INACTIVE because they feel they have been ignored and not appreciated and the business operator doen’t realise they have lost a customer until it is brought to their attention much too late.

Implementing a Customer Retention Strategy is imperative for business success. Customers drive profits in today’s increasingly competitive market. Remember, YOUR CUSTOMERS have many more outside options if they feel neglected in their dealings with you.

You must communicate and build relationships with your existing customers, meeting and exceeding their expectations and satisfying their needs. When you do this, your existing customers are more likely to …

• Stay loyal longer
• Be more receptive to the workshops marketing campaigns
• Book more services and relative spare parts
• Refer friends and relatives to the workshop
• Pay less attention to competing brands and advertising and is less sensitive to price
• Cost less to serve than new customers because transactions become comfortable and routine

Who is the The Farmers silent business partner?

What would your reaction be if someone came to you with the following offer?

• Supply you with an ACTIVE CUSTOMER data base
• FARM your customer data base for you
• MARKET to the workshops lapsed customer base
• Carry out PROMOTIONAL ACTIVITIES in conjunction with the service department.

AND while carrying out these 4 primary tasks, could also contribute 30% efficency to the workshops total gross.

Does this sound too good to be true?

NO! This someone or something exists … its YOU and your hard working SILENT BUSINESS PARTNER known otherwise, as specifically task designed Car Dealerships Software.

Workshop Software is potentially one of the most under utilised marketing tools in the workshop, and is certainly the most cost effective. All that is required on your part, is a commitment and direction to achieve the goal of business growth for your Workshop, increasing profitability by increasing the number of services and spare part sales though maintaining a strong, efficent customer relations strategy.

As the owner, include your Workshop Software in the business marketing strategies. Also surprising is how some of the the better quality packages streamline other areas of the business. An immediate task is to make customer retention programs a part of your business operations culture. Don’t just pay it “lip service”, it needs to be an effective, planned and easily implemented strategy, then Customer Retentions will underwrite your strategies for attracting new customers

A recent story reported by Dealers Edge Headlines prompts us to re-visit the issue of security in dealerships – particularly in the parts department.

According to Dealers Edge Headlines, Morris Pontiac Cadillac GMC dealer, Robert Morris, was surprised when the yearly physical inventory of the parts department uncovered three missing engine assemblies. A follow up investigation led to the arrest of parts Manager Roman Lundgren on charges of grand theft by deception. The value of the three engines was placed at $43,000, but the dealership suspects other thefts and is still investigating.

It appears that Lundgren ordered the three engines in question on the dealership’s account, but had the assemblies delivered directly to the intended customers. Lundgren had the customers pay him directly and pocketed the proceeds of the sale. Lundgren was a nine-year employee of the Cleveland area dealership.

Dealership owner, Robert Morris, expressed shock at the theft saying, “You never expect anything like this to happen.” That is an all-to-common response heard from most dealers when a substantial theft is discovered. All-to-common as well, unfortunately, is the fact that many of these thefts are perpetrated by long-time and trusted employees.

Like it or not, any business with a large and diverse inventory presents opportunities for theft or fraud. The typical dealership parts inventory contains a large number of parts that can easily be converted to cash. In fact, surveys and studies on fraud consistently show that theft of inventory and plant continues to be the most common form of internally investigated fraud with more than 40% of frauds being of this type!

Now, we look at what you can do to prevent or at least minimise the theft of parts from your dealership.

Proximate Causes
Being aware of the proximate causes of fraud is the first step in prevention. Three conditions must exist in order for fraud to occur: situational pressure (for example, “keeping up with the Jones’s” or living beyond their means), opportunity and rationalisation. Combined, these conditions comprise what is known as the “fraud triangle.” In short, a need or motivation (usually financial) comes together with the opportunity to commit and hide a dishonest act (usually theft). The thief then rationalises his action as merely getting even with the company for some perceived injustice.

Methods for Deterrence
The best methods for preventing theft or fraud against the dealership are those that remove one or more of the sides of the fraud triangle.

A five-step approach is recommended for preventing theft and improving internal controls and paper flow problems. The FIVE STEPS can be identified by the acronym CLEAR – check, lock, enforce, access, record. Here are some basic measures to consider for each action.

Check

• Regularly perform random bin checks or keep a perpetual inventory
• Investigate any unusual consumption or shortage
• Routinely inspect incoming freight. Check against the bills of lading or packing slips. Note all discrepancies and ensure that corrections are made.
• Routinely inspect outgoing freight, especially the parts delivery trucks. Quantities and types of parts being shipped must agree with the delivery tickets.
• Review purchase orders regularly. They should be filled out completely and include a corresponding work order or parts ticket if applicable.
• Perform a physical inventory at least once a year
• Audit the cash registers at least monthly
• Require the customer’s full name, address, and phone number whenever parts are returned for a refund. Randomly call the customers to verify that the returns are legitimate
• Check references for all new employees
• Spot check trash cans and trash bins to make sure saleable parts are not being removed in that way.

Lock

• All entrances and exists must be locked securely after business hours
• Parts department should have a separate access from the rest of the dealership
• Depending on the size of the inventory and the number of employees, consider a locked security area with limited access for valuable items like audio equipment
• All inventory items must be in an area that can be locked after business hours. (Incredibly, some dealerships have unsecured inventories that extend into the showroom or service department)

Enforce

• Make sure all parts employees are aware of the security police. Allow no exceptions, not even for the dealer principal
• Ensure all parts employees administer the security policy

Access

• Limit access to parts department employees only
• Post signs that clearly identify the “no admittance” areas
• Employees from other departments should be accompanied by a parts employee when they enter a secure area
• Locks on parts department doors should be keyed differently from the rest of the dealership
• Maintain rigid control over parts department keys.
• Limit access to inventory file records to parts employees. Change passwords often
• Parts counters should also act as barriers with no open access
• The layout of bins should provide for clear views of access doors including the shipping and receiving areas
• Mirrors should be installed to monitor hidden areas
• Consider installing security cameras

Record

• No part should leave the inventory without being documented
• Maintain accurate records
• Only parts department employees should charge parts against work orders
• Parts used by the dealer principal, if provided at no charge, should be recorded on an invoice “at no charge”
• Counter tickets should be numbered sequentially and accounted for daily
• Parts on loan to the service department should be documented
• Returns to the manufacturer or distributor are documented and carefully checked against any credits. A counter ticket can be generated for documentation. This will also relieve the inventory on-hand quantity

The Human Factor

Predicting which employees are likely to resort to theft is not easy. However, any unusual or out-of-the-ordinary behaviour by employees should be noted. Here are some warning signals that should be heeded:

Lifestyle – this is important. Any obvious discrepancy between an employee’s income and lifestyle should raise red flags. Look for the purchase of expensive cars, bigger houses, heavy gambling, and a sudden increase in available cash, etc. Sudden and unexplained improvements in lifestyle should be discretely questioned.

Holidays – or rather lack of them. Keeping a fraud concealed becomes a full-time job. Employees who don’t take their annual leave may be trying to avoid detection. While they are away, others may spot something suspicious. A good company rule is to require all employees to take their leave annually.

Strange Behaviour – Does the worker seem overly interested in the company’s accounting procedures? Do two employees seek overtime together?

Tips and Rumours – In most cases, rumours will be nothing more than meaningless gossip. However, tips should quietly followed up to ensure that no fraud is taking place.

Remember – “Crime is 10 percent motivation and 90 percent opportunity”