Categories
Car Auction Dealer Software Wholesale Lot

Wholesalers back in My Dealership? Dealer Auction Software

Wholesales in my dealership

Dealer Auction Software that helps save auction fees & avoid the major pitfalls of wholesaling.

Just because at times retail customers are disruptive and even bounce checks, would you shut down your dealership? Of course not, instead you would put controls in place to prevent future issues.

We kicked out wholesalersBut for some reason, dealer principles were advised at their 20 groups and at conferences to kick wholesalers out of their dealerships. Dealers were told that wholesalers were disruptive and were bribing our used car managers. That their checks bounced and that the only way to prevent all of this was to kick them out, once and for all.

While these issues did happen at times, it was the exception. Unfortunately we tend to remember the extremes. In my experience, the wholesalers and independents I have meant over they years, while sometimes rough around the edges, are solid hard working business people. They are the core behind what makes our industry tick.

It seems crazy to me that we have excluded them from our dealership, sort of like the proverbial, throwing the baby out with the bath water.

Think about it. If you found a way to control the check issue, the back room deals and the disruption. Your dealership could save hundreds of dollars per car in auction fees and transport fees. The best part is your manager isn’t away from your dealership, missing TO’s and coaching opportunities with your sales consultants.

Is a Dealer Held Auction the Answer?

In this article you will learn many of the basics of running your own dealer auction and welcoming profitable, fee free wholesale transactions back into your dealer group. You will learn how to prevent most of the pitfalls and above all how to stay organized using dealer auction software, so you can focus on profit.

The Dealer Auction Study

My partners and I conducted a one year study of dealer run auctions and private dealer bid sales. We visited dealer auctions that have achieved 95%+ sell rates on a weekly basis, even in the dead of winter. We have seen it all from complete “Red Light AS IS” auctions to dealers that recondition every car that goes through their lane. We learned quickly the advantages of using dealer auction software and running online versus physical and picked up some of the best practices along the way. The following is a small portion of that study.

Magic 10 steps? No such thing.

I am not trying to say that it as easy as just 10 steps, just like magic you can run your own dealer auction. Not at all, this is just a 10 step primer to help you understand what will be expected. I recommend that you speak with other dealers who are running their own auction or call companies like ours, who specialize in helping dealers run an accountable profitable and successful auction.

So what are the steps to starting your own dealer wholesale auction?

Retail lot or wholesale row sign1. Merchandise your wholesale cars as vigorously as your retail. For many dealerships there are two kinds of trades: Cars we’re going to keep and cars we are going to sell at auction. Traditionally we process them differently. What if you merchandise wholesale cars as expertly as you do your retail cars, then offer them to your local and national wholesalers and independent dealers online. Do you think you could sell a bunch of those cars before you have to take them to auction? Of course, and because you don’t pay fees or transportation you avoid expenses and above all make more on profit.


2. Process your wholesale car using the same tools your inventory team are already using.
No need to reinvent the wheel here, just have your IM’s (inventory managers) use the same tool they use to process retail trades. This way they are not overwhelmed with too much change. Companies such as vAuto, Red Bumper, DealerTrack and Vin-solutions already have a special category for wholesale where you can add photos and descriptions. Then you can feed the inventory to your wholesale website or to a wholesale marketplace like Auction Simplified

Wholesale Photos focus on flaws3. Focus on the flaws not the cheese. Wholesalers are very different from retail buyers. All they want is the basics of the car and photos of the flaws and a well thought out condition report. So merchandising for wholesale can be quite a bit easier. You don’t have to take 40-60 photos or write a Shakespearean level description, instead keep it to the basics.
My partner Dave Kaiser, explains it like this:

“Take 10-15 ‘Get to know me’ photos then take photos of the rust spots or missing items. If there is a special feature such as AWD or Navigation that is not normally on that vehicle, go ahead and photo it as well.”

In most cases 15-20 photos and a condition report will get the job done. Some dealers write out a condition report and scan it as a photo of the car or use the free condition report built into Auction Simplified. It only takes 5-7 minutes per car to complete. As Dave says over and over again. “Point out the issues on the car so the bidder can make a serious bidding decision.”

4. Put your wholesale cars ONLINE the as soon as possible.

Cars have 48 hours to be onlineApplying the Dale Pollak, Velocity retail approach to wholesale, makes the most sense. If you can get a list of your wholesale cars in front of hundreds of buyers the day they arrive. Then list them on your wholesale marketplace for hundreds of used car dealers to see. And get all of this accomplished On Day One or within 48 hours at the latest, you should turn your inventory faster than if you wait for the next auction especially if you are waiting for decent lane numbers. Again this is just one more tool in your digital marketing plan. Not every car will sell this way. That is why I still think off site auctions are useful as a secondary strategy to your successful dealer run auction.

One extra benefit of having your cars on an auction platform, is your dealer auction will be listed by other wholesale tools such as Autoniq .

5. Hold an inspection period. SOLUTION TO AUCTION PITFALL #1

To avoid wholesalers showing up at random times, hold a regularly scheduled inspection time. This will allow buyers to visit in a controlled area at a specific time. Have a mature lot attendant there with keys and to offer help and allow them to drive the cars if they like (on their dealer plate of course.) This builds value and improves wholesaler relationships over time. You will find that the wholesalers will pay more when they can trust the dealer and will sometimes buy from start to finish online. Not every wholesaler will buy online. Some feel they still need to touch and feel the car, that is why I recommend a viewing or inspection period.

Auction Inspection Day

Hold your inspection period at a time that is convenient to the buyers in your area, for example, don’t have it at the same time as other auctions in your market. This way more buyers will be available to view your cars.

6. Certified Checks or Floor Plan only. SOLUTION TO AUCTION PITFALL #2

certified-used-carsAt first, it is critical to establish your auction rules. We recommend that you only accept certified checks unless you have an established relationship with the wholesaler. At minimum hold the title paperwork until their check clears.

You might think that buyers would be upset with this but in my experience they are usually so glad to be back in the dealership and avoiding huge auction fees that they understand the reasoning and will work with you at first.

As your auction takes off, you will be able to invite in floor plan companies as well. This way the money is EFT directly into your wholesale account with reduced risk. CFO’s love EFT from floor plan companies.

7. No one should know your bidders until the end, including the manager. SOLUTION TO AUCTION PITFALL #3

Use software that hides the bidders until the end. True accountability and tracking is a key security measure to prevent bribes and backroom deals. Software like Auction Simplified are great for this because they allow buyers to bid completely online. It has one truly unique feature, no one knows who the bidder is until they win. All bids are truly anonymous. This way there is no risk of those back room kick backs, because know one knows who bid. I admit it, that was a shameless plug for the company I co-founded, but it solves the biggest issue with wholesaling direct; accountability.

back room deals with wholesalers

TIP: If you are aware of a trouble buyer or you don’t want a buyer at your auction, you can block them from seeing your cars online.

This works especially well with competitors. Lets face it you don’t want them seeing your trades. Again not something easily done if you take the car to off site auctions.

8. Merchandise to your wholesalers.

bdcIf you spend a little effort on making your wholesalers feel welcome, by providing donuts and coffee or pizza and wraps at lunch time, they will come back each week and make your viewing day part of their schedule.

I recommend that your BDC includes 25-50 calls per week in their action plan to invite wholesalers to your weekly events.

Sending form letter invitations and post cards periodically to remind independents and wholesalers about your online marketplace is also recommended.. Many successful dealers run specialty sales when they have a glut of similar trades, like trucks. The call would sound like this:

“You’re invited to our wholesale lot for a very unique truck auction this Thursday at 9am-3pm, final bids by 4pm online. Lunch is noon, we hope you can join us.”

9. Staff Appropriately

It is not terribly expensive to staff your auction appropriately and it is money well spent. Be organized on your inspection day, have an extra lot attendant managing the car keys so you can focus on the important things. When your auction ends have appropriate billing staff and cashiers ready to bill the transactions. Try to have everything billed for pickup the next day and be ready for a rush billing for non local dealers.

1Titles to trades0. Priority Cashiering.

Pick a location for the wholesalers to cash out, it can be a managers desk but it works better if it is a cashiers window. With a little training and rule setting, cashiers become terrific gatekeepers for auction transactions. As your auction takes off consider having a special cashier just for wholesale transactions, sort of a priority window, so the wholesalers feel important. Because in my view they are.

In conclusion. If you gain trust, show concern and respect and make wholesalers and indy’s feel welcome they will pay more for your wholesale cars. If you don’t have to ship your car, pay auction fees or have to send a manager off site for the day, you’ll make more money wholesaling cars.

If you can turn a $500 car into a $700 car that’s a 40% profit. It is next to impossible to make 40% on most of your retail used cars.

Digital marketing for wholesale cars is long over due.

Resources

If you are ready to start your own dealer auction and wholesale marketplace, call our team or myself directly at 877-877-4511 or visit dealersimplified.com for more information and strategy guides.

Categories
Business Development Car Auction Dealer Software Wholesale Lot

It’s Time for Digital Marketing for Wholesales Cars

If your dealership survived the recession of 2007-08, you understand the value of Digital Marketing for Retail and the importance of getting your cars online fast.

You probably have all the latest and greatest tools for selling cars to the retail public, the best pricing tools, beautiful SEO efficient websites and the latest apps.

You insure your retail inventory is online by day 3 at the latest. We have all become, what I call, “Online Dealers with Local Delivery”

This leads me to the following questions:

  • Wholesale Cars online Day 1Isn’t time to do the same for wholesale?
  • Why is it OK to wait a week or two before selling our trades at auction but we require our managers to have our retails on-line in three days?
  • Why do we not digitally marketing our wholesale inventory to our wholesalers on day one?
  • Why did we kick the wholesalers and independent buyers out of our stores? (Don’t jump to conclusions on this one, really think about it, because it is the root cause of some wholesale loss.)
  • Why do we send our prime wholesale money makers to off site auctions only to give up profits to fees, transportation and travel time.?
  • Why do we pay those sellers fees at all, even negotiated fees still add up?
  • Why is it ok to pay for shipping? And if it is free, who is actually paying?
  • Why don’t we run our own wholesale auction?
  • Why not digitally market your Wholesale Inventory?

Take a 22 minute meeting with us and we will show you how!

Call me now 716-818-4444 (my cell phone) or 877-877-4511 touch 1 for sales.
You have nothing to lose, its free to sellers (no fees, no software expense whatsoever.)  One dealer we spoke to said he “averaged $312 more per car at his private bid sale” Is it time you took a hard look at that profit center

Kevin Leigh
Co-Founder
Dealer Simplified, LLC

Categories
Business Development Dealer Software Retail Car Lot

The Important Question To Ask Dealer Software Vendors? Hint:Not DMS Integration

The Core Question?

If you draw concentric circles around your dealership accounting office you will probably find several software packages attaching themselves to your DMS. Everything from inventory managers, compliance software to CRM’s and service schedulers.

Each supplier probably had a booth at NADA where they showed off their bells and whistles and colorful graphs and functionality. We all get sort of mesmerized by the experience, taken by the flashiness and chrome.

Dealer Software is too complex
DEALER SOFTWARE IS TOO COMPLEX:
This is an actual training slide from a software vendor. I hid the brand to avoid the embarrassment for the company in question, but you know who you are.

As the long time Director of Variable Op’s for a large dealer group in Upstate New York,  I used to look forward to returning to the group to show of the latest and greatest software that could “revolutionize” our dealer group. Usually very early on in that meeting someone will ask , “does this integrate with our DMS?” I would say that is one of the least important questions early on. What dealers need to start asking is “How often are those shiny features actually used?”

We founded Dealer Simplified after sitting through three dealership website meetings. In one case I was shown a really cool bar that allowed customers to track searches. It looked great and was presented as a “Killer Feature” of their website. When I asked, “how much is it actually used by customers?” the salesperson actually gasped and stood there for a moment like a deer in the head lights. I pushed and finally he said 1-2% of the time.

I realized right then and there, Shiny Features are much different from Usable Features. The core question is, why are we always focused on the shiny bells and whistles instead of the features that make us money.

Lets take CRM for example, vendors love to show how you can make lists of customers to call and fancy reports showing our failing salespeople. The programmers that designed these features never sold a car in their life. Reports don’t sell a thing, until the salesperson learns to love his/her CRM.

In CRM the real questions are:

  • How does it help me retain customers?
  • Will my sales team use it and why?
  • How does it identify potential clients?
  • Can I speak to a satisfied 50 year old salesperson using this CRM every day?

In my opinion, the evolution of dealership software is not to add more bells and whistles or better DMS integration but to remove unused features and work towards higher utilization.

Utilization Through Ongoing training.

I really believe that software utilization comes through training. I think dealers spent way too much time showing their sales team every bell and whistle of the new software package they’re trying to launch. In my training classes I focus only on the items that salespeople and sales managers are going to use. Especially early on.

The key is to have multiple meetings over multiple months, because the sales people and managers have no idea what questions to ask until they use the software for a period of time. They also should have the cell phone number to the software vendor so they can ask questions on the fly as they are using the dealership software.

Require Quarterly Training Revisits as Part of the Contract:

One of  the least mentioned and most important lessons I have learned with software vendors is to require in their contract that they revisit and retrain your team at least once a quarter. Again it is my believe that ongoing training is an essential part of software utilization.

Categories
Dealer Software Defining Car Speak

What is a DMS – Dealer Management System?

Components of a Modern DMS

A dealership management system (DMS) or auto dealership accounting system is a bundled management information system created specifically for the automotive industry and especially for  car dealerships or large dealer groups.

Some DMS's are OutdatedDMS is not for everyone, typically small scale dealers and independent used car lots will manage their business with generic accounting packages. Even large dealer groups will outsource parts of the DMS to achieve higher quality products.

A typical example of outsourcing is inventory management. In most cases dealers are using companies like VAuto, VinSolutions or Dealer Simplified.

Another reason dealers are outsourcing is that many of the traditional DMS systems are outdated or the dealership cannot afford the massive upgrade charge. It is just less expensive to keep the basic accounting package from their DMS and bolt-on modern software such as CRM and Dealer Web Sites.

Dealers need software to support all aspects of running a dealership such as:

  • Tracking vehicle inventory
  • Tracking sales
  • Finance and insurance calculations
  • Dealer websites
  • Menu selling systems
  • Tracking
  • Accounting
  • CRM
  • Wholesale management
  • Internal company websites and message centers
  • Calculating employee commissions
  • Purchase order tracking
  • Parts inventory
  • Auction management
  • Work order management
  • Appointment scheduling
  • Proper planning
  • Follow-up

Most Common Dealer Management Systems found in dealerships today are ADP, Reynolds and Reynolds and Dealer Track. However many new DMS systems have arrived on the scene in the past few years and are offering easier integration and connectivity with software partners with modern API’s and SSL Keys.

# of Dealership using Non-DMS add-on's
Categories
Dealer Software Retail Car Lot

Top 10 Reasons you need an Easy CRM

how-to-use-the-easy-crm“Do I need a CRM?” is the most common question we hear. First let me ask these questions; do you want a system to help you convert leads into customers? Do you want a system to help you retain your existing customers so they buy from you again? Do you want to have your customers send you referrals?

The Easy CRM (shameless plug) is the perfect match for small businesses, ranging from 1 to 1,200 employees that need to turn leads into customers for life. There is no need to install software on a computer, no need to spend hours studying a manual, it’s easy to use and secure.

10. Uncluttered focus

A great CRM will integrate emails, tasks and calendars into one easily maintained and managed place. You’ll learn things about your business you never knew before. You’ll become organized at storing things in a central location and before long you’ll bring all the pieces together.

An easy CRM system will allow you to focus on customers and sales actions.

What group of leads, customers or businesses should you be focusing on?
What is my shortlist of VIP’s?
What is my next action that will focus me on what needs to be done?
What broadcast activity or call campaign should I be doing, morning, noon and night?

9. Small business CRM is focused on sales activity.

Using a dynamic list of “Next Actions” for every prospect or customer, will help in a natural way, move prospects and customers through the sales funnel towards a sale. “Next Action” style CRM encourages upfront sales decisions with a clear and simple way of seeing sales targets.

8. A great CRM will create peer pressure.

Once your CRM is fully operational, the team will start to see who is using it well and who is succeeding on their tasks. It is like a built in older brother that constantly reminds you how well you are doing compared to the rest of the team. It’s never fun to feel like you’re going at it alone. Peer pressure is a great motivator and spending time focusing on the poor performers can increase your capacity and help you grow your company. You can stage friendly inter-office competitions to see who can close the most deals, sell the most dollars, or carry on the most conversations. Bottom line — Competition helps business.

CRM-notification-bitching-betty7. CRM Becomes Your “Bitching Betty”

Probably one of the most important advantages of a great CRM is how it tells you what to do, and when. CRM is like a great sales coach that keeps you on top of your game by reminding you endlessly and without remorse. It’s like the autopilot on an aircraft that warns the pilot to “Pull up, Pull up” when the plane is too close to the ground. A great CRM will tell you to call, email, write and when your customers needs your attention. Pilots call the voice “Bitching Betty” but would never want to live without that layer of protection in their lives. Why would you want to live without a CRM?

6. Never lose your data

If you use a Rolodex, memo books and paper calendars for tracking your customers then the odds are high that you are going to lose them at some point. If you store everything on your laptop or cell phone? Remember, they can be stolen. But with a web-based CRM you effectively protect your data from being lost. Of course, servers can crash and hard drives fail but with the proper web host and data backups you’ll never lose your customers. A responsible secure and well maintained on-line CRM like the EASY CRM (another shameless plug for our awesome software) will allow you to back up locally, take your customers with you if you leave and know that your data is secure in the cloud.

5. CRM is like a Crystal Ball

Everyone wants to know the future. If only there was a way to know what to expect. A great CRM helps you with that. Now of course a CRM cannot predict the future with 100% accuracy (it’s not really a crystal ball), but a good CRM can give you a reasonable expectation of the future based on past performances and past events.

4. CRMemory, Let your CRM be Your Second Brain

A CRM will help you not only keep track of every task and every event but also relate them to the appropriate customer or lead. A great customer relations system can help keep all those conversations in one place and make it easy for you to quickly look back in time and see how things have progressed.

3. With CRM You Become a Customer Service Superhero

Have you ever gone to a party and wished you could remember everyones name? Even if you are awesome with names, have you ever wished you could remember the last time you called that person, or if their birthday was close. CRM helps you remember all the important details, their last product of interest, their children’s names, and even when NOT to call them. Because you don’t want to be so annoying that they don’t answer your call.

2. CRM Email Campaigns.

One of the things CRM does extremely well is identify which leads and customers you should be emailing. With a great CRM you will have at your fingertips well written templates that you can use to send to your clients, leads etc. Some will tell you that email is dead, but we find that well written and mobile friendly personal messages that happen to be sent by email are very effective.

Help Key1. CRM Becomes Your Selling Assistant.

With a CRM you can store and manage hundreds of clients and let a computer ‘Assistant’ handle the task of memory and recall. Take advantage of the CRM and use it for your personal success. Then your personal growth is never held back by your memory. Lets face it you probably don’t know where your car keys are right now, so how do you expect to know who to call or who’s birthday it is?

One final thought: a great CRM will allow you to access your information from anywhere in the world where you can get internet access. It will allow you to have full access to everything from your cell phone, smart phone, tablet, iPad, PC or MAC.