There are many assets available in the dealership, but the one that doesn’t really show up on your Financial Statement or 20 Group Composite is the asset of time. This can be a very a tricky asset to manage. We know the quantity of time most of our employees spend at the dealership, but what we typically don’t have the same grasp of is the quality of time being spent.
It’s very easy for anyone to abuse this asset, but vehicle salespeople might be the biggest misusers of time in the whole dealership. This has always been the case – and most of us do not do enough about it on a consistent basis. Remember, our good friend Dave Anderson always says that our biggest challenge is “chronic inconsistency.”
I can get away with saying this myself, because I was guilty of this at times in my career. I was an above-average salesperson; so I sold a lot of cars, made good money and my sales managers (for the most part) let me spend most of my time waiting for the next customer. It’s not like we didn’t follow up for be-backs, of course, but anything like consistent prospecting and business development didn’t really happen. Then when I became a Sales Manager, I didn’t know any better than to basically help my team with the customers that came in from dealership-generated leads and remind them to follow up with the ones that didn’t buy from a day or two ago. No one really followed up beyond that, other than the rare, true professionals. The psychology of a salesperson is that if you did not buy from me the first time and I cannot convert you into a be-back, then you must not have been a serious buyer.
But after I became a General Manager I grew more aware of just how high the stakes were; and how a “come to work to wait” culture was a real liability. The dealerships that truly have an appointment-setting culture are the ones that are the most consistently productive and profitable. This of course means that the more attention going into setting appointments today, the more known customers we’ll have coming in tomorrow… for both sales and service.
But in truth, I was hot and cold in my consistency and there was always just enough traffic. And if there wasn’t, there would be a new model on the horizon so traffic would be picking up soon. And with multiple brands, I was able to rationalize that we were much more on top of things than we actually were. Sound familiar?
To put it plainly, the asset of time is being abused in most dealerships.
At the NCM Institute, we spend at least three hours in our General Sales Management course dedicated to the sources of salesperson-generated leads. We highlight the statistics that this lead source closes at approximately 50% (because we already have a relationship with these clients).
Dealerships have CRM tools that are designed to manage and help close these leads. But I have yet to work with a GM or GSM who says they are at least a 6 on a scale of 1-10 on holding their people accountable for using this tool the way it was designed. In all fairness, they tell me that there are parts of the tool they use better than others. But when I ask them if they print off Daily Worksheets for each salesperson in order to help hold them accountable for their activities, most say they do not. When I ask if they have a ten-minute sit down meetings will each salesperson either before they go home each day or at the beginning of each shift, most say that they do not.
These are not meant to be “Gotcha!” sessions. The primary function of any NCM Institute class is to uncover opportunities for more productivity and profitability. And we believe that the almost cultural mismanagement of time in the vehicle sales department is the primary reason for high turnover and low productivity for probably 70% of most sales forces in every dealership.
In order to have the Total Gross Profit necessary for our variable operations to be consistently profitable, we need to have the right amount of salespeople doing the right amount of activities per day. And tools exist to help us along the way.
When it comes to personnel productivity, this lack of maximizing the time each salesperson spends per day really shows up, primarily in below average (or even just average) amount of vehicle sales per month, per salesperson. That average never really changes because most salespeople (and sales managers) are focused on dealership-generated leads rather than salesperson-generated leads.
So when we are discussing metrics with our clients and they are woefully short of Benchmark or Key Performance Indicators, it’s very likely that the asset of time is being under-utilized. In closing, I certainly hope that the time you have invested in reading this will help you maximize your asset of time more efficiently.