By Chip King, Partner, ZipDeal
I will keep this brief, (I hear you saying, “YEAH RIGHT!”) in fact I will likely struggle to get in 3 or 4 paragraphs…the idea is super simple, but could be very impactful for most dealers.
As you know, margins continue to shrink in new car sales, and we struggle to keep our once high-income sales teams from rapid turnover. Add to that the fact that the cost of used cars in the market has skyrocketed, while availability has dramatically dropped. According to AutoList, the average length of ownership is now about 6 years, around the same as the average loan.
It’s time to fine-tune every opportunity to add income, and to add it transparently, from willing and happy customers! Like all successful processes, this one must be applied 100% of the time for maximum impact.
Every time there is a trade involved in a new or used car sale, make this a required process to be executed by your sales representatives. You may already have a list of questions regarding the trade with the more traditional questions that help with settlement and reduced CIT issues such as:
- Do you have your title with you today?
- Is the trade titled in your name?
- Any other names on the title?
- Do you have your registration with you?
- What state is your trade titled in?
- Is there an open loan on your trade?
Here are the 5 critical questions that will foreshadow your additional sales opportunities when the customer goes to the business office for settlement:
- Did you purchase an Extended Warranty when you bought your trade?
- Did you service your vehicle at the selling dealer?
- Do you have any of the service records?
- Did you purchase an Environmental Protection Package (Paint Sealant and Interior Protection)?
- Did you purchase Tire and Wheel Protection?
- Do you have a Dent Protection package?
When the customer says “yes” to any of these questions, it’s helpful to let them know that it positively impacts the value of the trade. You may want to consider presenting a trade increase coupon at that time?
Your customer now has an incentive to consider protecting their new vehicle when the opportunity is presented. He or she may also be more likely to set their first service appointment with you and give you the chance to earn their ongoing service business. Do not forget to share the revenue to keep the process in motion and to keep a focused sales team!
I cannot tell you how it kills me when I hear a dealer say “It’s a great idea, but I can’t get my team to follow my current processes.” Don’t say that…fix it!
Ok… that was about 8 paragraphs… but if you add these procedures or a custom version fitting your store’s M.O., you will likely experience a PVR increase of several hundred dollars and increase your service and sales retention. It’s the super simple idea that works.
About the Author
Chip King spent his career in automotive retailing from 1977 to 2006. Holding every position in variable operations, including General Manager and Dealer Principal, Chip has had a special focus on the “customer experience” throughout