As we begin the fourth quarter, it's a good time to check certain areas of your operation to ensure a profitable end to 2003.

In addition, by properly positioning your operation now, you will be able to begin 2004 in an offensive posture as opposed to a defensive one.

The first item to check is your new-vehicle days supply level by individual car and truck model line. If you are high in any area, check your wholesale availability (stock and transit) and allocation. Plan a promotion and incentivize the sales force on these models to draw attention to them.

Personally check your new-vehicle inventory and identify units that have been in stock for more than 90 days. Using fluorescent stickers helps you keep track of that. Ensure each vehicle is ready to sell and has the required price label. You might also consider segregating this inventory so it is easily accessible by your customers and sales staff.

If you would like to add some fun and excitement to your new-vehicle department while improving professionalism, you might conduct a series of new product walk-around contests.

One of the most fun methods I've used is to gather all sales personnel, draw a sales person's name from a hat and then draw a vehicle he or she will represent in the walk-around.

Give that sales person 10 $10 bills and then solicit 10 questions from the sales personnel relating to that product. For each question the presenter answers correctly, he or she keeps $10. For each question answered incorrectly, the presenter must pay the questioner $10. This contest not only creates a studying frenzy but a fun time, and a good way to spiff employees. Everyone should come out a winner.

Next, you want to check not only your used-car and truck day's supply, but also aging. Again, you personally should check each vehicle to ensure they are ready to sell.

I also suggest you and your used vehicle manager drive all vehicles that have been in inventory more than 30 days. Make note of any items needing repair, attention and such.

While walking and driving the inventory, highlight any seasonal vehicles that represent a challenge as winter approaches, i.e. convertibles in the Snow Belt.

After completing your new and used vehicle inventory analysis, it's time to pull out your receivable schedules to check for any current or potential issues.

If receivables are not a part of your departmental management pay plans, make a note to ensure that component is included, effective Jan. 1.

Reserve any balances 61 days and older. Going forward, the manager's monthly pay will be affected only by the difference in the reserve. They gain if the reserve is decreased. They're penalized if it increases.

The next item to check is your expense categories for any out-of-line conditions. This will allow you to quickly isolate any category. Then you have the ability to run detailed reports to quickly identify any specific area of focus and install the proper processes to control the expense.

A word of caution: It's easy to assume an expense account is out of line when in fact the real problem may involve sub-par gross.

In late November and early December each of you will begin the 2004 forecasting and budgeting process. By taking the initiative today and identifying any areas where corrective actions may be needed, not only will you be in a position to capitalize now, but you will also create a clean slate for starting out the new year.

Good selling!

Tony Noland ( is the president and CEO of NCM Associates, Inc.