Dealers Bear the Brunt

I'm a dealer, a guy who likes to make deals. I execute the “meet, greet, qualify, pick and close” very well, and I'm constantly marketing for the next customer.

My only other dealerly pursuit is recruiting salesmen. (Yes salesmen not salespeople; in my heart of hearts they're all salesmen, even the women. Same with acting; they're all actors these days).

I learned years ago that success in the car business is a simple matter of lead generation and closing percentages. This is the essence of dealering.

Sadly, manufacturers and politicians have so twisted the role of the retailer that if you listen to them, all we should be is a bunch of hand-holding cheerleaders more interested in satisfaction indexes than in making car deals.

Their view may make the industry politically correct but it sure doesn't help dealers increase sales or make payroll. And it doesn't seem to satisfy many customers either.

Don't get me wrong, some dealers use sales tactics that cross the line. Most, and I mean the overwhelming majority, don't. They can't even if they wanted to. Today's customers are too saavy.

What gets my goat are the number of manufacturers and politicians who draw a connection between dealer profits and pure evil without regard to the service that dealers provide or the cost of providing that service. Manufacturers' demands divided by the number of new cars a dealer sells cost more than the full margin most manufacturers offer. And, the political quagmire of today's compliance measures imposed on dealerships are way out of line with what anyone (customers, manufacturers or politicians) is willing to pay. Yet there they are: rules, laws and demands all piled on the dealers back.

Everyone wants a kinder, gentler world until their philosophy gets in the way of what they want or how much they're forced to pay. Dealers are always the easy scapegoat when there's a breakdown in the system because of the myth that their margins are infinite and their profits obscene.

Which brings us to this month's rant. It's about time everyone began taking responsibility for their part in what's going on around here.

Customers will have to learn to shop and negotiate (which seems to be what they want to do in spite of the number of dealers trying to go with one price).

They'll have to learn how to protect their identities and privacy too. We can't shop their credit and at the same time treat them like they're in hiding.

At the same time, manufacturers must market their brands and provide their customers with caring warranty policies without whining (and auditing) every time a conscientious dealer saves their reputation by doing what's right rather than offering customers the cheapest warranty solution imaginable.

Lenders will have to improve their ability to qualify good risks and collect bad ones, and pay dealers a fair profit for facilitating the process.

And who are they kidding with all those self-serving dealer-lender agreements that place full responsibility on dealers for false facts whether or not those are known to the dealer?

Finally, politicians will have to stop whipping the retailer every time a consumer group cries about the cost of goods and services. (Legislation limiting cost shifting from OEMs to their dealers might be nice, too).

A factory buddy of mine recently paid me the ultimate left-handed compliment. “Peter, I love to send friends to your store because they always come away feeling fully informed without the slightest pressure to buy.”

Until that moment I thought I was servicing my customers. After that comment, I felt like the proverbial emperor in new clothes; what I thought was an evolved selling system was, after all, no selling at all. The dealer's world has become way too complex.

In the beginning, dealers perfected the “meet, greet, pick, qualify and close.” Life was good.

Back then, manufacturers built brands and products, banks loaned customers their purchase money and the customer watched over his or her own wallet. Everyone was happy. Today all the lines are blurred, and few are smiling.

Peter Brandow is a veteran dealer with stores in Pennsylvania and New Jersey.