Pub. 9 2019 Issue 1

10 AUTOMOBILE DEALER NEWS ILLINOIS www.illinoisdealers.com CONSULTANT’SCORNER Y ou do not want to be the inefficient dealer in an efficient market. If you are like most dealers, you have already implemented a lot of change in your dealership over the last 10 years. You’ve had to adapt to remain competitive. You’ve had to adapt in order to make money. Frankly you’ve had to adapt in order to stay in business. 2019 will bring a new wave of challenges, some of which you are dealing with right now. Through the great recession dealers made tremendous strides to trim expenses. Some big changes and some small. We fired the plant service. We cancelled the newspaper. We reduced our number of NADA guide subscriptions. We fired the shuttle bus driver. With the help of technology we went from six people in the accounting office to three. We job shared and cross trained and did whatever we could to trim head count. When new car grosses went down we made up for it by increasing used cars. When new and used car grosses started to go down we focused on velocity and managing our inventories better. When new car grosses continued to go down we became masters at maximizing factory incentive programs. We picked up floor plan credits and we benefited from declining interest rates. When new and used car grosses continued to go down we turned to F&I and we got real good. F&I was no longer considered found income. It was the life blood that we lived on. We trimmed our overall advertising budget. We shifted to digital. We dropped the old traditional methods of advertising. We went back to our service department and demanded that they become a bigger contributor to the overall dealership profit picture. Today’s service department is not just part of the sales service cycle we all so covet, it also must contribute meaningful profit. Efficient Dealership? BY JOEL KANSANBACK, EXECUTIVE VICE PRESIDENT OF AUTOMOTIVE DEVELOPMENT GROUP