Pub Yr 2 | Issue 3 OFFICIAL PUBLICATION OF CENTRAL FLORIDA AUTO DEALERS ASSOCIATION GETTING TO KNOW JASON KIRKLAND GETTING TO KNOW RAJ ALEXANDER Page 6 Page 8 Page 11 CONNECTING AUTO DEALERS AND THE CENTRAL FLORIDA COMMUNITY Weighing In on EVs and the Value of Dealership
RMG D R I V I N G D E A L E R P R O F I T A B I L I T Y Proud Partner
OFFICIAL PUBLICATION OF CENTRAL FLORIDA AUTO DEALERS ASSOCIATION Pub Yr 2 | Issue 3 ©2022 Central Florida Auto Dealers Association, Inc. (CFADA) | The newsLINK Group, LLC. All rights reserved. Accelerate is published four times each year by The newsLINK Group, LLC for CFADA and is the official publication for this association. The information contained in this publication is intended to provide general information for review, consideration and dealer education. The contents do not constitute legal advice and should not be relied on as such. If you need legal advice or assistance, it is strongly recommended that you contact an attorney as to your circumstances. The statements and opinions expressed in this publication are those of the individual authors and do not necessarily represent the views of CFADA, its board of directors, or the publisher. Likewise, the appearance of advertisements within this publication does not constitute an endorsement or recommendation of any product or service advertised. Accelerate is a collective work, and as such, some articles are submitted by authors who are independent of CFADA. While Accelerate encourages a first-print policy, in cases where this is not possible, every effort has been made to comply with any known reprint guidelines or restrictions. Content may not be reproduced or reprinted without prior written permission. For further information, please contact the publisher at: 855.747.4003. FOLLOW US ON: 100 Weldon Boulevard Sanford, FL 32773 Phone: 407.708.2780 cfada.org The magazine is produced in partnership with 4049 South Highland Drive Millcreek, Utah 84124 855.747.4003 | 801.676.9722 thenewslinkgroup.org 2 PRESIDENT’S MESSAGE 4 OUR LEADERSHIP: 2022 BOARD OF DIRECTORS 6 GETTING TO KNOW RAJ ALEXANDER 8 GETTING TO KNOW JASON KIRKLAND 11 WEIGHING IN ON EVS AND THE VALUE OF DEALERSHIPS 14 AUTO BUYING PREFERENCES 16 THE PANDEMIC HAS CHANGED THE WAY DEALERSHIPS DO BUSINESS 18 THE INS & OUTS OF DEALERSHIP COMMUNICATION 21 DEALER MEMBERS 24 ASSOCIATION MEMBERSHIP BENEFITS Pub Yr 2 | Issue 3 1 CFADA.ORG
President’s Message Evelyn Cardenas President/CEO Central Florida Auto Dealers Association Thank you for all that you do for our communities and your customers. I hope you enjoy this issue as much as I did. I enjoyed reading each dealer’s unique and serendipitous journey. Welcome to our latest edition of our Accelerate Magazine. To start, I want to share with you information recently released about the future of Orange County. According to the Orlando Economic Partnership, Orange County is “projected to grow to 5.2 million by 2030, surpassing the D.C. Metro area.” (2022). Central Florida specifically perseveres as the center of innovation, expansion, and phenomenal growth. Our region is not only experiencing a population explosion, but a business expansion, mobility innovation, and the introduction of robust new technologies and technology visionaries. Wages are rising, wealth is increasing, and customers are plentiful. Currently, Florida is second in the country for EVs! In Florida, we are growing our multimodal transportation options. Our governments are collaborating with our electric companies and tech partners to create smart cities, and interconnected roadways, expand last-mile transportation, grow the high-speed rail, and provide the necessary infrastructure for EVs and autonomous vehicles. To help shape our mobility future, CFADA has been asked to be part of Orange County’s EV task force. I do not know about you, but I feel blessed to live in this state. As automobile dealers, you have become part of a greater smarter mobility ecosystem that helps keep our communities moving and thriving. The naysayers advertise that our cars will become obsolete. The reality is that cars will continue to be a key if not the main mode of mobility; what is shifting is that, in our large state, consumers finally will have other viable options to supplement their mobility needs. We have come a long way from Henry Ford’s time and the idea that all that people wanted was a faster horse. What we all want is to get to our destinations and to live our lives to the fullest, with the least effort and the most convenience- and our cars do just that. Thank you for all that you do for our communities and your customers. I hope you enjoy this issue as much as I did. I enjoyed reading each dealer’s unique and serendipitous journey. 2 Pub Yr 2 | Issue 3
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Jason Kirk land Director Jenkins Auto Group Evel yn Cardenas President/CEO Central Florida Auto Dealers Association Chip Gannaway Director Van Gannaway Chevrolet John Mant ione Director Fields Auto Group U.S. Mar ine Director Sutherlin Nissan Richard Sox Counsel Bass Sox & Mercer Er ic Matos Director Universal Nissan Randy Parks Secretary/Treasurer Parks Auto Group Shannon Kominowsk i Chair Holler Hyundai Glenn Ri tchey, Jr. Vice Chair Daytona Hyundai, Jon Hall Automotive Group George Nahas Director George Nahas Chevrolet Raj Lal l y Director Orange Buick GMC Our officers and directors play a critical role in our success. The board consists of a diverse group of highly trained professionals. Each person on our leadership team brings many years of experience in the U.S. and worldwide. Their dedication ensures that Central Florida’s new and veteran automotive professionals have access to the region’s most comprehensive industry resources and educational opportunities. OUR LEADERSHIP: 2022 Board of Directors 4 Pub Yr 2 | Issue 3
Running a dealership comes with its share of uncertain terrain. But one thing is certain. Our Dealer Financial Services team is dedicated to being by your side with the resources, solutions and vision to see you through. Lauren D’Hondt lauren.dhondt@bofa.com 407.420.2771 bofaml.com/dealer Making business easier for auto dealers. Especially now. “Bank of America” and “BofA Securities” are the marketing names used by the Global Banking and Global Markets divisions of Bank of America Corporation. Lending, other commercial banking activities, and trading in certain financial instruments are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Trading in securities and financial instruments, and strategic advisory, and other investment banking activities, are performed globally by investment banking affiliates of Bank of America Corporation (“Investment Banking Affiliates”), including, in the United States, BofA Securities, Inc. and Merrill Lynch Professional Clearing Corp., both of which are registered broker-dealers and Members of SIPC, and, in other jurisdictions, by locally registered entities. BofA Securities, Inc. and Merrill Lynch Professional Clearing Corp. are registered as futures commission merchants with the CFTC and are members of the NFA. Investment products offered by Investment Banking Affiliates: Are Not FDIC Insured • May Lose Value • Are Not Bank Guaranteed. ©2020 Bank of America Corporation. All rights reserved. 3235016 12-20-0021
Raj Alexander is an active new member of CFADA, and he is also the managing partner at two dealerships, Porsche South Orlando and Central Florida Lincoln. We recently talked with Raj about his life, his work and his experiences in the industry. GETTING TO KNOW RAJ ALEXANDER Please tell us about your childhood and education. I was born in Mumbai (formerly Bombay), India. I was an only child. My mom and I moved to the U.S. when I was 11 years old. We were very blessed to have a close family, which is normal in our Indian culture. My mother worked long hours in retail to provide for us, and I grew up in an extended household with my grandparents, uncle and aunt, who all had a hand in raising me. Growing up, I wanted to be a doctor; in our culture, it’s looked at favorably if one pursues a career in medicine, computer sciences or business. I had an affinity for math and sciences, so becoming a doctor seemed a natural choice. I played football and focused on my academics, which helped me attend Rutgers University to pursue my career in medicine. During my studies at Rutgers University, I lost my motivation to pursue medicine and steered my attention to pursuing Business Management/Finance. What interested you as a child and young man? I loved anything related to cars. I remember going for haircuts with my grandfather, and he would buy me matchbox cars to add to my collection each time. In my teens, I would love car shows and detailing cars. In my 20s, I loved tuning my cars and going to the race track. When did you become interested in the dealership industry? After Rutgers, I started a management training career path with Circuit City; I quickly realized I excelled at sales in each department I was assigned to. A friend working in a car dealership convinced me to try my sales talent in the automotive world. I started out as a Top Sales Rep in my first month, soon was selling 30+ cars a month and already was focused on moving to the finance manager position. I found it easy to make friends with prospects, and I quickly earned repeat and referral sales from customers who became clients for life. What happened next? I migrated to South Florida and started at Braman BMW in West Palm Beach, Florida. I spent the next 18 years there growing in responsibility. I held positions as a sales adviser, finance manager, sales manager, general sales manager and director of sales and ultimately became the general manager of Braman Porsche West Palm Beach. 6 Pub Yr 2 | Issue 3
After that, I had an opportunity to become the general manager of Mercedes-Benz of Palm Beach, which had a pathway for me to become the VP of the Florida dealership in the automotive group. As each year passed, my dream of owning a dealership by the time I turned 40 was fading until January 2020, when an opportunity came via an unsolicited phone call, ironically on the morning of my 40th birthday. I remember it like it was yesterday. It was a Saturday morning when the opportunity to become a Managing Partner on the brand I hold close to my heart (Porsche) became a reality. Looking back, it proved to be the best move of my career. Now I just acquired my second dealership, Central Florida Lincoln, and I am looking forward to additional dealerships in the future. Why is Orlando a great market right now? Florida continues to lead the nation in growth. Over 1,000 people move to Florida each day, motivated by favorable taxes and a booming real-estate market. And who can complain about our weather? Central Florida has a vibrant hospitality industry and is a hub for medical and technical companies. I see tremendous growth potential in Central Florida over the next 10-15 years. Please tell us about your mentors. My greatest mentor in life is my mother. She is my hero and my best friend. She is my biggest fan, and from a young age, I always wanted to make her proud. She has worked in the sales industry for many years, and I learned everything I know about sales from her. She has a work ethic to this day that I admire, and I love that she has always followed her heart in all that she does. My grandfather, uncle, stepfather and countless other managers I have worked for over the years have had a profound impact on the person I am today. Why did you join CFADA, and how have you been involved in it since then? CFADA has a vested interest in supporting dealers. Evelyn Cardenas recently helped me plan an event that would allow us to get more empowered women involved in our community to our dealership. We are also planning some events for the annual CFADA auto show to engage the people who attend. Why is membership in CFADA important? What are the benefits? CFADA builds relationships with legislators and protects dealer interests. The leaders and staff can answer legal or business questions and advise you about investing in your business or growing more effectively. CFADA also invests in helping dealers recruit and educate younger people about opportunities in the auto business. It creates pathways into the industry for people, especially young people. What is your biggest career accomplishment so far? I am proud of the culture we have in our dealerships. We share our passion with our clients and stay involved in giving back to our local community. It is important to me that we help our employees have balance in their lives. They are my number one resource, and I never lose sight of that. Without them, we have nothing. What are the three most valuable career suggestions you would give someone you wanted to mentor? 1. To be successful, do what you love. Be passionate and engaged. 2. Stay true to your values and your principles. 3. Be patient enough to learn but impatient enough to take risks. What has been the secret to your success and growth in the industry? I learned early that I could only go so far on my own. So I surround myself with the best people, pay them well, and remove hurdles so they can succeed. Tell us about your family? I have a son (12) and a daughter (10). They are amazing young people who are smart, kind and faith-driven. My daughter loves animals, and my son loves the arts. I push them to do what they love; there is no do-over in life. What do you enjoy doing when you aren’t working? I don’t have as much free time being a dad, and my business commitments take up most of it. However, I enjoy golf and racing cars on the track when I can fit them in. Most of all, I love my family time with my children. What is your favorite car? Also, what are you driving now? My all-time favorite car is the Porsche Carrera GT. It’s a V10, manual transmission supercar the likes of which will never be made again. I would love to have that in my collection someday. I currently own a Porsche 911 Turbo S Cabriolet. I believe it’s the ultimate daily driver that is also a supercar. Do you have any last words for those reading your article? I love what I do. There isn’t a day I don’t wake up that I feel so humbled and blessed for all the opportunities I have had, the people I have met and the dedication I have seen. The last 22 years in the automotive industry have been a dream come true. I look forward to all that is ahead for us all, with incredible hope for a better and brighter future. Pub Yr 2 | Issue 3 7 CFADA.ORG
GETTING TO KNOW JASON KIRKLAND Jason Kirkland has been in the retail automotive industry for 30 years, and he has worked at Jenkins Honda of Leesburg for 26 of those years. Jason has been a general manager there for seven years and currently serves as a director on the CFADA board. We recently talked with Jason about his life, his work and the industry in general. Where are you from, and what’s your background? What interested you as a child and young man? I was born in Clearwater, Florida, and raised in the Fort Lauderdale area of South Florida. I went to private Catholic school, grade school through high school, and played many sports while growing up, but my favorites were baseball and tennis. However, now I play golf because I injured my knees when I was younger and had to have two ACL replacements. Tell us about your education. I had one year of college at the University of Tampa. After turning 22 and getting into the car business, I made too much money and had too much fun to think about going back to school. I don’t have to go to work: I get to go to work. When did you become interested in the dealership industry? I knew a kid when I was growing up whose father was in the car business. His house was impressive. I asked him, “What does your dad do for a living?” He said his dad was in the car business. I thought that was pretty cool, but I didn’t think about it for myself until I met Mr. Jenkins when I was 18 years old and working at the Harbor Island Athletic Club in Tampa, Florida. He was a member there and would always talk. Mr. Jenkins persuaded me to work for him five years after the conversation with my friend. I was 22. 8 Pub Yr 2 | Issue 3
How did you become the general manager at Jenkins Honda of Leesburg? When I first started working for him, Mr. Jenkins was the general manager at Courtesy Pontiac GMC. He started me out in sales, and after a year, I went into finance. I’ve worked for him all but four years since then, and I’ve been a general manager for him for 13 years. I’ve worked as the general manager at Jenkins Honda of Leesburg for the last seven years. When I wasn’t working for Mr. Jenkins, I was helping my dad out with some little private lots he had. But Mr. Jenkins and I always communicated with each other even when I wasn’t working for him. Why did you join CFADA, and how have you been involved in it since then? Glenn Ritchey is a general manager in Daytona and the vice-chair at CFADA. He called me because he was looking for a Honda dealer to join the association. What are the benefits? Why is membership in CFADA important? Belonging to different groups is important because It gets your name out there and creates more business. Associations like CFADA put great minds in the same field together, and the relationships that members make with other members give them an advantage over everybody else. In addition to CFADA, I’m also a board member for the Chamber of Commerce in Leesburg, Lake County. What is your biggest career accomplishment so far? I don’t know that I’ve done it yet. I’m 52. I hope my biggest accomplishment is still ahead. What are the three most valuable career suggestions you would tell someone you wanted to mentor? 1. Learn from other people’s mistakes. 2. Stay in one place. Don’t jump from place to place. 3. You’ve got to balance your work-to-home-life ratio because you’ll lose personal relationships that are important to you if you don’t. I’ve been there and done that. Supply chain issues have been a huge challenge for everyone. How are you solving them at your dealerships? New car volume is down, grosses are up, and we’ve switched our focus to CPOs (Certified Pre-Owned) and used cars. I think the problems will get worse by the end of the year. Last year, we had supplies on the ground; this year, we don’t have what we had last year. However, the supply chain should start ramping up by the middle of 2023, going into 2024. What is the biggest challenge facing dealerships in the next three to five years? How can dealers successfully deal with it? We’re making record gross profits, and some managers think they created all their success. But it’s not always them creating it; it’s the market. Dealerships need to be training the sales staff. Dealers who don’t will have a hard time continuing to succeed when things get back to normal because their sales staff will have forgotten how to sell cars. We train our staff the same way we did two to three years ago. What do you enjoy doing when you aren’t working? I work six days a week, so I don’t have much free time, but I play golf and spend time with the family. There’s a huge lake in Florida where we like to go, and we just got back from visiting my wife’s family in Pennsylvania. Tell us about your family. My mother is living with her husband in South Carolina. She is a retired nurse in her 80s and is doing continued on page 10 Pub Yr 2 | Issue 3 9 CFADA.ORG
well. My dad was living near me, but he is 83, has Alzheimer’s and has been in the hospital. I have two siblings. My half-brother lives in Australia, and my halfsister lives in Texas. My wife is Amy, and she is awesome. She’s very creative. It’s hard to buy her gifts because she prefers gifts from the heart. She sells Pampered Chef and loves it. We’re going to need a bigger kitchen because we’ve bought so many of their products for ourselves. We have five children combined, ages 13-28. One daughter is about to turn 16, and I also have three older boys. Do you think any of your children will follow in your footsteps? None of the older ones have asked about it, but I wouldn’t oppose it. The way things are now, you can’t be in this industry if you aren’t a good operator. Do you have any last words for those reading your article? What a wonderful time this is to be in the car business! continued from page 9 O ces: 2822 Remington Green Circle Tallahassee, Florida 32308 Tel 850.878.6404 Fax 850.942.4869 4208 Six Forks Road, Suite 100 Raleigh, North Carolina 27609 Tel 919.847.8632 Fax 919.847.8633 DEALERLAWYER.COM PROTECTING OUR FLORIDA DEALER CLIENTS FOR OVER 30 YEARS Bass Sox Mercer represents automobile, truck and motorcycle dealers in complex franchise issues, litigation and transactions. The firm has the knowledge and experience to address a wide range of issues, with the goal of not only aiding their clients in meeting a specific, immediate objective, but also providing creative responses and strategic solutions for issues that will arise in the future. 10 Pub Yr 2 | Issue 3
Weighing In on EVs and the Value of Dealerships continued on page 12 On Jan. 5, 2022, The Washington Post published an op-ed article by Liam Denning entitled “Car Dealership Laws Aren’t Fit for the Electric Age.” On Jan. 13, 2022, NADA’s president and CEO, Mike Stanton, responded. The following sections contain a summary of the op-ed and Mike Stanton’s response. An Admittedly Biased Summary of Liam Denning’s Article in The Washington Post The op-ed begins with Liam Denning’s view of the auto dealership world. It isn’t pretty. He sees dealerships as no more than a revolving door for products. (Isn’t that what any good retail store tries to be?) The pandemic and supply chain issues emptied lots, then kept them empty. He saw the dealerships’ response to the pandemic as an opportunity to raise auto prices as volume fell. To support that claim, he said volume for 2020 was 7% less than for 2019, but that gross margin almost doubled, making their response to the pandemic nothing more than a chance to raise prices while volume fell. He then notes that dealers have a “growing challenge” as they move forward. How accurate are his claims? They are misleading. Although he doesn’t talk about auto manufacturers or By Mike Stanton Pub Yr 2 | Issue 3 11 CFADA.ORG
continued from page 11 other industries, they too had unexpectedly profitable years after the pandemic shutdown. And although net profit was up for U.S. dealers, net profit included net operating profit and incentives paid by automakers to dealers who exceed sales targets. Also, chip shortages meant manufacturers focused on building SUVs and trucks because they have higher margins than small cars. Higher net profit is to be expected for everyone under those circumstances. The article then moves to an admiring analysis of EV manufacturers, with Rivian Automotive Inc. and Tesla Inc. mentioned by name. He says nothing about how direct sales affect EV profits, but he does say EV manufacturers are highly valued at the moment. He then talks about how the current system came to be. State laws passed decades ago were designed to prevent predatory behavior by big U.S. automakers and force them to use independent franchises for vehicle sales and service. After the history lesson, he claims that the current market is different from the 1950s market. Why? He says three U.S. brands no longer dominate the market. The current market, he claims, is too competitive to allow a repeat of the same issues that caused legislation to be written in the first place. Really? Tesla dwarfs all other EV manufacturers. And although Elon Musk has plans to fill the global market with Teslas, Denning ignores Musk’s gigafactories in Berlin, Shanghai and Texas. Even though Denning names Rivian and Tesla as two important companies in the developing EV market, citing sky-high valuations, he is wrong there, too. The three largest EV manufacturers are Tesla, VW and General Motors … not Rivian. Rivian is riding on expectations, not accomplishments. But since newcomer Tesla is the EV manufacturer currently dominating the EV market, why would anyone conclude states should throw away hard-earned legislative protections? Remember, too, that Musk – who is admittedly brilliant – will never remind anyone of the late Fred Rogers. Next, Denning says that high dealership margins come from selling vehicles and then taking care of them. He implies that EV sales departments meet several times with buyers while educating them about their potential purchases and that franchise dealers are all about the hard sell. Since EVs have fewer parts, though, he suggests service departments will be much less profitable in the future. It’s hard to know what to address first. Selling is selling, and doing it right means building a customer relationship. That’s why the best dealers have always made a point of helping their communities prosper. There are even many dealerships where the customers and employees are multigenerational. Dealerships like that do not fit a “hi, bye” model, especially in small communities. Dealerships have to care about customers, or they don’t last. And “less service” is not the same as “no service.” Tesla, in particular, has skimped so far on building up the service side of the business. As sales volumes increase, that’s going to be a problem. Denning then turns his attention to Michigan, Florida and New York. Yes, the market is changing, which means the way autos are built and sold will also change. Yes, dealerships have invested a great deal of time and 12 Pub Yr 2 | Issue 3
energy working with legislators. Yes, Rivian and Tesla valuations are high and are affecting the market. None of that somehow makes dealers dishonest or irrelevant. That’s our summary of Liam Denning’s article. Read on for Mike Stanton’s excellent response, with which we fully agree. How NADA’s Mike Stanton Responded Dear Editor: Liam Denning’s piece on car dealerships (Car Dealership Laws Aren’t Fit for the Electric Age, Jan. 5) uses decades-old tropes to make the case for direct sales as the best path to EV adoption. But he misses the mark by failing to grasp what is actually involved when average Americans buy or lease a new vehicle. The truth is, America’s 16,500 dealerships and millionplus highly skilled product specialists and technicians are essential to achieving the government’s goals for broad EV adoption. Here’s why: The next stage of EV adoption won’t mean getting affluent buyers into $100k+ luxury or performance vehicles. It will mean getting average consumers into mass-market vehicles they depend on every day to get to work and manage family life. It will mean helping those customers figure out how to finance their vehicles and how to handle their trade-ins. It will mean educating them about the differences EVs present. And it will mean keeping these vehicles on the road when inevitable repairs and recalls happen – without long wait times. Today’s EVs are great vehicles – but they’re not perfect. It’s possible that EVs may need less service in the future, but in 2021 the data shows they require more service and repairs than ICE vehicles. Tesla’s recent recall of some half million vehicles and GM’s recent recall of some 100,000 Bolts suggest that EVs are not immune to safety issues that must be fixed. Because local dealerships compete for customers on sales and service, the result is that pricing is competitive, and service is plentiful – from multiple same-brand dealers. It means you can always get a dealer on the phone, and you can always get a local appointment, with no waiting or frustrating 1-800 calls. With new complex new products like electric vehicles, personal service and education is needed more than ever. EV buyers agree. In the largest and most comprehensive survey ever conducted of future EV buyers in the U.S., the analytics firm Escalent presented future EV buyers with a factory sales model and a franchise dealership model. Only 20% preferred the direct approach. Twenty-three percent were neutral. And a full 57% chose the current dealership model. When 20,000 future EV buyers demand for dealerships be a big part of their EV purchase experience, it is clear that the franchise dealership model works just as well for EVs as it does for traditional vehicles. America’s car and truck dealers are all-in on EVs and raring to get going in promoting them. Our best environmental policy is to leverage the network of America’s 16,500 dealerships to help America successfully make the transition to EVs. Sincerely, Mike Stanton President and CEO National Automobile Dealers Association When 20,000 future EV buyers demand for dealerships be a big part of their EV purchase experience, it is clear that the franchise dealership model works just as well for EVs as it does for traditional vehicles. Pub Yr 2 | Issue 3 13 CFADA.ORG
Auto Buying Preferences The auto industry is starting to undergo a massive switchover from ICE autos to EV autos, and there’s no shortage of people to tell you EVs are going to have a big impact on the industry. What’s less clear is how that implementation will occur. Many people expect direct retail from manufacturers to expand, but fewer people ask what customers want and like. Escalent is an analytics advisory company that focuses on business disruptions and transformations. The company conducted a survey, May 5-June 16, 2021, of 1,248 new-vehicle buyers from a global database. Those who responded were selected based on age (18-80), gender and location, and the survey’s demographics were weighted to reflect actual vehicle sales based on the vehicle segment. The survey was done on an opt-in basis as part of a panel. What were the results? It wasn’t the slam-dunk for direct retail you might have expected. The majority of those surveyed (57%) prefer traditional car buying. Only 20% prefer direct retail. If you think the older segment skewed that result, think again: 94% of those less than 30 were satisfied with dealerships. Overall, 87% were satisfied. What about a hybrid buying experience? Again, the preference was for being in-person at the dealership for at least part of the transaction: • 75% for purchases • 60% for financing • 85% for taking delivery versus home delivery • 79% for repairs and services versus having a technician come to a customer’s home The obvious takeaway is that most people, including younger customers, want to conduct business at the dealership. In particular, 63% want to take EVs for a drive before buying them. Test drives got a higher approval rating than any other source of information. However, they are less interested in getting information from a dealership salesperson; 31% said a salesperson would be a primary information source. The 2021 Global Automotive Consumer Study, conducted by Deloitte, confirmed these survey results. Approximately 71% of customers want to buy their autos in person, and 64% are uncomfortable buying 100% online. When asked why they preferred going 14 Pub Yr 2 | Issue 3
to the dealership, 75% said they wanted to see their vehicle before buying it, and 64% thought a test drive was necessary. Only 38% wanted to negotiate in person and face-to-face. That doesn’t mean they wanted to spend a lot of time there. They didn’t want to be at the dealership for more than an hour. That’s probably why car buyers also preferred doing online research and paperwork, including the financing portion. They wanted transparency and time while evaluating decisions such as buying extended warranties. For decades, consumer pain points have included the following: • Disliking long waits • Evaluating financing options while under pressure • Meeting too many people • Having too much paperwork Those pain points were a fact of life before the pandemic. Less than 2% of all vehicles were sold online. The pandemic changed that: 30% of U.S. new car sales in 2020 were sold online. But there’s a difference between doing something because you have to and doing something you want to. People like going to dealerships. But they don’t want to be there for hours. Buying a vehicle by using a hybrid process gives customers convenience and speed. It also allows them to see their vehicle in person and test drive it before making a final decision. As a dealer, the key to understanding these survey results is reducing the pain of buying a car and increasing the convenience. Seeing a car and taking it for a drive is not a pain point and can only be done in person. People are always going to want that part of the auto-buying experience. But there’s a great deal that can be done to make other parts of the experience more pleasant than they’ve been in the past. Dealerships aren’t going away. However, changing business practices to include better selling methods won’t go away, either. And that’s a good thing. Buying a vehicle by using a hybrid process gives customers convenience and speed. It also allows them to see their vehicle in person and test drive it before making a final decision. Pub Yr 2 | Issue 3 15 CFADA.ORG
Dealerships Do Business The Pandemic has Changed the way Even though it has been over two years since the pandemic shutdown of March 2020, the divide between pre-pandemic life and post-pandemic life has not closed. The future has very few certainties, but that doesn’t prevent you from making educated guesses. There are specific areas that could affect the future of your dealership. Those areas are the ones where you should focus your decisions. Here are a few general subjects you should consider to get you started, but everyone’s situation is different. There might be others you should add, too. Cyberattacks The digital cloud is important for a couple of reasons: convenience and security. The cloud makes it possible to access information somewhere other than a physical store, and it also protects that data by using security protocols. Although the cloud’s convenience is an obvious benefit, security aspects are important, too. Automotive dealerships have a high volume of data, and much of it is sensitive because it involves personal and financial information about customers. Security patches and updates for cloud-native systems can be installed whenever necessary, and cloud record backups prevent you from losing important information if or when someone hacks your business. If you don’t already have a cloudbased DMS, you should consider getting one. Digital Advertising Websites, including social media websites, are an opportunity to help potential customers find you. You can then let them know about any special offers you might have. That becomes doubly important at a time when many people are still avoiding brick-and-mortar stores. Mobile Services Sometimes people don’t want to bring a vehicle in for service. Some 16 Pub Yr 2 | Issue 3
dealerships have met that need by expanding their services; more specifically, they offer mobile services. They can pick up a vehicle from a customer’s home, rotate the tires or change the oil, and then return it. Suppose you are considering offering similar services at your dealership. If so, you will need a DMS that can work off-site without a VPN. Online Shopping Most potential customers now prefer to do some or all of their shopping online instead of at a dealership. Thanks to the internet, they can conduct in-depth research and become well-informed before making their final buying decisions. According to an online article on the Autolist website that appeared in May 2021, people spend more than nine hours researching vehicles. Going to the dealership to buy a vehicle often takes about three hours. That time might be spent looking at vehicles, talking to the sales staff, test driving, negotiating the purchase price and trade-in price, and signing paperwork. The shift to online research and paperwork that has been filled out in advance allows you to improve efficiency. If customers start the buying process from home, that means you can often shorten the time needed to finalize the sale. As people do more paperwork at home, the sales process becomes easier, and customers are happier about their vehicle-buying experience. What is the ideal amount of time? A Car and Driver article by Jack Nerad published Jan. 4, 2018, said customers wanted to spend 45 minutes to an hour finalizing their purchase. Although that was more than four years ago, the pandemic has increased people’s expectations about buying goods quickly and easily. The 2022 Deloitte Global Automotive Consumer Study contains results from a survey of 26,000 people in 25 countries. It found that people still prefer buying in person from an authorized dealer. However, online purchasing was also attractive because those surveyed thought it would be easier and more convenient. You don’t have complete control over how long it takes someone to buy a car, but you should make buying as easy as possible whether customers are online or in your store. Online, you might want to consider having a virtual sales manager. Payments It has become increasingly important to take payments securely online. That way, customers can pay at their convenience and avoid crowds. Your DMS can do more than enable online payments; it also allows you to track them. Remote Work One advantage of cloud-based software is the way it allows employees to work remotely. If you set things up correctly, employees working from home can set up deals, offer different payment options, schedule service and test-drive appointments and allow customers to set up contracts and payments digitally. The pandemic pushed the entire world forward technologically when it became necessary to shut down public institutions and ask people to isolate themselves. That was hard, and it continues to be hard. But companies also became more efficient, and what used to be considered a concierge level of service became mainstream. As a result, you can deliver a better experience to your customers than ever before. That’s always good for business. One advantage of cloud-based software is the way it allows employees to work remotely. If you set things up correctly, employees working from home can set up deals, offer different payment options, schedule service and test-drive appointments and allow customers to set up contracts and payments digitally. Pub Yr 2 | Issue 3 17 CFADA.ORG
The Ins & Outs Of Dealership By Dominion DMS Communication within your dealership can make a world of difference for your customers, your employees, and your staff. Even if you believe your dealership is great at communicating inside and out, improvement is always possible. Working toward more effective communication can mean: • Increased Revenue – Do your service technicians spend a lot of time walking back and forth to the parts back counter to discuss and retrieve parts needed for a vehicle? Are you service advisors waiting for customer authorization on services? How long do customers need to wait at the dealership to get updates on their vehicles and pay? This time adds up to fewer cars serviced, fewer cars sold, and money left on the table. • Happier Employees – Businesses that present more transparency and communication improve employee morale. This means more engaged team members. In fact, according to the McKinsey Global Institute, effective communication can improve productivity in any workplace by up to 25%. Happier employees also mean reduced turnover. • A Fulfilling Customer Experience – Put yourself in the shoes of a customer for a moment. Which sounds better: spending the day in a dealership waiting room, or going about their day with the trust that they know their car is in good hands? People are known to take better care of their cars over their own health. Your customers want to take their vehicles somewhere where they will be frequently updated on services. • Transparency in Your Dealership – If you communicate better and more frequently with your employees they are more likely to communicate better with you. This means problems are solved quicker, your staff is more relaxed, and your customers come back. If one or more of these would be beneficial at your dealership, now is the time to start. Barriers to Effective Internal Communication If communication is lacking throughout the dealership, there might be a physical or psychological barrier causing it. The cause may be deeply rooted or something easily fixable. Do any of these sound familiar? A Lack of Transparency There could be any number of reasons why staff members might not be in sync. Often it’s because nobody understands the goal. For example, if you expect your dealership to service 1,200 vehicles a month, does everybody in your service department focus on that? If so, are they aware of how they are performing? Not being transparent about information like expectations or even the vision of the business can get in the way of meeting goals. Clearly defined goals set the right expectations. There should be a process or tool to help maintain an easy flow of internal communication. Unclear Direction from Managers An easy mistake a manager can make is to point out an issue without involving employees in finding a solution. Let’s say a service manager received complaints from customers about paint scratches on serviced vehicles. Communication 18 Pub Yr 2 | Issue 3
Dominion DMS is a pioneer in Microsoft-based dealer management systems with decades of experience partnering with franchise dealerships to deliver a superior experience, reduce costs and protect their business. Our cloud-native VUE DMS offers digital security, flexibility and efficiency to help dealers meet today’s rapidly-changing market. Explore more of our resources at VUEDMS.com. We encourage you to visit our website and browse more of our content by scanning this QR Code. Relaying this to the service staff without a prevention plan going forward may not help. Reminding employees to be careful with vehicles is reasonable, but what if the vehicles were damaged prior to arriving at the dealership? Your team may suggest implementing a more consistent check-in inspection of the vehicle’s condition upon arrival. This inspection could actually lead to higher service revenue in repairs to these damages along with more trust from the customer. Employees Can’t Ask Questions Do you remember the old saying, “There are no stupid questions”? Is that what your employees actually believe? Fostering an environment where your team feels comfortable speaking up will strengthen your dealership. Creating a habit where experienced employees are encouraged to mentor others will improve their morale and allow new employees to get up to speed more quickly. Not Recognizing and Celebrating Good Work Staffing issues can mean that teams are stretched more thinly than before. With everyone so busy, it is easy to forget to show appreciation. The perception of being unappreciated can lower morale and lead to burnout. When employees feel recognized and seen by managers, they feel more open to voicing their ideas. Satisfied employees are far more likely to provide superior customer service and productivity. Stressful Training The more difficulty new employees have with their training, the less likely they will be comfortable asking questions or communicating well with others. According to a 2016 study by the National Auto Dealers Association, 28% of dealership terminations occur within an employee’s first 90 days. Starting a new job often demands learning a lot of information. Investing in effective training programs can pay dividends in quicker new hire productivity while reducing turnover. How to Improve Dealership Communication There are several ways a dealership can implement to increase and improve communication between departments. These tips can break down many of the barriers listed earlier that prevent good communication within the dealership. Start with Yourself You are in charge. This means you influence a lot of what happens at your dealership for better and for worse. Create a culture of good communication. Set up ways to promote transparency in your dealership. Spend more time with your staff to create a comfort level for employees to ask questions, understand expectations, and feel more recognized. This should result in better goal attainment, a happier workforce, and more satisfied customers. Communicate Digitally It is hard to beat a face-to-face conversation, but that is not always possible or efficient. Digital communication is better than none at all. There are paid and even free options available for sending messages between departments. It may even be functionality that is already available. Using an internal chat tool can provide quick answers to keep your business running at its peak. Create One Source of Truth for Information A dealership typically invests in many different types of software, with different and sometimes redundant sources of information. Between your DMS, your CRM, and other tools in use at dealerships today, it can be confusing and inconsistent. A best practice is to choose one system to be the source of truth that all employees rely on. This will make transparency easier, and provide the foundation to communicate across departments. Between all of the benefits, barriers, and tips discussed, there is one overarching theme: effective internal communication is important for a successful dealership, and it starts with you as the manager. It offers many benefits and prevents a lot of potential problems. Overall, it can improve productivity, boost profitability, and create a positive employee and customer experience. If you are unsure where to start, take a look at your dealer management system. See what features are available that may make following the tips provided easier. As a DMS provider ourselves, we strive to make important processes like internal communication easier for you with dashboards, chat features, and collaboration tools. https://www.vuedms.com/resources/reconsideryour-dms/?utm_campaign=state-associationcentral-florida&utm_source=media-ad&utm_ medium=florida&utm_term=awareness&utm_ content=download-ebook Pub Yr 2 | Issue 3 19 CFADA.ORG
801.676.9722 | 855.747.4003 sales@thenewslinkgroup.com ARE YOU READY FORGROWTH? ADVERTISE IN THIS MAGAZINE TO ROCKET YOUR BUSINESS FORWARD.
Aston Martin, Lotus, Jaguar of Orlando 4249 Millenia Blvd. Orlando, FL 32839 Audi N. Orlando PO Box 1720 Winter Park, FL 32790 Audi S. Orlando 4725 Vineland Rd. Orlando, FL 32811 AutoNation Acura N. Orlando 1001 Rinehart Rd. Sanford, FL 32771 AutoNation Chevrolet Airport 5600 Lee Vista Blvd. Orlando, FL 32812 AutoNation Chevrolet W. Colonial 3707 W. Colonial Dr. Orlando, FL 32808 AutoNation Ford Sanford 4911 Wayside Dr. Sanford, FL 32771 AutoNation Honda Sanford 1000 Rinehart Rd. Sanford, FL 32771 AutoNation North Florida Market/Porsche of Orlando 9590 S. HWY 17-92 Maitland, FL 32751 AutoNation Toyota Winter Park PO Box 4070 Winter Park, FL 32793 Bill Bryan Chrysler Dodge Jeep, Inc. 3401 U.S. HWY 27/441 Fruitland Park, FL 34731 Bill Bryan Kia of Leesburg 8644 S. U.S. HWY 441 Leesburg, FL 34788 Dealer Members Bill Ray Nissan PO Box 521400 Longwood, FL 32752 Bob Steele Chevrolet 2800 W. 520 Cswy. Cocoa, FL 32926 Boniface-Hiers Chrysler Dodge Jeep 1775 E. Merritt Island Cswy. Merritt Island, FL 32952 Boniface-Hiers Mazda 625 E. NASA Blvd. Melbourne, FL 32901 Carl Black Chevrolet Buick GMC 11500 E. Colonial Dr. Orlando, FL 32817 Cecil Clark Chevrolet PO Box 491090 Leesburg, FL 34749 Central Florida Lincoln 2055 W. Colonial Dr. Orlando, FL 32804 Central Florida Toyota Scion 11020 S. Orange Blossom Tr. Orlando, FL 32837 City Kia PO Box 770279 Orlando, FL 32877 Classic Honda PO Box 1720 Winter Park, FL 32790 Classic Mazda East PO Box 1720 Winter Park, FL 32790 Coastal Hyundai Mitsubishi 915 W. New Haven Ave. Melbourne, FL 32901 Cocoa Hyundai 1825 W. King St. Cocoa, FL 32926 Coggin Deland Ford Lincoln PO Box 741120 Orange City, FL 32774 Coggin Honda of Orlando 11051 S. Orange Blossom Tr. Orlando, FL 32837 Cory Fairbanks Mazda 400 N. HWY 17-92 Longwood, FL 32750 Danny Len Buick GMC 17605 U.S. HWY 441 Mt. Dora, FL 32757 David Maus Chevrolet 972 Towne Center Blvd. Sanford, FL 32771 David Maus Toyota 1160 Rinehart Rd. Sanford, FL 32771 David Maus Volkswagen N. 1050 Lee Rd. Orlando, FL 32810 David Maus Volkswagen S. 5474 S. Orange Blossom Tr. Orlando, FL 32839 Daytona Hyundai 901 N. Nova Rd. Daytona Beach, FL 32117 Pub Yr 2 | Issue 3 21 CFADA.ORG
Dealer Members Deluca Toyota 1719 S.W. College Rd. Ocala, FL 34471 Don Mealey Chevrolet 17185 State Rd. 50 Clermont, FL 34711 Don Mealey Sport Mazda 9786 S. Orange Blossom Tr. Orlando, FL 32837 Don Mealey Sport Mitsubishi Subaru 3772 W. Colonial Dr. Orlando, FL 32808 Ferrari & Maserati of Central Florida 525 S. Lake Destiny Dr. Orlando, FL 32810 Fields BMW 963 Wymore Rd. Winter Park, FL 32789 Fields BMW of S. Orlando 9750 S. Orange Blossom Tr. Orlando, FL 32837 Fields Motorcars Orlando 895 N. Ronald Reagan Blvd. Longwood, FL 32750 Ford of Clermont, Inc. 1101 E. HWY 50 Clermont, FL 34712 Ford of Ocala, Inc. 2816 N. W. Pine Ave. Ocala, FL 34475 Gary Yeomans Honda 752 N. Tomoka Farms Rd. Daytona Beach, FL 32124 Gator Chrysler 840 S. Harbor City Blvd. Melbourne, FL 32901 George Nahas Chevrolet 4135 E. State Rd. 44 Wildwood, FL 34785 Greenway Dodge, Chrysler, Jeep 9051 E. Colonial Dr. Orlando, FL 32817 Greenway Ford 9001 E. Colonial Dr. Orlando, FL 32817 Holler Honda PO Box 1720 Winter Park, FL 32790 Holler Hyundai PO Box 1720 Winter Park, FL 32790 Infiniti of Melbourne 625 E. NASA Blvd. Melbourne, FL 32901 Island Lincoln Jaguar Land Rover 1850 E. Merritt Island Cswy. Merritt Island, FL 32952 Jenkins Nissan of Leesburg 10234 S. Hwy. 441 Leesburg, FL 34788 Kaiser Buick GMC Truck, Inc. PO Box 2813 Deland, FL 32721 Key Scales Ford, Inc. 1719 Citrus Blvd. Leesburg, FL 34748 Kisselback Ford 1118 13th St. St. Cloud, FL 34769 Land Rover Orlando 199 S. Lake Destiny Rd. Orlando, FL 32810 Lexus of Winter Park PO Box 5669 Winter Park, FL 32793 Massey Cadillac of Orlando 4241 N. John Young Pkwy. Orlando, FL 32804 Massey Cadillac South Orlando 8819 S. Orange Blossom Tr. Orlando, FL 32809 Mercedes Benz of North Orlando 1100 Rinehart Rd. Sanford, FL 32771 Mercedes-Benz of Orlando 810 N. Orlando Ave. Maitland, FL 32751 Mercedes-Benz of South Orlando 4301 Millenia Blvd. Orlando, FL 32839 Mercedes-Benz, Porsche & Audi of Melbourne 509 E. NASA Blvd. Melbourne, FL 32901 Mullinax Ford of Central Florida 1551 E. Semoran Ave. Apopka, FL 32703 Mullinax Ford of Kissimmee 1810 E. Irlo Bronson Hwy. Kissimmee, FL 34744 Mullinax Ford of New Smyrna Beach 2317 S.R. 44 New Smyrna Beach, FL 32168 Murphy Cadillac, Inc. 174 E. Hibiscus Blvd. Melbourne, FL 32901 Napleton’s Volkswagen of Sanford 4175 S. Orlando Dr. Sanford, FL 32773 Orange Buick GMC 3883 W. Colonial Dr. Orlando, FL 32808 Orlando Dodge Chrysler Jeep 4101 W. Colonial Dr. Orlando, FL 32808 22 Pub Yr 2 | Issue 3
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