PUB 1. ISSUE 4. 2023-2024 11th Annual Barbecue for the Troops Fundraisers Taking Place in July
Memberships in: • AUTOCPA Group • The American Institute of Certified Public Accountants • The Illinois CPA Society CERTIFIED PUBLIC ACCOUNTANTS Located in Central Illinois, we serve the entire state. Contact us today to learn how we can help your dealership thrive. Drive Your Dealership Toward Financial Success We specialize in automobile dealers in the following areas: • Dealership valuations • Automobile dealer legal support • Buy-Sells for dealerships • LIFO inventory computations • Financial statement analysis • Corporation Income Tax returns • Personal Income Tax returns • CPA prepared financial statements • Dealer estate planning • Employee theft consulting • Internal control studies and audits • Profit consulting • Training office managers/CFO’s • 401K Audits Serving more than 250 Automobile Dealers throughout the United States (309) 662-8797 Email: woodwardassoc@cpaauto.com Website: www.cpaauto.com 1707 Clearwater Avenue P.O. Box 1584 ·Bloomington, IL 61702
14 10 ©2024 The Chicago Automobile Trade Association | The newsLINK Group, LLC. CATA Up To Speed is published four times each year by The newsLINK Group, LLC for the Chicago Automobile Trade Association and is the official publication for this association. The information contained in this publication is intended to provide general information for review, consideration and 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 the Chicago Automobile Trade Association, 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. CATA Up To Speed is a collective work, and as such, some articles are submitted by authors who are independent of the Chicago Automobile Trade Association. While CATA Up To Speed 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. 05 From the Desk of the EVP By Chris Konecki, Executive Vice President, CATA 09 CATA Election Results Jared Wickstrom of Dick Wickstrom Chevrolet Elected to Chicago Automobile Trade Association Board of Directors; Three Current Directors Re‑Elected 10 11th Annual Barbecue for the Troops Fundraisers Taking Place in July 12 CATA Annual Meeting and Golf Outing Recap 14 Auto Show Insights Initiative A Mission to Drive OEMs Back to Shows By Jennifer Morand, President, CATA 18 All-New DriveChicago.com Launched By Mark Bilek, General Manager, DriveChicago 20 Hilb Group CATA’s Recommended Consultant for Healthcare Optimization By CATA 22 Is Now a Good Time to Sell? What Today’s Buy-Sell Market Means for Automotive Dealers Considering an Exit By Jennifer Rafael, DSMA 24 Dynatron Knows Fixed Ops Revenue, Do You? By Leigh Silver, Chief Executive Officer, Dynatron Software CONTENTS CATA UP TO SPEED 3
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№ 1 From the Desk of the EVP Chris Konecki, Executive Vice President, CATA As we head into the warmer summer months, I wanted to take time to share a recap of what has recently transpired behind the scenes at the CATA and to also give you a look forward to some of the things coming up that we will have available for you. On the auto show front, we have been busy meeting with auto manufacturers, giving them a robust recap of how the show performed as well as getting their feedback regarding the show. We have also been meeting with automakers who did not participate in the 2024 show. These manufacturers are not only important to the show’s vitality but also important for dealers who have franchise agreements with them. We are always working to get more complete OEM participation because we know that when an OEM exhibits at the Chicago Auto Show, that moves the sales needle for its dealers. With a little luck, we hope to again host those missing from our auto show, either for the first time or to welcome back an old friend. We have also just concluded closing the books on the First Look for Charity black-tie gala held just before the show opens to the public. It was another successful year for this benevolent event, raising $2.8 million for 18 local charities. This event, although it only lasts for four hours, lives on for many months due to the reach the money raised has for the benefiting charities. Looking ahead, the CATA has concluded a successful annual meeting and golf outing held at Cog Hill Golf Club in Lemont, Illinois. It also marked the occasion of the naming of a new director to the CATA Board of Directors. Jared Wickstrom of Wickstrom Chevy in Roselle, Illinois, was elected to the board and three incumbent directors were also re-elected for new three-year terms as of the June annual meeting. The incumbents include John Crane (Hawk Auto Group), Fred Marks (Classic Toyota and Classic Kia in Waukegan) and Jason Roberts (Advantage Dealer Group). CATA UP TO SPEED 5
This year’s BBQ for the Troops event is scheduled for Saturday, July 13, and will offer more options for dealers who wish to participate. In addition to holding a traditional BBQ event, dealers can host “test drive for the troops” events throughout the month of July with a donation for each drive given to the USO or simply accept dealership donations for the cause. The CATA’s fall Chicago Drives Electric event will take place from Oct. 3-6 and continue to showcase electric and PHEV vehicles to the public. We anticipate having more brands than we did in 2023 and are working on finalizing the details. The CATA’s largest event, The Chicago Auto Show, is scheduled for Feb. 8-17, 2025, with the First Look for Charity taking place the evening before the show opens to the public, on Friday, Feb. 7. We are currently planning the details of the show and are confident that next year’s show will deliver the consumer interest and sales spike enjoyed by all of our dealer members. As always, the CATA thanks you for your membership. Our association is stronger because of your collective involvement. Recently, however, we’ve faced some headwinds. The governor’s recent budget removed the dealer’s ability to hold back the 1.75% tax which you have been previously allowed in return for collecting the state’s sales tax. Also, there was a challenge by Volkswagen to the Warranty Reimbursement Law which the CATA, in conjunction with the IADA and service tech union, worked to pass two years ago. Issues like these highlight the need for us to have friendly contacts with local and federal legislators. We recently partnered with Congress Plus, which will allow us to quickly determine those of you who have relationships with local and federal members of congress. Our action committees, CATPAC and NADAPAC, also rely on relationships with these lawmakers and knowing which of your dealerships are in their districts helps us when we need to address issues. So, thank you; your continued help and cooperation are what make this organization successful, and we’ll continue to fight on our dealer members’ behalf. 6 CATA UP TO SPEED
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№ 2 CATA Election Results Jared Wickstrom of Dick Wickstrom Chevrolet Elected to Chicago Automobile Trade Association Board of Directors; Three Current Directors Re‑Elected The CATA election results were announced at the annual meeting and golf outing in early June. Jared Wickstrom of Wickstrom Chevrolet in Roselle, Illinois, was newly elected to the CATA Board of Directors. John Crane, Fred Marks and Jason Roberts were also re-elected. Wickstrom, a native of Lisle, Illinois, succeeds his father, Casey, and uncles, Colin and Richard, on the CATA board. He is also currently a member of the Chicagoland Chevrolet Dealers LMA board. “I would like to thank my peers for having the trust and confidence to elect me to the CATA Board of Directors,” said Wickstrom. “It is truly an honor, and I am thrilled to join such a passionate group of people to advocate for our collective interests, promote integrity and help navigate the challenges that will continue to come our way. I look forward to serving.” For 2024-25, CATA Board Members include Chairman Jason Roberts, Vice Chairman Ryan Kelly, Treasurer and Secretary Steve Phillipos, Auto Show Chairwoman Kelly Webb Roberts, Emir Abinion, John Crane, Jerry Haggerty, Dan Heller, Fred Marks, Dan Marquardt, JC Phelan and newly elected Jared Wickstrom. CATA UP TO SPEED 9
№ 3 11th Annual Barbecue for the Troops Fundraisers Taking Place in July 10 CATA UP TO SPEED
Chicagoland’s new-car dealers are once again on a mission to raise awareness and funds for the military and their families. During the month of July, area dealers will host community and online fundraising events with donations benefiting the USO. More than 50 participating dealers are planning to host events on Saturday, July 13, including everything from patriotic ceremonies, classic car shows, live music, games for kids of all ages and — of course — barbecue. Also during July, participating dealers are making donations for every test drive at their dealership. 11 years ago, the CATA and area new-car dealers partnered with the USO to create the Barbecue for the Troops campaign to raise money for our local troops and their families. What started as a few hot dogs and tossing loose change into a tin can has now grown into an annual festival which brings in thousands of dollars. In fact, the program’s lifetime total is over $1.1 million raised for the USO! To learn more about the program, see a full list of participating dealers or contribute to the fundraising efforts, scan the QR code. https://www.cata.info/2024-BBQ-for-the-Troops CATA UP TO SPEED 11
№ 4 CATA Annual Meeting and Golf Outing Recap Longest Putt winners: • Ravi Baichwal • Joel Dixon • Fred Squillo Longest Drive winners: • Ahmad Ali • John Francel • Ben Neeley Closest to the Pin winners: • Chris Burress • Kevin Chichon • Joe Crane Scramble winners: • Course 1: Robert Egyed, Erik Schmit, Clayton Bonnell and Cody Boarman • Course 2: Rob Johnson, Mike Arias, Ben Neeley and Chris Norman • Course 3: Ivan Mahanic, Jason Beane, Steve Hernandez and Mike Farrand Putting contest finalist: • Jeremy Gleason Lastly, Kevin Chichon and John Idler both got a hole in one at the outing — Congratulations! On a perfect, sunny June day, the CATA Annual Golf Outing welcomed more than 250 members to Cog Hill Golf & Country Club for an afternoon of networking, enjoyment and, of course, a round of golf. The day began with a networking reception followed by the annual meeting hosted over lunch. After lunch, golfers spent the sunny afternoon on the links, wrapping up 18 holes just in time for the 19th Hole Happy Hour. Sponsors covered the courses, providing drinks and conversation throughout the day as golfers made their way around. Prizes were awarded to those who were having an exceptional golf day:
Thank you to our sponsors who made this golf outing possible. Presenting Sponsor Vitu Platinum ABC 7 Chicago Powering Chicago Gold ACV Auctions Autotrader/Kelley Blue Book/ Cox Automotive Effectv OpenLane Protective Reynolds & Reynolds Road Dealer South Chicago Auto Auction Zurich Silver Accurate Office Supply Assured Partners Automotive Internet Media Bank of America Merrill Lynch Cars.com Dynatron EAI Design/Build Financial Renaissance Select Marketing Group Illinois Recovery Group S & S Automotive Bronze American Eagle Better Business Bureau Cost Advisor Cumulus Chicago Excell Automotive Equipment Truist - Regional Acceptance Shartega IT Utility Management Group Walsh Long & Company Inc. CATA UP TO SPEED 13
№ 5 Auto Show Insights Initiative A Mission to Drive OEMs Back to Shows By Jennifer Morand, President, CATA Over the last eight months, I have led a strategic planning project as chairwoman of the Auto Shows of North America (ASNA) committee with the primary objective of attracting manufacturers back to auto shows. As the project comes to a close, I am excited to enter the next phase of execution. One of the first initiatives of shows working together to showcase efficacy to OEMs was teaming up on a research initiative with the same thirdparty (Productions Plus) and common question to poll auto show attendees across the country. 14 CATA UP TO SPEED
The study involved 10 auto shows all in different regions with aggregate data representing nearly 1 million auto show attendees. This collaboration is a first step in the right direction of providing manufacturers with the metrics and data they’ve been seeking for a long time from shows. The report elaborates further on the new insights to showcase the undeniable marketing impact that auto shows have on consumers. The recently completed research initiative conducted by Productions Plus, which involved 14,908 auto show attendees located throughout the U.S., provides vital insights into the consumer vehicle research process and the indispensable role that in-person marketing and educational experiences, like auto shows, provide. The data, collected from consumers at 10 different auto shows nationwide, represents 920,316 auto show attendees in regions quantifying 1.6 million new retail light vehicle registrations, per Experian Automotive data. Highlights include: 9.2 Million Consumer Hands-on Vehicle Experiences • Consumers average 2.8 hours on the show floor, visit 8.6 OEM exhibits and sit in/experience 10.1 vehicles during their auto show visit. These figures equate to 2.5 million hours spent on the show floor, 7.9 million display visits and 9.2 million vehicles experienced firsthand. • 74% of all attendees (681,034) come to learn about vehicle technologies and see the latest vehicle offerings. • 42% of all attendees (386,532) indicate they are more likely to purchase a vehicle they test drive or ride in onsite. • 64% of all attendees nationwide (589,000) are between the ages of 22-55. • 94% of all attendees (865,097) were hoping to see a brand that was not onsite. CATA UP TO SPEED 15
Auto Shows Attract and Influence In‑Market Consumers • 43% of all attendees (395,736) report they are in the market to purchase a vehicle within the next 12 months. • 76% of in-market attendees report a brand’s absence from an auto show impacts their purchase likelihood. • 37% of in-market attendees added a brand to their consideration list as a result of their auto show experience. • 69% of in-market attendees report the auto show was helpful in their purchase decision. This national study validates what the auto show community has known for some time, which is that auto shows play a crucial role in shaping future purchase decisions. Even in today’s digital world, there is no better place to showcase the latest product in front of qualified buyers than an auto show. Moreover, as the auto industry continues to shift to EVs and other alternative fuel options, auto shows serve as vital educational platforms for widespread adoption of these new technologies. While this exercise with Productions Plus was a valuable one, as it was the first time in history that 10 unique auto shows collaborated on a streamlined data collection initiative, it foreshadows what’s to come regarding shows working together into the future to provide manufacturers exactly what they’ve been after for a long time. As auto shows, as well as manufacturers, strive to educate the masses about alternative fuel options and more, research such as this is of incredible value. The research found that prior to attending an auto show, one-third of attendees admitted to knowing nothing about driving, charging or maintaining an EV. By the end of their auto show visit, one-third of these attendees reported they had gained valuable insights into electrified vehicles. The data for this research was collected during the 2023-2024 auto show season as part of the Auto Show Insights Initiative executed by the Insights division of Productions Plus. Ten auto shows 16 CATA UP TO SPEED
participated in the initiative: Chicago, Cleveland, Denver, Milwaukee, Orange County, Oregon (Portland), Philadelphia, Seattle, Utah (Salt Lake City) and Washington, D.C. “Productions Plus has staffed auto shows around the country for over 40 years,” said Hedy Popson, CEO of Productions Plus. “We know and understand the value of connecting people and brands and experience these key interactions at every auto show. It’s evident that auto shows are the place where lower-funnel decision makers go to comfortably research their vehicle options.” Chief Research Officer Amy Emmatty added, “All data that we collected from attendees onsite and postshow supports this and demonstrates the incredible impact these events have on both consumers and industry trends, proving auto shows really are the most influential factor affecting new vehicle purchase decisions — surpassing digital, TV and other forms of media.” CATA UP TO SPEED 17
№ 6 ALL-NEW DriveChicago.com Launched By Mark Bilek, General Manager, DriveChicago DriveChicago.com, a significant complimentary benefit to all CATA dealer members, recently launched a completely redesigned website. As before, the primary mission of DriveChicago.com is to capture in-market vehicle shoppers and deliver them to CATA member dealers. Ancillary to that is advancing CATA marketing initiatives like BBQ for the Troops, the Chicago Auto Show and Chicago Drives Electric. Extending a more than 10-year partnership with automotive digital marketing powerhouse Automotive Internet Media (AIM), DriveChicago.com takes advantage of the latest cloud-based database management and web hosting software. The new site is more focused and extremely fast, delivering vehicle listings in the blink of an eye. DriveChicago.com does not get in the way of the shopping experience; rather, it delivers the customer right to your door. When a site user clicks a vehicle listed on DriveChicago.com, a new tab opens, displaying that vehicle on your dealership’s website. In the coming months, look for DriveChicago.com to become the No. 1 non-paid referrer in your site’s Google Analytics. DriveChicago.com continues to list only the new and used inventory of CATA dealer members. There are no priority, sponsored or featured listings. Vehicle search results are solely based on the users filter options. As part of the rebuild, AIM also developed a way to eliminate inventory feeds and instantly update the more than 100,000 vehicle listings on the site. Even though the new site is live, the AIM team continues to refine dealership listings and deploy tools like WebBuy’s digital retailing tool for trade-in quotes and values. However, the biggest value of DriveChicago.com remains: driving traffic to your website. 18 CATA UP TO SPEED
CATA UP TO SPEED 19
№ 7 Hilb Group CATA’s Recommended Consultant for Healthcare Optimization By CATA The CATA is proud to announce Hilb Group as a new Recommended Consultant. Hilb Group is the go-to partner for CATA business owners who need help controlling costs and navigating the complex world of healthcare and human capital management. Specializing in the auto dealership business for more than 30 years and serving 1500 dealerships, Hilb Group knows the industry and can help dealers pay for and manage employee benefits more efficiently. Hilb Group’s proven process collaborates with dealers every step of the way to develop a customized strategy that fits your business’s unique needs. Hilb Group was built by dealers, for dealers to ease the administrative burden of employee benefits and to create pathways for you to decrease healthcare costs while simultaneously improving benefits for employees. The CATA Member Benefits committee, chaired by Dan Heller, Heller Ford in El Paso and Heller Lincoln & Chrysler Dodge Jeep Ram in Pontiac, reviewed several candidates in the healthcare field and selected Hilb Group because of their overall track record and familiarity with new-car dealer operations. “Born out of the Virginia Auto Dealers Association, the Hilb Group has experience lowering employee benefits costs while maintaining or increasing benefit offerings,” says Dan Heller, CATA Member Benefits Committee chairman and dealer principal 20 CATA UP TO SPEED
at Heller Auto Group. “Hilb has helped more than 1500 new‑car dealers reduce prescription drug costs by an average of 42% and medical costs by 10%-23%. Hilb Group has done this while simultaneously easing the administrative burden of employee benefits and HR.” The Chicago Automobile Trade Association Member Benefits Committee works to establish and maintain preferred partner relationships with allied members with programs offering unique value to our dealer members and the CATA. CATA Approved Member Partners are thoroughly reviewed by the Member Benefits Committee and have proven track records of benefiting CATA member dealers. The vendors work with the CATA to offer these programs to our entire membership. Remuneration to the CATA may also be part of these agreements. The aim of the CATA Recommended Consultants program is to identify and recommend organizations that have a proven track record of helping dealers in areas of the business that can be particularly challenging to navigate and manage. In recognizing these organizations, the CATA believes that all dealer members can benefit from the expertise and services that the selected organizations provide. CATA Recommended Consultants are independent organizations not tied to the sales process of any individual product or service and have agreed to offer special pricing to CATA member dealers. Contact Colin Royster at croyster@integrumadvisors.com or (540) 526-7074 today to get started on potentially lowering your employee benefits costs by up to 35%. For more information about CATA Approved Partners, please visit https://www.cata.info/partners. For more information about CATA Recommended Consultants, please visit https://www.cata.info/service-providers. CATA UP TO SPEED 21
IS NOW A GOOD TIME TO SELL? What Today’s Buy-Sell Market Means for Automotive Dealers Considering an Exit By Jennifer Rafael, DSMA As a dealership Principal, the questions of if and when to sell require significant consideration. After all, when it comes to a legacy into which you’ve likely poured a sizable amount of sweat equity, it’s important to ensure that any potential transition reflects the value of the asset you’ve built. If selling your dealership is an option you’re considering, the right time to do so is always the timing that works best for you. External market factors will always be in play. The key to making a successful exit as a dealer is to navigate those factors to your greatest possible advantage. That said, a sizable contingent of dealership principals is finding themselves asking as of late, could now be the right time to sell? What’s important to know now if you’re a dealer eyeing an exit is that selling your business in a successful and profitable manner — even in today’s sometimes unpredictable market — is entirely possible when you have a strong team backing you. The question of “When is the right time to sell at top dollar?” is certainly relevant, but another question that is perhaps even more important is, “Who is the right partner to help me sell at top dollar?” A strong buy-sell partner who is well-versed in the intricacies of auto dealership mergers and acquisitions can help situate you in the best possible position in any given market. If you’re looking for the right partner, DSMA would like to invite you to discuss how our team can be the right fit for you in today’s evolving landscape. Post-COVID, there are many insecurities about the market. The industry initially encountered inventory and production shortages. However, as the pandemic subsided, the balance shifted markedly. Dealerships found themselves inundated with new inventory while facing difficulties in acquiring used inventory at profitable margins. Furthermore, rising interest rates have compounded the complexity of the situation. All this has meant profits are down for brands across the landscape of OEM. But that doesn’t necessarily equal a true negative impact for the industry. By exploring not only historical values, but future values as well, DSMA ensures that our service is relevant to the market. Through our strategic process, we’ve examined issues experienced during the last three years and projected modeling of what the next three will look like, based on market conditions. This approach allows us to right-size our values and make them relevant to today’s market. In other words, we give our customers a data-driven snapshot of the future — one that right now suggests it’s a good time to sell. Here are just a few reasons why dealers choose DSMA as their trusted advisor when considering making an exit from their business: • Strong network of interested buyers: Today’s dealership buy-sell market contains a healthy volume of dealers looking to acquire, which is one of the reasons why now may be an advantageous time for exiting dealers. Importantly, though, buyers must be chosen wisely. Different kinds of dealerships need different kinds of buyers. A qualified buyer is one who is likely to be approved by your dealership’s OEM, is familiar with your local market and has experience running a dealership of similar size and scale. A partner with a robust array of active candidates has a large pool to draw from when matching you as a seller with a buyer who will provide the right fit for your specific circumstances. • Industry-leading business valuations: As a dealer preparing for an exit, the importance of an accurate valuation cannot be overstated. A dealership’s valuation is one of the most influential factors in attracting the right buyer candidates for your business. A business assessed too high above market rate will struggle to attract buyers, leading to a longer time on the market, leading in turn to increased hesitancy among potential buyers. Meanwhile, a business assessed too low will reduce the returns seen by the exiting dealer. Producing truly accurate business valuations is what we do. • Full-service capabilities: Mergers and acquisitions require a diverse range of specialties. From legal experts to financial advisors, marketing consultants and more, many experts are required to ensure an efficient and successful transaction. It starts with our team of “matchmakers,” who do the heavy lifting for you to identify targeted, relevant and qualified buyers to successfully take over your business. From there, DSMA handles every step of the process — from due diligence to OEM approval and more. “As a dealer eyeing an exit, timing is a consideration, but timing isn’t everything,” said Jennifer Rafael, Vice President & Partner, Midwest/ partner at DSMA. “Any set of market conditions come with their own pros and cons. When it comes to making the most successful and profitable exit possible, the most influential factor will always be the partner you choose to be your advocate in navigating those market conditions.” With the right partner by your side, you’ll be in the best possible position to make the most profitable exit possible under the market conditions surrounding you. If you’re a dealer considering whether now could be the right time for you to make a move, you can contact local trusted mergers and acquisition advisors in your market by visiting www.dsma.com. 22 CATA UP TO SPEED
BUY@DSMA.COM +1 833-650-4188 DSMA.COM LET DSMA PUT YOU IN THE DRIVER’S SEAT. ACCELERATE YOUR SALE. Fast-track your dealership sale with DSMA. Our streamlined process and experienced team guarantee expedited transactions and maximized profit for your business. BUY@DSMA.COM +1 833-650-4188 DSMA.COM To learn more about our 100+ acquisition opportunities across North America and the United Kingdom, visit DSMA.com. OUR MIDWEST TEAM MIKE FUNK M&A Associate michael.funk@dsma.com 312.674.4556 JENNIFER RAFAEL Vice President, Partner jennifer.rafael@dsma.com 312.927.9561 JONATHON MORONI Business Dev. Manager jonathon.moroni@dsma.com 312.674.4556 GREG BROWN M&A Associate greg.brown@dsma.com 312.674.4556 CHRIS HAWLEY M&A Associate chris.hawley@dsma.com 312.674.4556 KEVIN CHRIST M&A Associate kevin.christ@dsma.com 312.674.4556 ZACH HICKSON M&A Associate zach.hickson@dsma.com 312.674.4556
№ 8 Dynatron Knows Fixed Ops Revenue, Do You? 24 CATA UP TO SPEED
By Leigh Silver, Chief Executive Officer, Dynatron Software When a dealership wants to increase Fixed Operations revenue, there are typically two common avenues to follow: selling more and increasing traffic. While these two strategies can certainly work, there is a third and often overlooked avenue: optimize your pricing. Profitability can be greatly impacted by failing to optimize price in your Fixed Ops department. When a dealership sets its pricing, what is used to decide if the strategy is competitive and in alignment with customer expectations? Oftentimes, there is little to no data-driven decision‑making when it comes to pricing simply because dealerships do not have access to the data or industry insights necessary to make informed decisions. What Factors Impact Fixed Ops Revenue Opportunities? Whether you’re aware of it or not, there is a good chance you’re leaving money on the table every month, leading up to potentially hundreds of thousands in lost revenue each year. There are numerous factors influencing Fixed Ops revenue opportunities, but among the top three are pricing, work-mix and poor warranty filing protocols. Pricing Challenges Establishing and maintaining the “perfect price” that maximizes customer retention and profitability is no easy task. Oftentimes, dealerships lack the market insights to be able to competitively price their services without losing out on repeat business or new customers. Work-Mix Impact on ELR It can be challenging to know the impact work-mix can have on an optimized CP ELR. Making sure tech times are in line with labor rates for all your different services can be equally as difficult. Dealerships oftentimes lack the bandwidth and tools to track these metrics which can lead to many small price deviations that add up to a major loss of revenue. Lacking a Warranty Filing Protocol Without accurate data and business intelligence tools, dealerships miss out on potential revenue gained from proper warranty labor and parts filings. Oftentimes, there are unnoticed gaps in customer pay that can hinder markups and approvals. How to Increase Fixed Ops Revenue Once you’ve gained an understanding of what is impacting your fixed ops revenue opportunities, the next step is to do something about it! Here are three ways you can overcome the challenges previously mentioned and ultimately increase fixed ops revenue. Optimize CP ELR In order to optimize CP ELR, you must strategically determine optimized customer pay labor rates, pricing matrices, packaged menu pricing and parts pricing in a way that drives more revenue without driving away business. Setting the “perfect price” requires analytics and market intelligence which are the tools you can get with Dynatron Software. Increase Price Compliance Once your pricing structure has been optimized, service management should hold service advisors and technicians compliant. Enhance Work-Mix Visibility Understanding your five categories of work-mix is the first step to being able to control pricing compliance, flat rate times paid to technicians and discount allocations. Dynatron helps your service department easily view your work-mix, a task that would otherwise be very challenging. Dynatron’s Approach to Increasing Fixed Ops Revenue At Dynatron Software, we find datadriven hidden opportunities and execute our proven process that historically has generated an average of $200K of revenue within the first year for our clients. When it comes to fixed ops revenue, we help dealerships develop business plans to combat sub-optimal pricing, price erosion and the challenge of warranty parts and labor reimbursement rates. This is done by combining market research, data analysis CATA UP TO SPEED 25
DID YOU KNOW? Enjoy your association news anytime, anywhere. Scan the QR code to visit our online publication to stay up to date on the latest association news, share articles and read past issues. cata-up-to-speed.thenewslinkgroup.org and strategic processes to define a clear path to continuous improvement. Our pricing optimization analytics software provides unique business intelligence data essential to creating a roadmap to success. Daily reports help dealerships easily identify pricing overrides, hidden discounts and extra unauthorized hours, all factors that can hinder performance. This data also helps to keep technicians compliant with the pricing strategies set forth. In addition to this, we understand a pricing strategy should be determined in part by examining the performance of the surrounding market and potential competitors. Dynatron has access to comparative market performance metrics that are used to create an optimal variable price strategy. PriceSmart — Price Optimization for Your Fixed Ops Department PriceSmart helps dealerships develop business plans to combat sub-optimal pricing, price erosion and the challenge of warranty parts and labor reimbursement rates. This is done by combining market research, data analysis and strategic processes to define a clear path to continuous improvement. “Two or three years ago, we bought a Chrysler dealership in Tennessee, and their warranty rate was $90. And our current rate that we're filing for right now is $203. It's typically so hard to do a warranty rate increase that people skip it, and they take the percentage increase that the manufacturer gives, for instance, or they just don't file. With Dynatron it gives you the opportunity to maximize your effectiveness when you're filing for warranty rate increases, whether it's parts or with labor. It's made a massive difference in our gross profit percentage to our stores. I wouldn't run a store without it,” said Eli Andrews, regional fixed ops director at Hudson Automotive Group. Get in the Know with Dynatron Software When it comes to fixed operations revenue, the conventional approaches of selling more and increasing traffic often overshadow the critical role of pricing optimization. Neglecting to fine-tune pricing strategies can significantly impact profitability. Without the insights derived from data-driven decision-making, dealerships risk leaving substantial revenue untapped. By embracing Dynatron Software as a strategic partner, dealerships can overcome these challenges and significantly increase fixed ops revenue. Through a combination of market research, data analysis and strategic planning, Dynatron empowers dealerships to not only optimize pricing but also navigate complexities such as price compliance and work-mix visibility. Schedule your 30-minute meeting at go.dynatronsoftware.com/cata to learn more today and start building your dynasty. Leigh Silver is the chief executive officer of Dynatron Software. He brings nearly 20 years of experience in automotive technology and is seen as a thought leader in the automotive industry. 26 CATA UP TO SPEED
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. Brad Bartsch bradley.w.bartsch@bofa.com 469.201.9755 Tony Garcia anton.r.garcia@bofa.com 312.438.8356 business.bofa.com/dealer Making business easier for auto dealers. Especially now. Diana Zamudio diana.zamudio@bofa.com 312.234.2466 “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 | Are Not Bank Guaranteed | May Lose Value | ©2022 Bank of America Corporation. All rights reserved. 4826555 08-22-0145 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. Brad Bartsch bradley.w.bartsch@bofa.com 469.201.9755 Tony Garcia anton.r.garcia@bofa.com 312.438.8356 business.bofa.com/dealer Diana Zamudio diana.zamudio@bofa.com 312.234.2466 “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 | Are Not Bank Guaranteed | May Lose Value | ©2022 Bank of America Corporation. All rights reserved. 4826555 08-22-0145 CAD-08-22-0145_Illinois Auto Dealer News.indd 4 8/18/22 11:44 AM
BROWN & BROWN Overview Brown & Brown Dealer Services (BBDS) is an F&I performance company aimed at helping to build tailored solutions for today’s vehicle retailer. The complexities inherent to the F&I business demand a white glove approach with the flexibility to satisfy a variety of brands or markets. The BBDS network of providers helps ensure the proper F&I program is developed and executed to help maximize upfront sales and profits, provide a top-tier customer ownership experience and create wealth-building opportunities downstream. How We Can Help Our BBDS team is comprised of experienced and knowledgeable F&I specialists that have worked with dealers for decades. They are equipped with access to the industry’s top product providers, a top-rated training and development program and commercial insurance products to help you find solutions to fit your business needs. F&I Products • Flexibility to help fit your needs • Access to A-rated providers • Two in-house administration companies • Wealth-building opportunities on products Training Solutions • F&I Management Certification School • Learning Management Systems (LMS) delivering online training • Monthly webinars and video training archive • Ethics & Compliance Certification Participation Programs • Program selection based on your goals and objectives. NCFC, CFC, Retro or DOWC • Nationally recognized team that specializes in evaluating and configuring personalized solutions • No obligation evaluation of your current program Property & Casualty • More markets for your risks mean more choices to help meet your individual business and personal needs • Knowledgeable professionals to help identify your unique risks and find solutions to help protect your assets Employee Benefits • We can help you build an effective benefits strategy • Health Collective Purchasing Arrangement that includes a dedicated service representative to help you with premium savings, national and regional coverage and to help make the administration of your plan more efficient DEALER SERVICES The Broker for the Dealer Custom F&I Programs That Help Deliver Results and Profits Brown & Brown Dealer Services 263 Shuman Blvd. • Naperville, IL 60653 | bbrown.com | (847) 612-9361 Overview Brown & Brown Dealer Services (BBDS) is an F&I performance company aimed at helping to build tailored solutions for today’s vehicle retailer. The complexities inherent to the F&I business demand a white glove approach with the flexibility to satisfy a variety of brands or markets. The BBDS network of providers helps ensure the proper F&I program is developed and executed to help maximize upfront sales and profits, provide a top-tier customer ownership experience and create wealth-building opportunities downstream. How We Can Help Our BBDS team is comprised of experienced and knowledgeable F&I specialists that have worked with dealers for decades. They are equipped with access to the industry’s top product providers, a top-rated training and development program and commercial insurance products to help you find solutions to fit your business needs. F&I Products • Flexibility to help fit your needs Training Solutions • F&I Management Certification School • Learning Management Systems (LMS) delivering online training • Monthly webinars and video training archive • Ethics & Compliance Certification Participation Programs • Program selection based on your goals and objectives. NCFC, CFC, Retro or DOWC • Nationally recognized team that specializes in evaluating and configuring personalized solutions • No obligation evaluation of your current program Property & Casualty • More markets for your risks mean more choices to help meet your individual business and personal needs • Knowledgeable professionals to help identify your unique risks and find solutions to help protect your assets Employee Benefits • We can help you build an effective benefits strategy • Health Collective Purchasing Arrangement that includes DEALER SERVICES The Broker for the Dealer Custom F&I Programs That Help Deliver Results and Profits This magazine is designed and published by The newsLINK Group, LLC | 1.855.747.4003 18W200 Butterfield Rd #096 Oakbrook Terrace, IL 60181
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