PUB. 5 2024 SPECIAL EDITION THE OFFICIAL PUBLICATION OF THE VIRGINIA AUTOMOBILE DEALERS ASSOCIATION 2024 VADA Convention
© 2024 Virginia Automobile Dealers Association (VADA) | The newsLINK Group LLC. All rights reserved. Virginia Auto Dealer is published four times each year by The newsLINK Group LLC for VADA and is the official publication for the association. The information contained in this publication is intended to provide general information for review and consideration. 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 specific circumstances. The statements and opinions expressed in this publication are those of the individual authors and do not necessarily represent the views of the 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. Virginia Auto Dealer is a collective work, and as such, some articles are submitted by authors who are independent of VADA. While VADA and the newsLINK Group encourage 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 newsLINK Group at (855) 747-4003. 8 16 CONTENTS Pub. 5 2024 Special Edition Virginia Automobile Dealers Association A Message From President and CEO Don Hall 4 A United Voice in Washington and Richmond for the Retail Auto Industry 6 VADA 2024-2025 Executive Committee and Board 8 2024 VADA Convention 10 Advancing Automotive Technology Education The VADA ASE Partnership 11 2024 Events 12 It’s Time To Be a Prepper! By Barrett “Barrie” Charapp Beaty, Esq., Charapp & Weiss LLP 14 Service Warranty Audits Putting Your Best Foot Forward By Justin Carr, Vice President of Sales and Marketing, Warranty Processing Company 16 The Ultimate Interview Guide for Dealers A Comprehensive Guide To Conduct an Interview Process That Engages Automotive Talent and Makes Hires Faster By Hireology 21 Protect Your Dealership From Fraud and Cyber Threats Learn About the Latest Fraud and Cyberthreats, How To Defend Against Attacks and What To Do if You’re a Victim of Cybercrime By Lyubena Smith, CTP, Treasury Sales Manager and Pamela Garrison, Treasury Consultant for Truist Dealer Services, in partnership with Paula Mashburn, CPA, CFE, Partner with HHM CPA firm 24 7 Steps to Red Flags Rule Compliance By Zurich 26 Leadership 27 Thank You VADA Allied Members 28 Thank You VADA Program Partners 30 VADA PAC United as One for the Franchise System 2 Virginia Auto Dealer
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TThis past summer marked a pivotal moment for Virginia’s automotive industry as we gear up for an impactful campaign season and reflect on the lessons from our recent convention. With our eyes on the future, it’s crucial to highlight the vital role our dealers play in maintaining Virginia’s top business ranking and the importance of a united voice in Washington and Richmond. Back in July, CNBC named Virginia as America’s Top State for Business in 2024. This marks the sixth time our state has claimed one of the top spots and the third win in five years, setting a record for any state. With strong infrastructure, accessibility and shovel-ready sites for businesses cited, this achievement can be celebrated by dealers across the commonwealth. You play a critical role in this ranking. Virginia’s labor force is the largest ever and continues to grow — this proudly includes 61,000 retail automotive employees. Dealerships are the largest retail sales contributor statewide. SUPPORT NEEDED TO MAINTAIN MOMENTUM We must work to keep Virginia No. 1. A healthy, pro‑business environment requires lawmakers who understand the importance of keeping business owners and their people thriving. The Virginia Auto & Truck Dealers Political Action Committee (PAC) A MESSAGE FROM PRESIDENT AND CEO DON HALL A UNITED VOICE in Washington and Richmond for the Retail Auto Industry will begin our annual push for contributions in September. However, early contributions are essential to set the pace and demonstrate our commitment to driving our impact and our pro‑business, pro-dealer message home to legislators. The PAC provides us access to lawmakers to discuss the significant issues impacting the auto industry. We also use these funds to support Virginia candidates who understand the importance of our industry, regardless of political affiliation. As I’ve always said, money doesn’t buy votes, but it does give us the platform to advocate for policies that support our industry. Your contributions, whether you’re an owner, GM, principal or manager, are vital. Forward this message to those in your organization and encourage them to contribute too. If every one of Virginia’s retail automotive employees gives, imagine the power of our collective voice. We are fortunate to have generous members who have supported the PAC so far this year, including Governor’s Club-level contributions from Loyalty Automotive and Shelor Motor Mile. Visit our Contribution page on vadapac.com, which will be regularly updated to acknowledge your support. WHY GIVE NOW? LOOK NO FURTHER THAN VADA ‘24 AND CARB Our June convention highlighted the ongoing need for a unified voice and showcased the importance of the franchise system in our industry. 4 Virginia Auto Dealer
Keith A. Laudenberger, CPA klaudenberger@cbmcpa.com Councilor, Buchanan & Mitchell’s automotive dealership accounting team is your trusted partner in achieving your financial goals. Our professionals are experienced leaders with a deep comprehension of the challenges and opportunities faced by the automotive industry. Contact us today if you are ready to experience personalized service. cbmcpa.com 301.986.0600 7910 Woodmont Ave, Suite 500 Bethesda, MD 20814 John R. Comunale, CPA jcomunale@cbmcpa.com STEERING YOUR FINANCIAL SUCCESS IS OUR BUSINESS Tax Planning & Preparation Cost Segregation Analysis Mergers & Acquisitions Audits, Reviews & Compilations Business Process Review Succession Planning LIFO Inventory Fraud Prevention Buy/Sell Agreements Business Valuations Financial Planning Wealth Management Our Services: Studies and stories continue to show the system benefits not only our industry but also the consumers and employees who are the backbone of our businesses. Our lineup of speakers at this year’s convention certainly delivered lasting insights and headlines on Virginia’s legislative landscape. Virginia Attorney General Jason Miyares spoke on the heels of his and Gov. Glenn Youngkin’s announcement that Virginia will exit California’s zero-emissions mandate at the end of this year. DMV Commissioner Gerald Lackey shared his vision for the state agency, and he has done a phenomenal job making Virginia DMV a leader among its peers. We thank both leaders — and many others — for sharing their analysis on the industry. Turning to electrification, my recent op-ed on reassessing Virginia’s path, published in the Richmond TimesDispatch, reiterates the critical need for balanced approaches that consider industry realities, consumer needs, and policies that help, not hinder, progress. This applies to CARB — and more — as our industry continues to evolve. DON’T PUT CDK INCIDENT IN THE REARVIEW MIRROR, YET The recent CDK Global cyberattack brought to light the importance of having robust backup systems. While our hands were just as tied as yours when it came to restoring service, we controlled what we could — in this case, working closely with DMV to ensure all customers could still conduct business with the agency, and developing an online resource center. Whether a CDK customer or not, let this moment serve as a reminder that it’s essential for dealerships to have disaster plans and revisit their insurance coverages regularly. If you don’t have a disaster plan, now is the time to create one. Ensure that your insurance covers business interruptions and cybersecurity threats, as these events are becoming increasingly common. So join us in our efforts for a collective road ahead. Start by supporting the PAC for 2024. It’s not just a contribution, but a commitment to the future of the retail automotive industry in Virginia. JOIN OTHERS WHO HAVE GIVEN TO THE PAC FOR 2024 https:/ vadapac.com/ vada.com 5
VADA 2024-2025 Executive Committee and Board EXECUTIVE COMMITTEE Dan Banister Chair Banister Automotive Roger Keller Vice Chair Sheehy Auto Stores Eley Duke Treasurer Duke Chevrolet GMC John Altman Secretary Beyer Auto Group Don Hall President & CEO Virginia Auto Dealers Association David Dillon Immediate Past Chair Southern Auto Group Tim Pohanka Legislative Chair Pohanka Nissan Hyundai Chris Lindsay PAC Chairman Lindsay Automotive Left to right: Don Hall, President & CEO; John Altman, Secretary; Dan Banister, Chair; Roger Keller, Vice Chair; Eley Duke, Treasurer FULL VADA BOARD OF DIRECTORS John Altman Beyer Automotive Group Falls Church Gardner Britt, III Ted Britt Ford Lincoln of Chantilly Chantilly Conrad Aschenbach Front Royal Ford LLC Front Royal Andy Budd Country Chevrolet Warrenton Daniel Banister Banister Nissan of Chesapeake Chesapeake Harry Carrion Haley Automotive Richmond Zachary Cochran Whitten Bros Chrysler Dodge Jeep Mazda Richmond Mark Dalton Terry Volkswagen Lynchburg David Dillon Southern Team Auto Group Roanoke Eley Duke Duke Automotive Suffolk Eric Flow Flow Motors Charlottesville Don Hall Virginia Automobile Dealers Association Richmond Josh Hamilton Checkered Flag Motor Car Co. Virginia Beach Tanner Hulette Page Auto Group Mechanicsville Cameron Johnson Magic City Auto Group Roanoke Roger Keller Sheehy Auto Stores Fairfax Steve Klimkiewicz Cavalier Automotive Group Chesapeake Ashton Lewis First Team Automotive Chesapeake Chip Lindsay Lindsay Management Co. Woodbridge Chris Lindsay Lindsay Chevrolet Woodbridge Ross Luck Luck Chevrolet Ashland Tom Mohr Highway Motors Inc. Roanoke Jeff Owens Southern Auto Group Chesapeake Michael Patrick Patrick Buick GMC Inc. Ashland Tim Pohanka Pohanka Nissan Hyundai Fredericksburg Rachel Pullen Safford Brown Auto Group Fairfax Michelle Radley Radley Automotive Group Woodbridge Jake Sodikoff Steven Nissan Harrisonburg Michael Suttle Suttle Motor Corp. Newport News Matthew Walsh Carter Myers Automotive Colonial Heights 6 Virginia Auto Dealer
Anticipate every turn In an industry that’s always evolving, your dealership can rely on our Dealer Financial Services team’s 90 years of experience to see what’s around the corner, forward-thinking insights to prepare you, and technology to keep you ahead of the curve. What would you like the power to do?® JL Winslow, jl.winslow@bofa.com business.bofa.com/dealer ©2023 Bank of America Corporation. All rights reserved. DFS-699-AD 5949042 Investment products offered by Investment Banking Affiliates: Are Not FDIC Insured Are Not Bank Guaranteed May Lose Value “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, derivatives, 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., which is a registered broker-dealer and Member of SIPC, and, in other jurisdictions, by locally registered entities. BofA Securities, Inc. is a registered futures commission merchant with the CFTC and a member of the NFA.
2024 VADA Convention VADA held its 2024 Convention at the Wild Dunes Resort in Isle of Palms, South Carolina, in June. This year’s opening reception brought the Kenergy with a Barbie‑themed celebration, while we closed the convention with a colorful neon party that bookended three days of industry networking, family fun, dynamic speakers and interactive panels. Notably, this year, Virginia Attorney General Jason Miyares took the podium to emphasize the role of cars in providing personal freedom. He discussed Virginia’s decision to exit California’s zero‑emissions mandate, advocating for consumer choice and criticizing the mandate’s feasibility. Miyares also addressed the challenges of the national electric grid, emphasizing the need for significant investments to meet future energy demands. Other speakers included Brian Finkelmeyer with Cox Automotive and Kevin Tynan of Bloomberg Intelligence, both of them returning guests. Amberly Allen of Dealer Merchant Services led a panel of superstars, including John Altman of Beyer Auto Group; Liza Borches, former VADA chair and fourth-generation leader of Carter Myers Automotive, and automotive analyst and auto tech investor Steve Greenfield. See more photos at vada.com/convention. Find news, podcasts and more from the event at vada.com/news. 8 Virginia Auto Dealer
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T Advancing Automotive Technology Education The VADA ASE Partnership The Virginia Automobile Dealers Association, in collaboration with the Virginia Department of Education and the ASE Education Foundation, has launched a transformative program to elevate automotive technology education in Virginia’s secondary schools. This initiative aims to enhance the quality of automotive technology programs across the state and inspire young individuals to pursue rewarding careers in this dynamic field. THE ESSENCE OF THE ASE PARTNERSHIP The ASE partnership involves a robust network of automotive manufacturers, the National Automobile Dealers Association, state automobile dealer associations, participating dealers, and selected high schools and tech prep schools. The program’s core objective is to motivate students to consider careers in retail automotive service and equip them with the skills necessary for entry-level positions or advanced studies in automotive technology. COMMITMENT TO HIGH STANDARDS AND LOCAL ENGAGEMENT Participating high schools and vocational-technical schools boast ASE-accredited automotive and collision repair/ refinish programs. Local dealerships play a crucial role by engaging with the schools’ Business & Education Councils, sponsoring internships and funding Tool Scholarships to alleviate the financial burden of acquiring quality starter tool sets for students. This comprehensive support system ensures students receive the necessary resources to thrive in their training. FROM CLASSROOM TO CAREER: STUDENT DEVELOPMENT High school juniors are recruited to join ASE-accredited technician training programs, where they undertake rigorous academic and practical courses in automotive technology or collision repair and refinish. Participation in SkillsUSA further hones their employability skills, including dependability, a positive attitude and teamwork. Students typically begin full-time internships at local dealerships during the summer between their junior and senior years. Under the mentorship of experienced technicians, they refine their technical abilities and professional competencies. Upon graduating high school and earning an ASE Entry-Level Certification, these students are well-prepared to embark on full-time employment or continue their technical education. A PATHWAY TO CONTINUED PROFESSIONAL GROWTH The ASE program is designed to support ongoing professional development. Many dealerships plan to sponsor their interns in advanced, manufacturer-supported college programs, such as Mopar CAP, GM ASEP, Honda PACT, Toyota T-TEN and certificates from Mercedes-Benz and BMW. Through their ASE experience, students recognize the importance of lifelong learning, whether through college degrees or manufacturer training programs. The ASE Education Foundation proudly accredits programs in all 50 states, ensuring a nationwide standard of excellence in automotive technology education. This partnership underscores VADA’s commitment to fostering the next generation of skilled automotive professionals. Get involved and find ASE programs at vada.com/ase-career-paths/about-ase/. 10 Virginia Auto Dealer
2024 Events SCAN THE QR CODE TO VIEW THE CALENDAR https://vada.com/vada-events Don’t miss out on the exciting events we have coming up! vada.com 11
T It’s Time To Be a Prepper! By Barrett “Barrie” Charapp Beaty, Esq., Charapp & Weiss LLP The hottest news of the year in the car industry was unfortunately the fact that CDK had a cyberattack that had dealers without a DMS system for weeks. There are still so many unanswered questions, and the true effects on the dealers are still unknown. Dealers persevered, as always, and adapted by handwriting deals and taking care of the customers because dealers adapt to any adversity thrown at them. It was a true testament of how dealers need to embrace modern technology while also savoring the need to know the old standard of selling vehicles … pen and paper! This article does not ponder what those dealers affected by the CDK outage should do, rather it’s a wakeup call for every dealer. What happened to CDK is not unique to CDK, and it happens to large and small companies on a daily basis. For those reasons, we write this article to identify steps you can take to be ready for the next cyberattack. 1. Safeguards Policy By law, your dealership must be Safeguards Rule compliant. This requires a Safeguards Policy to ensure that your dealership has the correct procedures in place. We highly recommend the NADA’s policy, “A Dealer Guide to the FTC Safeguards Rule,” as a template that should be geared towards your dealership. As required in the Safeguards Policy, your organization should have a data breach protocol in place, including who should be in charge in the event of a data breach. To view the NADA policy, scan the QR code. https://www.nada.org/nada/educationconsulting/driven-management-guide/dealerguide-ftc-safeguards-rule-l43 12 Virginia Auto Dealer
2. Insurance Dealers should review their insurance policies to determine if they have the correct coverage, specifically policies on cyber insurance, cyberattacks and business interruption. Dealers need to understand what is and is not covered under their policies. Dealers also need to understand when claims need to be filed. If you have questions about your policies and what is covered, speak to your insurance agent or carrier. 3. Letter to Vendor If a vendor is breached, dealers need to know what happened in the breach. Dealers need to know: (i) whether the data kept by vendor was encrypted, (ii) if encrypted, whether the encryption key was breached, (iii) whether the dealer’s records were accessed and part of the breach, and (iv) if so, the number of dealer records affected. Specifically, dealers need to ask whether their customer data was encrypted, accessed and part of the breach. Some states, such as Virginia, provide statutory rights to dealers to get that information from the manufacturer. Va. Code 18.2-186.6(D) states: An individual or entity that maintains computerized data that includes personal information that the individual or entity does not own or license shall notify the owner or licensee of the information of any breach of the security of the system without unreasonable delay following discovery of the breach of the security of the system, if the personal information was accessed and acquired by an unauthorized person or the individual or entity reasonably believes the personal information was accessed and acquired by an unauthorized person. 4. Addendum to the Vendor Agreement for Compliance With the Safeguards Rule As part of your requirements under the Safeguards Rule, dealers need addendums to their vendor agreements that state that the vendor maintains the dealer’s customer data in compliance with the Safeguards Rule. You should have a form document that the vendors sign that states they will comply with the Safeguards Rule, the information held by the vendor is encrypted, the information is owned by the dealer, the information is maintained only as permitted by the law (state and federal) and as long as you have a business relationship, and that vendor will protect the information. Dealers should have addendums on hand as they consider new vendor agreements and review all current vendor agreements and/or addendums to ensure compliance with the Safeguards Rule. 5. Data Security Dealers should ensure that their systems have security in place and run tests frequently to ensure no malware or virus has impacted their systems. Dealers should be speaking with their IT providers to ensure all safety protocols are in place. 6. Customer Information Breach Protocols Under Federal and State Law Your written security program and plan pursuant to the Safeguards Rule should outline the procedures that should be taken in the event of a breach. The Safeguards Rule requires dealers to file a notice (within 30 days of discovery of the event) with the FTC in the event of a data breach occurrence impacting 500 or more customers. For the recent CDK attack, NADA, CDK and the FTC worked out an agreement that in the event the attack resulted in a breach that would trigger notice to the FTC, CDK will file on behalf of the dealers. However, dealers need to know that for any future breaches, the obligation to provide notice to the FTC is theirs. Additionally, your state may have notification requirements to customers for data breaches. If you use the NADA Safeguards Policy, there is a form customer notification letter that you can conform to your dealership in the event of a data breach that triggers customer notification. For the CDK attack, there has been limited information on the breach and whether it triggered a customer notification would be dependent on your state’s law. Dealers need to consult with their attorneys regarding the need for any notification for data breaches related to customer information, and what those notifications should look like. The automotive industry works on 30-day cycles. Most dealers are up and running after the CDK breach and those that were not affected just had a big sigh of relief that it wasn’t their dealership. However, now is not the time to sit idly by until another breach occurs, because it’s only a matter of time before the next cyberattack occurs. Make sure your processes are in place to ensure the next event has the least effect on your dealership. vada.com 13
O Service Warranty Audits Putting Your Best Foot Forward By Justin Carr, Vice President of Sales and Marketing, Warranty Processing Company Over the past few years, warranty audits have become mandatory. They are no longer driven by your dashboard or the health of your dealership in the eyes of the manufacturer. They are happening more randomly as manufacturers work to claw back warranty dollars however and wherever they can. Planning for an audit includes having strong processes in place before a manufacturer pays you a visit. Preparing the claims for presentation once the audit comes can be difficult if your team isn’t organized. Challenging the findings will be daunting if your team doesn’t have a strong grasp of the manufacturer’s policies and procedures and the state laws that can help protect your money. Falling short in an audit scenario can be incredibly damaging for your business. Reputation, monetary loss and key players time being consumed in a market that needs their expertise are just a few reasons why it makes sense — on many levels — to be proactive. The good news is there are tools out there to help. After dealing with the pandemic, supply chain shortages and a changing economy, the auto industry is trying to find its center. Dealers are looking to fixed operations to fill the short fall of smaller profit margins experienced on the front side of the house. This high level of disruption to dealerships has changed many long-standing policies. This fact alone increases the likelihood of things slipping through the cracks. When this is paired with new staff that may not be fully trained, the stage is set for mistakes, as well as the probability of poor decisions. Since warranty audit visits are back, you are creating a high-risk, high-liability scenario if you are not prepared with a document management process that has vigorous checks and balances. Knowing this begs the question: Does your team have efficient and consistent processes in place? In a typical warranty audit, most manufacturers review 50-100 VINs. We all know how much detail, as well as supporting documentation, is involved in warranty claims. This equates to many labor hours pulling documents, checking for completeness and accuracy and re-filing the requested documents. Additionally, compiling all this information can lead to misfiling down the road or result in lost documentation. Dealers who do not have a solid electronic system for organizing their documents are putting themselves at great risk. EMPLOYEE TRAINING Given the complexity of the warranty process, regular reviews and consistent reminders are a necessity. This may require training service and parts employees to follow all the necessary steps through the life cycle of a repair order to make sure nothing is missed. It begins with the client booking an appointment for service and doesn’t end until the claim is 100% properly paid and filed for review, should there ever be a need to look back. This requires creating, writing down and making those procedures and policies available to employees. Don’t forget it’s extremely important to keep employees accountable for the process. Would you take a long road trip without a map? This would likely end poorly, having wasted lots of time in the process. Traveling with no road map is like holding your team to a process that isn’t written down and clearly documented — only this time, you’re not just getting lost, you’re losing lots of money. It only takes one employee not following the process to cost your dealership thousands of dollars. Thousands of dollars that could have been avoided. In order to steer clear of this, employees should know their role in the process and make sure they complete their responsibilities before moving the claim forward. Below are just a few examples of some of the key players touching a warranty claim. • Service advisors should make sure the VIN Inquiry is run and attached, prior approvals are handled, signatures are present and repeat repairs follow manufacturer guidelines. • Technicians are responsible for documenting the 3 Cs (Complaint, Cause, Correction) with diagnostic test results. Failure to include all and complete 3 Cs on any line may lead to a chargeback during the audit. They will ensure the Technical Service Bulletins are followed in their repair and noted in their story. They are responsible for their time punching and making sure all onetime-use parts are replaced and charged out on the repair order. • Managers need to make sure they are authorizing add-on repairs, multiple component replacements, straight time and more. 14 Virginia Auto Dealer
These are just a few important examples of the hurdle’s dealers can run into during an audit. Another area where documentation must be researched thoroughly is customer eligibility for incentives. Client information and eligibility are being scrutinized at a new level. You always want to avoid giving the impression of misconduct or being tagged for fraudulent submission by the manufacturer. Fortify yourself and your team by communicating with them about the expectations of an audit so they can be prepared. A “no exceptions” policy pertaining to paperwork and warranty work should be understood by properly trained employees. Fraud should never be taken lightly. It is a serious issue that warrants serious action. Help your new hires understand committing warranty fraud or performing unnecessary work will result in termination without warning or second chances. Implementing selfaudits is a great way to help your team stay compliant. DESIGNATE A COMPLIANCE OFFICER Routine self-audit reviews are one of the best ways to ensure your program is compliant when an actual audit happens. Designate an employee as a compliance officer and assign them to regularly spot-checking claims and pulling a few job cards to check for complete, accurate information. You can direct them to conduct these weekly or monthly, but make sure it is consistent. Along with this, there are some important criteria to keep in mind: This position should be assigned to someone other than the Service Manager or an employee who is incentivized by closed claims or collected dollars. This is to make sure there is transparency and integrity in the process. Extra compensation can be considered for this person since their workload will increase, but their incentive should be based on a clean audit. Make sure their focus is on keeping all the dollars the dealership deserves instead of just closed claims or paid receivables. ELECTRONIC DOCUMENT STORAGE There’s no better time than now to invest in electronic document storage! Stuffed filing cabinets and overflowing document boxes can lead to disaster. A single missing document could result in a costly chargeback for your dealership. Using web-based software to scan and store documents electronically provides a simple solution with significant benefits. It can take your storage from looking like Grandma’s attic to an organizer’s dream. Even better, all documents become instantly available through a quick search, allowing you to compile required auditing materials in seconds instead of hours. Scanning may not be anyone’s favorite pastime, but it is essential. Scan all documents, including signed invoices, receipts, technician notes, diagnostic tests and warranty claim reimbursement forms. By using a document scanning provider, you can quickly locate all documentation associated with each VIN through web-based software, making the audit process painless and smooth. Typing each VIN into a search bar is much easier than searching through filing cabinets for hundreds of documents. This simple solution offers a big payoff. Like most things in life, an electronic storage system is only as good as what you put into it. Even the best storage system can’t compensate for careless and haphazard scanning. Assign one of your stronger employees who will have a direct role in the audit presentation process to organize the scanning. Their time will be worth keeping your business in order if it can prevent chargebacks. Given that the role has a direct impact on your bottom line and dealership health, it should not be put on the back burner for an entry-level clerical employee to tackle. HIRE PROFESSIONAL HELP Hire someone in the industry who is familiar with the warranty process. It will pay off in the long run by saving you time and money as well as relieving unnecessary stress — and who doesn’t need that? Make sure they follow best practices and document consistently with uniform standards. You will want them to customize internal auditing procedures for your specific dealership or dealer group. Many companies offer health checks if you don’t have the bandwidth to perform a self-audit. Others offer self-audit checklists so you can perform informal audits on a regular basis. It’s best to find someone with significant experience who has navigated the industry over a long period of time. If they have their finger on the pulse of the industry, and they can help get your employees working together as a team or better yet, help in the training process, it’s a no-brainer. Remember, those who are prepared need not panic. Have consistent policies in place, and be organized so you can put the cleanest, most complete repair orders in front of the manufacturer when they ask to review them. Know the manufacturer policy and procedure manual as well as your state laws so no dollars are taken from you unnecessarily. Review the final summary with your team to identify accountability. Then, make sure to retrain and update your process list so you know your dollars are protected. Follow our advice above, and audits will be a breeze. Get your dealership in order and make the stress of warranty audits a non-issue! Warranty Processing Company has been helping dealerships since 1986. They have a number of service plans to fit your needs. Their knowledge of cars, industry experience and extensive service background make them the perfect partner to increase your warranty gross profits. Justin Carr is the vice president of sales and marketing at Warranty Processing Company, which recently relocated to Texas. Justin works with dealers nationwide to increase efficiencies within service departments and educates dealer staff on why efficiencies. To learn more, visit warrantyprocessing.com. vada.com 15
I The Ultimate Interview Guide for Dealers A Comprehensive Guide To Conduct an Interview Process That Engages Automotive Talent and Makes Hires Faster By Hireology description with the words you choose; for example, you could use uplifting and encouraging terms to describe the atmosphere of teamwork that exists at your dealership at large. Finally, you need to define the key competencies of the role that you’re hiring for. If you’re hiring for a technician position, the candidates typically need to already have their ASE certification or be willing to complete it within a certain timeframe. Alternatively, you could also advertise any apprenticeship programs you offer in your job description to recruit from a wider talent pool, if applicable. Applicant Selection When evaluating initial applications, it’s important to begin the process with realistic expectations in mind. While there is no such thing as a perfect candidate, you should have an idea of Interviews are an essential but often uncomfortable experience in the hiring process — for the candidate and the hiring manager — especially if they’re more used to working in the service bay or behind the scenes at a dealership. Between 2023 and 2027, the TechForce Foundation projects that the economy will need more than 465,000 entry‑level automotive technicians. With automotive talent in such high demand, dealerships need to do everything they can to create streamlined and effective interviews at all of their locations. Holding effective interviews and making the entire experience enjoyable is key to keeping top talent engaged in your dealership’s hiring process, reduce the amount of no-shows to interviews, and converting to your newest hire. In this comprehensive interview guide, you can expect to understand how to run an efficient interview process through each of the three phases through action items and data-backed insights. If you follow this advice, you’ll create an intentional approach to interviewing that empowers your dealership to follow best practices while putting the right people in the right seats at the right time. BEFORE THE INTERVIEW Before the interview even takes place, there are steps the hiring team at your dealership needs to take in order to attract and hire the best automotive talent possible. We’ve outlined the key tasks your team must tackle in order to optimize your process for a competitive hiring advantage. Define Your Ideal Candidate Your job descriptions need to pull their weight in your recruitment marketing strategy, meaning that they should do some heavy lifting in your recruitment channels. According to Hireology’s research, the number one hiring challenge for dealerships across the country is candidate quality. With technician talent in such short supply these days, it can be tempting to rely on general job descriptions for recruitment — but this type of generalized hiring can backfire in big ways. Your job description is the first contact your dealership has with the talent pool, so you need to find a way to connect with the right people. If you can’t do that, then you likely don’t have a clear enough idea of your dealership’s ideal candidate. You need employees who have the technical and soft skills necessary to not only fix the inner workings of vehicles, but also be able to hold conversations with customers and relay repair information. That’s why it is so important to consider your company culture and what type of person would be a good fit for your dealership before you begin writing (or generating) a job description. You can tactfully include this information throughout your job 16 Virginia Auto Dealer
what you’re willing to be flexible about in your approach to applicant selection. In order to run efficient hiring processes at your dealership, you need to remember that you can’t be completely tied to the requirements listed in the job description. Why? Data from our 2023 State of Automotive Hiring Report, only 13% of automotive job seekers meet all of the requirements in the open roles they applied for. Conversely, almost half (48%) of automotive applicants will only apply to open positions if they meet 75% or more of the requirements, so being more flexible in your applicant selection process can provide you with more candidates to choose from. Master Interview Preparation Before you start scheduling interviews, establish a procedure for conducting these sessions to ensure cohesiveness across all hiring managers. You can’t afford for each hiring manager to create their own interview processes, as this hinders you from being able to hire the same caliber of candidates across your dealership or locations. When hiring managers adhere to the same interview process, however, you have a uniform standard of candidate and interview experience for hiring managers to use as their baseline for hiring. One of the most effective ways to master interview preparation is to use interview guides to craft targeted and effective interview questions. Interview guides, like the ones available through the Hireology platform, have multiple benefits like removing bias from the interview process and making sure that all candidates are evaluated on the same criteria. While interview guides can assist in eliminating bias, it would also be beneficial to research corporate bias training to provide to your hiring managers so that you can create a diverse and inclusive workforce at your dealership. When you have multiple people speaking to the same candidate, it’s also important that your dealership is making the best use of your and the candidate’s time — so using interview guides make sure that your hiring managers get the information they need without asking duplicate questions. If you don’t have access to pre-written interview guides, you can also use AI to generate questions to disperse amongst your interviewers too. Address No-Show Interviews Before They Happen Candidates suddenly dropping out of the hiring process with no warning or acknowledgment has become a vada.com 17
common hiring phenomenon in the automotive industry. It’s so common that a term coined for dating has found a new home here: ghosting. In fact, 93% of dealerships experienced ghosting last year alone — but there are tools you can use to prevent no-shows from happening at your dealership. First and foremost, your dealership needs to find a calendar sync tool. This tool does exactly what you think it does — it takes all of your hiring manager’s calendars to offer candidates interview appointments that work best for them. Why does this work? For starters, it eliminates the timeconsuming back-and-forth rapport that arranging interviews used to require. You can send a link to your calendar as soon as you receive an application (although we’d recommend filtering candidates before inviting them to interviews). But you shouldn’t stop there. If you truly want to cut down on the number of no-show interviews your team endures, you need to find a way to remind applicants of their upcoming interviews that doesn’t put more responsibility on your hiring team. Using a tool like Hireology’s interview reminders increases overall engagement with candidates and keeps them interested in your dealership as a potential employer. These reminders can be sent through SMS text messaging, emails or both so you make sure that your candidates see the message. We found that customers who combined our interview scheduling tool with texting capabilities increased their applicant-to-conversion rate (meaning they made hires) at double the rate of traditional recruiting methods. Don’t believe us? Recent Hireology research found that the number one reason automotive job seekers ghost interviews is because of a lack of communication and transparency from the dealership. BEST PRACTICES FOR CONDUCTING INTERVIEWS Surprisingly, most of the hard work for interviews occurs before and after the interview. Being organized is one of the best strategies your dealership can use to give candidates a great first impression of you as an employer. Your focus during the interview should be on getting to know the candidate to the best of your abilities while holding a natural conversation. Take a look at the best practices we have listed to learn more about how you can conduct efficient and effective interviews to hire better candidates faster. Hold the Right Amount of Interviews for the Role You need the people in the door — fast. But you also need to do your due diligence to make sure you pick the right candidate for the position. In order to do this, you may need to conduct more than one interview depending on the seniority level of the position you’re hiring for. We suggest holding two interviews for roles in high demand and/or with high turnover to move as efficiently as possible. Hireology data revealed that over a third (34%) of automotive applicants want to be interviewed within 48 hours of applying, while 60% want to be interviewed within three days. The first interview should be a simple phone screening where you give the high level overview of the job and feel the candidate out. This conversation shouldn’t last more than 15-20 minutes; you want to be able to look at the big picture of the candidate, just in case they might be good for another role you’re trying to fill. At the end of the first screening interview, be sure to close the conversation with the compensation and location information to make sure that the candidate is comfortable with what you’re offering. Just like in sales, you want to always be closing in interviewing so there are no surprises when an offer letter comes through. The second interview would be with who the candidate’s direct supervisor would be to see how they get along and get their take. Create a Positive Interview Environment Interviews are, by nature, anxiety‑inducing interactions. The candidate’s very livelihood could be on the line here — and that outside event can impact how they perform during the interview. Give the candidate some grace here by doing what you can to subconsciously ease their nerves. Tips for building rapport and fostering candidate comfort during interviews include: 1. Familiarize yourself with the application ahead of time and keep a copy in front of you to reference during the interview. 2. Welcome them warmly with a handshake. 3. Don’t dive right into the questions — keep it casual and uncover their current situation. 4. Set expectations for the rest of the hiring process and how you’ll communicate during it. 5. Generally treat candidates like humans with families and friends. 6. Do less talking and more listening. 7. Steer the conversation but don’t dominate it. Remember: onboarding starts with the interview. It’s not unheard of for a candidate to choose a lower paying job 18 Virginia Auto Dealer
offer within their desired salary range if they felt like it was a better cultural fit. We found that 36% of automotive job seekers would take a lower paying role within their desired salary range if it provided a good culture or working conditions. As dealers, you know better than most that first impressions matter — and when you can provide an enjoyable experience for the customer (or the candidate), you’re on your way to gaining their loyalty. Go Beyond the Script Just because you’re using an interview guide to make sure that your hiring managers gather all of the relevant information from candidates doesn’t mean that you have to go down the list robotically. Instead, you should ask questions during the natural flow of conversation so it feels less like an interrogation and more like a dialogue. The questions you have in your interview guide should vary in type. You want to find out if the candidate has the technical skills and experience necessary for the role you’re filling, especially if you’re hiring for technicians. Despite this, you also need to gauge whether the candidate has the soft skills needed to handle interactions with customers. You can do this by asking a variety of behavior-based and skill‑based questions from your interview guide during the interview. Capture Insights in Real Time Other than steering the conversation to find out more about the candidate, your only job during the interview is to document your findings to share with the hiring manager and others involved in the hiring process. If you don’t have a way to note your findings while you’re discussing with the candidate, you run the risk of forgetting information that could help you make a decision between one candidate and another. Taking notes in real time is extremely important so that you can make the best hiring decision for your dealership. Without these annotations, you can’t accurately give comprehensive feedback to other hiring managers. When it comes to evaluating candidates, the more information the better — so noting things like their attitude, their strengths, how you would rate them for the role in general and more can all help you make the final decision. POST INTERVIEW BEST PRACTICES Holding a successful interview doesn’t mean you’ve crossed the finished line just yet. Now, you need to compile your thoughts into a fair evaluation of the candidate, which can sometimes feel more daunting than the interview itself. Block Time for Hiring Administrative Tasks Daily Immediately after the interview, you should take 10-15 minutes to review your notes and clarify any ambiguities while the interview is still fresh in your mind. Realistically, your hiring managers should be able to plan this brief period of time immediately after the interview. Employees who work on your hiring team should also block time in their daily schedules to complete all of the various hiring administrative tasks assigned to them instead of trying to squeeze it in when they can. This technique ensures that these critical steps actually get completed and that the employee will have the dedicated time they need to focus. Examples of tasks hiring managers could work on include updating candidate statuses or scoring candidates based on their notes from earlier. Accurately Update Candidate Interview Status Modern hiring platforms exist to make hiring easier and faster — but only if you know how to optimize your usage. In this case, if you want truly efficient candidate tracking and organization at your dealership, it’s crucial to track your interview statuses. Interview status goes further than whether or not the candidate was hired or rejected; you can use these statuses to reflect on confirmation of interview invites, if the interview is in progress or completed, if the candidate simply didn’t show up, or even canceled. These interview statuses can come in handy when you’re reflecting on your various candidates’ interview statuses within leading recruitment platforms like Hireology to note whatever situation you please. With interview statuses, you can accurately track meaningful codes to reflect a candidate’s progress. You should also use tagging features available to make searching for candidates that much easier. Instead of scrolling through all of the candidates you have for an open role, simply type in some unique identifier that you’ve flagged the candidate with to save time and move faster. This is especially helpful when you want to reach out to previous applicants who you thought might excel in a different role or if they were simply second place in the last round of hiring. Using tagging in this way can expand the pool of qualified talent you can hire from — and can potentially speed up your process overall. Evaluate and Score Candidates Holistically When you first sit down to evaluate and score candidates, you want to compare their answers in the interview to what your ideal candidate that you envisioned earlier would say. This keeps the evaluation fair since you’re not directly comparing them to another candidate and can unbiasedly provide an interpretation of their skills, both technical and interpersonal. We suggest that you never score anyone over 80% if you’re the one conducting the initial phone screening, simply so you don’t give the hiring managers you pass them along to with any reason to have bias. You don’t want to influence them in any way, so scoring 80% or below lets them go in with their own expectations for the experience. After completing this initial evaluation, it’s time to compare candidates to one another. At this step in the decisionmaking process, it gets down to brass tacks: who has more of the skills you’re looking for in the role? If you did your due diligence when comparing the individual to the ideal candidate, you vada.com 19
have a pretty clear picture of what each candidate would bring to the position. Move with Urgency Hiring in the retail automotive industry happens fast. Considering that 61% of automotive job seekers accept the first role they’re offered — and 45% will accept the second — if you’re holding an interview and you know that this candidate would excel in the role and at your dealership, you can schedule them for the second interview immediately. You don’t want to offer the role outright, but if you have no worries about passing this individual along then you don’t have to wait any courtesy days/time period to contact them again for a follow-up interview. Just like in sales, time kills deals. The sooner you can schedule secondary interviews or follow up in general with candidates, the better. While you want to move quickly, you still need to complete certain hiring steps to ensure that you’re making the right decision for your dealership — and that means conducting reference checks. Typically, you can do this step for top candidates before the final interview in order to speed up the process and get them on your team faster. Keep Lines of Communication Open Immediately after the interview, you should send the candidates a thank you message for their time and what they can expect in terms of next steps. There are more opportunities available in the retail automotive space than there are job seekers, so having the candidate show up and complete the interview is an accomplishment itself. You can make this follow-up process much simpler for your team by using a customizable template that you just drop details into and send. This simple act keeps the lines of communication open between you and the candidate so you can continue to engage with them throughout the rest of the process. If you choose to not continue with a candidate, it’s very important that you provide closure to rejected candidates. Make it a priority to let rejected candidates know that you’re choosing not to move forward with them within two to three days — but be kind. You might want to stay in contact with these talented workers later down the road; they could continue their education, gain more experience or be interested in a different role at your dealership when you connect with them again. If, for some reason, the hiring decision is delayed and cannot be rushed you need to keep the candidates warm. Again, you want them to be excited about joining the team at your dealership so you can’t let stalls and hiccups make them second guess — or accept another role elsewhere. Create a Consistent Process All in all, you need to create a system that works best for you and the hiring team at your dealership. How you carry out these steps might differ from how the dealer down the road does it, but all that matters is that your process makes sense for you. It is important, however, that you document the general procedure to use again in the future. Keeping all of your templates, hiring steps, job descriptions and candidates from all of your rooftops in one centralized location like an applicant tracking system makes it much easier (and faster) to get your open roles in front of job seekers the next time you have an opening. Analyze and Optimize As you go through your candidate ratings, comparing one to another should be easy. If it’s a close decision, you can always rely on the candidate notes from all of the interviewers for more insight on how the team feels. Sometimes that’s not enough though; in that case, you could consider scheduling one more interview with each of the two finalists. However, if you feel that no one that was interviewed met your expectations, there are two options you could take: lower your standards or consider alternative methods of advertising your open roles. READY TO HOLD BETTER INTERVIEWS AT YOUR DEALERSHIP? Interviews are a critical part of the hiring process — but it can be difficult for everyone involved in hiring to be on the same page. By creating a uniform system across your locations, you can ensure that you’re consistently hiring people at the caliber you want. Dealers that prioritize easing the interview process for candidates and their hiring teams will find the most success in the years to come. Hireology is the leading provider of hiring software for multi-location businesses. The platform equips HR and business leaders with the support and tools they need to attract better quality talent, fill open roles faster, and make data-driven hiring decisions. Hireology was rated No. 8 on G2’s 2023 list of 50 Best HR Products. With focused expertise in the retail automotive industry, 1 in 4 dealerships nationwide rely on Hireology for their hiring, HR and payroll needs, putting people at the center of their organizations. For more information, visit hireology.com. 20 Virginia Auto Dealer
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