Tuesday, August 01, 2006

Lots of Deals - Part I

The phrase “If I could … would you buy?” while widely used is not the best effort implemented by the sales personnel. Let’s review the process.

Step 1) Meet the customer – make it genuine, warm and friendly.

Step 2) Build rapport – Find common ground with the customer. Remember, no one is going to buy from you until they feel you care about them.

Step 3) Interview – Practice your FORM. Find out about the customer’s family / occupation / recreation / and motivation. Interviews are best done at the workstation and not on the lot. The lot can seem confusing and overwhelming to a customer. Your workstation has fewer distractions for both you and your customer. As in any interaction with the customer, it is critical that the presenter “be there” during the interview process, which requires attention to the activity at hand. Do not look at the customer while your brain is thinking about lunch or what you have to do after work tonight. Get focused and be present with your customer.

If the interview reveals past credit difficulties, the prudent sales professional may want to turn the customer to the special finance department to secure financing prior to selecting a vehicle. At minimum, the sales professional should attempt to obtain a customer statement (credit application). The sales manager will then be in a position to make an informed choice about the path the deal should take. Better information increases the likelihood of making the deal.

Step 4) Product selection – In today’s environment, it may not be about what the customer wants to drive; rather, it is selling what they can afford to drive. The interview process is critical in providing information about the customer to assist the professional in the correct product selection.

Step 5) Demonstrate the product – Fifteen minutes is not enough time to create value in a $20,000 purchase. Even if the customer has been shopping and has seen other vehicles, they have not seen this vehicle. The sales professional recognizes the value of the time spent in the product demonstration process. Time spent building value and selling the vehicle to the customer makes the write-up easier. The more a customer loves the vehicle the more likely his/her focus will be on monthly payments and not the selling price of the vehicle.

Step 6) Do you have the right vehicle? “If together we can find the terms agreeable with all parties would you [the customer] purchase the vehicle now?” Obtaining a commitment to purchase the vehicle now is essential to the write up. If the customer is not willing to purchase now, why complete the practice on the write up? “On a scale of 1-10, with ‘10’ being this is the vehicle you must buy and ‘0’ being this is the only vehicle on earth running, where are we?” If the customer responds with “7,” ask what will it take to make it a “10.” Perhaps a different vehicle? Perhaps the correct terms? Perhaps buying the trade at a number that is acceptable to the customer? It could be one of many things. Find out and report to your manager.

Too many sales representatives begin the write up process with, “If you could, would you buy this vehicle today?” First of all, today is made up of 24 hours. Don’t you want to write the deal up now? If the dealership could do what? Sell below invoice? Pay higher than book for the trade? Finance the vehicle for zero down, and extend the financing for the lowest payment? If you are now thinking that I have gone mad, do read on. I have recently heard all of the previous comments from a contemporary, educated sales force convinced that all of their customers come into the dealership armed to the teeth with invoice, buy rates, and high book from the web. The result of these fears is that sales professionals are selling neither themselves nor the dealership; nor are they presenting the vehicles. They are in too much of a hurry to give away the gross profit of the dealership for the sake of moving iron.

If your sales are off your profits are low. If this is the case at your place, take the time to put your sales personnel in front of a camera and videotape their process from the “hello” through the write up. Play it back for them to view. Do not comment on what they are doing poorly; rather, focus on what they can do better.

Everyone wants to know how to increase effectiveness and profitability while decreasing time with paperwork. If you can sell the product on the lot, the numbers will be there. There will be more about this in the September issue.

World of Special Finance, August 2006