by Andrei Smith | Jun 27, 2019 | Mastering Sales
This article “Car Sales Skills” is a timely article. As I am writing this, the fiscal quarter is ending for my dealership, and we are wrapping up the last few deals of the month. After traveling for a few weeks, I ended up back at my desk with a large quota to conquer and a week to do it. Every day I’ve been bringing my best face forward to work with the customers, and I’ve been paying attention to what works best when I’m in the zone.
It’s from these customer experiences that I distilled down these three car sales skills. The three car sales skills that I’ve focused on are patience, determination, and organization. I’ll break down how I think these three car sales skills can help you set yourself up for success when working with customers.
Patient Mindset: How Long Can You Take It?
I’ve spoken about patience before, in my 2018 wrap-up article:
Blogging, as my side business, is slow going. It’s a labor of love, one that takes a long time to scale to reasonable profitability. Anyone that sells you the “overnight success” story is just making shit up- I can tell you that honestly from the trenches. I figured that if you break down my hourly rate on this project, I would be making an average of a dollar an hour.
So why do it? The easy answer is- I’m just not there yet. One day I will make more. Matthew McConaughey, that weird actor dude, once said that “my hero is myself, in ten years.” Although that still sounds a bit odd, I like the sentiment. Right now I make $1/hour doing this blogging business, but six months ago I was losing money doing this. Now I have passed breaking even; I only have one way to go (up, hopefully)!
So patience is key. In blogging, in automotive, and life. It took me a while to figure that out.
This above advice that has only become more relevant to me.
Car Sales Skills: Becoming a Patient Chameleon
You can’t just sell easy car deals. To sell the volume that it takes to set yourself up for financial independence, you need to sell the vast majority of types of people cars. That means you need to sell slow customers, the fast customers, the cheap customers, and the barely-speaking-English customers. To make the outsized incomes that car salespeople routinely make, you need to master the art of the patient chameleon.
The patient chameleon can take 10x the punishment of the average salesperson, changing attitude to facilitate the demanding customers. Why is it important to remind yourself to be patient? The reason is simple; it’s easy to get burned out when working directly with the public. You are liable to have to answer the same questions, day in and day out, to customers that are often thankless. That can grate on anyone, especially when you’ve been working at a store for more than a few years.
When you are a patient chameleon, you know going to work that customers are going to grate on you. You see it coming, and you plan for it. The patient chameleon shifts their attitude to facilitate the customers.
I make a game out of being patient. When confronted with a demanding customer, I mentally go through a few steps:
- I remind myself that if I get upset, this will only get more difficult
- I think of all of the times that I have dealt with demanding customers successfully in the past
- I challenge myself to give this customer a perfect experience, regardless of how difficult they are
Rather than treating the customer as the challenge, I create a game out of being perfect. The more complicated the customer, the more difficult the game, the more accomplished I am if I succeed.
The Patient Chameleon Saves It’s “No’s”
Customers can only be told “No” a certain number of times. The majority of customers can only be told “No” three or four times before turning against you. Once you have exhausted that number, the customer will resent you, deeming you unworthy of their business.
When you consistently oblige a customer wishes for the majority of the sales process, you are saving your “No’s” for later. That way you can say “No” a few times during the negotiation and still maintain the customer satisfaction you need!
Even the Patient Chameleon has Limits
Ok, so that sounds great, but how realistic is it? I’d say harnessing the “patient chameleon” mindset and running with it will work with 80% of the demanding customers. That said, once in a while, you will run into one of those world-ending customers. The customers that don’t trust you fight you every time and refuse to be happy.
These are customers that I politely let go. It’s not worth it for me to try and fix a broken person. Perhaps they are inherently bad or possibly it’s just not their week, but regardless, I don’t need to ruin my week helping them.
When I deal with a customer like this, I will give still give it a good attempt. I will bend over backward, but only to a point. When they begin to become distinctly unpleasant, I find a way to let them go. Until you’ve worked in customer service for a few months, you might not know what I mean, but you will know when you see it.
So how do you get rid of a customer like this? If they are looking at cars, I would test drive and show them the vehicles they are interested in, and then let the conversation reach a natural end. I might mention an upcoming appointment and suggest that we schedule a follow-up. In the worst cases, I have told the customers that I think that “this isn’t working for us,” and I offer to direct them towards some other store that might be able to help them.
Determined Mindset: How Long Can You Last?
I’ve had one big goal since I graduated from university: Financial Independence. The idea of having enough capital investment to buy my freedom from work has been the central tenet of my working career for seven years now. Perhaps it’s my dislike of being managed or my hatred of going to the same building every day. Whatever it is, I’ve wanted to become financially independent since the second week I began working. I’ve worked every day with that goal in mind, determined to make it my reality.
You need to be able to put off what you want now in the short term for your “big goal” in the future.
Your goal may be different. Perhaps you dream of owning a home or putting your kids through the best Universities without debt. Regardless of what your goal is, you need to have a “finisher’s” mindset. That means that you are singularly dedicated to accomplishing the goal that you set for yourself. You have told yourself that you will do what it takes to get to where you want to go.
My goal of Financial Independence requires me to save over a million dollars and have it invested. The magic of compound interest means that the earlier I begin investing, the better I will do.
Car Sales Skills: Dedication to a Big Goal
When working with customers, you need to remember the “big goal” that you align your work life with. When you consider the house that you and your spouse want to put a down payment down on, you get a bird’s eye view of your job. It is a means to an end. As such, there isn’t an option for you to “give up” on a deal. You can’t “half-ass” it. The only option for you, if you hope to accomplish your goals, is to work hard and work efficiently.
This determination to accomplish your goal will give you the ability to accept new challenges at work. You will be willing to take on projects that seem outside of your skill set, with the understanding that you will learn what you need to accomplish the small tasks.
Every customer is both a person who needs care and attention and a brick in the road to your “big goal.” Never forget this balance.
Organized Mindset: Can You Juggle?
If you plan to build a road, brick by brick, to reach your “big goal,” you need to stay in a straight line. Being organized is so often ignored, even though it is a requirement for operating at your highest capacity. You need to be able to juggle your responsibilities at the dealership and never drop the ball.
In the car dealership, having an organized work life means that you have a firm grip on what you are working on every hour of the day. Your desk is clear of clutter, and your email inbox is under control.
Personal organization is the shield that stands between you and potentially letting down customers. How often do you forget about an appointment or an email because you were scatterbrained? Do you ever forget about responding to a text because it sinks into your messy message inbox?
I use a few key strategies to keep myself together.
Car Sales Skills: Organization Tools
My first tool to keep myself organized is my paper hot customer list. I always have a piece of blank printer paper followed to 1/3 size with a list of my hottest customers. I jot down their names and the car they are interested in, plus the date of their next appointment. If they don’t have an appointment, it sits blank, driving me to follow up with them.
I’ve tried using excel, my CRM, outlook, and an array of other tools, but for this, nothing beats paper. That little paper reminder of my highest potential customers keeps my head in the game every day.
My second tool to keep myself organized is my CRM strategy. By focusing on “Update Days” in Dealersocket, I can always make sure that my web leads are followed up with on a regular schedule. The “update days” metric is the linchpin of an effective follow-up strategy. If your customers are being touched every three days, they are unlikely to be forgotten.
by Andrei Smith | Jun 24, 2019 | Mastering Management, Mastering Sales
What is the ideal car salesman pay plan?
The pay plan is the most important guiding document of a sales organization. How you pay your salespeople dictates how they will act. If you focus the pay plan around profit, your salespeople will focus on profit. If you concentrate the pay plan on volume, they will focus on selling as many units as possible.
There is no one “perfect” car salesman pay plan. That said, there are some guiding principles that all car salesman pay plans should adhere to (and some potholes to avoid).
In today’s article, I’ll be reviewing the various facets of the car salesman pay plan, with a focus on best practices. Make sure that you always keep in mind what your salespeople think about their commission.
Crafting the Perfect Car Salesman Pay Plan: Figuring out a Target
Just like any real estate deal or business plan, the perfect car salesman pay plan starts by working the numbers backward. You need to build a car salesman pay plan that enables your top performers to make more money than they could anywhere else, while also allowing your average salespeople to make an area-adjusted average income.
Your car salespeople sacrifice to work their job. Those with the skills you seek are valuable assets to your company that need to be compensated accordingly. Your top performers could sell at any dealership, and often, in other industries as well. Your salespeople are probably working long hours and weekends away from their families, in a position with plenty of stress.
In the San Francisco Bay Area, the competition that you face as an employer is mostly from technology companies. These technology companies often have better working conditions and hours than your dealership. To capture your salespeople, you need to enable them to make more money at your dealership than they could if they switched over to technology sales (at least for the first few years). Making a strong income quickly is one of the biggest draws of the car sales career.
Market Research (Other Business Types)
As a sales manager, the first thing you should do when researching your car salespeople’s new potential pay plan should be to find out the optimal income level that you want the top 20% to be able to achieve.
The optimal income level comes down to what is available in your local market for your employees. To figure this out, I recommend speaking to real people rather than relying on aggregator websites such as Glassdoor.
In my area, new salespeople at the dealership could qualify for entry-level “Sales Development Representative” roles at local technology companies. These roles pay between $55k to $75k after bonus in my area, with full health care benefits and beautiful offices. I can find this out quickly by reaching out to a few of my long term customers and friends that work in those businesses.
Therefore, to attract talent to work at the car dealership, I need to have my top 20% of staff be able to make between $80k and $90k in their first year. This extra money will ensure that the salespeople will have to take a pay cut to change industries. This number ($80k, for example) will be what I use to work backward from to build a pay plan.
Market Research (Other Dealerships)
Many car dealerships in my area are plagued with expensive turn-over rates. Therefore I don’t rely on comparisons to their pay plans since what they are doing isn’t working.
That said, if there is a superstar dealership in your area, I always recommend figuring out what they offer. The experience of your salespeople is more than pay, but it is a critical piece of the puzzle.
Crafting the Perfect Car Salesman Pay Plan: Working Backwards
Now that we have our “goal” income ($80k), we can begin to work backward to design the car salesman pay plan.
Our perfect car salesman pay will be competitive enough to keep our employees happy while aligning their activities with our business goals.
Let’s start with some example business goals:
- Max Volume: You want your dealership to sell as many cars as possible. Gross profit is less important. This strategy is generally based around having a profitable service center and an aggressive manufacturer stair-step program.
- Max Profit: You want your dealership to make money where it can, and as much as possible. Gross profit per car is incredibly important to your dealer. This strategy is generally based around having less service retention and a smaller volume of vehicles on the lot.
- Mixed: You want units, you want gross profit, you want it all. You need to have balance.
Max Volume Dealership Example
Let’s say you work at a dealership that is focused on maximizing the volume of cars sold. You have plenty of inventory in stock, and you need to move it.
When building a car salesman pay plan for a dealership like this, you are going to put the focus on unit bonuses. You don’t want your salespeople to stress on the front end profit of deals. You want your salespeople to bring you every transaction, regardless of the offer.
Let’s work backward. Our top-20% salesperson needs to make $80k/year for our store to be competitive. Therefore, they need to make $6600/m when performing at their level. At the current time, this type of salesperson sells 12 cars per month. In California, I need to pay $1000/m as basic income, so I need to spread $5600 over those 12 cars. A simple way to build this pay plan would be to structure it as such:
If you sell 1-11 vehicles, you make $400/car (plus $1000 base pay)
If you sell 12+ vehicles, you earn $475/car (plus $1000 base pay)
Now my salespeople that sell ten cars a month will make $5000 per month and my salespeople that sell 12 vehicles per month (the top-20% salespeople) will earn $6500. This significant jump between 10 and 12 cars should encourage salespeople to push to at least sell 12 cars.
Max Profit Dealership Example
Let’s take the exact opposite strategy, max profit. The logic is simple with this strategy. You need to align your salespeople with making as much profit as possible. The easiest way to do this is to focus their pay plan around a high percentage of profit offered.
After discounts in your market, your average front end profit is $900 per car. Your goal with this strategy will be to beat this number. A reasonable goal might be $1100 profit per car. If your average salesperson sells 12 cars a month here is the math:
$1100 goal profit per car * 12 cars sold on average = $13,200 profit
You will need to give your salespeople a reasonable minimum commission per car to keep morale high, so let’s say you pay a $300 mini per car sold:
$300 minimum commission * 12 cars sold on average: $3,600 income on 12 cars sold minimum
With a $300 minimum commission, your 12 car salesperson is making $3,600. You need to get that number to $6600 per month based around a target profit of $1100 per car. Out of the $13,200 profit, you need to pay $3000.
$3000 additional commission needed / $13,200 profit goal = .22 -> 22%
Done, here is our pay plan. We pay $1000 for showing up and $300 mini per car sold. On top of the mini, we pay the salesperson 22% of the gross front end profit:
$1000 Minimum
$300 Mini Per Car * 12 Cars = $3600
Plus 22% of $13,200= ~$3000
Total Income: $6600 per month
The Reality of The Situation
The reality of the situation is this: you already have a car salesman pay plan in place at your dealership that your salespeople are used to. All salespeople fear their pay plan changing, which means that you will likely not be able to institute a completely new pay plan without considerable upset.
The purpose of this article is to give you instead of an idea of how you might go about tweaking your store’s current pay plan to align better with your goals.
by Andrei Smith | Jun 4, 2019 | Mastering Sales
It has become clear at car dealerships across the country that the market for new cars has begun to cool. After half a decade of substantial gains, the demand for new vehicles is experiencing a bit of a slow down, which makes now a perfect time to sharpen your skills. In a contracting market, there are still those who make an out-sized income.
When the market slows, those who have surfed by with lackluster skills and work ethic fall by the wayside, while superstars continue to gain market share. If you can survive the dip, you will be one of the few when the good times come back around.
To illustrate this, consider the home builders in the Bay Area, where I live. In 2007 and 2008, the market for new homes cooled off tremendously, leading many home builders to quit and join other industries. The going was tough for a couple of years. The few companies that did stick around, continuing to evolve and find new avenues to make money, ended up with the entire market to themselves when things turned around.
I’ve sold Audi’s to many of these folk, and they all say the same thing: the key is surviving the dip.
Step One of Standing Out in a Cooling Market: Work the Portfolio
The lease penetration rate of dealerships across the country has skyrocketed in the last seven years. As the economy recovered from the “great recession,” many customers came back into the market for a new car in a shifting landscape. Manufacturers such as Audi and Volkswagen had changed their lease offerings to be much more incentivized at the same time as electric cars with substantial federal rebates started to hit the market in volume.
When confronted with this market, many customers decided to lease.
Now, as the market cools, there is a pipeline of guaranteed buyers lined up for the next three years. Even if we see a global recession hit with a 10-20% stock market pullback in the next year (anything could happen), these lease customers will still need to make a decision.
Your goal is to gain control of as much of the lease end portfolio as possible. Learn how every part of the lease end process works and become the expert at your store. Ask your management team for a list of 90-day lease maturities and begin to send them robust email templates.
Here is the basic workflow for working the lease end portfolio:
- Get in contact with customers 90-120 days before their lease end. Represent yourself honestly as the lease maturity manager, and offer to do a “pre-inspection” of their car to prepare them for their lease end. By getting in touch early, you minimize the chance of the customer walking into a different dealership first.
- When the customer arrives for their appointment, have an exciting product for them to check out while you inspect their car. Using the lease contract guidelines, make a note of the condition of their current vehicle. Have your used car manager estimate their lease end vehicle’s value and compare it to their payoff.
- While explaining to the customer the lease end process, offer some key swap deals that you have prepared. You will find that in a cooling market for new cars, the used car market will thrive. This means that valuations will be higher for the lease end cars, with strong potential for an equity situation. If you can, structure a deal with equity for their lease end as a trade in, and offer to swap them into a new model with no money at signing.
- If the customer isn’t ready to make the jump, make sure you still leave a good impression. Their lease end date forces their hand- they are going to need to do something in the next 90-120 days. Make sure you are the person they think of first!
Here are some email templates that I have successfully used for my lease end customers:
Dear CUSTOMER,
My name is NAME and I will be your Lease End Manager for your current BRAND.
As you move towards your lease end date I will be able to answer any questions you have.
If you are interested in leasing a new car, buying out your current vehicle (or anything else) I will be your contact here.
You may be eligible to get out of your current BRAND early. Are there any new cars that interest you? Let me know if so- I can get you quotes using our BRAND Loyalty program.
Thanks!
Sincerely,
NAME
PHONE
Good Afternoon CUSTOMER!
My name is NAME, I am the lease return specialist here at BRAND. I will be your primary source of contact for your end of lease options. I noticed your lease will be maturing in the near future and I just wanted to see if you had any plans after your lease ends. I will probably be trying to call you in the next few days to get in touch!
1. Do you want to pick out a new car?
2. Do you want to purchase your current vehicle?
3. Other questions?
Please let me know what you decide so I can make it a smooth and easy for you. I would love to chat on the phone about your options- give me a call!
Lease Maturity Date: __________
Thanks,
NAME
PHONE
Hi CUSTOMER,
Just wanted to send you a courtesy email to remind you of your lease maturing soon! Do you have any questions or concerns you would like for me to address about your lease before that day comes? Let me know.
Your Lease End Manager,
Step Two of Standing Out in a Cooling Market: Learn to Sell Used
At many stores all across the country, new car salespeople look down on used car salespeople. Instead of learning how to sell used cars, they ignore the entire side of the business, often scared of the label.
This is madness. Used cars are a huge profit center for your dealership, and you can be earning a cut of that.
After making sure that it’s ok with your management, start offering new and used options to every customer. Just by letting your customers know that you can sell used cars, you increase your lifetime value to the customer. Although they may come in to buy a new car, in the future, they may be back in the market for a used car.
Often I’ve sold new cars to parents, and then used cars to their kids.
Walk your used car inventory every day. Learn the “comparable cars” to your new vehicle offerings. Used cars can provide a great negotiation tool if you know the stock. When a customer offers you ten thousand dollars off on a new vehicle, counter by showing them the one-year-old version of the car they are interested in. The pricing of the used car will justify your new car price.
Here is how that works:
SALES: So, what did you think of the new Q5? The vehicle that you liked is listed for $51500, with all the best features!
CUSTOMER:I love the car, but my budget is more around $42000. What can you do for me?
SALES: I’ve got two great options for you. I can sell you this new car for the KBB price of $48200 or I can show you this one year old loaner car with the same options that is priced at $42500. Which would you prefer?
This inventory knowledge will make you a superstar negotiator. You don’t need tricks to win negotiations; you need information and a clear and concise way of communicating!
Step Two Bonus: Side Hussle Used Cars with Turo
If you take my advice and become a used car superhero, you will soon notice a large number of cars your dealership starts wholesaling after they take cars in on trade.
These cars are taken in on trade and then turned around and sold wholesale to smaller dealers and sent to auctions.
If you can save up a few thousand dollars, I suggest you look into picking up some of these cars cash from your dealer. Then you can start building your own Turo fleet.
Turo is like Airbnb for cars. It was initially meant for people who don’t use their cars every day to rent them out when they weren’t using them. Now, entrepreneurs have begun to build out their fleets.
My advice? Shoot for 8 or 9-year-old Honda Fits and Toyota Prius. These cars depreciate slowly, are cheap to maintain, and are easy to rent.
If you are interested, sign up for Turo with my coupon code to get $25 (I get $25 too, thanks!)
Step Three of Standing Out in a Cooling Market: Live Within Your Means
Personal finance is hard for everyone, but it can be especially hard for car salespeople. The boom and bust cycle of this business leads droves of salespeople to alternate between living in luxury and poverty.
The problem is that humans are bad at planning. When the going is good, people live large, spending every penny on fancy things and expensive indulgences, rather than focusing on the essentials.
I track my income and expenses with Personal Capital (click for $20 coupon code). Here is what it looks like:
Using the app, I can track every income and expense, making sure that I am always keeping an eye on the big picture: growing my net worth. This is only possible when I carefully track my finances.
When the market cools, incomes tend to dip. If you are living beyond your means, you are in for a rude awakening.
Focus on lowering your fixed costs. Don’t rent the most beautiful house you can afford, or buy the biggest house that you can mortgage. Practice restraint on these enormous fixed costs, and you will be much more flexible in a downturn!
For a good idea of how I think about personal finance, check out Mr. Money Mustache.
Step Four of Standing Out in a Cooling Market: Double Down on You
Customers can buy a car from anywhere. If you are the salesperson, you need to stand out if you hope to survive the coming cooling market.
Salespeople get contented in their position at a dealership and begin to lag in their self-improvement. This is a trap!
My mentor Frank has a saying written up on the wall in the sales office: “Complacency is the Assassin of Ambition.” Don’t become the lazy salesperson who lets their skills dull in the bull market when the going is easy.
Step Four Part 2: Personality
I’ve written extensively about car sales referrals, so I will just touch on this topic here.
Car sales is a business where in your personality can make or break your business. In this business, you are often going to be selling a product that is not unique to your store. This means that the customer has more options, and therefor you need to stand out more.
Your greatest asset in this business is your personality. Do you project confidence and trustworthiness? How often do you strive to find things in common with your customers? Do you listen attentively?
At the end of the bull market, you will find many salespeople who have grown lazy, content to be the same or worse than the day before. Make sure that you don’t fall into this trap. Make the extra effort to be the most likable salesperson possible.
by Andrei Smith | Jun 3, 2019 | BDC Training, Mastering Sales
After releasing The Automotive BDC Manifesto, I began receiving tons of great emails from new BDC representatives. One-on-one coaching has quickly become my favorite part of working in this field. The best part about coaching reps is that I learn the common questions that plague everyone when they are starting.
One of these common questions is “how much follow-up is too much?”
We can all understand the worry behind this question. New BDC representatives are bound to be worried about “over-calling,” since the customers could conceivably get frustrated and complain.
The prospect of being annoying, and the consequences associated with that, can be daunting to anyone starting a role in an Automotive BDC.
Representatives always want to be undeniably likable, which is a great strategy, but they shouldn’t be scared of doing the follow-up.
I’m here to alleviate that worry. The following schedule is one that I have used, with almost no complaints, for years. It is comprehensive and effective, as it focuses on customers that remain unqualified during the first seven days after putting in a lead.
Note– this process is only for those customers that remain unqualified. If a customer picks up a call or returns an email, then turn off these templates and follow-up according to their wishes (and schedule).
The following process is effective at qualifying a large percentage of your inbound web leads.
The schedule assumes lead arrives in the morning.
Everything in Red Italics is meant to be replaced with the correct information based on the lead and your dealership. For example, where my email offers my “5% pledge” your dealership might offer a “free year of detail.”
Overview of daily schedule:
Day 1: 3 Calls, 2 Emails, 1 Text
Day 2: 2 Calls, 2 Email, 1 Text
Day 3: 1 Call, 1 Email
Day 4: 1 Call, 1 Email
Day 5: 1 Call, 1 Email
Day 6: 1 Call, 1 Email
Day 7: 1 Call, 1 Email
Day 1 (The Day The Lead Arrives to the Automotive BDC)
Email #1 (Send as soon as you receive the lead):
Subject: Andrei @ Audi Stevens Creek regarding the Audi A4 for Steve
Hi Steve,
The Audi A4 you clicked on (stock #42112) is available and in stock at my dealer.
I saw you requested an “e-price” for this vehicle, so I wanted to get you this information as soon as possible.
I do have time today at 5 pm to show you the car (after work) if you would like to come by.
MSRP: $51,995+ tax/fees
TrueCar Estimate: $49,150+ tax/fees
Our 72 Hour Selling Price: $48,995+ tax/fees
I’ve attached the window sticker of the vehicle you are interested in, and you can click here for the professional photos of the car.
This vehicle’s beige interior is unique in the market right now and another salesperson has an appointment to show the car this weekend.
Here at my dealer, we do offer five years of free servicing with your vehicle purchase and we have a free pickup service if you are coming to the dealer to buy the car by yourself.
I am looking forward to chatting more about this vehicle’s specifications and pricing. Let me know if you have time to come by today!
Sincerely, Andrei Smith
408-555-5555
P.S. This sale would be included in my 5% pledge – 5% of my commission from this sale will go to the Fistula Foundation to help pay for surgeries for women in need!
Email #2 (Send a few hours after the first email):
Subject: The Voicemail
I left you a voicemail earlier today at 415-222-2222. I am reaching out in regards to your interest in the Audi A4. I’d love to chat- here at Audi Stevens Creek we pride ourselves on being the absolute cheapest place to buy an Audi!
I’ll be calling again to try and reach you a little later. If you prefer to chat via email just respond to this email!
Sincerely, Andrei Smith -> Text or Call me @ 408-555-5555
Call #1 (Leave immediately after receiving the lead):
My name is Andrei Smith and I am calling from Audi Stevens Creek for Steve, in regards to your interest in the Audi A4 that you clicked on. Call me back at 408-555-5555. If I don’t hear back from you I’ll go ahead and give you a call around 5pm.
Call #2 (Lunchtime call):
DO NOT LEAVE A VOICEMAIL (three voicemails on the first day is enough to make any customer uneasy)
Call #3 (Leave around 5 pm):
My name is Andrei Smith. Guess I missed ya! I’ll just give you a call tomorrow if I don’t hear from you!
Send one opt-in text message alongside one of these three first day calls. The opt-in text will generally be a generic one required to be sent by your CRM system.
Day 2
Email #1 (send in the morning):
Subject: Grabbing Your Attention on the Audi (48 hours left)
Hi Steve,
The Audi A4 you clicked on (stock #42112) is available and in stock at my dealer.
I do have time today at 5 pm to show you the car (after work) if you would like to come by.
MSRP: $51,995+ tax/fees
TrueCar Estimate: $49,150+ tax/fees
Our 48 Hour Selling Price: $48,995+ tax/fees
Here at my dealer, we do offer five years of free servicing with your vehicle purchase and we have a free pickup service if you are coming to the dealer to buy the car by yourself.
Sincerely, Andrei Smith @ 408-555-5555
Email #2 (Send around 5 pm):
Subject: RE: the new car
Hi Steve,
I left you a voicemail at 415-222-2222.
I am reaching out in regards to your interest in the Audi A4.
I’ll be calling again to try and reach you a little later. If you prefer to chat via email just respond to this email!
Sincerely, Andrei Smith -> Text or Call me @ 408-555-5555
Call #1 (Call in the morning):
My name is Andrei Smith and I am calling from Audi Stevens Creek for Steve, in regards to your interest in the Audi A4 that you clicked on. Call me back at 408-555-5555. If I don’t hear back from you I’ll go ahead and give you a call around 5pm.
Call #2 (Call @ 5pm):
Andrei from Audi. Call me back at 408-555-5555. Need to tell you about a deal we have running!
Send 1 Opt-In text message alongside one of these two 2nd day calls.
Day 3
Email (send in the morning):
Subject: 24 Hours and 0 Minutes
Hi Steve,
The Audi A4 you clicked on (stock #42112) is available and in stock at my dealer.
Our 24 Hour Selling Price: $48,995+ tax/fees
Did you want us to bring you the car/send an Uber for you to pick you up/pay for your Taxi?
Sincerely, Andrei Smith 408-555-5555
Day 3 Call (Call @ 5pm):
Andrei from Audi Stevens Creek. Call me back at 408-555-5555.
Day 4
Email (send in the morning):
Subject: a poem for you…
Hi Steve,
Roses are Red,
Violets are Blue,
We can’t sell you a car,
If we never talk to you…
Sincerely, Andrei Smith @ 408-555-5555
Call (Call @ 5pm):
Need to get in touch about the car… call me at 408-555-5555
Day 5
Email (send around noon):
Subject: sorry
Hi Steve,
I wanted to say sorry.
I’ve been following up with you a bunch and I hope that isn’t pushing you away from responding.
It’s my job to get in contact with you to make sure we take perfect care of you.
Check out our reviews @ this link.
Sincerely, Andrei Smith @ 408-555-5555
Call (Call @ 5pm):
Andrei from Audi. Call me back at 408-555-5555.
Day 6
Email (send in the morning):
Subject: HR
Hi Steve,
We have some awesome specials running right now on the car you are interested in.
HR is getting mad that I’m sitting on my computer all day emailing customers that don’t respond! Should I stop reaching out?
If you are still interested in the Audi– reply to this email. I hope to talk soon!
Check out our reviews @ this link.
Sincerely, Andrei Smith @ 408-555-5555
Call
I hope today is the day I hear from you! Andrei from Audi. Call me back at 408-555-5555.
Day 7
Email (send in the evening):
Subject: Termination of Active Follow Up
Hi Steve,
Since I haven’t been able to reach you, I’ll be removing you from active follow up. If you are still interested, please take the time to send me an email.
Sincerely, Andrei Smith @ 408-555-5555
Call
I’ll be removing you from active follow up if I don’t hear from you today. This is Andrei from Audi. Call me back at 408-555-5555.
Automotive BDC Follow-Up
The mantra “buy or die” is a bit crude, but there is a grain of truth to it. Your job in the Automotive BDC is to get customers into the dealership. You can’t do that if they stay unqualified.
That said, follow-up won’t always be successful. One of the best processes you can put in place is always to do a failure analysis when an opportunity doesn’t go your way. You may find that my follow-up process needs to be tweaked for your local community!
If you are looking for more content like this, check out my two books, The Automotive BDC Manifesto and How to Sell Cars on the Internet.
Also consider joining our Facebook Group!
by Andrei Smith | May 30, 2019 | Mastering Sales
This article covers some of the most common car salesman commission questions I receive. The first few questions will be questions that non-salespeople ask me, but I’ll finish with questions that I get from fellow salespeople that are looking to improve.
Questions From Non-Salespeople about Car Salesman Commission:
Isn’t it stressful being commission only?
At the start? Yes. Thankfully, if you can find a good dealership, they will often offer you a “guarantee” when you begin. When I started selling cars, the managers provided me (and my two friends that started with me) a $3000 per month guarantee. The idea is that if your commission is less than $3000 at the end of the month, they will still pay the full $3000.
After the first three months, you should have an excellent idea of whether or not you are cut out for this type of work. The car sales business has a shallow barrier to be decent. Becoming a superstar is a bit more work, but beating your guarantee shouldn’t be too hard.
What if you don’t make any money in a month?
In reality, this would likely never happen. Most dealerships now will pay a minimum wage to a salesperson whose commission is less than what they would have made as an hourly employee. That said, this safety net is unlikely ever to be utilized since even in the worst months some people are buying cars.
The fear of not making any money because of a lack of a “guaranteed salary” is overblown, and exasperated by the culture of living paycheck to paycheck. To be successful financially, you need to get to financial safety as soon as possible. That means building up a savings account that you can tap if you do have a bad month.
Commission only car sales is an exercise in risk versus reward. Since you are willing to take the “risk” that you will not make any income, you can take advantage of the outsized “rewards” of this payment plan.
What other careers can you start that enable you to make six figures, with no college degree, your first year? Salary is safe, but it is capped. If your salary is $50k/year, then you cannot possibly make $100k in your first year. If your commission is risky, then the rewards can be huge!
Are there days you don’t make anything?
Tons! During my first few years selling luxury cars, I would make $100k-$160k/year selling 14-18 vehicles per month. If you take into account the fact that half of those cars were sold on Saturday and Sunday, you can begin to understand how much “down time” there is in the car business.
The successful salespeople that move up in their organizations utilize their downtime well. They find a few extra deals and build a few more relationships on the “slow days” when others sit around and talk.
Why wouldn’t you want a base salary? What’s so good about commission only?
Risk versus reward. I see a salary not as a guaranteed income but as a capped income. If my salary is $80k/year with a potential $20k bonus, how is my performance reflected in my income? Under that pay plan, an employee that generates $500k in revenue is paid almost the same as an employee that produces two million dollars in revenue.
I want an uncapped commission only income because it frees me to prove myself and feel like a partner in the business. If I make the business money, I want a cut. That’s it!
Questions Salespeople Ask Me About Car Salesman Commission:
How much do you make per month?
Over the last seven years, I’ve made between $100k and $240k per year selling luxury cars. This is a striking fact to some, and the basis for my opinion on if car sales is a good career.
How much does the average salesperson make?
The average salesperson? That depends on which average salesperson. If you mean the average Audi salesperson in California, then I would say about $75k per year. The highest paid salesperson that I’ve met makes about $450k per year.
Average car salesperson in the United States makes around $40k-$60k per year, according to a quick google search. If you read up on the car salespeople forums, such as reddit.com/askcarsales, you will find plenty of people who make six figures all across the country.
How do you keep track of your car salesman commission?
I maintain a detailed excel sheet that shows every commission, every spiff, my months surveys, and my total backend profit. It’s evolved over the last year to be very comprehensive.
I recommend maintaining the record of your income in an excel sheet so that you can keep track of accounting errors that your dealership makes.
What do you mean “work your pay plan”?
Working your payment plan is the beauty of a commission only job. On your first day, your management team gives you a payment plan that dictates how you can make money at the dealership.
Here is an example pay plan:
Salespeople earn $1000 guarantee per month. They also receive 35% of new car profit, 25% of used car profit, 5% of backend profit, and $100 per survey. If they sell 14 cars, they earn a $500 bonus, and if they sell 20 cars, they earn an additional $1500 bonus. All negative deals on new and used vehicles pay a $300 mini.
That is a fantastic pay plan since there are a few avenues to make money. The average salesperson looks at their pay plan once, and then forgets it, figuring that they will try and sell as many cars as possible.
The smart salesperson looks at their pay plan every month, figuring out how they can squeeze more money out of it. If front end profit is down, they will resort to trying to sell more cars on lease to maximize back end profit. They would always focus on the surveys since they can increase every car’s income by $100 each! They would always try and sell volume, rather than just going for the big commission cars.
by Andrei Smith | Apr 23, 2019 | Mastering Sales
The Automotive BDC is one of the underutilized profit centers of the car dealership.
Dealerships need F&I (Finance and Insurance) gross profit to remain profitable as a business. That means that dealerships need to sell extended warranties, financing, and other after-market products in order to stay afloat.
How does the Automotive BDC fit into that?
I’ve been reading a dealership book by Max Zanan, and I came across a point that I haven’t thought of before:
When a customer checks out a car but doesn’t buy that day, it is expected that the salesperson does follow up. That’s normal.
On the flipside, when a customer says no to an F&I product, such as an extended warranty, very little (if any) follow up is ever done.
Why is that?
There are two main reasons:
- No one wants to do the work (F&I representatives have limited time)
- No one wants to change a contract after a customer leaves
BDC Representative Aftermarket Follow Up
It would be pretty easy to set up a process for BDC representatives to follow up with sold customers on aftermarket products.
The beauty is that every single customer is a “real” customer since the representatives would be calling customers that have already bought cars.
The calls can be part of ensuring a perfect customer experience if they are handled correctly.
If a customer decides to re-consider an aftermarket product, the Automotive BDC representative can get the F&I manager involved to close the deal. The product can be sold over the phone by taking a credit card and mailing the documents (or e-signing!)
The Process to Set Up the Sales
When an F&I manager pitches the products to a customer unsuccessfully, they will know which products they were “close” on. When a customer says “no” to a list of six products, generally there is one or two that they were on the fence on.
The F&I manager could have an excel list wherein they put the deal number, customer name, the product they were close on, and the offered price.
That list would be emailed the next day to the BDC representatives to call. To give them a reason to call, the management could decide to offer a 15-30% discount on the product.
Here is the script that I would use for the voicemail:
Hi Steve! Congratulations on your purchase yesterday. I hope you are enjoying your new Audi Q5. Your finance manager, Jenny, wanted me to call and offer you a discount on a product that you were considering to add to your purchase. Please give me a call back @ 408-555-5555!
Alternatively:
Hi Steve! Congratulations on your purchase yesterday. I hope you are enjoying your new Audi Q5. We wanted to follow up with you about the warranty you were considering adding to your purchase- we have the ability to discount that today by 20%. It’s a huge savings on this product that I think would be very valuable to you. Call me @ 408-555-5555 if you are interested!
I don’t have any illusion that the closing ratio on these offers will be above 10%. That said, I think with proper communication between the BDC and the finance department could result in a handsome extra profit every month if this strategy was instituted.
Email Template: F&I Follow Up
Here is an email template I would use:
Dear Customer,
Congratulations on your purchase! Please let us know if you have any questions about your new car.
When chatting with my finance manager about your sale, he mentioned that you were on the fence about the 10 year/100k mile warranty.
He said that it might be worth reaching out to you with an additional discount in case you wanted to add it to you contract.
While he quoted you $3299 for the warranty, he said that I could discount it to $2899 if you wanted to add it to your contract today.
We don’t have a lot of time before we send everything to the bank, so let me know today!
Thanks,
Andrei Smith
PS. If you have any questions make sure to reach out to us via this email address!
Short, sweet, and to the point!
The BDC selling F&I products is a fresh idea for me, as I haven’t implemented it yet at my dealer. Have you? If so, tell us about it here:
Ethical Internet Managers, Sales Managers, and BDC
by Andrei Smith | Apr 3, 2019 | Mastering Sales
Since I’ve recently published the new book, How to Sell Cars on the Internet, I wanted to get back to sharing some best car salesman tips on this blog. Please note that I say “car salesman” instead of “car salespeople” just because Google likes it better.
The last weekend of the fiscal quarter for my dealership just elapsed. Working up to and through that weekend was an excellent opportunity for me to get back to the basics of closing deals in person while juggling my responsibilities with the steady stream of internet sales traffic.
I maintained my sanity in the hurricane of business that came our way because of a few of the best car salesman tips that I’ve gathered of the last few years. These tips include The Five Minute Rule, The Perfect Process Rule, and The Relationship First rule. If you are looking for guidance on how to have successful Saturdays, check out this article.
I’ll be breaking down these three “best car salesman tips” in this article. If you have any best car salesman tips that you want to share with me, feel free to add a comment at the bottom or send me a message via the contact page.
If you are looking for similar content, I have some articles such as Car Sales Tips Closing a Car Deal and Internet Car Sales tips. If you sell any cars online, I have recently released the new book, How to Sell Cars on the Internet, that is full of great tips.
Best Car Salesman Tips #1: The Five Minute Rule
RULE: Anything that you can do in less than five minutes should be done right away.
There is a laundry list of tasks associated with selling cars that are only tangentially related to the sale. Before, during, and after the deal, the salesperson is required to:
- Maintain Meticulous Notes (customer preferences, trade-ins, pricing expectations)
- Keep Track of Issues with Inventory (low gas, damage, missing)
- Keep Track of Car Keys
- Keep Personal Information and Documents Secure
- Answer All Incoming Phone Calls (In a Timely Fashion)
- Answer All Incoming Texts
- Answer All Incoming Emails
- Remember When Surveys are Dropping and Then Remind Customers
- Set Aside Loaner Cars for Service Customers
The list goes on.
How are we supposed to manage this workflow without letting things slip through the cracks?
The first step is to follow the five-minute rule. If, at any time you are not with a customer, you receive or remember a task that you need to accomplish, get it done right away. If you follow this, you will avoid having a huge pile of little annoying tasks stacking up in the back of your head. These little tasks, like ordering a key for a customer, are like little itchy thorns in your shoe. Although one won’t drive you mad, if you wait until there are five poking your foot, you are going to get uncomfortable.
I’ve found that stress is almost always related to feeling overwhelmed.
When I get overwhelmed at work, it’s rarely big projects that have piled up. It’s generally a million little small tasks that have quietly sat in the background, waiting for my attention.
The stress of these piles of “small things” combined with the outsized consequences of forgetting them is what you can avoid by adopting the five-minute rule.
Best Car Salesman Tips Example: 2nd Key
When you find out that a car that you sold is missing its second key, it can be annoying for both you and your customer. That said, it is generally an easy fix- promise the customer that you will order them a new key and usually their disappointment fades away.
Everything thing is then going to be okay.
Unless you forget to order them a second key!
At my dealership, it takes around 5 minutes to get the due bill, sign it, and make it to the parts department.
Easy right?
So easy that the task just gets written down, not a high priority to finish right away. Why spend the time to order this key right now when you can do it later?
That mindset is precisely what has got me in trouble in the past. Countless times a customer will call a week after taking their car, asking about a second key. I will stammer and delay, trying to remember if it’s here. I’ll end up making an excuse. As soon as the call finishes I run to the parts department and get the key ordered.
Unless… I just write it down to do later.
Best Car Salesman Tips #2: Perfect Process
RULE: Respond to common problems with the same process, every time.
What are some common problems you run into at your store? I’m referring to those problems that are part of doing business.
Things like cars with lot damage, customers that want financing but just moved to the country on a Visa, and required password changes.
What do these three things have in common? All three are common problems that occur at my store. This “best car salesman tip #2” is not about the answers to these three problems, as none of them can be prevented. What can be done is to have a perfect process in place.
What do I mean by perfect process?
A perfect process is a set “response” to these “triggers” that is followed by everyone on the team, one hundred percent of the time.
Best Car Salesman Tips: Perfect Process Example
Problem: Foreign national customer wants to buy a car, but has no-credit and is on a Visa.
Perfect Process: When confronted with a foreign national customer with limited credit that wants to buy a car, follow the following process:
- The customer fills out full credit applications and provides two references
- Then the customer provides soft copies (via email) of their Visa/Passport/Social Security Card.
- Then the finance manager calls the assigned bank representative while forwarding the documents
When we follow that exact process, the deals almost always get approved quickly. If instead, the salesperson does not support this process, the deal ends up being bounced around between the sales desk, the finance department, and the salesperson.
Problem: Salesperson’s sold car has “lot damage.”
Perfect Process: When confronted with a sold car that has “lot damage,” follow the following process:
- The salesperson creates a group text with the sales manager and the body shop representative.
- The group text should have comprehensive photos of the damage, the stock number of the car, and the customer’s contact information
- The salesperson organizes with the customer for when the vehicle should be brought to the body shop to have the damages repaired
This is another example of a process that, if followed correctly, will result in the timely resolution of the problem. There are an infinite number of ways that this situation can end badly if the process is not followed.
Best Car Salesman Tips #3: The Relationship First Rule
The car business does not exist without customers. Customers are people, and people like to be treated correctly.
In the process of selling and repairing cars, problems arise. When issues arise, there are a variety of solutions with varying consequences to the bottom line of the dealership.
My advice? When at all possible, value the relationship with the customer over any one transaction. Always try to make money, but when making money would get in the way of building a strong, lasting customer relationship, shy away.
Think of all the opportunities that we, as salespeople, have to influence our customer’s choices. The most successful salespeople align themselves with their customer. Your customer should think of you as an advisor, not a scam artist.
If you prize the relationship with your customer above all, you will create fans of your business. Customers that are fans of your business will always come back and they will often bring their friends.
Best Car Salesman Tips: Review
I recommend three essential tips. They include The Five Minute Rule, The Perfect Process Rule, and The Relationship First Rule.
Let me know what you think of this content. If you found value in it, consider checking out a few other popular articles. Some of my favorites include one about requesting finance applications, one about creating successful appointments, and this one about overcoming laziness and lack of motivation!
by Andrei Smith | Mar 15, 2019 | Mastering Sales
Since success in car sales requires the ability to build rapport quickly, every factor of the first impression is important. When a customer meets you for the first time, what signals are you sending? Part of that signaling will depend on your attire, so I wrote this article “Best Dress Shoes for Car Salesman” to help you out!
Are you letting them know, using every tool that you have, that you are a respectable and upstanding salesperson? Someone that they can trust to spend their money with?
What do your shoes look like?
It’s essential for your shoes to be professional.
One of the first questions you may ask yourself when applying for and getting your first car sales job will be what to wear. What exactly is the “car salesman dress code”? Is there a standard attire or does it vary dealer to dealer?
The answer is that although there is some variance dealership to dealership, most dealers conform to a standard dress pattern that varies between hot and cold seasons. The standard car salesman dress code is business casual (button down with tie and slacks) in the colder months, and khakis with a branded polo shirt in the warmer months. Although there are dealers that want you to wear a suit 365 days a year, their numbers are dwindling.
Best Dress Shoes For Car Salesman: Must-Haves
Car salesmen have unique requirements for their shoes. The shoes themselves need to:
- Look Professional
- Handle a Variety of Weather Conditions
- Be Able to Handle the Asphalt of the Car Lot
We need to find attractive dress shoes that can withstand outdoor conditions
Best Dress Shoes For Car Salesman: The Guide
If you walk into Macy’s or browse Amazon’s shoe section you will be overwhelmed with options of shoes.
The aisles are lined with hundreds of pairs of shoes, with hugely varying prices. Price signaling would lead us to believe that the more expensive the shoe, the better it will perform for us. This is hardly the truth. Here are a few examples of shoes that look good, last a long time, and don’t cost an arm and a leg.
Best Dress Shoes For Car Salesman: Brown Leather Dress Shoes
Clarks is a brand that is well known for a variety of shoes, most commonly the more casual Clarks Chukka Desert Boots. That said, Clarks makes one of the best dress shoes for car salesman- the Tilden Plain Oxford. These shoes look professional, with 100% leather, and a durable sole.
The Tilden Plain Oxford from Clarks
When I say “durable sole” I’m referring to the synthetic bottom of the shoe:
Much More Durable
The Amazon feedback seems pretty positive as well:
These Clarks shoes are hands down the BEST dress shoe I have ever owned. I’m already shopping for pairs in other colors/styles! I’m on my feet in these most of the day, and they really cut down on my knee and back pain. They’re super comfortable and have a stylish look. I can’t say enough good things about these shoes or this company. Clarks has earned a customer for life!
Note- I’ve found the shoes above to run a bit wide. Consider sizing down a half size when you order a pair.
Best Dress Shoes For Car Salesman: Black Leather Dress Shoes
For the black leather dress shoes, I still recommend Clarks Tilden Oxfords (Black). The combination of the price point ($50-$100), the quality, and the adherence to our three car sales requirements make them the best shoe that I can recommend.
The reviews on Amazon seem to agree:
For the price, these are a great value. Super comfortable. I was looking for a shoe I could wear all day. Usually, this means you need rubber soles (no wood). You can’t resole many one-piece rubber sole heels, but that’s fine. Rarely do I do that since the top of the shoe shows so much wear, it makes me want to get a new pair of shoes no matter how much shoe-shining I do.
I own Saks 5th Avenue brand shoes, Cole Haan, and many other pricey shoes. Sure these Clark’s don’t look as sharp as Italian-made shoes. But Clark’s are comfortable. With this particular shoe, they struck the right balance between fashionable and functional–a rare feat indeed!
With Toe Cap on the Black Shoes
Best Dress Shoes For Car Salesman: Other Options
I’m confident that the first two shoes should be enough for most car salesmen to get started. That said, I have had some recommendations come in from other readers, which I thought I’d share. Your mileage may vary, as I don’t own these particular shoes:
- Nunn Bush Men’s Norris Wingtip Slip-On Loafer:
- La Milano Mens Cap Toe Oxford Leather:
- Dockers Men’s Proposal Leather Slip-On Dress Loafer Shoe:
Best Dress Shoes For Car Salesman: Work in Progress
This article has been sitting in my draft folder for a few months. I don’t have much to add other than my two simple suggestions at the top, so I’ve held off on publishing it. That said, I figure it might provide some value for someone so I might as well publish it.
This article would be a lot better with your feedback! Let me know if you know of any ideas for the “Best Dress Shoes for Car Salesman”!
You are the dealership’s representative. If you seem disinterested, tired, frustrated, or aloof, your customer is going to question how much you truly want to sell them the vehicle. The customer will then wonder how “fair” you are pricing a car if you don’t really care if you sell the car or not.
I implore you to perk up. Drink some coffee and remember why you came to work today. When you are sitting across the customer, they should have a distinct impression that you will do anything to sell this car. This type of attitude makes any deal you offer much sweeter, as the customer believes you when you tell them an offer is fair.
by Andrei Smith | Mar 13, 2019 | Mastering Sales
In time, we all get comfortable and complacent at our jobs. After the initial learning curve, we can begin to coast, using the same tools for years. As our confidence in our work grows, arrogance can creep in. This insidious trait can numb us to the feedback from others. As long as our paychecks keep coming in, we ignore our process falling apart and rely on the momentum that we built to carry us through our jobs. When your process falls apart, it’s critical to conduct a failure analysis of what’s going wrong.
It can take a particular “wake up call” incident to alert us to this process. That’s what happened to me this week.
For context, I’ve been selling cars for around seven years now. In less than six years I had grossed (before tax) over a million dollars in income, an amount of money that has profoundly changed my life. Of the four thousand salespeople in my brand, I was top 200 by year one, top 50 by year two, and top 10 by year three.
It was a steep climb to the top of the car sales food chain, bolstered by a successful partnership and supportive managers (plus a strong bull market). I’ve published an ebook and have a second one about to launch.
Life is good. Things have gone my way.
That is, until last week.
That’s when I realized that I was dropping the ball.
Here is my failure analysis.
Failure Analysis of My Conversation with Tio
Tio’s lead came on Monday morning, with a clear message:
“Shopping around for this exact car with the exact same features. Another dealer is offering this Q7 for 56k but doesn’t want to have to drive that far to get it. Can you offer a better deal? If so, I’ll go with you to save me the trouble of driving to the far East Bay.”
When I saw this, I was happy- what a great lead to get Monday morning!
I was excited to close up this deal. Not only was I confident that I would close this deal within the hour, but I also figured that I would be able to merely match the competitor’s offer (instead of beating it) since I could offer value outside of just price.
When I responded to the lead, Tio was at work and asked me to have our conversation via text, which worked for me since I could multi-task and answer other leads while closing the deal.
Our conversation began easily enough:
Tio sent me a picture of the invoice of the car that the other dealership had offered him and the price that they had provided. At this point in the conversation, my goal is to close the deal for as close to that number as possible as soon as possible to get him off the market.
He almost immediately relents on pricing, telling me that “to be honest I’m ok w exactly what they offered open to any color but black or brown.” I patted myself on the back, relishing in how easy it was not to lose extra money to sell him a car.
Failure Analysis: Problems Emerging
The problems then emerged. I took things one step further, attaching my offer of matching their quote with a requirement (that Tio comes today). In my experience when I say this, customers will respond with the day they are free, and I will agree to honor the price on that day. This adds a little finality to the conversation.
Things are about to turn.
The conversation changes when Tio brings back his desire to “see if you can do less than 56k that’s what the other dealer is offering”.
At this point in the conversation, I have two choices:
- Confirm that I’m listening to his desires and offer a compromise.
- Double down on the original offer matching, stating the ways that I provide value (instead of just discount)
Failure Analysis: Making the Wrong Choice
Retrospectively, it seems that I decided to do #2 (poorly).
While I was confident that I could close this deal quickly and get a quick start to the week, I was blind to the facts- namely that I don’t know anything about this customer (and he doesn’t know anything about me!). I know that he is in the market for a Q7, he lives relatively close to my dealership, and he is flip-flopping a bit on what he wants.
I should have seen the warning flags in the short conversation. He started by saying that a “to be honest I’m ok w exactly what they offered” and then responded to my offer to match with a repeated request for me to beat it.
His change of heart speaks to the point that he is uncomfortable in this type of conversation. When he said that he was “ok w exactly what they offered,” deep down he wasn’t sure if this was a good deal. Since I agreed to the match so quickly, his insecurity in the deal crept back in. He worried that everything was too easy.
He feared that he was being taken advantage of.
If I were smarter at the time, I would have looked at the facts and decided to take a softer touch in my response. I could have explained in a few sentences why I didn’t want to offer more discount, and I could have said everything more graciously. Instead, I was very direct, which ended up not going over (as you will see below).
He immediately responds to my offer to match the other dealership with “Thanks Andrei. Gonna pass. Appreciate your time”. This response was my next warning that things had gone astray in this conversation. Something I had said had made him feel uncomfortable.
Failure Analysis: Doubling Down on the Wrong Path
At this point, I should have given him some space, perhaps calling him with a fresh, better offer around lunch time. That way I would have saved face.
Instead, the conversation got worse. I doubled down on a relatively straightforward close, asking him what it would take to “get this wrapped up efficiently.” The underlying message there was that so far this conversation had not been efficient.
Although this type of straightforward close will work with many people, it is liable to insult someone who has a bad impression of you.
The deal is about to fall apart.
Looking back at this conversation, it’s apparent that I should not have continued this conversation to this point. When the customer says “Just tell me the best deal you can offer w the info provided” it’s a clear message that he was not happy with how things had progressed so far.
Again, instead of taking a moment to recoup, I forged on ahead. In retrospect, the very best thing I could have done was to turn the deal at this point. I could easily have had an associate or manager reach out with an offer and a fresh face.
I didn’t. Instead of seeing Tio’s responses as a sign of his frustration, I saw them as ineptness. At the time I just shook my head in bewilderment, confused how this customer can change his stories so quickly.
I was entirely lost by this point in the conversation. The reigns were out of my hands, and my autopilot took over.
I questioned why we were having this conversation in the first place (if he hadn’t yet decided on the vehicle), instead of seeing his deflection as a sign of something else.
I’m sure you saw this coming. When Tio says, clear as day, that he “don’t appreciate your tone,” I finally realize consciously how badly this conversation has gone. I try to recoup by saying “No tone guaranteed,” but it was far too little too late.
Failure Analysis: Nail in the Coffin
I have to say, my performance in this conversation was amateurish. Upon re-reading the thread, I can see the times where I missed his underlying messaging.
Failure Analysis: Conversations Matter
I get paid the way I do because I am typically good at closing a large volume of car deals. Much of that is process-based, but people skills are no less critical. We are not computer engineers, or surgeons, or architects. We are salespeople, and conversation is our programming language.
I find it incredibly useful to analyze conversations that go poorly since we can all learn so much from our failures. Failures give us an excellent opportunity to identify weaknesses and address them. Few things sting like losing an easy car deal.
Failure Analysis: Other Failures
In January and February of 2019, my sales surveys have been below the national average. This simple failure has cost me around eight thousand dollars in bonuses so far and will continue to cost me if I don’t address it.
In the car business, many dealerships attach survey clauses to their pay plans. Therefore, it’s incredibly important to review your pay plan and keep track of how your actions line up with the pay plans goals. I find it useful to pay attention to how much money you are losing by not aligning your actions. Your pay plan is your real boss!
by Andrei Smith | Feb 28, 2019 | Internet Sales
When requesting a credit application for a customer, there are three main options. When sharing personal credit information customers are understandably nervous, and as such, I have found it best to provide options for them to use.
Here is the template I use when requesting a credit application:
SUBJECT: [Confidential] Credit Application at Audi Stevens Creek
Dear CUSTOMER,
In order to streamline your car purchase, it will be helpful to run your credit before you arrive. We are dedicated to securely collecting your information, and we have two ways that you can provide us the information.
Option One: If you click this link (insert hyperlink), you will be directed to our secure website for submitting applications. Simply fill out everything on that site and press submit. Please let us know if you need any guidance or have any questions by calling me directly at phone number.
Option Two: If you prefer to submit via email, simply fill out the information below in your reply to this email. Once I receive it, I will call you for the social security number:
LEGAL NAME:
BIRTHDAY:
PHONE NUMBER:
HOME ADDRESS:
YEARS AT HOME ADDRESS:
PREVIOUS ADDRESS:
YEARS AT PREVIOUS ADDRESS:
CURRENT JOB TITLE:
CURRENT MONTHLY INCOME BEFORE TAX:
CURRENT EMPLOYER:
YEARS AT CURRENT EMPLOYER:
PREVIOUS JOB TITLE:
PREVIOUS EMPLOYER:
YEARS AT PREVIOUS EMPLOYER:
HAVE YOU EVER DECLARED BANKRUPTCY?
HAVE YOU EVER HAD PROPERTY REPOSSESED?
DO YOU HAVE ANY LAWSUITS PENDING AGAINST YOU?
DO I HAVE YOUR PERMISSION TO RUN YOUR CREDIT?
Thanks for filling this out, I will speak to you soon.
Sincerely,
NAME
TITLE
PHONE
Here is an alternative I use with customers that I already know:
SUBJECT: [Confidential] The Fast Buy
Hi CUSTOMER!
I want to make this purchase as quick and painless as possible for you. I’ve developed a process that can make this quick and I will just need a bit of help from you before you come into the dealer.
Simply fill out the information below in your reply to this email and attach your current drivers license and insurance card.
LEGAL NAME:
BIRTHDAY:
I’ll call you for the social security number!
PHONE NUMBER:
HOME ADDRESS:
YEARS AT HOME ADDRESS:
PREVIOUS ADDRESS:
YEARS AT PREVIOUS ADDRESS:
CURRENT JOB TITLE:
CURRENT MONTHLY INCOME BEFORE TAX:
CURRENT EMPLOYER:
YEARS AT CURRENT EMPLOYER:
PREVIOUS JOB TITLE:
PREVIOUS EMPLOYER:
YEARS AT PREVIOUS EMPLOYER:
HAVE YOU EVER DECLARED BANKRUPTCY?
HAVE YOU EVER HAD PROPERTY REPOSSESED?
DO YOU HAVE ANY LAWSUITS PENDING AGAINST YOU?
DO I HAVE YOUR PERMISSION TO RUN YOUR CREDIT?
Thanks for filling this out, I will speak to you soon.
Sincerely,
NAME
TITLE
PHONE
That’s it! Hope that helps.
