Part of being a successful car salesman (or saleswoman) is keeping your eye on your earnings. Your income is the most straightforward single metric to use (as a salesperson) to measure your worth to your company.
I’ve written this article to guide you the simple steps I followed to make my first million selling cars (in six years).
Now, make sure you don’t misunderstand my perspective. I don’t think that your earnings are the end-all of who you are as a human being. Instead, I propose that your income most easily quantifies your worth to your company.
Just like a high demand car commands a high value, a high-quality salesperson should demand a high income.
Sales is a brilliant career because your income (assuming it is commission) correlates directly to the profit your business produces.
Consider the alternative. If you had a career in human resources, how do you quantify your value? Your effect on the companies bottom line will have to be extrapolated from abstract numbers such as employee turn over and payroll accuracy.
In sales, if the store makes money, you should too.
I believe in the car sales career because it has worked for my friends and me.
Becoming a Successful Car Salesman
The beauty of the car sales career is that you can learn on the job. Every skill that you need to be successful is taught by the repetition of situations that come up at the dealership.
The car sales career is unique because of it’s short sales cycle. As a salesperson, you can have five attempts to make a sale on one Saturday afternoon.
Compare that to the other sales jobs with similar incomes. In technology sales, your product is often a subscription that needs to be approved by a VP or C-level executive. You pitch your product to whoever you can, and you slowly work your way up the food chain at the company. A sale can take 6-12 months!
What if you made a mistake early in the process (product knowledge misunderstanding, overpromising, annoying the wrong person). You might not realize that the whole deal was going to fall apart for months.
With that type of job, your personal growth can take time. Your opportunities to iterate your process and improve only appear when you make mistakes.
So we come to the beauty of the car sales career.
This is a career where, if you are paying attention, you can make mistakes and improve every day. Your sales cycle is measured in hours, not weeks or months.
So how do you create the opportunity for yourself?
You take more chances.
That means you need to talk to more “ups.”
You should be fighting for every opportunity that comes your way. Not because every customer is worth talking to, but because every customer is an opportunity for you to learn something.
The Math of Success (Customers/Day)
Let’s say you want to make a million dollars, like I did, in your first six years.
What does that take?
There is some simple “work-backward” math that we can do together.
For my example, we will assume that you make $500 per car sale if you average out all of your bonus and commissions.
Then, we will assume you close 20% of the customers that you talk to.
Let’s work backward.
One million dollars, divided by six years, is $166,660 per year.
$166,666 per year is $13,888 per month.
$13,888 per month, divided by $500 per car, is 27 cars sold per month.
So you need to sell 27 cars per month, for six years, to make a million dollars (before tax).
We said earlier that you close 20% of the customers that you talk to, which is one in five.
If you sell one in five customers, to sell you 27 cars, you will need to talk to 135 people per month.
If you work 23 days a month, you will need to talk to 5.86 people per working day to make a million dollars in six years.
Taking that one step further… assuming you take one hour a day of “breaks” and work nine-hour days, you will need to talk to a new customer every 1.4 hours.
That sounds very doable to me!
Where to Find Customers
To talk to a new customer every 1.4 hours, you need to be well versed in the different “avenues” that you can find new customers.
The most obvious customer is the walk-in customer who shows up unannounced at the dealership. It should be a given that if you want to make a million dollars in six years that you will need to be the master of getting these opportunities.
In your first few years, while you are handling floor traffic, you need to be on the constant lookout for these customers to arrive. Before doing anything else, master this funnel!
The highest closing rate customers you will find are going to be inbound phone calls. Can you figure out why?
Think about the psychology of someone calling into a dealership in the 21st century. They have access to every online resource, but they decided to call instead.
Calling a dealership is a clear buying sign. They are looking to get answers fast and from the source. They don’t want to wait. To make your million, you are going to need to be fast to pick up inbound phone calls.
So let’s say you have mastered the walk-in traffic and the inbound phone calls. What could hold you back?
Think about the math we did earlier. Consistency is going to be a key to making an outsized income.
If you want to be consistent, you can’t have many “bad days.”
Let’s address this mindset.
Difference Between “Good” and “Bad” Days
I’m going to take a little break to share an idea that a mentor shared with me recently:
Have you ever noticed how some days you wake up and you feel great? You are excited to face the challenges of the day, you are happy to be awake? You can’t wait to get started?
…And have you ever noticed how other days you wake up and things are different? You feel tired and you feel flat. You’re dreading going to work and you wish you could just hide away from it all?
Well I was having one of those “bad” days yesterday. I woke up feeling like cold deli meat. I was just not happy. On a whim, I opened a window and I looked outside.
You know what I found?
I found a nice sunny day.
The fact is that most days here are sunny. The birds wake up and chirp every single day.
All that negative junk? It had nothing to do with that day. It had everything to do with what was going on in my head.
Every day is the same. It’s how we react to it that is different.
Having this type of mindset is a key part of being a successful car salesman.
Successful Car Salesman Mindset: Every Customer has Value
That story brings me to my point. Successful car salespeople don’t see some customers as good and others as bad. They see every single customer like a piece of the puzzle that is going to build their career slowly.
Some customers are going to be lay-downs. They will pay MSRP and leave happily. Others will grind you for hours, test-drive four cars, and then leave in a bad mood, without a new car.
None of that matters in the end.
What matters is that you keep a level head, and absorb as much opportunity as possible.
You aren’t going to be able to find those perfect golden customers if you don’t talk to the annoying customers.
Not only that, those annoying customers give you a fantastic opportunity to practice.
“Eat Out of My Hand”
Those annoying customers can be thought of as a waste of time, or they can be considered as a challenge course for your successful car salesman personality.
Here is where “eat out of my hand” comes in.
It’s the summation of a mindset I use when I work with the most challenging of customers.
When a challenging customer appears, you will know quickly. Challenging customers make their attitudes clear early on, with the way they talk and the things they say. Even their body language can give them away.
When I am faced with one of these customers, I clear my mind and concentrate on the challenge ahead.
In my head, I repeat this:
This customer wants to hate you Andrei.
They want to have a bad day.
Things are not going their way today and they want to put that on you.
Andrei, you are going to face this down as a challenge.
Your mission is to make this asshole love you.
Make this guy love you so much that he would eat out of your hand.
There is a magic to this mindset. I create a game to play, with the end goal of converting the challenging customer into a rabid fan.
When I repeat that mission back to myself, I get excited — what better test of my skills than this challenging customer.
The Return of Humanity
While becoming a successful car salesman it is possible to maintain your humanity.
I am often successful with the most difficult of customers, simply because the challenge makes me invested in the sale.
The best part of this mindset, of challenging yourself to convert the challenging customer, is that you often find that the customer isn’t a bad person.
I’ve found that the most challenging customers are not bad people, but rather, they are scared.
Their fear centers around the fact that they have heard of the evils of trickster salespeople. They fear being taken advantage of.
When you turn their experience around, when you win them over, they lose their fear.
Not only do they lose their fear, they often will grow attached.
I’ve had some of my most demanding customers become “referral machines.”
Referrals are the End Game
Every customer you talk to, buyer or not, is an opportunity to generate referral business.
When you make a great impression, you can create fans.
Fans will believe in the value you bring, and they will spread your name far and wide.
The most successful salespeople work primarily off referral business.
It’s just a better lifestyle.
Referral customers come to you from a place of trust, and they are infinitely more comfortable to work with.
Don’t forget that every customer is an opportunity to grow new fans (fans are like investments; they grow exponentially!)
Essentials of the Successful Car Salesman
If you’ve followed along so far, you should have the essentials of my strategy for making money in automotive:
- Work Backwards to Figure out How Many Customers to Talk to Every Day
- Master Phone and Fresh Ups
- Understand the Consistency Requirement
- Value all Customers as Lessons
- Treat Challenging Customers as a Game
- Earn Referrals
If you follow these steps, you will be well on your way to making your first million.
The last step? Join a community of like-minded professionals and grow your network!