Training » We don't have time to work these leads!

We don’t have time to work these leads!

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Leads were going into the dealership’s CRM, but they were only occasionally being looked at. We placed a courtesy call to the owner and he asked if someone could stop by. When our Regional Manager arrived at the dealership, he encountered Jimmy, the special finance manager, who told him the dealership “didn’t have time” to work our lead program. They were too busy with lot traffic. Who of us hasn’t faced times like that? Since our Regional Manager was there to help the dealership sell more vehicles, he began to ask questions to discover what the underlying issues were. In doing so, he found not only some systemic problems, but also a troublesome perception. Here is what he found:

Jimmy knew special finance well. He had a good knowledge of his lenders, their programs and the niches they fill. He was familiar with his inventory and knew how to structure deals. He controlled the sales process well. He was very effective at setting customer expectations during the credit interviews and knew "how to land cars on customers." In fact, he was so effective at handling subprime that every task associated with it became his.

The dealership had been doing very little subprime business before Jimmy arrived. Obviously the owner was thrilled as this “new business” began to grow and he was ready to take it to the next level. Jimmy had started by handling desk turns but now also had the responsibility of contacting and working the dealership’s proactive leads. Though they had talked about getting Jimmy some help, he was doing everything but the test drives. It was really little wonder that he felt the dealership had no time to work proactive leads. So what needed to change systemically?

The dealership needed to develop a subprime team. None of us can do it all… including the most effective among us. Even if we could do it all, we’d be more effective by delegating less challenging tasks to others and focusing on those tasks where we bring a unique value to the process. Jimmy was carrying responsibilities that should have been delegated. As a result, he was not only overwhelmed but the dealership was also not realizing the maximum contribution subprime could have been making to the bottom line. In the process of establishing an effective subprime department, it is important to look at the individual tasks that need to be accomplished to make sales. Break down those tasks into repeatable and trainable processes.

What should Jimmy have been doing? I’d submit that a Special Finance Manager is earning the dealership money when they are hanging paper with lenders, rehashing deals, setting customer expectations during credit interviews and “landing cars on customers”. In the same way doctors delegate easier tasks such as taking blood pressure and temperatures to nurses, a special finance manager should delegate easier tasks that are trainable to other staff.

What are the tasks that often can be delegated to other individuals on the Special Finance team? Some to consider include: taking initial customer interviews, making initial phone calls to set appointments, following up on missed appointments, collecting stips, printing contracts/packages, packaging deals, pursuing CITs. Does that mean these tasks should never be handled by a special finance manager? No. It comes down to your dealership’s volume and the individual’s capacity. You must however think through tasks that can be delegated and build processes to accommodate growth.

Jimmy’s declaration that they "didn't have time to work our leads" wasn’t so much a recognition of his need to add additional staff or delegate work as it was a revelation of a troublesome perspective. To Jimmy lot ups were more valuable than leads. He had been very effective in working desk turns. He was comfortable with customers that stood before him but had failed to see the value of customers that had raised their hand and asked for help with financing. I appreciated the questions our Regional Manager asked Jimmy.

"As you greet individuals that come on the lot, what do you know about them? Do you know their name, address, phone numbers or income? Do you know whether you should show them vehicles or walk them inside to secure financing? Do you know their credit score or have permission to pull their bureau? Do you know anything about their ability, stability and willingness that your lenders will be evaluating?" Jimmy saw where these questions were going and immediately had a paradigm shift. If proactive lead programs are worked properly, they not only provide additional "ups" but "ups on steroids". They just aren’t in front of you yet!

If sales reps were to ignore a lot up, they would be fired. The same should be true for your leads programs. Lead programs are not perfect. They can be however extremely successful if worked properly. Even with adequate staff, working leads properly means not only working hard but smart. Below are several Best Practices that will help you work smarter and make sure you maximize your ROI with Subprime leads:

To prioritize workflow, rate your leads based on your perceived chance of making a sale. Your rating should be a function of your customer’s credit, job & residence history, down payment, trade equity and capacity to repay a loan (DTI ratio). Also consider your lender pool and inventory.

Use a rating scale of A/B/C/D. An “A” you would spot deliver, a “B” you’d spot with the right structure (low advance, low pmt, money down etc.), “C” you’d submit first for approval and “D” is a get-me-done.

Now follow up… but don’t cherry pick. Work your “A’ leads first, then your “B’ leads and down the line. Thoroughly work all your leads, just like you do your lot traffic. Don’t cherry pick ones “you think” are car deals.

Only have a phone number or incomplete information? Still follow up. Many prospects that provide incomplete information are smart enough to not have everyone pull their bureau. With “hand holding” they can become great customers.

Know the answers, before the questions are asked. Customer questions and concerns are not unique. Keep a list of Frequently Asked Questions and train your staff by them.

I highly recommend that you implement these Best Practices for Subprime. Do so and you will sell more vehicles and make more money. If you would like to learn more, e-mail me and I’ll be glad to send a checklist of 49.5 Best Practices to SUPERCHARGE your Subprime Sales & Profits.

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