I've gone through 3 sales managers in the last year and can't seem to understand why? The interview is good, they seem to know what they are doing, but when it comes time to perform they don't. I thought I found the right manager with my second hire...he was great with customers, he was great at closing deals, but he called in sick at least once a week and we have a 5 day work week. We are closed on the weekends. We are a buy here pay here dealership and I've been looking at managers with franchise store experience because I think that those managers should have the proper training. Am I wrong?
First off, I'd like to find out why you'd be closed on a Saturday. That indicates your first problem- you may not have the numbers to KEEP a sales manager. You may need to consider a "jack-of-all-trades" employee that can sell as well as F&I- that way there's two oppourtunities for them to earn a living. It sounds like you need a good advertising budget. Not sure, maybe I'm completley off- course with these suggestions...let me know more about your situation
We are a small family owned dealership and to close on Saturday was a hard decision to make but after 5 years in business and very few car actually sold on Saturday we decided to close that day of the week. One reason why we close on Sat is because we require full coverage insurance to be added and proof sent over prior to the customer leaving the lot. And yes there are companies that insure customers on the weekends but after losing 3 cars to customer's insurance not willing to cover for damages we decided to close that day. We currently average 30-40 units a month without a "sales manager" and me wearing many hats. My sale manager's pay is based on commission and salary and it will avg about $40-$60k a year. The first sales manager stole from me, the second called in too much, and the third didn't know how to manage a team. Maybe the problem is me and if it is I need some guidance. This is what I normally do once a sales manager is hired. I tell that person what our policy and procedures are and what I expect from him. (i.e. train, motivate, set goals, manage the sales team, follow up with customers, take T.O.'s.) We have a "steps to the sale" guide and that needs to be followed. At the end of each day, I expect a brief report as to what is going on in the sales department as far as sales, appointments, and goals for the next day. Coming from a franchise store myself, I assume most managers know how to do all these things and all of this is told to the sales manager prior to hiring. The bad thing is I don't always have time to do the "daily" reports with him. We currently have about 10-15 phone sales leads a day and 5-10 lot leads a day. I KNOW we can sell 60+ cars a month but we currently are not. We've done 70 cars a month consistently with my first sales manager until I found out he was stealing money and I fired him. During that time we had 4 sales people, a sales manager, a finance manager and the leads were twice that of now. I've chosen not to spend that kind of money to advertise right now because of the lack of a sales manager. My second sales manager, we sold about 45 cars a month. He was only with me a little over a month until he suddenly "sold a patent and will be getting $250k". My third sales manager was a young guy in his mid 20's with 3 years experience as a sales manager at a franchise store. He seemed to know the duties of a sales manager very well and so after checking his history I hired him. After a while I noticed he couldn't adjust to a buy here pay here lot so we parted ways. So here I am.........
I am open to suggestions. Maybe I'm expecting too much, maybe I'm not involved enough, maybe I'm not paying enough, maybe I'm hiring the wrong people, I just don't know. What do you do at your store?
How many hours do they work and what kind of average gross front and back do they generate. A guy doing 60 units a month on a franchise used car lot at three to thirty-five hundred bucks front and back is going to make a tad bit more than 60K. The guy you want is going to tell you that he wants to run on Saturday and later in the evening than you are likely open now during the week. Good people are hard enough to find when the opportunity is there to make great money and advance their careers. They will have a hard time with a situation where the owner is not maximizing his sales and profitability.
The buy here pay here model is a tough one to manage because of the cash flow difficulties and the importance of buying the right mix of inventory at an acceptable level of quality. It might be that you should look for a buyer and manage the store yourself. Cash management (as opposed to cash flow) is another reason you should be present whenever the store is open unless you have a player you can trust with your life. I don’t envy your current position, but with three strikes in a row and the cutting back on hours it appears you are letting the situation get the best of you.
There are some good BHPH consulting firms that can analyze your whole operation top to bottom and make recommendations on everything you need to do and the order you need to do them in. If you are seriously committed to continuing in the business I’d call a couple and interview them…
Good Luck and Good Selling.
These guys are right. Most dealers have more traffic on the weekends. You should try working them on Saturday full day and Sunday half day. Then give them your slowest weekly day off. Then maybe work them half day on the second slowest day . Test it for a couple months...Do Tuesday's off and a half day/afternoon into evening on Wednesday or Thursday.
Real Managers don't call in one day a week unless they are terminally ill, have a drinking problem, or have a disabled one at home etc..One sick day a week sounds like a different issue to me, talk about it and get to the root of it.
Then give verbal awakening/talk" Sick days " better mean your in the hospital etc.... Then put a policy in place allocated annual sick day etc and personal day off policy in place, make all sign it and enforce from then on.
Hope it helps.
I'd suggest that your first problem is in looking at new car stores for your management hires. One of the universal truths about the BHPH business is that BHPH is not the car business, it's the finance business. That doesn't mean you should run off and try to hire someone from a bank or finance company either. They have spent their entire career learning how to turn your customers down. Look at associated businesses that appeal to the same customer base. Many BHPH dealers have been very successful in hiring managers away from local rent-to-own furniture companies, for example. It is the same customer base, the same process and the same collection issues and you can usually get them for a reasonable salary and bonus structure. Please feel free to call me if you want to discuss this further...Al
Hi,Ken. You are getting the best advice and for free also. These guys know what they are talking about. Everything that I type here is what I would do in your shoes. First hire an employment attorney to help you establish a policy and procedures book for all employees. It won't cost that much because those lawyers help businesses large and small everyday and it will keep you from getting sued. That's ALL you need right now. Alan is correct in looking at Rent-to-Own furniture managers. Their pay is tied to profit of the store, many are college grads, they are computer literate and very anxious to succeed. I know this because when I had a real job I had a couple these Rent to Own stores is the 1990's that I oversaw.
Stealing Why do people do it? Try this example from Corporate America. All money including checks are handled by one person (you can have other employees post payments) to be tallied up for deposit that day. Do a deposit everyday! The person making the deposit balances it to the transaction listings from your computer program. Then and here is the important part a different employee takes it to the bank for deposit. That person will then bring back the deposit slip and make a copy and staple that to the transaction listing for that day. The Manager or Sales Manager will get a copy to be faxed to you or your accountant or whoever you desire. Having three different people managing the loot makes it hard to steal. Encourage your customers to pay by Debit Card either in the store or over the phone. Our collections gained major yardage with debit cards.
This is my 2 cents worth and I hope things go well for you. Call or e-mail if you want to discuss further.
Thanks everyone for your input. If you have for suggestions, please feel free to add them.
Lots of good advice here. I think a large portion of your problem is in the wage. If you want to pay low scale wages you get low scale workers. Did you have to fire all three managers? Did you do any sort of exit interviews with them?
Your first problem could be your assumption that sales managers from franchised stores have the proper training. Some do, a lot do not.Secondly, as much as we would like to think the businesses are the same (BHPH and Retail), there are substantial differences, especially from the management aspect.
Generally, the new franchised operation has much more activity than a BHPH. By that I mean a "Deal" can happen in a matter of a few hours, where at a BHPH deals often take days and even weeks. You can spend countless hours collecting stips, verifying information and handling the documentation. Franchised retail operation managers do little of that. Their jobs are usually to manage the sales staff and sell cars. F&I handles the finance, the lenders handle the verifications and the title clerks handle the docs. It could be the managers are bored with the pace and the work.
The money could represent a problem also. Even though you offer 40-60K annually, this would almost certainly be a pay cut for a good manager.
Maybe you should be looking for a detail person, someone who has been handling lots of paperwork, is comfortable waiting for your customers to respond and has the ability to lead people. I would also strongly consider a woman, they are usually better at details.
Leedom and Associates was the group I was thinking about for you to consult with Ken. I have never worked with them, but from reviewing their web sites I would consider them before anyone else I know of based on the quality of information they present. Give them a call. It can't hurt and it might make a world of difference... Good Luck.