Do you really know your business? To know your business you must know all the operating metrics as well the core of your business model. Business is part art and part science. Knowing the science part makes the art much easier. Many dealers are still operating under an outdated business model that can no longer be supported in any economy, especially the current economic conditions. The only way to change the outdated model is to ask more questions, better questions, measure everything possible as often as possible and then take action to improve every day.

Every question you ask about your business causes you to reevaluate your business. Most dealerships are good at working in the business but the great dealerships are great at working on the business. Most dealers are under the assumption that if everyone just does more, then the business will grow. The reality can be the opposite. You can be like a hamster on a wheel running harder and harder but getting the same or less results. In today’s marketplace, that outdated model will cause your business to be eaten alive.

In baseball there is a phrase used in coaching pitching mechanics called “slow to go.” In business the same analogy is true. You have to slow down to ask the right questions, evaluate the right things, think in different directions and take different actions to spped the success of your business. The days of showing up, advertising a lot and working hard as a model for success are gone.

The following are important metrics and questions to understand and take action on everyday that can lead to success.

  • Why should someone buy from your dealership? Be very specific. Ask yourself “Who cares?” to each answer to see if it is defining and specific enough
  • What are the strengths of your business?
  • What are the weaknesses of your business?
  • What are the opportunities for your business and marketplace?
  • What are the threats to your business and marketplace and how can you not only deal with them but utilize them to your advantage?
  • What is the business within your current business that could be created?
  • What are the segments of your marketplace that are underserved?
  • Is there a way to add to or plus anything within your business?
  • Is there a way to subtract or minus anything within your business?
  • Is there a way to speed up or slow down the experience for your customers?
  • Is there an entertainment value to your business or experience?
  • How many walk-in opportunities are there?
  • How many phone opportunities do you have?
  • How many presentation/demonstrations?
  • How many opportunities closed?
  • How many opportunities delivered?
  • What are the totals and averages of all lead sources?
  • What percentage of your sales converts to ongoing service customers?
  • What percentage of your customers are inactive customers?
  • What percentage of your sales are repeats?
  • What percentage of your sales are repeat customers?
  • Do you have an ongoing and at least partially automated system for follow up of your customers?
  • Do you have a system to convert sales from service?
  • How many forms of lead generation and marketing can you list?
  • What are the production levels of each employee for every department? Everyone needs a metric to measure performance no matter the job.
  • What three improvements in your service sales process would increase dollars per repair order?
  • Do you have a quantified, complete and ongoing process to recruit employees?
  • What is your education and improvement program for your employees?
  • Have you quantified clear ongoing communications for the expectations of your employees?
  • Do you have formal feedback channels for your employees?
  • Do you know the breakdown of performance for your used inventory by model, price range, conquest models, trade-in vs. acquisition, and return on investment for days in stock?

The above questions are just a few of the questions you should ask every day. The days of being a good entrepreneur but just an okay business person are gone in the car business.

There once was a day where an auto dealer could possess a strong entrepreneurial spirit and skills necessary to start a successful auto dealership. A dealer can no longer run his dealership by the seat of his pants. Today he must also have strong skills at running the business day to day that involves utilizing data derived from good operational metrics and questions. There are a couple of old sayings in the car business. “The car business is a very forgiving business” and “Car dealers can make money in spite of themselves.” Both sayings are outdated and no longer true. If a dealer does not work harder on the business everyday than he does in the business, then he will quickly become a dinosaur.

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Comment by Mark Tewart on August 25, 2013 at 8:52pm

Thanks Robert

Comment by Robert Benn on August 25, 2013 at 8:18pm

Great points Mark. It just goes to show that the more things change, them more they stay the same. You are talking about taking ownership. "Who Cares", and blocking and tackling, the metrics. The challenge in this business is creating ownership on a scalable basis.

Comment by Mark Tewart on August 25, 2013 at 1:01pm

Thanks Pat

Comment by Mark Tewart on August 25, 2013 at 1:01pm

Thanks Anne

Comment by Mark Tewart on August 25, 2013 at 1:00pm

Thanks Marsh

Comment by Marsh Buice on August 25, 2013 at 9:38am

Mark, thanks for the specific questions-often times it is advised what we should do with no specifics-I love the specificity of these questions. They really got my thoughts cranking. Great work-as always my friend.

Comment by Anne Fleming on August 25, 2013 at 9:20am

Mark -- a very thorough and targeted article and really, almost a mantra, today. Thank you. All the metrics are so important to capture and look at and benchmark. As the industry - one dealership at a time - is going through its own "Best Practices Change Management" transformation, a critical question you mention and to keep TOP of mind, is indeed:  "Who cares + So what?" Not to come up with the "right" answer, but to have the answer keep developing and evolving to mirror consumer, cultural and technological shifts.

Comment by Daniel Tegeder on August 24, 2013 at 4:37pm

Great questions to ask yourself

Comment by Pat Kirley on August 24, 2013 at 11:42am
Hi Mark
You made some very relevant points, and I agree totally we must aim to be great.
It's hard but if it was easy everyone would be doing the same. Effort is measured
In results rather than time. Thank you for sharing.
Comment by Katie Colihan on August 23, 2013 at 2:06pm


I like that you gave so many questions that really got MY head moving. Even though I am not working currently IN a dealership, a lot of these questions are applicable to dealer-vendors, and marketing companies alike. It's important to always think "What more can I do?" or "How can I enhance the customer experience."

So much food for thought today, thanks!

-Katie Colihan
CarChat24 | Award Winning Fully Staffed Chat Service
Phone: (800) 510-7567

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