Boosting Used Car Selling Efficiency for Kenwood Dealer Group

By dialing in time-to-line metrics, Kings Toyota Gets Cars Retail-Ready in Half the Time

 

Transparency, manageable performance metrics and accountability improve used car efficiency

Kenwood Dealer Group consists of 15 dealerships in the Cincinnati, Ohio market. Dan Kommeth, who joined in early 2020 to fill the newly created group sales director position, was assigned to strengthen the stores’ competitive advantage.

Convinced that positive customer experiences begin well before a lead or walk-in arrives, Kommeth started his new assignment by investigating processes that flow into profitable car sales.

“I’m a process guy,” he said. “I like the idea of improving operations by establishing and following processes. The idea here is to build synergies within our group, yet still embrace individual store cultures.”

Kommeth’s background prepared him to visualize work activities from a future perspective within the granularity of day-by-day dealership operations. He has spent 27 years in retail operations, including general manager positions for four dealerships, the last one as GM of Lexus of Milwaukee.  

As a “process guy,” Kommeth experienced that evolution was a process itself. That journey prepared him for his Kings Toyota assignment.

“I stumbled into this focus on process investigation,” he confessed. “When I got into the business, there was no such process known now as a CRM. I kept sales contacts on index cards. When CRMs appeared, I liked how its use organized my day and helped me work my plan.”

When promoted later to used car manager, he grew frustrated with how long it took the store to move trade-ins and auction purchases into their new sales cycle. “I wanted them front-line ready quickly,” he said, “but the service manager prioritized customer-pay, so internal work lagged.”

When that service manager left, the GM told Kommeth to fill his shoes. It was in the service environment, he said, he experienced scheduling technology, upsell tracking and retention marketing systems. “They taught me that processes could be measured, and once measured, improved upon,” he said.

Kommeth brought that measurement-improvement attitude to his next assignment with that dealership, heading variable operations. “We still sat around too much, waiting for something to happen,” he said. Again, he  asked questions: “How do we track look-to-book?” “How do we track the follow-up?” and “How do we track the elements of the sale?”

Process Improvement for Kenwood

When Kommeth moved to the Kenwood Group, he studied improvement opportunities presented by various group stores. He then chose Kenwood’s Kings Toyota, the group’s largest store, with an eye toward upgrading its reconditioning operation to get cars front-line ready faster.

Kommeth learned about reconditioning workflow automation when he was the GM at Performance Lexus. The recon system used there, Rapid Recon, delivered fast turnaround that helped the store benefit from faster reconditioning and a more-efficient selling process.

When he moved to Kings Toyota, Kommeth found reconditioning there still relied on shared computer spreadsheets. “That frustrated me because if the service or detail managers were off, or the used car manager didn’t move cars into recon, they backed up,” Kommeth said. “I knew from my prior experience using Rapid Recon it would eliminate communication delays or gaps.”

System transparency is critically essential to Kenwood’s executive management.  A transparent process is hard to manipulate; its activities and events are trackable. It makes hiding mistakes and misuses difficult.

 “The level of transparency that Rapid Recon gives us into the reconditioning operation is the sort of clarity management I would love to have throughout all areas of the dealership,” Kommeth said.

He introduced the Kings Toyota team to this time-to-line (T2) reconditioning advantage in steps. Confidence grew as managers in weekly meetings studied reconditioning metrics reported on their Rapid Recon dashboard from their laptops or phones.

“Now we don’t go on hunches; we let the data speak,” Kommeth said.

Dialing in Efficiency

Kings Toyota reconditions 400 cars a month. After eight months on Rapid Recon, the dealership’s T2L speed is 14 days; it was 28 days. “We’re working on resetting T2L as we go forward, with our eventual target at three or so days,” Kommeth said.

A dialed-in T2L store:

 

  1. Has a GM (or proxy) who takes ownership of the store’s T2L to drive speed to sale
  2. Puts structures and disciplines in place to sell cars before they get stocked in
  3. Uses work item details and approval steps in their recon software to build value in the deal and urgency among sales, BDC and desk personnel; they use this data to build confidence in the dealership and in the quality of the used cars sold
  4. Has built a culture in which all personnel involved in servicing, reconditioning, selling and financing cars use the reconditioning software data and reporting to help customers buy
  5. Heeds T2L metrics as the “holy grail” for high performance, transparent communications and accountability for clear and precise management in any market

 

The discipline performs well, regardless of the dealer’s used car reconditioning volume. Consider:

 

  1. Retail automotive today is a reduced-volume, scarcity-driven sellers’ market. The era of gross/turn-driven inventory management with disappearing margins is gone.
  2. T2L, from the origination of recon workflow software in 2010, is focused on helping dealers drive efficiency and accountability into their recon and used car operations. In a reduced volume market, dialed-in T2L takes advantage of this narrowing window to make vehicles sale- and delivery-ready sooner.
  3. The communication and coordination needed to pull off this efficiency without mistakes take work; the COVID pandemic has taught that only dealers with a workflow system in place have been able to adapt quickly and satisfactorily.

“We’re building the awareness here at Kings Toyota that a really efficient dealership embraces a speed-to-sale culture,” Kommeth said. “It’s no longer ‘How much can we make on this car?’ but ‘How fast can we make money on this car?”  

Kommeth recognizes that change is progressive.

“We’re working to bring similar results to the group,” he said. “If we can recondition 400 cars a month this fast by dialing in T2L, there’s no reason other stores reconditioning fewer cars cannot likewise enjoy the same benefits.”

For more information about how dialed-in T2L can help you be more efficient and profitable, visit www.rapidrecon.com

 

 

 

 

 

 

 

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