Cow Tipping and Other Hoaxes
It is time to dispel more of those car business myths, rumors, hoaxes and fables that have been passed down through the annals of time. Like the one about the pig farmer with the manure stained overalls and the bag of money. Everyone seems to have their own version of this story. The moral to the story, true or not is; treat every customer like they’re millionaires. You just don’t see that many pig farmers any more. Moving right along, I wish I could do this “Myth Busters” style and show you video footage of my scientific experiments while making zany comments throughout. While I do kinda dig the one guy’s beret, that “Iranian-soccer-team-shower-drain-hairball” over his lip is hideous and the other guy needs to research the scientific benefit to daily bathing. In any event let us address some of the more prevalent misconceptions in automotive sales.
Myth #1: The Finance Manager cut my deal so he/she could sell a warranty! Let me approach this frequent concern as gently as I can. That is the most moronic, asinine idea ever concocted! This is a favorite topic of discussion in the “dope-rings”. Okay boys and girls, here’s a little business lesson for you: Back-end gross i.e. service contracts, finance reserves; gap and the like are, for the most part, cancellable. Front end gross is not cancellable. Dealerships get charged back when customers cancel service contracts or re-finance etc. So it is bad business to sacrifice front end for back end profit first off. Secondly, no self respecting Sales Manager would allow this to happen. They will usually call the F&I manager weak for not selling their product and move on to the next deal. Typically what happens is the finance source (bank, credit union) does not approve the entire loan amount. For example: They’ll say the customer can borrow $10,000 on this specific vehicle and they approve them for after-sales (back-end product). If you were trying to sell it for $12,000 with no money down you have 2 choices. You either get down payment from the customer or as a last resort you cut the front of the deal and try to build profit back into the deal through F&I products. If the customer has no money to put down what other options do you have? You can not sell the car or restructure it as best as possible to meet the bank guidelines and maximize profit for the dealership. So, be thankful that you have a car deal and move on to the next. Stop focusing on what you don’t have and be grateful for what you do. As a side note: your Sales Manager wants you to make good commissions. He/she realizes that you are the front-lines of the dealership and if they can optimize your gross on every deal you’re attitude will be better which will help you (and them) sell more cars. Management really does want to take care of you. Well, most of you. Some of you whining, virus spreading, miserable, negative know –it-alls; your boss is simply looking for the opportunity to run you off.
Myth #2: This place looks for ways to NOT pay people their bonuses! Wow, if I really thought that was true of my employer, I’d be gone before they could say “carry-over”. I get my hackles up any time I hear an employee refer to their place of employment as “This Place” with the same contempt in their voice as people in a sweat shop or prison camp. Hey, Jack-ball! If it’s so bad there; here’s an idea: Leave. This is the life you have CHOSEN. You are there by choice and with your free will you can simply choose another employer. Pack up your stuff and beat it. Nobody is forcing you to stay. The inevitable challenge you’ll face is everywhere you work is going to be “This Place”. The only thing that changes in this business is your address. Every store has its quirks, politics and issues. There are no perfect employers this side of Heaven so deal with it. Focus on the positives. If the negatives out-weigh the positives then it’s time to move. Thank you for allowing me to vent and now, back to our subject. The truth is reputable employers want to ensure you have earned your bonus and that you get what you deserve. This mindset that dealerships want to withhold earnings so they can continue to earn interest on the money or just not pay the people who generate the income to begin with is ludicrous. If I may vent again… For you to think the interest gained off of your miniscule bonus is some huge motivator to your employer is ignorant and overstated to say the least. The interest earned on your bonus wouldn’t be enough to buy the dealership owner a freakin’ Happy Meal. So, shut up! You’ll say “Yeah, but if they hold everyone’s deals and bonuses, that’s a lot of Happy Meals.” If they hold everyone’s bonuses LEAVE. Also, if they hand you a paycheck and say, “Don’t cash this till the day after tomorrow.” Get out! That’s a pretty big sign that there’s some financial instability. To quote Mufasa from Lion King, “Run like the wind Simba and never look back”. Okay, let me see if I can get back on topic. Employers need to ensure they are being funded by the banks etc. In other words they’ll pay you when they’ve been paid. Or, in a lot of cases dealerships pay based on the fact that there’s a “clean deal” going to the bank even before they’ve gotten their money. Which further underscores why the accounting department wants all the i’s dotted and t’s crossed. In the on going battle between the Accounting Trolls and the Shining Knights of Sales or The Valiant Accounting Defenders and the Sleazy Sales Vermin (depending on which dept. you represent). From the sales side there is a perception that the accounting department gets some joy and benefit from holding over deals till the next pay period or month so as to rob you of your bonus. First off, riddle me this genius: What happens when that “carry-over” deal helps you make a bonus next month? All these people are doing is making sure you get properly paid on closed, booked and funded deals. And yes, there must be a definitive cut-off date otherwise they’ll never be able to clean up each pay period. Have you ever been paid on a deal and then because the bank didn’t fund it due to missing stipulations etc. the deal unwinds and you get charged back the commission and/or bonus? There’s no nice way to put it; it plain sucks. Rest assured you would rather have just not been paid on the deal. So let the accounting departments do their job and as long as all of your paperwork etc. are in order things will work out just fine.
The bottom line is Dealership owners and GMs understand that morale and positive attitudes are vital in the success of their business. Few things de-motivate like mishandled or miscalculated pay. Mistakes happen on every level: sales, finance and accounting. The best we can do is to minimize them and get proper compensation each time.
Myth #3: Cow Tipping. What this has to do with the auto industry I’ll never know but I’m going to address it anyway. Cow tipping really is just a hoax. I was going to go into some crude anecdotes from when I served tables in restaurants and the lack of gratuity some customers left, but I don’t want to come across as mean or insensitive to the calorically challenged of which I am passing the initiation to join their ranks. I will say this though; I was working for a large hotel that bears the name of a certain skanky celebutant. It was Sunday brunch and the chaffing dish which held the bacon was empty with the exception of the slices of bread left at the bottom to absorb excess fat from the bacon. A customer grabbed the grease soaked bread, took it back to his table and ate it! Not just took a bite and became repulsed. He added syrup, ate it all and left no tip. There’s my evidence. I will say that whatever tip he may have left (15% of the $12 buffet) certainly wouldn’t have lasted as long as the impact of his story.
If you have any myths or hoaxes you would like discussed, researched or dispelled just reply to this article. If you have been offended by anything in this article, rest assured, it was intentional. You probably needed to be offended. If you were not offended, please re-read it, you must have missed something.
By Brad Alexander- from the book "The Paint Won't Lick Itself: Simple Truths for Selling Cars"