Planning for Tomorrow, Today
I apologize in advance, as this column is going to upset a number of sales managers.
The biggest challenge most dealerships face is recruiting the Millennial generation who have the right skill sets to become true salespeople.
There are a ton of qualified Gen Y’ers who could sell cars but choose less lucrative positions because they don’t like the traditional sales process and aren’t provided enough training to be successful in auto sales.
On average it takes four months to get hired for a call center position at Zappos and there is a line of applicants for a $14.00 hourly position at Apple stores. These are people who have the same skill sets you need to sell automobiles. So why do job-seekers reject our business?
Let’s start with what the majority of sales managers actually spend most of their time doing. They are closing deals for so-called salespeople, who are basically product presenters. They are “deal managers” as opposed to “people developers.”
If I were a Dealer today, my overarching goal would be to create an “empowered” sales staff that isn’t reliant on sales management to close their deals – which leads to happier sales people and happier customers. When you see a manager at any retail establishment, other than automotive, it is because there is a problem, not because the sales person is reliant on them to do their job …
But in today’s traditional sales model there is a “disincentive” for sales managers to develop sales people. If they create an “empowered” sales staff there will be less for them to do! An “empowered” sales staff also doesn’t need management to close their deals. So, why should a manager challenge the traditional sales model that allows them to be handsomely rewarded for their negotiating and closing skills?
So, if you as a Dealer want to eliminate your biggest challenge to recruiting a young, diverse, gender-balanced sales staff, you’re going to need to recruit some new managers. Managers the Millennial generation want to work for. Managers who have the right skill sets, or can be trained in the necessary skills to develop an empowered sales staff. Not an easy task!
Once you get these managers in place they will add much more value to your dealership while also reducing expenses.
An empowered sales staff will be able to take prospects from the meet and greet to close. This will allow for the next iteration of sales management. There will be “hybrid” managers who will be responsible for appraising trades, handling F/I and training their sales staff. This will allow you to operate with significantly less management while creating a more productive sales staff that leads to greater true CSI. The next iteration will be to develop your sales staff to take the process “A-Z,” which includes handling the financing.
I have about forty dealership clients that employ the A-Z model with great success. Besides newly focused Managers and Salespeople, they also use Document Processors to handle the compliance related regulations. Their management ratio is around 1:5-lessening their expense to sell a car in half compared to the traditional sales model – with higher customer satisfaction and much better personnel retention! Pretty compelling!
To reiterate, there are two fundamental issues that need to be addressed in the new model if you’re going to become a “modern auto retailer.”
The model I’m describing above is inevitable. When sales volume slips slightly and interest rates creep up a bit while on-going margin compression continues, you’ll be forced to change to a much more efficient, customer friendly, sales model. Why wait till you’re forced to change?
If you’d like to discuss new sales models and management development in more detail, send me an email (email@example.com) or give me a buzz – Mark Rikess at 916-715-8129.