Introducing vAuto’s Newest Associate

by dpollak on December 20, 2009

r83rtel8 copy Introducing vAuto’s Newest Associate

Today I had an unexpected visitor drop in. He was the former used car manager of the Duncan Automotive Group in the hills of Virginia. His name is Bubba Bob and he was trained and mentored by none other than the king of all Bubba’s, Gary Duncan.

Bubba Bob told me his sad story. He started working with Duncan approximately 50 years ago. Over those years, Bob saw a lot of good years and made a lot of money. He’d sold them bubba’s up in the mountains lots of trucks; he was a good ole boy. Unfortunately, all good times come to an end. According to BB, about a year ago the boss, Gary, got a wild idea. Gary started talkin’ some crazy nonsense, some stuff that started with a “V” and according to BB he couldn’t even pronounce.

Duncan made ‘em read a book called Velocity, and it was the first book he ever read. According to BB, Duncan made him read it again and again, but the B-man said that he “just didn’t get it”. He said that Duncan was just never the same. He was talking to some city slicker up in Chicago that was feeding him a lot of b-s. Eventually, BB said he figured it was time to hang it up.

He said it didn’t really matter much to him since he hadn’t been having much fun in the business anyhow. When I asked BB what he was going to do next, he didn’t know. He said that there were plenty of dealers around that still valued a guy like him, but he thought maybe he should raise some money from “them venture capitalists out east” and start a software company for himself.

hciiaef2 copy Introducing vAuto’s Newest AssociateI told BB that he had my full support. I said that I knew that there were plenty of fine gentlemen and dealerships all around the country that would be happy to buy his software.

At the end of our discussion, BB asked if he could stay a spell in my office. I asked him what he meant by “a spell”, and he said that he needed a place to live while he’s looking for his funding. I told him that he could sleep on my couch and work as our receptionist if he would agree to participate in a series of interviews with me. I said that I would like to one day write a book that told the story of his life and career. He said that he’d be happy to share his wisdom and knowledge.

I look forward to publishing transcripts of future interviews with Bubba Bob. I’m sure that he’ll give us all a lot of lessons and laughs.


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  • Donny
    Hey Im a growing vauto user in Pryor,Oklahoma..Wait..I have more respect for it than that..let me start over..Im a new, yet avid VAUTO user and frankly it has changed my entire business plan and mindset. WE went from a lame 2.85 turn to a solid 15 turn selling 60 a month to selling 160-170 stocking 150. in just 8 months. Needless to say there has been lots of growing pains. One of them is the speed of which we roll the car thru recon, and then the time to online presence with crispy photos. WE've dialed in on buying short supply, High volume units...My question is, why is it that as I buy stronger units, my front end gross continues to fall. Im sure you have heard it before. Being too aggressive on short supply vehicles. Not having faith in the days supply and waivering to much during negotiations...What are the top performers really collecting at the end of the day. The top performers, based on the new knowledge section stock less than half the amount of cars than we do but they are at 100% of market in their 1-15 bucket, then 1500 on their 15-30 bucket. Why is this way when their avergae days supply units are 80.15,,mine is 68. My gross is suffering. What does the expert say to this? Sincerely, and absolutley respectfully DOnny Willis, A committed Vauto user. BTW..Thanks for the awesome programs and yes the new mobile barcode scanner even works in real low light situations! I was impressed!
  • Donny,

    Wow! Congratulations on your awesome Velocity performance. First, I'm glad to hear that the new VIN scan is working well. We've gotten a lot of good feedback, and I want you to know that we are continuing work to make it even better in the future.

    I'm also very appreciative of the fact that you're tuned into our Knowledge Network. I created this tool just for this reason. I think it's very important that Velocity dealers share knowledge and learn from each other's successes and challenges.

    I’m not 100% sure that I understand your question, but I think it's about why the top performers are in fact top performers with higher price-to-market and higher market-day-supply cars. If this is the question that you're asking, it's really a good one and I'm not exactly sure of the answer. One would assume that it would take more aggressive pricing on higher market day's supply cars to be a top performer. Please confirm that this is in fact the question and allow me a little bit of time to dig into it.

    I can tell you that our industry is experiencing tremendous pain from gross compression. Over the past 24 months, wholesale prices have risen much faster than have retail prices. To this extent, you're not suffering alone. Keep in mind however, if average margins are shrinking, and they are, the only thing that a dealer can do to overcome the problem is to do it more often. In other words, you must go from money to metal, money to metal, money to metal more times in a year to compensate for the margin compression.

    Fortunately for you and other Velocity dealers, the natural reaction of traditional dealers is to raise their prices to counteract the margin compression. This in fact is exactly the wrong thing to do. It's like shutting off oxygen to a patient. You're handing over after-tax profit dollars to on-line classified sites to send a message to your market that you're competitors vehicles are more worthy of consideration. You might as well be sending $100 bills to your competitors, it will be a lot cheaper and no less effective.

    As you noted, the smart move is to price in the sweet spot in the market and then fight the good gross battle once the customer arrives in the showroom. Recently I conducted a webinar that can now be viewed from our website which outlines 4 very effective techniques for holding gross profit in the showroom. If you haven't seen this, I would encourage you to view it and implement the practices.

    Please continue to communicate with me and let me know of your success and challenges. I will look into your questions and respond with more insight soon.

    Thanks, and again, congratulations.

    Dale
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