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Jan. 21, 2008 – Identifying sales department issues, corrections

January 21, 2008
Filed under Archives

These articles recap some of the opportunities uncovered by Gart Sutton & Associates’ powersports specialists during consulting visits.
These are followed by recommended actions that address the issues. Our goal is to provide ideas to help improve your dealership.
Dealership details
Two years ago, the owners bought out an older, well-established dealership in a small, rural area. It has recently been moved from a small, 3,000-square-foot facility located in the downtown area to a 14,000-square-foot former supermarket building on the edge of town. The newly remodeled facility is partially visible from a main highway, but there is no direct access. The absentee owners originally left the daily operation of the business in the hands of the existing dealership staff.
The goal for this engagement was to identify and establish the processes necessary for the profitable operation of each department and the overall dealership. The following describes the findings for the sales department.
Focusing on sales
They are selling a lot of units, but because of the lack of a data management system, there is not enough data to determine the profitability (if any) of these sales. They must establish the profitability of every deal and install controls to ensure acceptable profits are made on saleable units. Non-saleable units must be disposed of quickly to reduce flooring costs.
The showroom area is bland and uninviting. The customer waiting area is blocked by counters and displays. Units are packed together on one side creating a sea of handlebars. On the other side there is a field of identical clothing racks. There are no windows. There is no music. There are some good wall displays. Clothing should be mixed with appropriate units to increase exposure to the product. Adding relaxing background music and lifestyle displays will promote a shopping/buying atmosphere.
Customers are not logged, so there are no measurements of closing ratios or traffic flows. There is no prospecting system. Salespeople who are not face-to-face with a customer should be on the phone trying to get appointments from prospects.
They have accompanied street demo rides for qualified customers. This best practice provides strong closing opportunities. Adding a pre-planned route would allow them to control the ride and reduce risks.
No structured selling process is being followed. Worksheets are not being completed for each sale. No formal sales meetings are being conducted. The only follow-ups to the sale are done by an outside company.
Salespeople handle the sale, including accessories, but much of the closing has been done by the G.M./sales/F&I manager. Separating the sales and F&I processes will lead to higher closing ratios.
Recommended actions

  • Correctly identify the actual cost of each unit. Include the cost of flooring, freight, set-up and accessory installation in this figure.
  • Develop a written prospecting process that includes the showroom log and the use of prospect forms or sheets. Develop goals and incentives for prospect calls and appointments.
  • Train the staff on utilization of the worksheet and require one for each unit deal. Completing the worksheet is essential to gaining a commitment to purchase and documenting the details of the sale.
  • Initiate a 48-hour phone follow-up with all unit purchasers. Track this with the supplied log form. Following up by phone within the first 48 hours can ensure higher customer satisfaction as well as yielding referrals for additional sales. Additional follow-ups should occur at regular intervals.
  • All customers who have expressed interest in a unit should be captured on a showroom log. This must become a non-negotiable practice. Sales can be increased by capturing customer information and following up to get appointments.
  • Separate the sales process from the F&I process. Salespeople need to close the unit sale and minimize discussions of rates and payments, deferring those to the F&I office.
  • Hold consistent, weekly one-hour sales meetings with an agenda and use them to motivate and train the staff. Provide for recognition of achievement as well.
  • Provide professional structured sales process training to all of the dealership staff. Utilizing a structured selling process will increase sales and profitability.
  • Provide ongoing training in the steps of the sales process. Monitor and reinforce utilization.

    Author, speaker and educator, Gart Sutton has been retained by every major powersport manufacturer/distributor. He is a frequent keynote speaker for national motorcycle conventions and state motorcycle dealer association events. Visit www.gartsutton.com.

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