I heard the same thing time and time again from dealers at Access: Velocity.

After all the effort, energy, money and time invested in retailing new and used vehicles, there just isn’t as much profit left on the monthly income statement as there used to be.

The proceeds from all the activity and sales amount to “profit dust” these days compared to the returns dealers once derived from their dealerships.

This reality emerged in our Access: Velocity workshops that addressed how dealers could sharpen their operational processes to reduce inefficiencies and drive more sales, and profitability, from their new/used vehicle departments and wholesale acquisition efforts.

But here’s the thing: When you take a collective look at the best practices and ideas shared in the workshops, they amount to a lot of small, incremental steps on the road to performance and profit improvement.

That’s because today’s car business is really a game of inches, where it’s imperative that dealers pay greater attention to the data and details of their businesses to be successful. The business calls for a higher level of operational discipline that, quite frankly, puts the very nature of many dealers, particularly those who came up through sales departments, to the test.

The good news is that most dealers here realize, or at least recognize, the need for seeking out every advantage they can. They understand that technology and tools will play a role. They know, or at least sense, that what guest speaker Jason Stein, publisher of Automotive News described as the “digitization” of dealerships is quickly gaining steam.

This backdrop probably accounted for a lot of the enthusiasm from dealers around vAuto’s latest innovation, which we discussed in the opening general session.

Beta test dealers shared how the innovation helps them instantly identify a vehicle’s investment value and use the insight to drive appraising and pricing decisions.

One dealer reported a $300 lift in front-end gross profit as managers worked to maximize gross on vehicles that deserve it, and minimize time in inventory for their more troubled investments. This is good news at a time of unprecedented margin compression.

We closed the day at a Chicago icon, Lou Malnati’s, where some of the conversations were deeper than the pizza.

It was a fitting end to a nearly perfect, and highly productive day at Access: Velocity.

More to come from Day 2….


Another Access: Velocity Begins

by dpollak on 10/18/2018 · 0 comments

I really am blessed.

For most of the day and evening yesterday, my Facebook and Twitter feeds were dancing from all the dealers traveling to Chicago for vAuto’s fourth, Access: Velocity event.

It’s a little like old home week here at the Peninsula Hotel. I’m hugging and shaking hands with dealers from across the country, some of whom were on the ropes nearly a decade ago, and now they’re worried about how to bring a newly acquired store up to speed.

The kids are here, too. I said hello to the sons of dealers who, not so long ago, were wearing jumpers and Velcro-strap shoes, and making it hard to hold a conversation.

Today, the kids are standing a whole lot taller and listening close. It’s pretty special to see the car business bug biting the next generation of dealers.

Ah, the memories.

Beyond re-connecting with friends, there’s also a palpable sense of anticipation here at Access: Velocity.

To be sure, some of the anticipation owes to what we’ve promised attendees will get: Today, we’ll unveil a new way to manage used vehicles that goes beyond Velocity.

It’s a moment that feels eerily like the earliest days of vAuto—when dealers’ need for a better way of doing business, and the ability of a company like vAuto to offer it, came together.

Speaking of coming together, I couldn’t help but suggest that I grab a photo of three vAuto team members who are here for Access: Velocity. They work in separate offices and get together less frequently than the probably should.

But each of these guys—Randy Kobat, vAuto’s vice president and general manager, Chris Stutsman, senior director of product innovation and Lance Helgeson, director of industry analysis—plays drums.

It was a unique moment for any company. We took the photo.

Even though we couldn’t come up with a clever caption, the moment didn’t pass without recognizing that if vAuto was a band, we wouldn’t have trouble filling the drum chair like Spinal Tap, and we’d need more space on stage than the Grateful Dead.

I’m excited for Day 1 of Access: Velocity.

More to come…


It’s been a bit of a dream come true for independent dealer Dan Oakes in Kansas City.

In 2010, Oakes acted on his curiosity and interest in the car business. His job as an energy trader provided the capital and time to open a small independent dealership, Oakes Auto.

The business grew by baby steps—a few cars sold each month, then a few more, and then some more.

By 2013, Oakes was selling about 60 units a month from a 100-car inventory.

“That’s when I quit my trading job,” Oakes says. “And I haven’t looked back.”

Today, Oakes’ business retails about 200 vehicles a month. It’s been recognized as one of the Kansas City area’s fastest-growing operations. The growth has also helped Oakes turn another dream into reality—to become a franchise dealer.

About two years ago, Oakes acquired a shuttered Toyota store to expand his sales operation and launch his own reconditioning/service department. The expansion drove additional sales and profit growth that gave Oakes the ability to apply for, and get awarded, a Mitsubishi franchise.

“I knew we could probably get Mitsubishi,” he says. “We started working on that right after purchasing the property.”

Oakes, who’s now looking to take over a second franchise dealership, credits vAuto Provision and the Velocity Method of Management as key factors behind his budding car business success story.

Initially, Oakes signed up for Provision to bring more market data-based, rather than gut-based, decision-making to his pricing decisions.

“Back then, I would notice that I could drop the price of a car that got old on me by $500,” Oakes says. “Then, two or three leads would come in. I thought, ‘that’s strange. Why didn’t they come in before I took the $500 off?’ That’s when I started understanding the market’s sensitivity to pricing.”

With a sharper, more market data-driven approach to pricing, Oakes sold more cars.

The data also shed light on other areas of Oakes’ business that were crimping his sales and profit potential:

Age management: Like a lot of independent dealers, Oakes struggled with inventory age. He’d look at a vehicle every couple of weeks and think it’s OK. After a few more weeks, he had a troubled, 50- to 60-day-old unit.

“With Provision, you can see if cars are sick or blind to the market,” he says. “If they’re not getting any VDP conversions, or the leads aren’t coming to the CRM, you can see in about two weeks if the car’s in trouble. You don’t have to wait 60 days, and the car’s full-blown sick, to realize it needs some attention.”

Buying inventory: As an independent dealer, Oakes knew his niche—cars that were a bit rare, and wouldn’t run up against the certified pre-owned and off-lease units available at franchise dealers. “I was a decent buyer, but it was still a little bit of a guessing game,” he says.

The gambles and guesses have largely gone away. “With Provision, we have all the data right in front of us to make better buying decisions,” Oakes says.

There’s another element to Oakes’ story that he considers essential for any dealer to be successful in today’s retail used vehicle environment—trusting that market data helps you make better decisions and consistently using the data when you make them.

“If you’re an independent dealer, used cars are the only way you’re making money,” Oakes says. “You have to be selling used cars. We designed and focused our entire operation around Provision and Velocity—move them fast and reload.”


3 Keys To More Efficient New Vehicle Inventory Management


Perhaps it’s telling that, as of today, no one has commented on the Automotive News piece that discusses how dealers will face a “tough slog” in the months ahead in new cars. The reason, I suspect, is the fact that dealers, and pretty much everyone else in the industry who’s paying attention, has long understood […]

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A Proud, Promising Moment for Cox Automotive and Auto Retailing’s Future


This week brought a significant milestone for Cox Automotive, the car business and me. On Wednesday, I was part of a group that cut the ribbon to officially open the new Cox Automotive Solutions Lab at Northwood University in Midland, MI. This lab is pretty special. First, it reflects the commitment of the Cox family, […]

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Where Can I Buy Cars?


The below is a post taken from my good friend and industry training expert, Tommy Gibbs’ Zinger. Where Can I Buy Cars? Posted on August 21, 2018 by Tommy Gibbs If I get asked this question once a week, I get asked this question 100 times a week. It’s generally phrased as, “We can’t find […]

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Musing on Major League Baseball and Used Cars Metrics


A New York Times piece this week highlighted a couple trends in Major League Baseball that some find disturbing. This year, for the first time in league history, there may be more strikeouts than hits through the course of a season. And, of the hits, home runs will account for a sizable share, perhaps more […]

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A YouTube Video Prompts A Stroll Down Memory Lane


My Facebook feed brought a pleasant, if random, surprise the other day. A childhood friend, Jim Ballard, shared a YouTube video (below) from a guy who apparently explores, and films, scenes in and around Gary, IN, where I grew up. In fact, Ballard and I were next door neighbors. For whatever reason, the videographer chose to […]

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How To Fix The Collapsing Ceiling In Used Cars


If you had the unfortunate experience of living in a house where the ceiling was slowly collapsing, you’d face one of two corrective choices. First, you could prop up the ceiling. I imagine this would involve using 4’ by 4’ posts, or maybe a metal beam, in the spots that sag the most. Second, you […]

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A Metric That Merits More Attention—Your Used/New Sales Ratio


When I was a dealer, we thought we were doing a pretty good job if we managed a .5:1 used-to-new-vehicle sales ratio. If we retailed 50 new Cadillacs a month, I expected that we would also sell 25 used units, which were almost always Cadillacs. A recent Automotive News piece suggests that, since I was […]

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