“A single individual is enough for hope to exist, and that individual can be you.”

In a surprise appearance via video at the TED 2017 conference in Vancouver, Canada, on Tuesday evening, the pontiff said that tenderness is “the path of choice for the strongest, most courageous men and women.”

Dale and Pope Francis 01 225x300 Pope Francis Calls For ‘Revolution Of Tenderness’ In Surprise TED Talk“Tenderness is not weakness; it is fortitude. It is the path of solidarity, the path of humility. Please, allow me to say it loud and clear: the more powerful you are, the more your actions will have an impact on people, the more responsible you are to act humbly. If you don’t, your power will ruin you, and you will ruin the other.”

The Washington Post reports that Bruno Giussani, TED’s international curator, spent a year trying to snag the pope for a talk. The newspaper reports that when the pontiff appeared on screen, “the room erupted in applause.”

He spoke in Italian, with the comments translated in subtitles, from Vatican City.

Francis spoke of being from a family of migrants, urged more “equality and social inclusion” in science, decried the “culture of waste” and called on people to listen to the “silent cry of our common home, of our sick and polluted earth.”

He also said we all have the capacity to “react against evil.”

“Through the darkness of today’s conflicts, each and every one of us can become a bright candle, a reminder that light will overcome darkness, and never the other way around.”

But the pope’s unifying message for a conference themed “The Future You” was one of a revolution of tenderness … a revolution, he said, that begins with hope.

“A single individual is enough for hope to exist, and that individual can be you. And then there will be another ‘you,’ and another ‘you,’ and it turns into an ‘us.’ And so, does hope begin when we have an ‘us’? No. Hope began with one ‘you.’ When there is an ‘us,’ there begins a revolution.”

 

The above article was originally posted in the Huffington Post.

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ncm A Thoughtful Note from NCM AssociatesI received the following thoughtful note from Terry Wichmann, a retail solutions consultant at NCM Associates.

ncm A Thoughtful Note from NCM Associates

Dale,ncm associates 78495569 300x135 A Thoughtful Note from NCM Associates

Thanks for your continuing help when I ask you to send your books to current vAuto clients and vAuto prospects.

When discussing “velocity” (in general) and vAuto (specifically) during NCM Associates “Profit Improvement Meetings” at dealerships, I always indicate to Dealer Principals / General Managers and Used Vehicle Managers that they will not “deeply” understand the “principles” of velocity unless they read your books.

Concerning your comments about the “Ross” speech… “Has snap judgments outlived their usefulness?”…an economist, with whom I had lunch yesterday and who sells analyses of new/used vehicle registrations to dealerships, indicated that Dealer Principals are generally “too instinctive” and not as analytical as they should be; he feels this approach “holds back” the retail car/truck business from some of the respect our industry deserves.  His thoughts somewhat endorse your insights to the Used Vehicle business.

Also, I was very moved by your message to Pope Francis; some Jesuit-educated “guys” (in my case, Cleveland St. Ignatius High School and John Carroll University) understand that Pope Francis was a Jesuit “first” and, then, our Pope.  I believe Pope Francis is guided daily by St. Ignatius’s “Spiritual Exercises” which encourages all us to “seek God in all things”.  The Catholic Church could use a few more Jesuit Popes “post-Francis”, which, I hope, will not occur for many years.

Best regards and God Bless,

Terry Wichmann  |  Retail Solutions Consultant  |  NCM Associates, Inc.

Thank you Terry, I appreciate your kind words.  As always, I’m here to help you and your dealers in any manner possible.

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It’s like a leaky faucet.

Drip by drip, the retail profit you make on used vehicles goes down the drain.  bigstock money flow 3764122 237x300 3 Best Practices To Beat Back Used Vehicle Margin Compression

But unlike a leaky faucet, the fix for margin compression in used vehicles isn’t as easy as calling a plumber.

That’s because, more and more, ongoing margin compression in used vehicles is the nature of the business.

According to the National Automobile Dealers Association (NADA), used vehicle gross profits as a percentage of transaction prices has been shrinking, bit by bit, for nearly the past decade.

NADA data shows that in 2009, used vehicle gross profits ran 14.3 percent of average vehicle transaction prices, compared to 12.1 percent in 2016. This diminished return may not seem like much, but it’s a significant difference when you consider the average used vehicle transaction price has grown by nearly $4,700 (from $15,210 in 2009 to $19,886 in 2016, a 31 percent increase).

The challenge, and opportunity, for dealers rests in how you contend with margin compression.

The fix isn’t as simple as selling more used vehicles. In a margin-compressed environment, you have to sell more used vehicles more efficiently to maximize an ever-smaller return on an ever-larger investment.

To achieve a higher level of operational efficiency and sales, I recommend the following best practices for dealers:

A consistent sourcing pipeline. You can’t retail vehicles you don’t have in stock. More and more, dealers are employing full-time, technology-enabled sourcing specialists to maintain a steady supply of incoming auction inventory. The specialists free up managers who previously found themselves lacking sufficient attention and time to selectively acquire the right auction vehicles, with specific Cost to Market and Market Days Supply metrics, to fill inventory needs. It’s not uncommon for these time-addled managers to just buy cars because their inefficient sourcing methods lead to frustration and less-than-optimal decisions. Similarly, the specialists give managers more time to oversee appraisals and maximize every trade-in opportunity.

Faster retail-ready turnaround. It’s still fairly common for used vehicles to spend five, seven or even 10 days in service before they are reconditioned, detailed, photographed and posted online. A Midwest Chevrolet dealer found that by trimming three days off his dealership’s eight-day retail-ready average, he realized an additional $300,000 in front-end gross profits. The dealer is now working to consistently meet a 36-hour turnaround, and anticipates the improvement will generate an additional $200,000 in front-end gross.

The example highlights the “time is money” axiom of retailing vehicles in today’s margin-compressed market. I would also note that top-performing dealers set aggressive benchmarks of 24 hours or less to complete detail and reconditioning work—a goal that typically requires automotive RO approvals when repair estimates fall within expected ranges, and dedicated recon teams in service.

Reduced inventory age. I currently recommend that dealers strive to retail at least 55 percent of their used vehicle inventory in less than 30 days. Dealers who achieve this objective, which requires a Velocity-oriented pricing strategy, are doing all they can to minimize margin compression and take advantage of retailing vehicles when they are fresh and stand to deliver maximum gross profit. To understand why reducing the days to sale of used vehicles is so important, I encourage dealers to do a quick study of the gross profits they achieve on vehicles retailed in less than 30 days compared to vehicles retailed after 30 days.

In most cases, the results show the average front-end gross profit declines by at least 50 percent once vehicles cross the 30-day line. If you segment vehicles retailed after 45 days, it’s not uncommon to see a roughly 50/50 split between vehicles that make a little money and those that lose a lot more.

This analysis often leads dealers to agree with my assessment that any vehicle that you don’t retail within 45 days represents a failure of management. For some reason, right or wrong, someone turned their back on these units, when they should have been working harder to sell them.

It should be noted that none of these best practices represents an easy fix. Each requires dealers, managers and team members to think and do things differently, sometimes in a manner that’s contrary to what they’ve been taught.

But dealers who get past these hurdles find their reward. It comes in the form of improved used vehicle performance and profitability in an era where neither can be taken for granted.

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Hal? Where Are The Used Cars You Purchased?

03.29.2017

One of the first movies that opened my mind to the power of technology was 2001: A Space Odyssey, the 1968 film from Stanley Kubrick. The movie was a cautionary tale about the danger of computers and technology becoming more human-like, creating dire consequences for actual humans. The central character was Hal, a computer that [...]

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A Key Problem-Solving Lesson From A Respected Diplomat

03.23.2017

I had the opportunity to take in a speech this week from former Ambassador Dennis Ross. Ross is a unique person. He’s served as a diplomat under three presidential administrations. He was a key player in Middle East peace talks for Presidents George W. Bush and Bill Clinton. He also served under President Barack Obama’s administration [...]

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Chevy Bolt Pricing: A Sign Of The Times

03.21.2017

I was intrigued by an Automotive News article this week that highlights pricing disparities among dealers as the new Chevrolet Bolt EV arrives in showrooms in select markets. The story notes a mix of price discounts and mark-ups across the seven states where General Motors is introducing the vehicle. Some dealers are discounting by as [...]

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Two Perspectives On Sourcing Auction Vehicles

03.07.2017

Let’s imagine there are two dealers in the auction lane, bidding for the same car. The first dealer wants the car because he’s sold a few of the same units recently, and did pretty well in terms of front-end gross. The three-year-old car has about 40,000 miles, and looks/smells pretty good. The CARFAX notes the [...]

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4 Reasons To Rethink How You Source Auction Vehicles

03.02.2017

“How has your auction-sourcing process changed in the past 12 to 18 months?” I’ve been asking dealers and used vehicle managers this question a lot lately. It’s interesting to note the four most-common responses: “Not much has changed.” About a third of dealers say things are pretty much the same when it comes to sourcing [...]

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3 Troubling Auction Sourcing Inefficiencies

02.27.2017

I’ve recently gained a deeper appreciation for the tireless efforts of used vehicle managers and buyers charged with acquiring inventory from auctions. Many spend half their time at work, plus uncounted hours at home, away from their families, to find and vet auction vehicles for an upcoming sale. This reality has given to a belief [...]

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Advancing The “No Barriers” Approach To Life

02.17.2017

I can still remember tearing up at the 2014 Access: Velocity event as Erik Weihenmayer shared his “No Barriers” approach to life and perspective at the meeting. Since that special time in Chicago, Erik’s been busy. He’s just released a new book, No Barriers: A Blind Man’s Journey to Kayak the Grand Canyon. As always, [...]

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