Article

The Process Says It All

August 2006, Auto Dealer Today - WebXclusive

by Kevin Day - Also by this author

The fast food industry is a highly competitive one, in which franchisers invest millions of dollars for new technology to entice customers to come to their restaurants. With this said, I ask the question, “Do you think you can cook a better hamburger than McDonalds?” My guess is your response is yes. But then another question arises, “so why don’t you open up a hamburger store and put them out of business?” The answer is simple; you can’t/won’t put them out of business because of the systems and processes that they have developed. McDonalds is a master at consistency with respect to their processes and systems.

When you buy a McDonalds franchise what are you really buying? A proven system. So if billions of dollars are spent buying systems (franchises) every year, then why is it that we do not develop our own? I learned the other day that Wal-Mart has the 2nd largest computer server in the world. They know how many times each register rings every hour in every store. There is a reason why Wal-Mart is such a dominant force in retail America. Their systems are second to none.

The car business is a different breed. Yes, there are a few of the mega stores out there, but by far the majority of dealers are smaller operations. Large or small, we all need systems and processes to run an efficient business. We in the auto industry should have a process that our sales people follow in selling an automobile. We should have processes in place for desking a deal processing paperwork on a deal, and delivering a deal. I remember a saying I heard a long time ago, “Processes before People.” The bottom line to maintaining and keeping a successful dealership is to implement solid systems, and then work hard at keeping your people sharp and motivated.

The key to maintaining the consistency that our customers know and want comes from the systems and processes we put in place. Think about this for a minute. Let’s assume you order a hamburger at the local McDonalds and you order a hamburger in Japan at McDonalds. Are they the same quality and standard? You bet they are! The process to prepare and cook the burger is always the same. Are your customers in your dealership treated the same way with the same processes every time?

Many of you reading this article are making good money. So what happens next. You start to grow? You expand. Business begins to show its peaks and valleys. Then unforeseen problems arise. Some dealers do not make it past these obstacles - others do. The failure rate of dealerships in the first three years approaches 50 percent. Is there an easier way? Yes, you must first establish a good business plan with solid processes and systems in place.

Having a system for each department in your dealership that flows to other departments is the key. Complete the processes the same way every time. If the automobile business would incorporate systems similar to the fast food industry, then it will flourish and become more respected. If the process is done the same way every time, then think about how much easier life would become to recruit and train managers. Your sales floor will be full of salespeople that have learned your processes and policies. Promoting them to managers would then be the easy part.

Remember success is a choice. Walk in step with a coordinated effort and consistently execute a good plan with solid systems, and good results will nearly always follow. The car business does not have a silver bullet or a magic wand to help us. However, the fundamentals of business are the same whether you are selling hamburgers, toys or cars. Good luck and good selling!

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