Once upon a time, there was a BHPH dealer who fell asleep in his office under the spell of a wicked customer. When this buy here pay here dealer fell asleep, he began to dream that he could sell his cars for anything he wanted to. He only had to advertise in the newspaper. Once in a while, he even ran a radio commercial and sold many, many cars. His facility was, well, pretty shabby and dirty, his macadam cracked and his signage very small. But, he did not care. He and his employees knew the BHPH business and did not need to change the way they did things or educate themselves on the business.
He handwrote his deal paperwork because computers were for sissies. There was almost no competition in his market, and his customers had a difficult time finding the competition in adjacent markets because they could not see the other dealers’ advertising. So life was easy and good. Plus, those customers he did sell all lived very close to his store. He made lots of money, and he knew he was the best BHPH dealer in the world (or at least his market). His business went on this way for 10 years.
Then, yesterday, a gorgeous princess (his Labrador retriever) gave him a kiss and woke him up. He was very disturbed to find that in the 10 years of his slumber, his world had changed.
The auctions where he bought his cars were crowded with buyers. He found the supply of cars was about a third of what he was used to, and now there were many BHPH dealers in his market, even some new car dealers (and those guys have lots of cash)! Those other BHPH dealers had built and remodeled their facilities, and they were nice. His building and facility that were shabby 10 years ago were now decrepit. His signage was faded and was out of date, and his macadam broken. His customers had dwindled, as had his sales and profits because customers now could shop his competition on a new-fangled invention called the Internet.
This Internet is like magic! No one really understood it, he told himself. Our sleepy BHPH dealer knew that in spite of all that had changed, he was the best! He knew he understood his business better than anyone; after all, he had been doing it for 30 years. He tried to stay in business, but sales traffic lessened and lessened. His sales went down every year. He blamed it on the recession and the market. All the while, his new competitors were taking advantage of his lack of change and got richer. Never did he think that in his slumber he had become totally out of touch with the BHPH business and was now on the verge of failing. He eventually closed his store and watched "Dancing with the Stars" and "LOST" until the end of his days.
Did you just yawn? You even look a little tired. Most BHPH dealers are asleep at the wheel. It does not matter how long you have been in the business. The buy here pay here market, our customers and the Internet have changed dramatically in the last five to 10 years. Companies like Amazon, eBay, Google, and Expedia have crushed their competition and created markets we didn’t even know existed. The world has changed the way it does business. If you are operating your BHPH business in the same manner as you did five to 10 years ago, you are in a fairy tale also.
Wake-up time is now. What are you going to do—change or close? You may not think so, but ultimately, those are your choices.