Iowa Auto Dealer (Fall/Winter 2020)

Fall/Winter 2020

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critical infrastructure Essential. That is what the United States Department of Homeland Security’s Cybersecurity & Infrastructure Security Agency calls the men and women who work in automobile dealerships in guidance issued for the purpose of advising state and local governments on which workers are essential to America’s critical infrastructure and who should accordingly be ensured of the ability to report to work during the COVID-19 pandemic.

You may remember that last spring there was great confusion and concern over whether Iowa automobile dealerships would be required to close. And if so, whether the entire dealership would be required to close or just certain departments. In the early months of the pandemic, Governor Kim Reynolds held daily press conferences at 11:00 a.m. and I spoke with dealers every single day who were calling wanting to know whether this was the day that an order closing automobile dealerships or prohibiting auto sales would be announced.

Simultaneously with gathering and distributing crucial information on how to keep dealership customers and employees safe, IADA was actively engaged with Governor Reynolds and her staff to ensure that they knew the critical roles that automobile sales, finance, repair, and maintenance each play in keeping Iowa’s economy functioning and Iowans safe and productive.

Admittedly, it’s easier to make the case for keeping the parts and service departments open. But dealers proved themselves essential in the early days of the crisis as Iowans bought cars and trucks at very nearly the same levels that they always do, and Iowa’s car and truck dealers found ways to safely and effectively serve those customers.

The question of whether Iowa’s dealers would be required to close sales operations was effectively answered with the federal government’s guidance on essential workers. Included on the federal list of America’s essential workforce is the following: “Workers critical to the manufacturing, distribution, sales, rental, leasing, repair, and maintenance of vehicles and other equipment (including electric vehicle charging stations) and the supply chains that enable these operations to facilitate continuity of travel-related operations for essential workers.”

I suppose I have a different perspective on automobile dealerships than most people do. When I am not immersed in the details and intricacies of regulatory compliance and dealership best practices, I get to work directly with the driven, successful, and, frankly, fun-loving people who staff and operate Iowa’s car and truck dealerships. But I have to admit, until this pandemic hit I had never considered the question of whether they were essential workers. If I had even thought of which workers are essential, I’m sure my mind would have immediately gone to jobs like health care providers, police and firefighters, utility workers, and maybe even employees in the food industry.

I would have been wrong. Iowans depend on those “critical workers” who staff automobile dealerships. Don’t get me wrong.

I have always thought you were important and that you provide valuable services to your communities and customers. But the state and federal governments have gone a big step beyond that.

They have recognized and publicly stated that you are essential.

In an environment where other workers were being told to stay home from their jobs at restaurants, barbershops and salons, shopping malls, and even schools and universities, the people who sell, lease, repair, and maintain automobiles were told that they need to report to work and figure out how to continue to safely keep Iowa on the road.

I am so proud of the way you have done just that over the past eight months. I know you will keep up the great job you’re doing until this pandemic is behind us. With this edition of Iowa Auto Dealer, IADA recognizes and celebrates who and what each of you are: Essential.

Bruce Anderson IADA President

FALL/WINTER 2020 1

TOP LEFT PHOTO BY JOHN LEE; LOWER LEFT PHOTO COURTESY OF THE DEPARTMENT OF TRANSPORTATION

in this issue

1111 Office Park Road West Des Moines, Iowa 50265 p: 800.869.1900 CHAIRMAN John Gookin VICE CHAIRMAN Matt Brown PRESIDENT Bruce Anderson SECRETARY Jon McCoy TREASURER Jim O’Halloran IMMEDIATE PAST CHAIRMAN

Mike Clemons

DIRECTORS AT LARGE

Kris Kramer, Danny Wilson HEAVY DUTY TRUCK DIRECTOR

departments

INDEPENDENT DIRECTOR

01

08

26

04

10

28

Fred Grask J Olesen

DISTRICT ONE DIRECTOR

Dave Wright

from the president You are essential.

DISTRICT TWO DIRECTOR

Josh VanNess

DISTRICT THREE DIRECTOR

Jason Willis

DISTRICT FOUR DIRECTOR

Carey Kemna

NADA DIRECTOR Jeff Weber EDITOR Brittany Bungert Iowa Auto Dealer (ISSN 2472-2634) is a bi-annual magazine produced for members of the Iowa Automobile Dealers Association. © 2020 Iowa Automobile Dealers Association Cover Photo: Drake University’s live mascot, Griff II, rides around town in a vehicle provided by Lithia Volkswagen of Des Moines.

COVER PHOTO BY JOHN LEE

2 IOWA AUTO DEALER

q&a How to build a business where people want to work.

show & tell The Griffmobile drives smiles—and brand awareness.

five things DOT Director Scott Marler has a message for dealers.

pro tip Top tricks for title clerks.

odds & ends The evolution and consolidation of Iowa’s automobile franchises.

features

14

the art of advocacy Learn how best to advocate for the automotive retail industry.

20

the new normal Dealers adapt to doing business in a world with COVID-19.

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Q&A

company culture

Three experts give advice on creating the workplace you want.

Q:

“How do we create a culture that makes our dealership a place where people want to work?”

KC CLAUSSEN Managing Partner Key Elements Consulting keyelementsconsulting.com

Have a suggestion for our next Q&A? Submit your questions to bbungert@iada.com.

4 IOWA AUTO DEALER

A:

A culture is built around the worst behavior leaders allow. And “allow” can mean anything from reward to merely permit without consequence. Research tells us that allowing such behavior that is hurtful to others, regardless of individual contribution, has a cost. It has a detrimental effect on performance, on creativity, and leaves a lingering negativity. And it hurts your bottom line.

So, how do you define what you want and begin leaving behind what you don’t?

Start with values. Your core values can shape the culture you want, but only if they are communicated, implemented, demonstrated, and all are held accountable to them. Selecting values is not simply listing words that sound good—they need to mean something. To experience their true value, leaders and employees must take time to intentionally create the values, use them as a decision-making lens, and, most importantly, live them.

Manage the change. One of the most important things to remember about any change is that the situation may “change,” such as when new values are defined, but the transition is a psychological process requiring an acceptance of letting go of something first and foremost. Only then are people ready to adapt behavior or attitudes to facilitate a new beginning.

Unfortunately, letting go of the old is one of the most common points of resistance, oftentimes more so than to the change itself.

Luckily, this can be addressed in large part with proactive and comprehensive communication.

Clearly, culture is more than just pingpong and free yogurt bars. It requires walking the talk from the top down and creating an environment where people want to come to work and do their best.

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Q&A

A:

ALI PAYNE President ethOs yourethos.com

“Rather than trying to get more out of employees, organizations are better served by investing more in them and meeting their multidimensional needs in order to fuel greater engagement and more sustainable high performance.”

Ali Payne 6 IOWA AUTO DEALER

Culture is a feeling, not a thing, and is built team by team.

Every interaction employees have with leaders reinforces their beliefs and feelings about the culture. What if you could build a culture and environment within your organization that empowers your employees? What if your employees brought their best selves to work every day and fully engaged with your organization’s purpose, ultimately creating the best opportunity for your most important asset, your people?

Imagine how that would impact attracting, retaining, and engaging top talent.

Imagine how that would impact business performance, customer satisfaction, and retention.

Rather than trying to get more out of employees, organizations are better served by investing more in them and meeting their multidimensional needs in order to fuel greater engagement and more sustainable high performance.

Today, high-performing organizations are realizing the benefits of building a culture that promotes the holistic wellbeing and engagement of their workforce. Organizational success is directly linked to employee engagement. Thriving, engaged employees: • Have fewer health problems and lower health costs • Produce sustainable high-performance work • Achieve more business goals • Drive the organization forward Organizations also need to be mindful of the whole employee journey and consider the resources and initiatives they provide employees in areas like career, financial, social/emotional, community, and physical well-being. Unique people, your unique employees, have different needs from their employer.

Today’s workplace doesn’t look the same as it did 30, 20, or even 10 years ago. At this point it doesn’t look the same as 10 months ago. The multi-generational workplace of today presents new challenges for employers. In fact, for the first time, we have five generations in the workplace, creating unique challenges as you communicate and engage with your employees. The differences in your workforce are exponential, and it’s hard to juggle and support every employee. We get it. That’s why having an organizational engagement strategy is a must.

Q&A

A:

If you want a workplace culture that sets you apart, then you need to focus on what makes your people successful. Many people are surprised by that answer, as they associate culture with things like happy hours or the general mood in the dealership. In fact, culture is a web of systems and processes you have in place that make it clear to everyone what is valued in your organization. What’s valued is what drives behavior, so the equation is actually quite simple: Put in place a culture that values the behaviors that drive success for the dealership and the people within it, and you’ll have a winning culture that gives you a distinct edge in the competition for the best talent. And if your culture is getting in the way of your people’s success— generating what I call “culture friction”—then you could be in trouble.

For example, the need for accountability brings with it some hierarchy, where managers must approve certain decisions, all of which is fine. But if a rigid hierarchy becomes the default, you might have generated some internal processes that keep the customer waiting unnecessarily, which is guaranteed to show up in your online reviews and net promoter scores. You may not be seeing it, but that preference for a chain of command could be making it harder for your people to adequately serve their customers. And that can lead to frustration among both your employees and your customers—and that’s a bad combination. That’s culture friction.

So if you want to stand out, start treating your culture like the tangible business tool that it is, rather than just a vague vibe. Root out the areas of friction and then change the way you do things to be more aligned with success. When your people know you’re committed to a culture that makes them successful, you’re on your way to becoming a best place to work.

JAMIE NOTTER Co-Founder, Culture Designer Human Workplaces humanworkplaces.net

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FALL/WINTER 2020 7

SHOW & TELL

top dog

A bulldog mascot and sponsored car create a winning partnership for Lithia Volkswagen of Des Moines and Drake University.

No one can miss the Griffmobile when the bold blue Volkswagen Atlas Cross Sport bearing the image of Drake University’s live mascot, Griff II, is on the road.

“It garners a lot of attention,” said Erin Bell, the director of Drake University’s live mascot program. “I see people smile as they see us and realize it’s the Griffmobile.

I also have people peering over as I sit at stoplights to see if they can see Griff II in the passenger seat, which they often can!”

Lithia Volkswagen of Des Moines has been the official sponsor of Drake Athletics since 2017 and has provided a Griffmobile for the mascot’s use since the beginning of that sponsorship.

“We love working with Lithia,” said Bell. “They have been a great partner of the live mascot program and the Griffmobile really elevates the image of the live mascot!”

The Griffmobile changes annually, with previous models including a Beetle, a Golf, and a Tiguan.

This is Griff II’s first year riding in the Griffmobile, as he recently stepped into the role following the retirement of the original Griff.

“We recently did an introductory tour of Des Moines with Griff II, intended to highlight our great city and also to highlight the Griffmobile and Griff II’s new status as Des Moines’ hometown dog,” Bell said. “It was a day-long adventure in the Griffmobile as we stopped at nearly 20 places in Des Moines for photos and to make social media posts.”

Social media is a key part of the relationship between Drake and the dealership, with Griff II’s Instagram handle (@drakeugriff ) boasting more than 9,000 followers. The Griffmobile is featured in a post a minimum of one time per month (#griffmobile), but often makes more frequent appearances.

The spin on the more traditional

ABOVE Griff II, Drake University’s live mascot, stands in front of the Griffmobile at Lithia Volkswagen of Des Moines.

OPPOSITE PAGE Griff II is comfortable anywhere in the car—including the driver’s seat.

PHOTOS BY JOHN LEE

8 IOWA AUTO DEALER

SHOW & TELL

coach’s car sponsorship has worked well for both Volkswagen of Des Moines and Drake University—so well they recently renewed the sponsorship for another two years.

“Now that we have been in this partnership for a few years, the Griffmobile is synonymous with VW Des Moines,” said Georan Churchill, business development manager at Lithia Volkswagen of Des Moines.

T h e d e a l e r s h i p h a s re c e i ve d positive feedback from customers and community members, and customers

“Now that we have been in this partership for a few years, the Griffmobile is synonymous with VW Des Moines.”

Georan Churchill and staff alike enjoy when Griff II stops by the dealership when the Griffmobile is in for service.

“The Griffmobile is just part of our partnership as the official sponsor of Drake Athletics, however the biggest benefit by far is the exposure,” said

Churchill. “We are able to keep our newest and best cars in the spotlight and out on the road traveling Iowa. In today’s world where social media is so prominent, it is a great opportunity for us to advertise our products and get valuable organic interactions on social.”

FALL/WINTER 2020 9

FIVE THINGS

five things from scott marler

The Iowa Department of Transportation Director gets candid about what he would like dealers to know.

We know that running a vehicle dealership can be a complicated venture and at the DOT we want to do our part to keep things running smoothly. The Iowa DOT maintains its dealer program to support about 4,000 licensees for new cars, used cars, towable recreational vehicles, vehicle leasing, recyclers, and other businesses. The primary staff supporting this program include the Bureau of Investigation and Identity Protection and the Vehicle & Motor Carrier Services office. As an agency, we strive to help dealers legally conduct business in Iowa as they provide mobility for Iowa residents and beyond.

Here are five things that I would like to share with this community.

1.

Scott Marler was appointed director of the Department of Transportation by Governor Kim Reynolds in February 2020. He has worked for the DOT for more than 20 years, gaining experience in traffic operations, highway project development, and regulatory compliance.

Prior to becoming DOT director, Marler was the director of the DOT’s operations division.

10 IOWA AUTO DEALER

Dealing with COVID-19 The Iowa DOT continues to assist dealers as we face the impacts of the COVID 19 pandemic. We have worked closely with IADA to allow for more flexible dealer hours during 2020 to help you respond to the changing needs of your customers and staff. Governor Reynolds extended the deadline to apply for title and registration through late August and she recently extended the expiration dates for temporary tags again. We continue to work with county treasurer offices to make a smooth transition from our COVID-19 waivers back to “normal” ways of doing business.

I am pleased that Iowa dealerships have adopted innovative sales practices that help protect customers and staff during this time. As we close out the year 2020, we don’t know for certain how COVID-19 will continue to impact vehicle dealerships, but I can promise that we will be responsive to your needs and will maintain our partnership with IADA to address issues as they arise. Feel free to

FIVE THINGS

share your ideas with IADA, which works closely with our Motor Vehicle Division staff, to discuss options.

2.

Progress on Electronic Registration & Title System Many of you are aware of the development and launch of an Electronic Registration & Title system (ERT) that provides a fully electronic method for dealers to submit title and registration applications along with ACH payments to county treasurers. We have been working closely with IADA throughout this project. As of late August, the system had successfully processed nearly 12,000 ERT applications for new car deals from about 20 different dealers.

In 2020, we have made additional enhancements to ERT including the ability to order all specialty plates, allowance for more than one credit vehicle, and, most importantly, adding a variance authorization to handle small discrepancies in payments without needing to fully resubmit a deal. Looking ahead to 2021, we have a major initiative to allow used car deals to be submitted in ERT. If you have the opportunity, we strongly

“If you have the opportunity, we strongly encourage you to utilize ERT for your customer deals. ERT provides a reliable way to submit title applications without needing to use mail or go to a county treasurer office, especially helpful as we wrestle with COVID-19.”

encourage you to utilize ERT for your customer deals. ERT provides a reliable way to submit title applications without needing to use mail or go to a county treasurer office, especially helpful as we wrestle with COVID-19. We will continue our partnership with IADA to improve and enhance this system. We hope you give it a try!

3.

Combating Internet Fraud Our Bureau of Investigation and Identity Protection investigators are continually on the lookout for new ways that dealers are being targeted by internet fraud. Recently, our investigators have responded to schemes where fraudsters created a website using a dealer’s information. Scammers are stealing and using legitimate dealer names and addresses to appear more believable.

Vehicles listed for sale on these sites are bogus and are typically high-end.

They require the consumer to wiretransfer funds to an account at the time of purchase. The website also includes shipping information and offers a moneyback warranty, which are also fraudulent.

These websites seem legitimate to

consumers who are looking to purchase a vehicle, often luring them to wire funds to the fraudster’s account without question.

Even minimal background research by consumers can give them the impression that they are purchasing a vehicle from a reputable dealership. Unfortunately, the vehicle is never delivered to the consumer.

The consumer is now a victim of this fraudulent scheme and loses the money that was wire-transferred to the fraudster.

While the consumer is at a loss, the scheme also damages a dealer’s brand and credibility, cutting a deficit in consumer trust that is hard to earn back.

We recommend that dealers conduct periodic internet-based searches of their own dealerships as a quick, simple, and proactive way to prevent fraud.

If you should run across this type of fraud, please notify the Bureau of Investigation and Identity Protection immediately at 515.237.3050. We will work with the Iowa Attorney General’s Office to investigate and rectify the situation.

4.

Tips for Successful Dealer Audits As most established dealers know, the Bureau

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FIVE THINGS

of Investigation and Identity Protection periodically conducts audits of dealerships, which may include on-site review or audit through electronic processing systems, including ARTS and NMVTIS. The audit program creates a fair and equal business environment for dealers in Iowa. The process improves the standard in compliance with Iowa statutes and sets businesses up for regulatory success through licensee education and awareness. Additionally, dealer auditing facilitates engagement between dealers and the Iowa DOT, building a relationship and providing dealers with a known point of contact and regulatory subject matter expert.

There are business practices that dealers can adopt and maintain to ensure consistent audit readiness. Maintaining readiness will benefit the dealers by generally aligning processes with Iowa statute and reduce audit time.

Below are five tips for dealers to consider in order to ensure an efficient and successful dealer audit: 1. Maintain a filing system that is organized with each deal jacket containing proper sales documentation, title copies, and required disclosures.

2. Ensure all copies of documentation are legible.

3. Ensure all vehicles in sales inventory are compliant with certificate of title requirements.

4. Ensure all title transfers are completed within the legal time frame.

5. Ensure personal information is not left out and is stored in a secure location.

5.

2020 Dealer License Renewal Update Iowa DOT dealer licenses expire on December 31, 2020. While past renewals added the convenience of online renewals, there were no online options for changes to the license or dealer account. The online renewals were strictly a continuance of a business license with the information on file at the time of renewal.

Vehicle & Motor Carrier Services have been working to improve the online renewal process and increase the opportunities for businesses to conveniently renew licenses online.

Renewing your license online will have a familiar feel because the process mimics the paper application. It allows the dealer to save and print the new, official license(s) immediately following renewal. Some changes to the license may still require additional documentation that cannot be completed online, so these renewals will instead need to move to the paper/mail process.

With renewed licenses comes new dealer license plates for 2021 and 2022.

Businesses that utilize these plates can

acquire them during the licensing and renewal process for the two-year term of the license. The new dealer license plates become effective on January 1, 2021. All previously issued plates expire December 31, 2020 and should be destroyed immediately thereafter. Licensees need to renew in a timely manner to ensure receipt of dealer license plates before the new license goes into effect. The new licenses and plates will be valid through December 31, 2022.

We encourage licensed motor vehicle dealers to complete the biennial license renewal process online during the fall.

Watch for further communications from regular dealer information sources and the renewal invite letter from the Iowa DOT in the mail. Then, log in to see the expanded options we have developed for an improved online renewal experience and customer success rate.

As we continue to navigate all the challenges of 2020, remember to be kind to one another, to have each other’s back, and find time to say thank you. Gratitude and grace go a long way in these difficult times. From us at Iowa DOT, we remain at your service.

Contact the Iowa DOT Bureau of Investigation & Identity Protection Enforcement, fraud, and audits 515.237.3050 invbureau@iowadot.us

12 IOWA AUTO DEALER

Vehicle & Motor Carrier Services Dealer licensing and vehicle titling 515.237.3110 vscusto@iowadot.us

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the art of advocacy

14 IOWA AUTO DEALER

Two hours each way is a long way to drive for a short meeting. But on December 3, 2010, IADA’s Bruce Anderson made the trek to RK Belt & Sons in Red Oak to meet with a promising candidate for the Iowa state legislature. While any meeting with a dealer and future legislator is time well spent, this particular meeting launched a decade-long relationship with the little known Montgomery County Auditor who just five years later would hold federal office: Joni Ernst.

What’s most remarkable about this story isn’t Ernst’s rapid trajectory to national prominence, and the lesson isn’t that dealers got lucky when they reached out to her. This is just one example of the success of IADA’s longstanding strategy of making early and meaningful contact through dealers with all businessfriendly candidates.

At both the state and federal levels, dealers have established enormously successful government relations programs.

Dealers—and the associations that represent them— know how to advocate for

their industry. But what is it that makes dealers so successful?

Building Relationships In advocacy, just as in the car business, relationships matter.

“IADA and NADA government relations efforts are so effective, and have been for decades, because of the direct, personal relationships that n e a r l y e ve r y l e g i s l a t o r has with his or her local automobile dealers,” IADA President Bruce Anderson said. “Legislators who know, respect, and value the dealers in their districts and communities are always willing to listen

to their concerns when crafting legislative policy that impact automobile owners and retailers.”

Connecting with state legislators, who you may run into while getting coffee or buying groceries, can be easy, but it is no less important at the federal level.

“Relationship building is vital, and it is important to keep in touch with your

FALL/WINTER 2020 15

THE ART OF ADVOCACY

Iowa delegates to the NADA Washington Conference pause between Capitol Hill appointments in 2019. Pictured, from left: Jeff Weber of Anderson Weber Toyota Lincoln, Paul DeYarman of Shottenkirk Chevrolet, Mike Clemons of Clemons Chevrolet, Stan Moffitt of Moffitt’s Ford Lincoln, and John Gookin of Gookin Ford Sales.

Do you know an elected official? Take our survey! iada.com/ grassroots-survey/

16 IOWA AUTO DEALER

senators and representatives to let them know what is happening back in your hometown and the state,” said Ivette Rivera, senior vice president of legislative affairs at NADA. “They want to hear about your role in the community, how many people you employ, and the outlook on the local economy.”

At both the state and federal levels, the time to make the initial outreach

is long before you plan to talk about a specific issue.

“Try to avoid asking them for something the first time you meet them,” said Brad Epperly of Nyemaster Goode, who has served as IADA’s legislative counsel since 2016. “Establish a relationship with them.

Ask them what motivated them to run.

Thank them for serving. Be a periodic attendee at their forums. Contribute to

THE ART OF ADVOCACY

their campaign in an election year. You would be surprised how much even $50 is appreciated from a constituent.”

Legislative subcommittee hearing rooms and the capitol rotunda before a key vote are not the place to be meeting a legislator for the first time.

“The key to success in those settings is already having friendships and relationships with legislators who know the franchised dealership business model, understand the importance of what dealerships do, and trust the opinion and insight of dealers,” Anderson said.

Bipartisan Approach One advantage dealers have when it comes to advocacy is that automotive retailing issues generally aren’t partisan.

“We work with coalitions on general business issues but concentrate on dealer-specific issues,” Rivera said.

“Working on a bipartisan nature, we identify champions for each issue and build relationships with lawmakers on the committees of jurisdiction most important to dealers. We often build allies with members of Congress that might not be viewed as business friendly but understand our industry and support our legislative positions.”

In an increasingly partisan world, some may struggle with the idea of working across the aisle. When advocating for the industry, it’s helpful to focus on the issues that impact your business rather than your personal beliefs.

“You don’t have to abandon your personal politics, but if you are engaging with a legislator on behalf of your dealership, association, and industry, try to stay in that lane,” said Epperly.

Many dealerships will host legislators and policymakers for tours and to educate them about automotive retailing. This can be an extremely effective form of advocacy and relationship building, especially when getting to know a new senator or representative.

But dealers will occasionally fall into the trap of using this valuable time to talk about things unrelated to automotive retailing. A dealer once used a tour with a senator to talk about a controversial issue dominating the news cycle at

the time—and completely missed the opportunity to discuss an important automotive issue the legislator had the chance to impact. Automotive advocacy shouldn’t be partisan and is rarely controversial, so before broaching a topic of conversation ask yourself whether this is important to your business or your personal life.

State Strategy Government relations has been at the heart of IADA’s mission since it was established in 1919. For more than 50 years, Nyemaster Goode has provided legislative counsel and helped shape the association’s strategy.

“The IADA government relations uses a non-partisan, industry specific approach,” said Epperly. “IADA employs a combination of grassroots engagement with legislators in our communities, visibility with fundraising, a sophisticated staff with extensive resources, and experienced legislative counsel.”

Nyemaster Goode boasts a team of experienced lawyers who are at the state capitol every day during the legislative session. Epperly and Dustin Miller provide the majority of IADA’s legislative support, although other members of the team step in when needed.

“The foundation of good legislative advocacy is twofold: knowing what you are talking about and relationships,” said Epperly. “Bruce [Anderson] makes sure we know what we are talking about, but with 150 legislators and several dozen staffers, it is unlikely that Dustin [Miller] or I will have the same relationship with all of them. So when working for or against legislation, we will not only utilize who might be best to work with a given legislator, but also talk through and strategize regarding the best approach.”

In part, Iowa dealers’ advocacy is effective because of the decades of work building recognition among regulators and policymakers of the important role dealerships play in their communities.

“Most legislators recognize the economic importance of automobile dealers and their role in legislative areas as diverse as tax policy, transportation funding, consumer protection, and road

Mark Dreusicke of Toyota of Iowa City meets with Senator Joni Ernst during the 2019 AIADA Washington Fly In.

“The least effective thing dealers can do is become complacent and take our political process for granted.

With more dealer consolidation, in recent years we have seen fewer dealers become involved. Yet we face many urgent challenges and it has never been more important to engage with your members of Congress because there is so much at stake.”

Ivette Rivera FALL/WINTER 2020 17

THE ART OF ADVOCACY

Governor Terry Branstad signs an amendment to the motor vehicle franchise act in 2013, giving dealers the right to appeal changes in their area of responsibility. Dealers Rich Willis (right), Ed Stivers (second from right), and Scott Politte (third from right) joined the bill floor manager, Representative John Landon (second from left), IADA Legislative Counsel Scott Sundstrom (left), and IADA staffers Mary Cason (third from left) and Brittany Bungert (center left) for the bill signing.

safety,” said Anderson. “That means that they frequently anticipate and are careful to consider the impact of legislation on dealer operations and are willing to listen to the concerns of IADA representatives and members.”

National Approach NADA combines legislative staff expertise with local leadership to craft a strategic approach.

“The key to NADA’s legislative and political strategy is its strong partnership with state dealer associations,” said Rivera.

When an issue impacting dealers arises, NADA legislative staff develops a plan to engage key members of Congress.

“It is always best when dealers with longstanding ties with their federal lawmakers convey the message that these dealer issues are important to their members of Congress,” Rivera said.

The dealer outreach is then followed by technical outreach from NADA’s legislative staff.

“In Iowa we are extremely fortunate to have involved auto and truck dealers with extensive legislator contacts (and experienced leadership with ATAE Bruce

“It is our duty to share our experiences so that we can continue to improve the industry and successfully move it forward.”

Heather McNamara 18 IOWA AUTO DEALER

Anderson), who are always willing to step up and advance policies that benefit franchised dealers,” Rivera said.

One of the strategies NADA uses to connect dealers with their members of Congress is to host the annual Washington Conference, where dealers from around the country fly to Washington for two days of briefings and meetings on Capitol Hill.

Heather McNamara of Mac’s Chevrolet in Mapleton first attended the NADA Washington Conference in 2016. “It felt very empowering to be able to meet directly with our political leaders and voice the issues that not only affect our dealership but those of the automotive industry as a whole,” she said.

Since attending the Washington Conference, McNamara has stayed engaged in both IADA and NADA, most recently taking part in a video call with Iowa state senator Randy Feenstra.

THE ART OF ADVOCACY

“My biggest takeaway from my experience of visiting Capitol Hill is that one person can make a difference,” said McNamara.

Making a Difference Effective advocacy is an art form, and, as with any art, it improves as you practice.

“Advocacy is exciting,” said Rivera.

“While it can sometimes seem intimidating to meet with elected officials they value your input. It is you, the dealer, who knows your business and your community best. You never know how impactful a congressional meeting can be. We have seen dealer meetings lead to valuable support for dealer issues as the lawmakers better understand dealer issues and how you drive the local economy and support

the community.”

As the 2021 session of the Iowa legislature approaches and a new congress is sworn in, look for opportunities to get involved. Reach out to recently elected officials to congratulate them on a successful campaign. Volunteer to host a member of Congress in your dealership.

And be prepared, should the need arise, to reach out to policymakers to discuss automotive retailing.

“When it comes to our industry we need to take ownership and advocate for ourselves,” McNamara said. “We are on the front lines of our business and nobody knows our business like we do. It is our duty to share our experiences so that we can continue to improve the industry and successfully move it forward.”

RIGHT Senator Chuck Grassley talks with Heather McNamara of Mac’s Chevrolet during the NADA Washington Conference in 2016.

BELOW Truck dealers visit Washington each spring as part of the ATD Washington Fly In. Iowa dealers Corey Murphy of MHC Kenworth (left), Jon McCoy of Truck Country (center left), George Grask of Grask Truck Group (center right), and Jim O’Halloran of O’Halloran International (right) led the delegation in 2019.

FALL/WINTER 2020 19

the new normal Dealerships navigate the reality of the pandemic.

20 IOWA AUTO DEALER

Before the coronavirus shook the world, automotive retailing was an in-person experience. Handshakes were part of every deal. Service advisors and customers would chat face to face about necessary repairs. And most people wouldn’t have considered showing up to work with half their face covered. But then the pandemic changed nearly everything about the way we live and do business.

More than eight months after the first recorded case of COVID-19 in Iowa, dealers are adjusting to new ways of doing business. Innovative and entrepreneurial, dealers have figured out how to sell and service cars while social distancing, and learned how to keep employees and customers safe. But what are best practices as we transition to a post-pandemic world?

And how will automotive retailing be forever changed?

Safety First Just one year ago, it would have been unimaginable to walk into a dealership and see every employee wearing a mask. Yet today, it’s almost unthinkable to walk into a dealership and see

the opposite.

“All of our employees mask up. It’s a condition of employment,” said Mark Hummel, dealer principal at Hummel’s Nissan in Urbandale. Hummel credits masks with preventing the spread of the coronavirus in his dealership. Although he has had four employees test positive since the pandemic began, not one of those four has infected another employee. And, he points out, wearing masks shows customers that the dealership cares about keeping them safe.

“A person that comes in that’s not wearing a mask, in most cases he doesn’t care that you are. The ones wearing masks, they care,” said Hummel. “Having everyone mask up is a safety thing

FALL/WINTER 2020 21

THE NEW NORMAL

on one hand, but also sort of a goodwill type thing for customers in general. It’s a positive image thing.”

Although as of this writing, Iowa does not have a statewide mask mandate, both the Centers for Disease Control and Iowa Department of Public Health encourage people to wear masks when social distancing isn’t possible.

“The evidence is clear that masks can help prevent the spread of COVID-19 and wearing a mask protects the people around you,” said Dr. Steven Rippentrop, medical director for UnityPoint Health at Work. “When worn correctly, it catches the moisture and droplets you produce while breathing, speaking, and laughing.”

In addition to mask wearing, Rippentrop identified several health measures dealerships can implement to keep employees and customers safe from both COVID-19 and other viruses, such as influenza.

“Dealerships can create and maintain policies that support a healthy place for employees to engage with customers,” Rippentrop said. “Examples could include easing absence for illness policies, rotating consistent teams to make contact tracing easier, physically isolating critical employees, requiring masks when closer than six feet from one another, increased cleaning of high-touch surfaces, and maintaining easy access to hand sanitizing stations.”

At Bill Colwell Ford in Hudson, the dealership is providing masks in individual bags for any customer that forgot their own, putting up plexiglass barriers, and using tape on the floor and signage to keep people six feet apart. Those policies have worked to keep staff and customers healthy.

“We have had one confirmed case and one very likely but never tested positive,” said Blake Colwell, general manager at

Bill Colwell Ford. “We have had several that we’ve had to make stay home until we knew they didn’t have it.”

Evolving Employee Policies For years, workplace culture in America has been dominated by the expectation that employees show up, no matter what.

Feeling under the weather? Push through it. Sick family member?

You better be at work.

But the pandemic has changed that expectation, perhaps permanently.

“The reality is, when employees go into work sick it can put their coworkers and customers at risk. It doesn’t matter how well someone might feel—if they are sick, they run the risk of spreading their illness to others,” Rippentrop said. “Each member of our community should always be self-monitoring for symptoms such as fever, cough, chills, sore throat, shortness of breath, muscle pain, or loss of taste/smell. Powering through despite these symptoms can lead to spreading the infection to others, including your coworkers and customers, who may not survive an infection.”

Once the pandemic ends, Hummel plans to continue to emphasize the need to stay home when sick. “The other thing we really want to press on the employees, even if we get out of this and have flu season: if you don’t feel well, stay home out of respect to your fellow employees,” he said. “I just think if we get behind that call that people will do it. It’s definitely a positive thing to do.”

Getting employee buy-in on that concept has begun at many dealerships.

“Everyone gets it, because no one wants to get their coworkers sick,” said Whitney Johnson, marketing and business

“A person that comes in that’s not wearing a mask, in most cases he doesn’t care that you are. The ones wearing masks, they care.”

Mark Hummel 22 IOWA AUTO DEALER

THE NEW NORMAL

development director at Bill Colwell Ford.

Dealers can look at enhancing sick leave policies to encourage flexibility and responsibility when it comes to employees who are ill. Russell Guay, an associate professor of management at the University of Northern Iowa, said that additional obligations from COVID-19 will make family leave more critical. “There are people needing to miss more time,” he said.

Time off for physical illness isn’t the only benefit that businesses are enhancing as a result of the pandemic. Mental health has taken a hit during the past several months, leading some employers to focus on developing additional support for employees.

“It is also important to recognize the stress that the pandemic has placed on many people,” Rippentrop said. “The rates of substance abuse, depression, and suicide have been increasing.

Making sure your employees have easy and affordable access to the appropriate mental health resources could save lives.”

Many employers are adding Employee Assistance Programs

as a benefit because of the mental health toll of the pandemic, said Guay.

“It’s not a huge expense for most companies,” Guay said.

“They’re finding it’s worth it. A lot are opting to do so during this pandemic.”

Many health benefits providers can help with establishing employee assistance programs. Reach out to your provider to learn more about the options available to your dealership.

The Customer Experience Equally important to how the pandemic has impacted dealership employees is the affect on the customer experience.

In March 2020, dealerships were forced to quickly adapt to new ways of conducting business virtually and limiting contact with customers. Virtual sales appointments and contactless service drop off and pick up are just a few of the ways that dealerships pivoted to safer customer service—and those options are here to stay.

“The reality is, when employees go into work sick it can put their coworkers and customers at risk. It doesn’t matter how well someone might feel—if they are sick, they run the risk of spreading their illness to others.”

Dr. Steven Rippentrop FALL/WINTER 2020 23

THE NEW NORMAL

“The process stuff for sales and service will never go away,” said Colwell. “I would prefer we improve on some of those things because I think they can help us grow.”

Bill Colwell Ford has seen about 15% of their sales appointments move to online. They conduct the appointments using a variety of platforms. FaceTime, Zoom, Skype—whatever works best for the customer.

“For the most part, we’ve gotten through the bumps and now it’s becoming a normal part of our day,” Johnson said. “It’s a normal thing for us to do now, and it’s not as big a hindrance as we thought it was before.”

In addition to virtual appointments, the new customer experience includes picking up vehicles for service appointments and returning them once the work is complete. Customers who opt to come into the store see tape on the floor and barriers at

the desks. The changes happened quickly, but staff embraced the new processes.

“Our employees knew that was what we needed to do to stay open,” said Johnson. “We were very fortunate we got to stay open and didn’t take that for granted.”

Hummel’s Nissan has implemented new processes for service customers, including bagging the customer’s keys so employees aren’t handling them. They also wipe down and disinfect high touch areas in vehicles brought in for service.

But it isn’t just the dealership’s approach to service appointments that has changed. “People have changed a little bit,” Hummel said. “I was talking with my service advisor, and there’s about three times as many people using the drop box.

They make an appointment online and leave the keys in the drop box. That type of behavior has changed.”

“Our employees knew that was what we needed to do to stay open.

We were very fortunate we got to stay open and didn’t take that for granted.”

Whitney Johnson 24 IOWA AUTO DEALER

THE NEW NORMAL

Hummel has found more and more of his customers communicating and shopping over the internet. “Online communication is definitely up and people are shopping from home,” he said. “But at the end of the deal they still come look at the car and close on the car at the dealership.”

Flexible Future Dealerships can adjust to the new normal as best as possible, but remember that the pandemic is still a fluid situation.

“We can do the best planning we can possibly do right now but have contingency plans in place in case things shift again,” said Guay.

Although no one knows what 2021 will hold, it’s safe to say there will be changes—and things dealerships can do to help survive and maybe even thrive throughout.

“If 2020 has taught us anything, it’s that every one of us needs to be flexible,” said Rippentrop. “Easing policies that give points or negative consequences for absence due to illness can also help keep illness out of the workplace. It’s also important to make sure your team knows and understands how to prevent the spread of COVID-19—by wearing a mask, practicing social distancing whenever possible, and washing your hands.”

Changes to Consider If you’re not already doing so, require masks when social distancing isn’t possible.

Evaluate sick and family leave policies to make sure they continue to fit what is best for your business, employees, and customers.

Look at whether rotating consistent teams of employees is an option for your dealership in order to make contact tracing easier.

Continue increased sanitization methods and encourage good hand hygiene.

Consider establishing an Employee Assistance Program as a benefit.

Enhance virtual sales appointments and contactless service drop off and pick up to better accommodate customers.

FALL/WINTER 2020 25

PRO TIP

unsung heroes

Title clerks make the magic happen behind the scenes.

It may not be the most glamorous job.

But the proper titling and registration of motor vehicles is a complex process that takes a detailed, deadline-driven person to do well.

A stellar title clerk can be the behind-the-scenes MVP of a dealership. But when title clerks aren’t given the tools they need to succeed, the entire dealership can suffer.

“Title clerks are the secret sauce to any successful automobile dealership,” said IADA President Bruce Anderson. “While their direct customer contact may be quite limited, if they don’t get their job done in a timely and efficient manner, things fall apart very quickly. Customer satisfaction plummets if title, registration, and license plates don’t get delivered promptly, and there are chargeback and lender recourse issues if titling and lien preservation deadlines are not met.”

Setting title clerks up to be successful is of paramount importance for every dealership. But how? Try these tips to keep your titling department running smoothly.

26 IOWA AUTO DEALER

Set a system.

“The most successful title clerks have a system in place to know where every vehicle they are responsible for is in the titling and registration process,” said Anderson. “Whether it’s a calendar, a tickler, or a spreadsheet, they know when the paperwork is due at the courthouse, when the temp tag expires, and when the funding source needs proof of lien. Meeting those deadlines should never be left to chance.”

Look at the entire process.

What causes bottlenecks in the title office? Some dealerships have found that title clerks can process paperwork more efficiently after retraining the F&I department to make sure they are properly filling out forms.

“Cross train finance department and title clerks,” said Jessi White, IADA director of dealer services. “They work hand-inhand in the process, and I think if both departments understood each other’s job functions and stumbling blocks, it would allow for flexibility and understanding. Knowledge is power and that

PRO TIP

can make it a smoother process for the customer.”

Embrace electronic efficiencies.

No more paper! Or at least, the industry is getting closer to it. Most registration and titling paperwork can be completed electronically—especially when your dealership begins using the electronic registration and titling program. Electronic signatures are accepted on forms from the Iowa Department of Transportation, including the Application for Title and Registration and the Application for Notation of Security Interest. In fact, the only document that requires an ink signature is the federal odometer statement, though the state is working on rules to permit electronic signature of that form, as well.

Resources

Head online for a title clerk training webinar and links to IADA content about titling and registration. iada.com/title-clerks/

Dive Into Digital

Electronic registration and titling can speed up the titling and registration process both at your dealership and for the counties. Reach out to IADA Director of Dealer Services Jessi White at jwhite@iada.com for more information.

Watch for updates.

IADA is working with the Department of Transportation and county treasurers to create consistency in the titling and registration process. With 99 county treasurers and more than 300 automobile dealerships, there can be many interpretations of the law. This harmonization group is working through these interpretations and establishing one process for everyone to follow. IADA will keep members updated as these processes are finalized via the Action Update newsletter. To sign up for the newsletter, email bbungert@iada.com.

Are you making the most of your membership?

Log on to IADA.com to • Access archived newsletters • Read dealer-specific guidance • Shop for dealership essentials

Request member-only access at iada.com/request-an-account/

FALL/WINTER 2020 27

ODDS & ENDS

an evolving industry

From 1970 to 2020, Iowa’s automotive retail industry consolidated operations and maximized efficiencies.

Automobile Franchises in 1970

1 franchise 2–3 franchises 4–6 franchises 7–9 franchises 10–14 franchises 15–19 franchises 20–39 franchises 40+ franchises

Note: Each dot represents a city.

Automobile Franchises in 2020

1 franchise 2–3 franchises 4–6 franchises 7–9 franchises 10–14 franchises 15–19 franchises 20–39 franchises

28 IOWA AUTO DEALER

Woodward & Associates, Inc.

1707 Clearwater Avenue ·P.O. Box 1584 ·Bloomington, IL 61702 (309) 662-8797 ·Fax (309) 662-9438 ·Email woodwardassoc@cpaauto.com ·http://www.cpaauto.com Providing service to Iowa dealerships and their related entities.

We specialize in automobile dealers in the following areas:        

Certified Public Accountants

Memberships in:

     

Dealership valuations Automobile dealer legal support Buy-Sells for dealerships LIFO inventory computations Financial statement analysis Corporation Income Tax returns Personal Income Tax returns CPA prepared financial statements Dealer estate planning Employee theft consulting Internal control studies and audits Profit consulting Training office managers/CFO’s 401K Audits

AUTOCPA Group The American Institute of Certified Public Accountants Licensed to practice in Iowa

Serving more than 250 Automobile Dealers throughout the United States

You’ve mastered the art of selling cars.

What about selling your dealership?

Our firm has completed over 100 dealership buy/sell transactions throughout the Midwest and beyond. When you consider the importance of these transactions, you want us on your side of the table. See how you can put our experience to work at Arenson Law Group, PC. Gold Sponsor of IADA and longtime member of NADC

www.arensonlaw.com info@arensonlaw.com | 319-363-8199 Left to Right: Michelle Arenson; James “Jim” Arenson; John Hofmeyer IV