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Take Your Profit First
Take Your Profit First By Bob Clements & Sara Hey
An excerpt from You’re the Problem (and the Solution) by Bob Clements and Sara Hey. Many of the dealers we work with put themselves last. They put everything and everyone else first—their employees, their expenses, their sanity—until there is nothing left at the end of the month for them. When we start talking about cash flow, it’s not uncommon to hear an audible gasp as this is a subject that dealers don’t want to touch with a ten-foot pole. In my mind, I think that’s because there are major misconceptions around cash flow and money in a dealership. Many times, it starts with your employees. Your employees assume that, since you own the dealership, you go home at the end of the night and count your piles of cash, which is all locked in a secret room in your house that you designed specifically for that purpose. If you are doing that, more power to you; but, if you’re not, you are like most dealers around the country. While your employees might see money coming into the dealership, what most employees don’t see is the large amounts
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March/April 2021
of money going out of the dealership. They assume that since you sell X number of units a year, you just put that money directly into your pocket. They don’t see the cost of the equipment, payroll, payroll taxes, liability insurance, workers compensation, building maintenance, or any of the other hundreds of expenses you have to pay from your ever-thinning margins. They may assume you are filthy rich with no care in the world and can’t reconcile why you aren’t driving an expensive sports car to the dealership every single day. We all know that the scenario many of your employees have created in their heads may not be reality. The struggle, many times, is how you bridge this gap of the misconceptions that the people around you (and maybe even you) have around money management inside of your dealership, with the changes that need to happen in order to have a profitable and thriving business. And heck, a happy and full bank account. So, let’s work on changing the misconceptions that you walk into your dealership with, and start taking your profit before anything else. The idea of taking your profit first may seem a little (or a
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