NOVEMBER/DECEMBER 2011
DEALER’S EDGE ILLINOIS INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION
LOCAL CREDIT UNIONS READY TO SERVE DEALERS ALSO Inventory Acquisition 101 PLUS Compliance Overdrive
DALLAS, TEXAS Permit No. 2079
PAID
PRSRT Standard U.S. Postage
Visit us at il-iada.com
IL_1111.indd 1
10/17/11 3:40 PM
INVENTORY FINANCING SOLUTIONS
NATIONAL COMPANY. LOCAL BRANCHES.
Experience the highest level of customer service with AFC!
Michelle and Mandy - AFC Indianapolis Representatives
AFC local branches provide inventory financing solutions, including lines of credit for: Retailers
•
Rental Operators
•
Salvage Dealers
•
Wholesalers
To learn more or apply for your AFC line of credit, contact your local Area Sales Manager: Jeff Martin Area Sales Manager 815-641-5042 Email: Jeff.Martin@autofinance.com
IL_1111.indd 2
10/17/11 3:41 PM
!
IL_1111.indd 3
10/17/11 3:41 PM
Are you a Certified Master Dealer?
INSIDE
Are you a Certified Master Dealer? This NIADA certification sets you apart from the pack and will help you increase your bottom line.
Here are the latest Certified Master Dealers in your area:
MAGAZINECONTENTS MAGAZINECONTENTS
• Phil Kuhn and Melanie Brown, Chicago Auto Auction, Waukegan, IL
06 Inventory Acquisition 101 10 Local Credit Unions 18 Compliance Overdrive
• Randy Crase, Crase Auto Connection, Channahon, IL For a listing of all our CMDs nationwide, visit niada.com and click on the “CMD” link above the map.
WHAT’SNEW R A2Z EDUCATION SERIES - AutoZone Educating the independent dealer to deliver the highest quality service levels to your customers, manage your shop efficiently, train your technicians and maximize profits. niada.tv R TURBO TIPS – Cars.com Provides Independent Dealers with practicable and actionable tips to help you sell more cars now! niada.tv R NIADA Mobile NIADA Mobile now offers access to Manheim Auction information on the go through our smart phone app. Manheim run lists and market reports are among the many enhancements now available. NIADA.Gigglepop.com
ADVERTISERSINDEX ADVERTISERSINDEX AFC – Automotive Finance Corporation..Inside Front Cover AutoTrader.com....................................... Back Cover Chicago Car Auction................................................5 Dyer Auto Auction..................................................14 Insurance Auto Auctions .......................................11 Lohman Companies............................................... 9 Manheim.com.......................................................17 Protective ...............................................................3 ShipCarsNow.........................................................15 Smart Auction ..............................Inside Back Cover TD Auto Finance .....................................................7 United Acceptance................................................13
NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV NIADA HEADQUARTERS: 2521 BROWN BLVD. • ARLINGTON, TX 76006-5203 PHONE (817) 640-3838 FOR ADVERTISING INFORMATION CONTACT: TROY GRAFF (800) 682-3837 OR TROY@NIADA.COM.
THE DEALER’S EDGE IS PUBLISHED BI-MONTHLY BY THE NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION SERVICES CORPORATION, 2521 BROWN BLVD., ARLINGTON, TX 760065203; PHONE (817)640-3838. PERIODICALS POSTAGE PAID AT DALLAS, TX AND AT ADDITIONAL OFFICES. POSTMASTER: SEND ADDRESS CHANGES TO NIADA STATE PUBLICATIONS, 2521 BROWN BLVD., ARLINGTON, TX 76006-5203. THE STATEMENTS AND OPINIONS EXPRESSED HEREIN ARE THOSE OF THE INDIVIDUAL AUTHORS AND DO NOT NECESSARILY REPRESENT THE VIEWS OF THE DEALER’S EDGE, THE ILLINOIS INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION, OR THE NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION. LIKEWISE, THE APPEARANCE OF ADVERTISERS, OR THEIR IDENTIFICATION AS MEMBERS OF IIADA OR NIADA, DOES NOT CONSTITUTE AN ENDORSEMENT OF THE PRODUCTS OR SERVICES FEATURED. COPYRIGHT © 2011 BY NIADA SERVICES, INC. ALL RIGHTS RESERVED. VISIT THE NIADA WEB SITE AT WWW.NIADA.COM. STATE MAGAZINE MGR./SALES Troy Graff • troy@niada.com EDITOR Andy Friedlander • andy@niada.com ART/PRODUCTION MGR. Christy Haynes • christy@niada.com PRINTING Nieman Printing
DON’T FORGET TO VISIT OUR WEBSITE FOR IMPORTANT INFO: WWW.IL-IADA.COM
Board of Directors t
Chairman Randy Crase Crase Auto Connection 25355 E. Ames St. Channahon, IL 60410 815-467-1807 randy_crase@comcast.net
Secretary Eric Nelson Nelson Automotive Inc. 1801 S. Busse Mt Prospect, IL 60056 847-439-2277 eric@heycars.com
President Gordon Tormohlen Tormohlen’s Good People Automotive 1800 S. Ihm Blvd. Freeport, IL 61032 815-232-5543 cookiebar@mwci.net
Directors: Mark Alcorn Carlyle Auto Sales 1708 Broadway Rockford, IL 61104 815-397-5010 carlyle2005@aol.com
1st Vice President Anthony Ferraro Payless Motorsport 13449 S. Pulaski Road Robbins, IL 60472 708-388-2300 agfauto@yahoo.com Treasurer Lori Chignoli-Cora Chignoli Auto Sales 1850 Essington Road Joliet, IL 60485 815-439-2233 lori@chignoli.com
Paul Gluchowski Turner Acceptance 4454 N. Western Ave. Chicago, IL 60630 773-290-5002 paul@turneracceptance.com Melanie Brown Chicago Car Auction 2731 Belvidere Road Waukegan, IL 60085 847-662-0100 melanie@chicagoauction.com
Amy Goodnight Lohman Companies 3901 15th St. Moline, IL 61266 309-764-8331x220 amy@lohman-companies.com Alex Tovstanovsky Prestige Motor Works Inc. 8959 Hanslik Court Naperville, IL 60564 630-780-6439 alext@myprestigecar.com Janette Peak PJP Auto Enterprise 3100 S. Douglas Springfield, IL 62704 217-793-3552 pjpautosale@comcast.net FOR INFORMATION ON HOW TO BECOME A MEMBER OF IIADA, PLEASE CONTACT BRUCE EKLUND AT 800-987-6627 OR LILCHEEPER5@ AOL.COM.
NAAA Alert - Take Action! Suppor t Legislation to Promote Charitable Donations of Vehicles NAAA asks you to send a letter supporting H.R. 860, Promoting Charitable Donations of Qualified Vehicles Act of 2011. Seven years ago, Congress changed the tax rules governing car donations. In the first year after the law changed, the IRS reported a 67 percent decline in the number of vehicles donated to charities. The current law does not allow for a tax deduction until a vehicle is auctioned and then only for the auction sale price. The proposed legislation, H.R. 860, would allow tax deductions based on fair market value up to $2,500 and require an appraisal over that threshold. This bill would maintain IRS reporting requirements for both taxpayers and charities without scaring away donors. NAAA urges you to take action by sending a letter to your Congressman asking them to support H.R. 860
4
THE
IL_1111.indd 4
DEALER’S
EDGE
NOVEMBER/DECEMBER 2011
il-iada.com
10/18/11 10:11 AM
IL_1111.indd 5
10/17/11 3:41 PM
IL_1111.indd 7
10/17/11 3:41 PM
IndustryNews
Inventory Acquisition 101 No need to overthink and thus overcomplicate things. The hottest topic right now in the Buy Here-Pay Here world has to be inventory.
When shopping for a new or additional auction sources, do not limit it to just the large national auctions. Independent auctions are becoming very aggressive in going after dealer business as well. I may be a little old fashioned, but have always preferred the independent auction as they seem to provide better service and an overall buying and selling experience. BY B R E N T C A R M I C H A E L
Not only where, but what and how to find and purchase it. Like most other areas of the BHPH business, the most successful dealers are focusing on the basics in this area, too. They are firm believers in the KISS (keep it simple, stupid) philosophy. No need to overthink and, thus, overcomplicate things. The first basic they are focusing on regarding inventory acquisition is repeat business. For the more successful dealers, between 30 and 40 percent of their monthly sales are from repeat customers. These will be either lowbalance customers traded into a new vehicle or previously paid-out customers that have returned to purchase again. So 30 to 40 percent of their monthly inventory need is satisfied with vehicles they have a history of and with; that’s pretty valuable information to have when it comes to the vehicles we deal with. Recycling of repossessions is the next basic to focus on. With these, you have the ability and time to completely check the vehicle out to determine its reconditioning need. You also have some historical information for the vehicle. The dealers I have the privilege of working with are recycling on average 60 percent of their repossessions each month to put back out on the lot for sale. The only negative seems to be that the recycled vehicles tend to have a higher reconditioning cost. They seem to need a little more love to get them lot ready but overall are more cost effective than purchasing at auction. Speaking of auctions, they are a basic that should not be overlooked. It is true that there are not as many vehicles going across the block these days, but it is still an effective source. The positive to vehicle volumes at auction being down is that they are becoming very competitive with one another for dealer business. Some auctions are even waiving buy or post sale inspection fees. There is no better time to expand your horizons and check out as many auctions as travel and expense will allow. When shopping for a new or additional auction sources, do not limit yourself to just the large national auctions. Independent auctions are becoming very aggressive in going after dealer business as well. I may be a little old fashioned, but have always preferred the independent auction as they seem to provide better service and an overall buying and selling experience.
I also recommend utilizing the World Wide Web in aiding in the search for an auction honey hole. Most auctions, national and independent, are posting most, if not all, of their upcoming sale vehicles, but post-sale information as well. Most are utilizing Smart Auction, Open Lane, and or OVE for the posting. These are also great resources for the dealer to not only purchase vehicles from the comfort of their office but also to research what auctions have available to know where your next auction visit needs to be. You might just stumble on an auction you weren’t even aware existed. A final basic in the kissing of inventory acquisition would be dealer trades. New car sales are down so this is not the source it once was, but still should not be overlooked. It won’t fill the overall need, but still could fill a partial need. I think the key here is personal contact with the dealer. I’m seeing too many buyers just calling the dealer asking what they have instead of taking the time to actually visit the dealers. Not necessarily a basic, but a stone that should not go unturned would be the private seller. Craigslist, eBay, newspapers and auto magazines are all sources to find vehicles. I, too, used to turn my nose up at this stone feeling it wasn’t worth the time and effort, but with today’s economic challenges, there are sellers out there who simply need the money to get by and are far more reasonable in their expectations. Will it fill the lot? No, but it could fill part of it and that is what counts. As for how to KISS the what and how to acquire inventory, I think it comes down to two very simple questions. How much do you have in the bank account? And how much of that are you willing to spend? There still is enough inventory available as long as you are willing to pay for it. Values are a little out of control right now but have seemed to have leveled off a little in the last month. Finding the right inventory for the right price is still possible. The key will be not to overthink and, thus, overcomplicate it. If you focus on the basics and keep it simple, you will be working smarter and not harder. Brent Carmichael Executive Conference Moderator NCM Associates Inc. bcarmichael@ncm20.com
6
THE
IL_1111.indd 6
DEALER’S
EDGE
NOVEMBER/DECEMBER 2011
il-iada.com
10/18/11 10:10 AM
IndustryEducation
AutoTrader.com’s Dealer Learning Center Gives Dealers Free Online Access To Educational Resources In an effort to help dealers leverage the Internet to effectively advertise online, AutoTrader.com has launched its Dealer Learning Center (DLC). This
online educational portal brings on-demand video tutorials, topical articles, proprietary and independent research, best practices and marketing handbooks to the dealer community at no charge. Dealers and their staffs can anonymously access these resources at www. dealerlearningcenter.com. As the go-to place for educational content on a variety of online marketing and research topics, the DLC includes information on online merchandising best practices, industry insights, video, social, mobile, chat and more. Dealers can also find important research studies such as the 2011 Polk Automotive Buyer Influence Study and the Northwood Dealer Walk-In Study. “This is yet another way that AutoTrader. com is fulfilling our promise to the dealer community: We Work for You,” said Chip Perry, president and CEO at AutoTrader.com. “We only win if our customers win, so we have been continually focused on ensuring that they have all the tools and resources necessary to be successful. From transforming our sales team into true advertising consultants a few years ago to creating more robust educational programs and resources, AutoTrader.com is bringing the latest information on effective online marketing and merchandising to the dealer community.” The Dealer Learning Center is an extension of the already robust programs AutoTrader. com offers through its Dealer Learning team, which supports the educational needs of dealers through hands-on learning. Comprised of automotive experts with extensive dealership experience, the Dealer Learning Team aims to help dealers use the Internet as a tool to drive shoppers to their showrooms as well as integrate online best practices with in-store processes that maximize operational efficiency. In addition to directly serving the dealer body with an array of educational materials, the Dealer Learning Center will also enable AutoTrader.com advertising consultants to enhance their interactions with their customers by providing facilitated learning that aligns with their customers’ objectives. Visitors can also see a schedule of upcoming events with information about the local market educational workshops being conducted throughout the country. These workshops are open to AutoTrader.com dealer customers, and in many cases, non-customers. Visitors can also learn about the AutoTrader.com Dealer Learning team and read workshops descriptions. The Dealer Learning Center was designed for ease of use and to provide visitors learning flexibility on the topics important to them. For
example, they can watch a 10-15-minute video tutorial on a topic of their choice or read an article on the same topic. It also lets dealers rate the educational resources on a five-star rating scale to help other users determine which assets contain the most valuable content to serve their educational needs. Furthermore, the DLC features full-site search capabilities to help users immediately locate the information they seek. Finally, the DLC offers a variety of ways for dealers to keep up to date with the most recent resources and events added to the site. Dealers can opt in to a monthly email update, which gives a rundown of all new content that has been uploaded to the site during the previous month, they can subscribe to an RSS feed, or they can visit the site’s overview page to stay informed.
“We were very thoughtful with the development of this site, taking into consideration how different visitors may prefer to learn as well as browse the content. Our priority is to accommodate and facilitate dealer learning, not only in person but also online,” said Eddie Cawley, director of dealer learning. “Our educators have retail automotive backgrounds, and they are interacting with dealers and their staffs every day. They understand the pain points of dealerships and have insight into what educational information they are hungry for. The content on the DLC speaks directly to the feedback we’re hearing from the field, and it will continue to evolve and grow.” Allyson Estes, Director of Industry Relation & Dealer Learning, explained further. “As an industry, we face new challenges all the time. AutoTrader.com has tremendous access to resources, research, and best practices about effective online marketing. It is our responsibility to share that information with the dealer community so that the industry as a whole is successful.” “We rely on dealers for learning just as much as they rely on us. It’s two-way sharing. This learning center is a new way to foster that communication,” she said.
Two of the most popular workshops the team is asked to conduct are OnLot2Online and Customer Connections. According to the workshop description for OnLot2Online, three out of four consumers are shopping online for cars, and they expect the same level of customer service online and offline – from reception to selling and financing. As a result, today’s dealerships require an integrated approach in order to convert prospects into customers and create ongoing customer loyalty. OnLot2Online was designed around this concept and focuses on how to take in-store best practices and move them into the online space. This program covers creating an “Internet Culture” at the dealership among all employees, aligning the online and offline retail shopping experience for shoppers, effective online merchandising tactics, new platforms to engage and influence car shoppers, and methods for tracking and sourcing dealership traffic. Customer Connections offers insight into how dealerships can engage and respond to online shoppers when they call, email, or walk in to the dealership. Additionally, it covers the dealership’s role and the dos and don’ts of new consumer engagement platforms such as live chat and social media-dealer rating sites. It also identifies various channels in which today’s shoppers contact the dealership and explains what shoppers are looking for from the dealership experience. Workshop participants also have an opportunity to practice effective methods for addressing and engaging shoppers. “Our workshops are very interactive. It creates an environment where dealers can also learn from each other. It’s an excellent way to reinforce learning and discover new ways that dealers make the Internet work for them. We are able to share many of the best practices that are working for dealers in other markets as well as the findings from performance metrics on AutoTrader.com,” said Eddie Cawley. The Dealer Learning team also conducts workshops on other topics like business transparency and inventory acquisition. The workshops are customized so that the information is relevant to the audience. “Different dealerships have different needs based on a variety of factors, so we take that into consideration when coming to a market or dealership to conduct a workshop. We want the content to be meaningful to the dealers in the room,” Cawley said. The Dealer Learning Center offers a new, effective format for extending the lessons from interactive workshops the Dealer Learning team conducts around the country. This online platform offers an immediate way for dealers to access these helpful insights about effective online marketing. Dealers can learn more at www.DealerLearningCenter.com.
8
THE
IL_1111.indd 8
DEALER’S
EDGE
NOVEMBER/DECEMBER 2011
il-iada.com
10/17/11 3:41 PM
IL_1111.indd 9
10/17/11 3:41 PM
LocalLending
Taking the Local:
Riding Your Credit Union to Profits
“What I like is that they work with us. We can call in a potential deal. If they turn down the deal, we can work with them, and maybe change some of the conditions of the deal – bigger down payment or a shorter term.” BY J I M S T I C K FO R D
Independent dealers are always looking to improve the services they offer their customers and that often means looking for and getting new sources of indirect lending, yet getting new sources of credit isn’t always easy. Fortunately for dealers and their customers, local credit unions can serve as a nearby source that wants to work with responsible businesses. Dealers who use credit unions as indirect lending sources have found lots of advantages to having them in their corner. One advantage is credit unions are often well-known in the community the dealer operates in and have their own customer base.
Chris Maynard, vice president of lending for Michigan First Credit Union of Lathrup Village, Mich., said his organization has about 85,000 members who bank at nine branches spread out through the state’s three most populous counties. Headquarters isn’t 2,000 miles away in another state. “We’ve been doing indirect lending through car dealers associated with us for about five years,” Maynard said. “Our program gives us a chance to grow our membership, increase our loan volume and forge relationships with dealers. Our loan program is very important in creating valued relationships with successful businesses.” Credit unions benefit from being associated with dealers through making loans, he said. If customers don’t belong to the credit union, they join as part of getting the loan. Now those people might not do anything else with the credit union except pay off the loan, but that gives the credit union an opportunity to offer them other services, such as checking, credit cards and home loans. Dealers benefit from being associated with a credit union because they get to work with a local lender who has a consistent underwriting approach, Maynard said. Another benefit: the credit union will steer customers to dealers who use their lending services. It’s the perfect time for members inquiring about taking out an auto loan to learn more about dealers who partner with the institution. Credit unions also are about customer service, and now dealers are their customers. “The credit unions work with us,” said Bill Perkins, president of the Bill Perkins Automotive Group in Eastpointe, Mich. “I’ve been working with Michigan First for about three-and-a-half years. What I like is that they work with us. We can call in a potential deal. If they turn down the deal, we can work with them, and maybe change some of the conditions of the deal – bigger down payment or a shorter term. We can work with them to a deal work to the advantage of everyone involved.” Craig Underwood, president of New Haven Auto Sales in Shelby, Ohio, has been working with the Ohio-based Directions Credit Union for about 14 years. He has a great appreciation of how their relationship has been nurtured over the years. “We work with banks and other lending institutions, but I’ve got to say that Directions is the best in terms of ease of use,” Underwood said. “We really value the relationship we have with them and they make it very easy to work together to serve our customers’ needs.” Jan Davis, sales manager for the Nice Car Co. dealership in Ottawa Lake, Mich., near the Ohio border and 30 minutes south of Ann Arbor, Mich., has also been working with Directions for the past several years. “We have a face-to-face relationship with Directions,” Davis said. “That’s important.” Having someone to call and speak with really helps maintain a strong relationship between dealer and credit union. Personal interaction is preferable to many dealers than dealing with a
company via the Internet and lending computer programs. While credit unions will work with dealers, they are still careful about lending practices. Trina Larson, director of sales and marketing for CRIF Select (a division of Denver-based CRIF Lending Solutions), said her company specializes in facilitating indirect loan programs for credit unions and her specific business is the auto and motorcycle department. CRIF helps set up loan programs for credit unions that are aimed at vehicle buyers. “We have been around for about 20 years,” Larson said. “We used to be known as Aimbridge. We’ve seen an increase over the past three years in credit unions seeking to get into the car loan business. They have money to lend and want to diversity their portfolios. “ Larson said credit unions are member owned, and therefore fairly conservative by nature. One thing they don’t want to do is lend money, sell the portfolio and leave delinquent customers hanging if they’re unable to repay the loan. That strategy, in part, led to the economic meltdown whose effects are still being felt. “Credit unions don’t like defaults,” Larson said. “But they do like working with customers to make loans that benefit everyone. After the bank problems of 2008, many credit unions saw that there was a niche to fill, in terms of auto loans, and many wanted to fill that niche. If a credit union doesn’t have the resources for marketing, that’s where we come in.” Larson said a smart credit union doesn’t do business with just anyone. They want to do business with dealerships that are stable, have been in business a while and maintain a certain volume of business. Credit unions are in it for the long run and want to work with dealerships that feel the same way. Customers come back to dealerships that take care of them, so an accommodating lender is an important part of the process. “Let’s face it, the paperwork involved in buying a car is intimidating,” said Underwood. “We all know that there is a lot of federal and state paperwork that a customer is supposed to read before a deal can be completed. Any help a dealer can get in guiding the customer through the paperwork maze is greatly appreciated. And credit unions help with that. There’s no sense of funny business from credit unions when it comes to paperwork and that lends credibility to us.” That credibility, he said, pays off in terms of repeat business. Buyers feel well treated by the credit union and by the dealership. The sense of fair treatment makes it much easier to get that customer back when it’s time for customers to buy another vehicle. It also helps promote word of mouth, which always is valued by the smart dealer. Credit unions understand the retail auto business, too. Obviously, there is a difference between franchise dealerships that sell both new and used vehicles and independents. Dealers who are afraid a credit union doesn’t understand that difference may worry they’ll be judged by the same criteria CO NTIN U E D O N PAGE 12
10
THE
IL_1111.indd 10
DEALER’S
EDGE
NOVEMBER/DECEMBER 2011
il-iada.com
10/17/11 3:41 PM
Pyle Takes Over as NAAA President After 22 years as a member of the National Auto Auction Association, Charlotte Pyle was excited to take on the role of president during the 2011 convention in Chicago in September.
Pyle, who owns Mountain State Auto Auction along with her husband, Joe, said Joe and his father were instrumental in getting her involved in the industry. “My background to the auction world began in the antique estate business. My husband Joe is an auctioneer and operated a business liquidating antiques and household furnishings for families that lost a loved one or just wanted to downsize,” she told Auto Remarketing. “His father owned a late-model used-car dealership and attended auto auctions. He introduced Joe to a gentleman in Fairmont, W. Va., who operated a small two-lane facility that had just lost their auctioneer. At the time, we were dating, so I rode along with him just to see what it was about, having never attended an auto auction. “The third week into this job, the clerk didn’t show up so they put me on the block with Joe. We continued working this auction for a few years together, which opened more doors for Joe in the auto arena.” Eventually, that auction closed. Seeing the need for a facility in West Virginia, Pyle and her husband opened a two-lane auction. The couple joined NAAA to expand their auction business from dealer-only to also include fleet/lease. “As any good auction owner does, we cased the [NAAA convention] halls and receptions for a few targeted representatives,” she recalled. “Having found one from Tupperware, we approached him. … After giving the normal sales pitch, the gentleman said, ‘Put your card in my coat pocket, and I will send you some cars. My hands are greasy, and I don’t want to ruin your card from eating these finger foods.’ “As we walked away, we were thinking there is no way in the world that will ever come to fruition. The very next week we got our first pickups from Tupperware and had a wonderful working relationship with that company. Don’t we all wish it were that easy today!” Pyle quickly became involved in NAAA, taking on a leadership role – with a little help from her friend, Barbara Wheatley. During Pyle’s second trip to the convention, Wheatley asked her to take notes for the Independent Committee since Wheatley was also scheduled to attend another meeting at the same time. “After the meeting, I met her in the hall and tried to give her the notes,” Pyle recalled with a grin. “She sweetly asked me to present them at the national board meeting. After my presentation, the meeting came to an end and Barbara said, ‘Charlotte, that was a wonderful job. You are now the independent secretary and will need to do this for every meeting. Congratulations!’ I still laugh at the way my sweet Southern belle connived me.” Pyle has served on a variety of NAAA committees over the years, but the assignment closest to her heart was co-chairing the Independent Auction Group for 10 years. In addition, she was on the founding committee of the scholarship foundation, convention committee, the mentor program and has served as president and board chair of the Southern Zone. BY JENNIFER REED
InterCall Brings Conferencing Services to NIADA Members
NIADA has partnered with InterCall, the world’s largest conferencing provider, to bring its members exclusive rates on audio and web conferencing services.
With the largest customer base globally, including 94 of the Fortune 100 companies, InterCall is ready to help your business reduce costs and unify your communications needs. InterCall’s program can reduce your monthly conferencing bills, cut staff travel time and expense and introduce web technology to enhance your conferencing experience. The NIADA Member Benefits Program provides discounted rates on all InterCall products, including Reservationless-Plus® audio conferencing and industry-leading web conferencing platforms, such as Cisco WebExTM and Microsoft Lync Online. Custom pricing is available for major events. To enroll, go to www.intercall.com/affinity/niada.htm or call 1-800-636-2377 from 8 a.m. until 6 p.m.
PROVIDING THE
LIVE ADVANTAGE
IN SALVAGE AUTO AUCTIONS LOCATION ADVANTAGE
CHOICE ADVANTAGE
INNOVATION ADVANTAGE
BUYER ADVANTAGE
EXPERIENCE ADVANTAGE
LIVE ADVANTAGE
The IAA Hybrid Auction Model combines live and live-online bidding into one auction event selling to buyers from more than 100 countries. Let us show you how our live auctioneers, IAA Run & Drive® lanes, and onsite previews promote your vehicles’ full value for high retentions. Contact us or visit www.iaai-advantage.com to learn more about IAA’s Live Advantage!
Stephen Cortez Chicago Area Auction Coordinator scortez@iaai.com • 630.335.0907
www.iaai.com
One Car One Difference turns donated vehicles into charity dollars. Make a difference in 2011 – visit 1car1difference.com © 2010 Insurance Auto Auctions, Inc. All rights reserved.
Jennifer Reed is Auto Group Editor for Auto Remarketing 101846iaa_DealersEdge_HP_Vertical_PRINT_16DEC10.indd 1
il-iada.com
IL_1111.indd 11
NOVEMBER/DECEMBER 2011
12/16/10 3:31 PM
11
THE
DEALER’S
EDGE
10/17/11 3:41 PM
LocalLending CO NTIN U E D FROM PAGE 10
as franchise dealers don’t need to do so. Tim Crosby, vice president of loan development for Directions, said the lender has 18 branches spread across central Ohio and the Toledo area. Directions, which caters to franchise and independent dealers, likes working with dealers who meet its criteria. “We have a program aimed at large franchise dealer operations,” Crosby said. “This program is technology based. Dealers submit information using a special app via the Internet. This app provides what I like to call instant decisioning. It’s all run by computers.” Franchise operations tend to be more heavily invested in technology, have several other resources to call upon and often deal with larger volumes of money and vehicle sales. Independent dealerships, on the other hand, can vary greatly in terms of size, sales, money and technology. Some independent dealerships are every bit as sophisticated as a franchise operation, but for others, a fax machine is the height of sophisticated technology, Crosby said. Thankfully for those dealers, the program aimed at independents recognizes this fact, and Crosby understands there are mom-and-pop dealerships that still prefer to do things via fax. Directions’ special car loan department accepts apps via fax, and approval or denial is returned to the dealer the same way. Speed counts when completing a sale, and credit unions can make a decision quickly.
Buying a vehicle is a very emotional business, said Underwood. Even if customers have done all their research on the Internet, compared prices, compared options and evaluated dealer reputations, that decision is an expensive one they’ll have to live with for some time. So when it comes time for customers to sign a contract, they can be very nervous. Every dealer has a story about a buyer who talked himself out of buying a sound vehicle that was sold at a reasonable price. Credit unions often are able to quickly answer whether or not a loan will be made, giving the customer less time to get nervous about the deal. Underwood said he can get an answer in 30 minutes; if a customer has to come back in three days to work out the terms of the deal, that’s three days of worry and doubt that have to be overcome. Credit unions also offer another benefit: competitive loan rates. Perkins said he likes working with credit unions because they offer good rates. The best service in the world is nice, but if that service pushes the loan out of most customers’ price range, it really doesn’t help the dealer. He noted the lending landscape has changed over the past decade. There are still a lot of banks out there, but the number of local banks that know the community and are willing to work with local businesses one-on-one has declined as local banks have been merged with large national outfits. It’s possible for a bank customer
who belonged to an institution with one or two branches to now be part of a bank with 3,000 branches thanks to mergers. Another reason to consider credit unions is marketing: they’ll literally drive customers into dealers’ arms. Most credit unions hold some sort of vehicle sale promotion during the year. Many do it several times a year. These promotions allow dealers to bring good vehicles to the credit union locations. The credit unions and the dealers typically split the cost of the promotion. It’s a real benefit to all: the credit unions get to expand their loan portfolios and dealers get to make additional sales. Oftentimes, good credit union customers are told they have been pre-approved for a loan and are invited to visit the credit union on a particular day when there will be vehicles for sale provided by participating dealerships. Perkins said when he’s been involved in a promotion such as these, he’s never sold less than 20 vehicles. Do that four times a year and that’s 80 extra sales a year. Even if you sell 500 vehicles a year, that’s still an extra 15 percent a year, and what dealer doesn’t want to see a 15-percent sales boost with minimal marketing effort on his part? “We’re happy to be on board with Directions Credit Union,” Underwood said. “We know that our customers are being taken care by the indirect lender, and the customers know that they’re getting a good loan at competitive rates. That’s a win-win in my book.”
the NEXT generation of NIADA try NIADA’S new MOBILE APP ACCESS GUIDEBOOK VEHICLE APPRAISAL SERVICES • GET INSTANT VEHICLE HISTORY REPORTS • ACCESS AUCTION PRE SALE RUN LISTS NATIONWIDE • STAY INFORMED WITH NIADA EVENTS & PROGRAMS
Get Started with NIADA’s Mobile App Today! For Details & Instructions Visit: http://niada.gigglepop.com or Call 1-855-MY-NIADA (855.696.4232)
12
THE
IL_1111.indd 12
DEALER’S
EDGE
NOVEMBER/DECEMBER 2011
il-iada.com
10/17/11 3:41 PM
NIADA Mobile now provides instant auto transport quotes as part of its innovative mobile app. With the
addition of ShipCarsNow to the NIADA mobile app, NIADA members will have shipping costs at their fingertips, giving dealers the ability make quick, informed purchase decisions whenever and wherever they buy wholesale inventory. NIADA Mobile currently provides vehicle values from Black Book, Kelley Blue Book and NADA; CARFAX and AutoCheck reports; as well as pre-auction run lists, continuously updated vehicle data, and VIN bar code scanners. “ShipCarsNow is one of our NIADA National Member Benefit Partners and we are excited to include nationwide auto transport as another service within of our mobile app platform,” said Scott Lilja, NIADA vice president of member services. ShipCarsNow recently introduced ShipCarsNow Mobile, a mobile app that gives auto dealers and remarketers a fast and easy way to get multimodal auto transport quotes from any smartphone. One of the few auto transport companies to offer flexible options of truck and rail service, ShipCarsNow’s mobile app complements their online auto transport service and offers auto dealers mobile access to instant auto shipping quotes while they’re bidding on cars at auction. In addition to instant price quotes, the ShipCarsNow mobile app provides users a link to register with ShipCarsNow.com for lower, preferred customer prices. NIADA members can use the app to login to ShipCarsNow.com to get quotes, track shipments, and quickly access ShipCarsNow sales representatives. To learn more about the NIADA Mobile app with ShipCarsNow auto transport quotes, visit http://niada.gigglepop.com
OfficeMax Offers New Partnership At NIADA, we’re always looking for ways to help you get more out of your membership. That’s why we’ve teamed up with OfficeMax to introduce the OfficeMax Partner Advantage program. OfficeMax is a leader in both business-to-business office product solutions and retail office products. OfficeMax provides office supplies and paper, in-store print and document services through OfficeMax ImPress technology products and solutions, and furniture to consumers and to large, medium and small businesses. OfficeMax customers are served by 35,000 associates through direct sales, catalogs, e-commerce and retail stores. OfficeMax has more than 40 years of experience in the business-to-business marketplace and is recognized as one of the most experienced national business products supplier. Corporate United, the nation’s largest group purchasing organization, selected OfficeMax as the 2010 recipient of the Corporate United Supplier of the Year Award.
Partners
NIADA Mobile Adds ShipCarsNow Auto Transport Quotes to App
Through the OfficeMax Partner Advantage Program, NIADA members receive:
- Exclusive member-only pricing - Superior personalized service - Innovative programs that deliver value to companies and individuals - Highly skilled technology team - More than 25,000 office essential products - Award-winning house brands - Large recycled product offering - Multiple ordering channels Online ordering is easy; just visit www.officemaxsolutions.com and type in the following: User name: 0722739w Password: omaxadvantage1 To order via phone, call 877-969-6629. Members with 20 or more employees may call 800-248-6343 to request more information on setting up your business account.
13
il-iada.com
IL_1111.indd 13
NOVEMBER/DECEMBER 2011
THE
DEALER’S
EDGE
10/17/11 3:41 PM
NIADA Auction of the Year Winner a Real Lifesaver
Bruce Beam, general manager of Dealers Auto Auction of Oklahoma City, is presented the NIADA Auction of the Year award from NIADA CEO Mike Linn (left) and NAAA president Jay Cadigan (right).
In recognition of an act of true heroism by its owner and staff, Dealer’s Auto Auction of Oklahoma City has been named NIADA Auto Auction of the Year, NIADA chief executive officer Mike Linn announced.
Linn presented the award to auction owner Gary Smith and general manager Bruce Beam on Thursday at the National Auto Auction Association annual conference at the Hyatt Regency Chicago.
IndustryNews
“This year’s recipient excels in the area of customer service … one which has smiling faces and very capable employees,” Linn said. “This is evidenced by many auctions, but once in a while, an auction will do something that truly sets it apart, sometimes even heroic.” That’s what happened December 23, 2010, when Odell Morgan, executive director of the Oklahoma Independent Auto Dealers Association, collapsed to the floor as the auction staff was preparing for the day’s sale at about 7 a.m. Smith rushed to him and checked his pulse -- and found none. The auction owner began performing chest compressions and instructed his staff to contact emergency personnel. Auctioneers, ring men, and dealers were there to assist while Smith continued CPR until paramedics arrived. Morgan had quadruple bypass surgery and continues his recovery. “Gary had the foresight to ask his physician many times how to best handle this type situation,” Linn said. “Based on his knowledge, he was able to instruct staff on actions to take and they responded without question. Because of actions taken that day, the auction staff were able to save a life.” The NIADA began presenting its Auction of the Year award to an NAAA member auction and its general management team in 2008. The award is presented to an auction that demonstrates support of the used motor vehicle industry and the independent dealers who utilize the auction by providing the highest level of customer service, providing dealers with resources to enhance their business, displaying support to the state association and its dealer members through participation in dealer events, and promoting industry community involvement.
Digital Odometer Tampering The National Auto Auction Association (NAAA) recently issued notice to its members to be on the alert for digital odometer tampering. The NAAA has received reports of digital odometer tampering through the use of odometer mileage programming devices. Since odometers do occasionally malfunction, manufacturers provide legitimate repair facilities security codes to use with authorized odometer mileage programming devices. The NAAA indicates the codes may have been compromised, allowing nonauthorized devices to be manufactured and sold online. The NAAA further reports that the National Highway Traffic Safety Administration (NHTSA) is familiar with the practice and has been in contact with auto manufacturers about the issue. The NAAA recommends its member auctions be on alert for potential mileage discrepancies that crop up between time of check-in and sale and between time of assignment and delivery to the auction, as this could be an indication that the vehicle was tampered with to decrease its value and provide a fraudulent benefit to the ultimate buyer of the vehicle. Individuals with information concerning odometer fraud schemes are encouraged to contact the NHTSA’s Office of Odometer Fraud at 202-366-5953. Complaints concerning a single vehicle should be reported at the state level. BY ADR STAFF
14
THE
IL_1111.indd 14
DEALER’S
EDGE
NOVEMBER/DECEMBER 2011
il-iada.com
10/17/11 3:41 PM
Extended Service Contracts and Dealer Controlled Financing The sale of extended service contracts, or vehicle service plans as they are sometimes called, has been a staple of independent and franchise dealers for many years. But most dealer-controlled financing dealers (BHPH and LHPH) have been reluctant to sell them for one major reason – any money the customer spends on an extended service contract typically reduces the amount of money the customer has available for a down payment on the vehicle. That means the dealer will have more money at risk in the contract for a longer period. The only alternative available in the past was to include the extended service contract in the amount financed, extending the term of the retail finance contract, raising the customer’s payment and, again, putting the dealer at risk for a longer period of time. A good extended service contract, however, can provide a DCF dealer with a number of advantages. Various studies estimate that approximately one-third of all charge-offs are the result of mechanical issues with the vehicle. We also know that an equally high percentage of delinquent accounts are caused when the customer is unable or unwilling to make the car payment because of mechanical issues with the vehicle. A good vehicle service contract can eliminate
many of these problems, reducing collection expense, delinquency and charge-offs. Some DCF dealers typically end up adding repair expenses to accounts when the customer cannot afford to pay for repairs themselves. We have all heard the saying, “When the car stops running, the customer stops paying,” and in order to avoid this it is often in the dealer’s best interest to keep the vehicle running. But adding repairs to the account increases the amount of the dealer’s cash invested in the deal and lengthens the amount of time until repayment is complete. Again, a good extended service contract can eliminate some of these situations. Using extended service contracts paid for by the dealership like a warranty can be a valuable marketing tool. Offering a 12 month/12,000 mile or 24 month/24,000 mile service plan can set you apart from your competition. Customers believe cars sold with warranties are better than cars sold without warranties and will choose to do business with dealerships that warranty or protect their vehicles. Some DCF dealers maintain a fund for paying for policy repairs by setting aside a certain portion of the profits of each sale. Finding an extended service plan that meets your needs can actually reduce this expense and eliminate
the paperwork it takes to administer such a program. Some dealers will provide a basic or shorter-term plan, then upsell the customer on a more comprehensive or longer-term program and use that upgrade to produce additional profit in the deal. The secret to using extended service contracts in a dealer controlled financing dealership is finding the right contract. There are very few extended service contracts designed specifically to meet the needs of the DCF industry. Plans with decent coverage for vehicles with higher mileage at a reasonable cost can be difficult to find. Plans that can be paid for on a monthly basis so dealers do not have to either reduce the amount they collect as down payment or finance the cost of the contract are even more difficult to obtain. The search to find the right warranty for your DCF operation can be a difficult one, but they are out there. Extended service contracts can assist you in both improving sales and reducing delinquency and charge-offs. Do your research carefully and diligently and you can find plans that will boost your dealership’s performance and help your customers at the same time. The right extended service plan is truly a win for both parties. BY AL MOSHER
15
il-iada.com
IL_1111.indd 15
NOVEMBER/DECEMBER 2011
THE
DEALER’S
EDGE
10/17/11 3:41 PM
IndustryDATA
EconomicOutlook Despite the high hopes for 2011, this year has proved to be a trying time for American consumers and investors alike.
A year that was supposed be a time of growth and recovery has turned out to be anything but, and current economic data shows signs that the U.S. economy may again be slowing down and is even threatening a second recession similar to the 1979-81 U.S. “stagflation,” only at a more severe level and on a global scale. KEY AUGUST/SEPTEMBER DATA
Positive Signs
THE SECRET TO A SUCCESSFUL SALES MONTH IS NOT IN THE ABILITY TO GENERATE MORE FLOOR TRAFFIC BUT RATHER TO BE MORE EFFECTIVE WITH THE FLOOR TRAFFIC YOU ALREADY HAVE.
U.S. productivity remains among the highest in the world, while U.S. non-financial corporations’ cash reserves remain at nearly $2 trillion. The August Conference Board Global Leading Economic Indicators Report shows the U.S. and China as positive at 0.3 percent and 0.5 percent, respectively, while Europe was down one percent. Automobile, SUV and light truck sales were up 1.2 percent in August relative to July 2011 and up 7.5 percent relative to August 2010. More than 6.5 million units were sold during March, April, May, June, July and August, the largest six-month cumulative level since the 2009 Cash for Clunkers program. Consumer confidence declined dramatically from July’s level of 59.5 to an August of 45.2, but showed a slight improvement in September 2011 at 45.4. Average disposable income was up slightly in August marking the tenth consecutive month that disposable income has increased. Mortgage interest rates were at near-record lows and the dollar index has been moving up consistently since August, increasing more than 6 percent.
Negative Signs
The Dow Jones Industrial Average fell 519 points – 4.3 percent – in August and was down 205 points in late September. The unemployment rate was at 9.1 percent again in August, with non-farm payroll unchanged and private sector employment up 91,000 for the month. The U.S. continues to have one of the highest corporate tax rates in the world, with an average rate of 39.27 percent, and U.S. companies hold more than $1.2 trillion overseas as a result. While gas and oil prices have eased slightly over the last couple of months, the threat of a global inflationary period is still very real with the potential for “stagflation” and recession stronger than ever.
Current Issues
One thing you can say about people in the auto industry is, “They sure are a positive bunch. Those car guys never have problems, they only have opportunities.” But one of the opportunities we have a problem with might be the lack of floor traffic. It has been a
challenging year with the “opportunity” expected to remain about the same next year. What will your strategy be to build traffic that might not come or, quite frankly, might not even be there due to harsh economic realities? Will you advertise more? Will you tell your people to be more aggressive and make more phone calls? What if these efforts didn’t equate to more floor traffic? What would happen if instead of advertising more (to a market that won’t respond), your strategy was instead to be more effective with the floor traffic you receive each month? It’s not a surprise – only a sad fact – that in North America the number of potential customers, or ups, that are sold on the first visit to a dealership still hovers at an amazingly low 19 percent. That means 81 percent of potential customers that visit a particular dealership for the first time do not make a purchase. Closing only 19 percent of potential buyers that come into a dealership places a tremendous amount of pressure on daily operations. Here’s an example. Let’s say a dealership wants to sell 49 vehicles in a month. Assuming a 19 percent closing rate on fresh ups, the dealership would have to generate 257 fresh ups that month, which translates to no less than 10 fresh ups per day (assuming a six-day work week). What would happen if sales managers and salespeople truly focused their efforts on improving their counseling skills with customers, their product knowledge skills, rapport-building skills, communication skills, feature presentation and value-building skills, and by doing so increased the overall closing percentage from 19 percent to 26 percent? Here’s what would happen: If it wanted to sell that same 49 vehicles in a month, the dealership would only need to generate 188 fresh ups that month – seven per day. Just by doing a little better job and taking perhaps a little more time with each guest. The secret to a successful sales month is not in the ability to generate more floor traffic but rather to be more effective with the floor traffic you already have. While the reality of today’s economy is that a dealer can’t control the quantity of floor traffic that enters the dealership, he certainly can take control of the quality of the selling process when working with a limited quantity of floor traffic.
BY TIMOTHY NA SH AN D JO E LESCOTA NORTHWOOD UNIVERSITY
Dr. Timothy Nash, an associate professor in Economics, Business and Public Policy, heads specialty programs, including Automotive Aftermarket and Automotive Marketing, for Northwood University. Joe Lescota is chairman of the Automotive Marketing Department at Northwood University and the instructor for the NIADA Certified Master Dealer program. Students interested in studying the automotive industry can contact Dr. Nash at tgnash@northwood.edu for information about Northwood’s programs.
10 16
H EE D SP A LR EKR ’PSL UE G 2011 TT H EA D G E NOVEMBER/DECEMBER NOVEMBER/DECEMBER 2011
Miss_1111.indd 10 IL_1111.indd 16
w w w . iml -s ii a ad da a .. cc o om m
10/17/11 4:41 PM 10/18/11 10:12 AM
Black Book’s Tim West Named to NAAA Hall of Fame Tim West, Black Book’s vice president and North American auction director, was inducted into the National Auto Auction Association Hall of Fame during its 63rd annual conference in Chicago. “Tim is extremely knowledgeable, personable and dependable,” NAAA chairman of the board David Angelicchio said. “He’s out there exchanging ideas and sharing information with our members. His efforts have earned him respect as a trusted friend and advisor to many auction owners and general managers. He embodies what it means to be a true NAAA stalwart.” West joins three of his Black Book associates in the NAAA Hall of Fame: Gene McDonald, Dave Cape and Bob Burnett. Since he began his career with Black Book in 1984 as an editorial assistant, West has worked diligently to build personal relationships with those in the industry. During the next decade he served as editor of both the Old Car and Domestic Car guides, then as assistant field coordinator and North American auction director. In that position, West expanded his connections and support during the transition from predominantly locally owned auctions to corporate owned and operated. He manages the overall industry interaction vital to Black Book’s ability to provide accurate and timely information, and oversees the production department, ensuring the quality of the printing and shipping of all the printed guides.
Kelley Blue Book Warns of Fake Website Scam Kelley Blue Book, a leading provider of new car and used car information is warning online car buyers of a scam using a fake Kelley Blue Book website. The scam attempts to solicit funds from
buyers through an escrow-based, guaranteed buyerprotection program - something Kelley Blue Book does not offer. Kelley Blue Book warns that any escrow-based consumer-to-consumer service or buyer and seller protection program offered under its name is a scam. Car shoppers should be aware that imitation websites look similar to the actual kbb.com and they should be cognizant of the domain name (URL) and email address (view the actual address, not the display name) provided by the seller. Car shoppers that encounter this type of offer from online sellers are strongly urged to report the seller to the Internet Crime Complaint Center at www.ic3.gov . For tips on how to protect yourself from phony online car-buying scams or fraudulent buyer protection programs, visit the FBI website at www. f bi.gov/news/stories/2011/august/car_081511/ car_081511 .
17
il-iada.com
IL_1111.indd 17
NOVEMBER/DECEMBER 2011
THE
DEALER’S
EDGE
10/17/11 3:41 PM
ComplianceOverdrive
Looking for Those Common Threads
FREE DEALER EDUCATION
24/7 ONLY ON NIADA.TV
COMPETING IN A CHAOTIC ECONOMY Never before have businesses felt such excruciating pressure to compete. Watch this session for tips on what’s next for the economy and what your business can do to survive and thrive. Presented by Todd Buchholz, a former director of economic policy at the White House, a managing director of the $15 billion Tiger hedge fund, and an award-winning economics teacher at Harvard. Buchholz targets his entertaining remarks to the cutting edge of economics, finance, and business strategy. He has advised President Bush, and is a frequent commentator on ABC News, PBS, and CBS, and recently hosted his own special on CNBC.
COMPETING IN A CHAOTIC ECONOMY CAN NOW BE SEEN O N W W W. N I A D A . T V.
www.niada.tv
Have you ever tried staring at a Magic Eye poster or book? At first glance, they look like complex, two-dimensional designs. However, if you view them in just the right way, images seem to pop out in 3D. But it can be a difficult task because the designs are intricate and sometimes overwhelming. For those in the auto finance world, it’s easy to get the same feeling when looking at the vast number of regulatory changes taking place each year. With so much happening at once, it can be hard to see the big picture. That’s why it’s important to take a step back and look for the patterns. So what have we been seeing in 2011? A common thread across recent laws and regulations is a strong focus on the credit decision process. Three areas in particular offer key examples of this:
Denial Notices: Section 1100F of the Dodd-Frank Act and its implementation regulations require disclosing a credit score and related information in adverse action notices when that information is used as part of the credit decision. The purpose is to encourage applicants to review credit report and credit score information to see if errors or inaccuracies are causing credit denials. Risk-Based Pricing Notices: The federal risk-based pricing rule requires dealers, lenders and third-party providers to notify consumers when they receive materially less favorable credit terms than others based on consumer report information. The idea is to give consumers more information and prompt them to review their credit report information to confirm it is correct. It can also help consumers avoid unnecessarily accepting higher credit costs due to credit record errors and inaccuracies. Privacy Disclosures: The new model privacy notices aim to create more consistency in how vendors, including dealers and lenders, present information. The disclosures are given at the beginning of the credit transaction process so consumers can choose a vendor with privacy disclosures most in line with their informationsharing preferences. The new form is required to be comprehensible to consumers, with a clear format and design; provide clear and conspicuous disclosures; enable consumers to easily identify sharing practices of a financial institution so they can compare privacy practices among financial institutions; be succinct; and use an easily readable type font. In each of these cases, the laws and regulations focus on preventing consumer misunderstanding, controlling consumer information, encouraging review of credit records for errors and preventing fraud. These are all actions that take place when a consumer is completing a credit application and a credit decision is being made. These new laws and regulations are aimed at helping borrowers and buyers be more informed at the front end of the credit process. Arguably, this also helps dealers and lenders prevent problems up front, a particularly important benefit during difficult economic times. It is better to have informed customers and accurate credit information at the time of the credit decision. Spotting issues after the sale will often be too late to avoid the losses they will bring. Like those Magic Eye images, patterns across the regulatory environment aren’t always easy to see at first. But if you adjust your focus, you can train your eye to spot the common threads and see the bigger picture. This can ultimately lead to a better understanding of regulators’ key concerns and help your dealership maintain compliance. BY CHIP ZYVOLOSKI
Chip Zyvoloski is senior attorney for indirect lending at Wolters Kluwer Financial Services. For more information, visit www.wolterskluwerfs.com/indirect.
18
THE
IL_1111.indd 18
DEALER’S
EDGE
NOVEMBER/DECEMBER 2011
il-iada.com
10/17/11 3:41 PM
19
il-iada.com
IL_1111.indd 19
NOVEMBER/DECEMBER 2011
THE
DEALER’S
EDGE
10/17/11 3:41 PM
IL_1111.indd 20
10/17/11 3:41 PM