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• FORMULA FOR SUMMER SELLING • WHAT YOUR CUSTOMERS REALLY WANT • AIMEE’S DEALER QUIZ

DALLAS, TEXAS Permit No. 2079

PAID

PRSRT Standard U.S. Postage

V isit us at w w w.mississippiiada.com

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MESSAGE FROM THE VICE PRESIDENT

Congratulations to those who have attended and completed our prelicensing seminar which is required by the Department of Revenue.

MAY

How’s Your Business?

Bishop, Charles A.

The most common question asked of an independent dealer is, “How’s your business?” The most common answer: “Business is slow.” With the economy on a downhill spiral and the cost of affordable quality vehicles on the rise, it is a struggle for dealers to purchase affordable vehicles and retail them at a cost the dealer and buyer can both agree on. Supply and demand is the nature of our business. The demand is there, but at a lower volume. The supply is there also, but at what cost to the dealer? I will admit it has been some time since I purchased a vehicle from an auction, and I just swelled with pride at the knowledge that I got a good deal and a good vehicle – or, as we like to say, one that was worth the money Costs continue to rise and we as independent dealers must continue to work together and with MIADA to ensure pro-auto business legislation, along with a pro-auto business environment.

APRIL

Aaron Williams aaron.auto72@aol.com

Hemsley, Jessica

Dexter, Toney DHD Enterprises Ekunwe, Nosakhare Granger, Yalanda Fat Mamma Auto Sales

Anderson, Theodore Fairway Auto Sales Dotson, Anita Dotson, Lee 3D Auto Sales Hall, Chandra Bolden Auto Group

Huffman, John Jones, Marsea Lacoste, Roger Roger’s Auto Ladner, Penny Ladner, Timothy Langford, Trey McAfee, Shelton Cargo Auto Moncrief, Bob Pham, Henry Pierce, Robert Ramirez, Maria Sanders, Deandre Shivers, Samuel Sims, Robert A & J Auto Smith, Glen

Hall, Jon Hays Used PowerSports Hays, Donovan Johnson, George Lawrence, Melissa Fat Mamma Auto Sales McCaffrey, Jason J McCaffrey, John H North MS Auto McCarver, Christopher Owen Superior Motors LLC McGraw, Spencer Hope Sales & Service Moncada, Jose C  oulten, Rodney M Automotive Remarketing Venture Group Palacious, David Payne, Sereena L Auto Auction Reps, LLC Regan, Eugene Mercedes Specialist of Oxford LLC Schaper, Judy C Wheels Inc. Spragins Jr, Charles Allen Swiftwater Sales & Rentals DBA Steadman, Tom Lucedale Auto Group LLC Taylor, Eric

Smith, Jonathan

Thach, Duoc C & P Auto Sales

Sojourner, Mitchell Sojourner Sales LLC

Thompson, James Robert

Taylor, Maurice Waits, Jeremy

Troy, Lori Ward, Napoleon

Walker, Jason

West, Michael Alan Lucedale Auto Group LLC

Wright, Towana

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I N D U S T R Y U P D AT E

NIADA’s Petersen Joins NMVTIS Advisory Board

MAGAZINE CONTENTS 06 08 12 16 25 26

Formula for Summer Selling Curbstoning: What’s Being Done What Customers Really Want Go All In on Service Aimee’s Dealer Quiz Compliance Overdrive

BOARD OF DIRECTORS Chairman of the Board Lester R. Howell 301 Clinton Blvd Clinton, MS 39056 601-924-3718

Secretary Steven Watkins 5660 I-55 South Byram, MS 39272 601-923-8600

President Jimmy Boling P.O. Box 1271 Grenada, MS 38901 662-227-5637

Treasurer Madalene Daniell 1500 Broadway Dr. Hattiesburg, MS 39402 601-264-2210

Vice President Aaron Williams 1428 Mississippi Dr. Waynesboro, MS 39367 601-735-3916

ADVERTISERS INDEX ADESA .............................................................................9 Ally................................................................................. 11 Auto Auction of New England................Inside Back Cover AutoTrader.com................................................Back Cover Chase.............................................................................14 Kelley Blue Book........................................................... 13 LA’s 1st Choice Auto Auction ...............Inside Front Cover Manheim.com..................................................................5 NIADA Certified............................................................. 21 Nowcom...........................................................................7 Protective ..................................................................... 19 United Acceptance ....................................................... 15 Voisys ........................................................................... 26 West Insurance..............................................................17

MIADA OFFICE

NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV

Independent dealers were given a voice in the National Motor Vehicle Title Information System (NMVTIS) when NIADA legislative /regulatory/compliance counsel Shaun Petersen was named to the NMVTIS Advisory Board. Petersen becomes the second auto industry representative on the 27-member board, joining James Moors of the National Auto Dealers Association. Moors, who represents new car dealers, suggested adding Petersen to the board to represent the used car business, Petersen said. “My appointment to the board will bring the voice of the used car dealer to the table,” Petersen said. “NIADA is seen as an independent and different voice from the new car dealer. I think it is significant they sought us out.” The board – which also includes members representing the insurance industry, the salvage industry, law

enforcement, consumer advocates, state departments of motor vehicles, organizations focused on preventing vehicle-related crime and the system’s technology partners – was established to advise the Department of Justice’s Bureau of Justice Assistance on ways to promote the effective and efficient administration of the NMVTIS program and database. NMVTIS was created to prevent the introduction of stolen vehicles into commerce, to protect states and consumers from fraud, to reduce the use of stolen vehicles for illicit purposes and to provide consumer protection from unsafe vehicles. NMVTIS reports provide title and branding data, odometer readings, total loss history and salvage history. Insurance carriers, auto recyclers and junk and salvage yards are required to report data to the system, and states must perform an NMVTIS check before issuing a title.

Fastenal Launches Expense Reduction Program Fastenal, a national distributor of industrial and construction supplies, has introduced an expense reduction program for auto dealerships to save owners time and money related to their shop supplies and essential tools. The centerpiece is Fastenal’s FAST Solutions℠ industrial vending system. To date, 8,000-plus machines have been installed to help organizations reduce supply consumption, move the cost of inventory to Fastenal, and increase worker productivity.

To access products, workers enter an ID code and a repair order number, then make a selection. If the request is authorized, the machine dispenses the product and automatically reports the details of the transaction, making workers accountable for what they use. Controls can also be established so that workers only have access to the products (and amounts) needed to do their jobs. For more information, visit www.fastenal. com.

Car-Mart Expands BHPH Footprint

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 Spark Plug is published bi-monthly by the National Independent Automobile Dealers Association Services Corporation, 2521 Brown Blvd., Arlington, TX 76006-5203; 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 Spark Plug, the Mississippi Independent Automobile Dealers Association, or the National Independent Automobile Dealers Association. Likewise, the appearance of advertisers, or their identification as members of NIADA, does not constitute an endorsement of the products or services featured. Copyright 2011 by NIADA Services, Inc. All rights reserved. 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

With more growth on the horizon, America’s Car-Mart recently opened its third rooftop in Mississippi, expanding the company’s network of Buy Here-Pay Here dealerships to 114 in nine states. Car-Mart’s newest lot is in Corinth, Miss. “We are proud to be expanding our business to great towns like Corinth,” Car-Mart president and CEO William “Hank” Henderson said. “Earlier this fiscal year we opened dealerships in Tupelo and Columbus, Miss., and we are very excited to be expanding in the state and are looking forward to opening additional locations in Mississippi in the upcoming year. “With each new dealership we open we have an opportunity to provide our excellent service to more customers and to earn their

repeat business in the future.” The Corinth dealership, which will be managed by Bart Sandoval, is the eighth dealership the company has added in fiscal year 2012. “We have a couple of additional locations that are very close to opening, and we will have announcements on those dealerships soon,” chief financial officer Jeff Williams said. “As we have stated, Car-Mart will continue to focus on increasing sales volumes at our existing stores and at the same time add great new locations. Beyond this fiscal year, we expect to open additional dealerships at an approximate 10 percent annual rate.”

BY WWW.SUBPRIMENEWS.COM

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B E I N G A B L E T O S E L L I N T H E D O G D AY S I S R E A L LY N O D I F F E R E N T T H A N S E L L I N G I N T H E H E Y D AY S .

Formula for Selling in the Dog Days of Summer The dog days of summer are here. The time to make hay while the sun was shining has come and gone. The typical Buy Here-Pay Here dealer will sell 40-45 percent of his annual units in the first three months of the year. He will also realize about the same percentage of his annual profit in those three months. So if you got off to a slow start in 2012, the dog days of summer could be the only way to salvage your year. Because we all know the last three months are not time to try to make your year. Being able to sell in the dog days is really no different than selling in the heydays. The same four key ingredients to selling are the same. The only difference is the focus has to be there. In the heydays, selling is pretty easy. Customers have money. You have inventory. All is right with the world. But come the dog days, customers have less money. And they seem to be harder to find. The first, and most important, of the key ingredients to selling in the dog days is training. Well-trained salespeople can sell any time of year. You should always be training your staff, always honing their skills. Both phone training and basic sales skills training should be done weekly, at a minimum. Work with staff on overcoming objections – role-playing is a good way to accomplish that. When it comes to phone training, work on how to set effective appointments. Lot traffic is at a premium during the dog days, so your people had better know how to effectively handle it. The second ingredient is appearance. Now, I’m not necessarily talking about your employees’ appearance, which should always be neat and professional, but your overall lot appearance. The No. 1 reason customers list as the reason they come in is “drive by.” So if that is the case, why wouldn’t you want

your lot to look the best in town? The lot should always be neat and orderly, not with vehicles facing all four directions of the compass and then some. Vehicles should be spaced evenly, with a good mix of colors and styles. A lot party or lot rodeo should be done at least once a week, if not more. It will really go a long way to making your lot look fresh. You should consider the vehicles on your lot your mannequins and treat them the way fine department stores treat theirs. Keep them fresh, neat, clean and always ready to sell. That goes for overall lot appearance as well. A fresh coat of paint and some weed killer can do wonders. Marketing is the next key ingredient. Again, with traffic being at a premium, this is the time when repeat and referral programs really pay dividends. It’s a good time of year to focus on referrals, not just with your customer base but with outside companies and people as well. If you are not already paying referrals to non-customers, it’s something you should seriously consider. I can assure you some, if not all, of your competitors are. Marketing also extends to your web presence. Make sure your website is up to date, especially if you are displaying inventory. I was on a dealer client’s website the other day and he had pictures of some of his inventory with snow on it. In addition to the inventory, make sure all other aspects of your site are up to date. That includes any advertised specials, about us sections and employee introduction sections. You wouldn’t want someone calling or coming in asking for someone or something that is no longer there. The last key ingredient in the dog days selling formula is advertising. In this very competitive industry, advertising in some form or fashion is

almost a must. The thing that makes advertising effective is reaching the right folks with the right message. The two most popular media are, of course, television and radio. There is a thought people watch less television and listen to more radio in the summer, but that is just not the case. Studies have shown television viewing doesn’t drop off at all during the summer, and the same goes for radio listening. The important thing to remember about advertising on both those media is to remember you are not your customer, so don’t advertise to yourself. Chances are your customers watch different television stations and listen to different radio stations than you do, so make sure the stations you are on are the ones your customers are watching and listening to. Customer surveys from new and existing customers are the best way to gauge their entertainment preferences. Simply put, just ask. As with marketing, your web presence is also a way to advertise. The use of your website, as well as Facebook and even Twitter can be ways to get your message out. I wouldn’t necessarily count on those selling more cars, but they are perfect ways to advertise new inventory or special sales promotions. The formula for selling in the dog days is the same as selling in the heydays. It just takes a little more attention to detail. There are usually fewer opportunities in the dog days, so capitalizing on them is much more important. Remember, the two most important ingredients in the formula are the two most inexpensive. Hopefully, you have the right mix of all the ingredients to keep the dogs at bay.

BY BRENT CARMICHAEL

EXECUTIVE CONFERENCE MODERATOR NCM ASSOCIATES INC. BCARMICHAEL@NCM20.COM

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U N L I C E N S E D O R U N F O R T H C O M I N G D E A L E R S H AV E A G E N T S P O S I N G A S P R I VAT E S E L L E R S I N C L A S S I F I E D A D S .

CARFAX Helps TV Station Take Aim at Curbstoner

Editor’s note: Curbstoning – sales of vehicles by unlicensed dealers – is a national problem that takes advantage of consumers and takes money away from state and local governments as well as legitimate dealers. This report from Memphis television station WMCTV exposing a local curbstoner and explaining the issue to the public is a direct result of the commitment of vehicle history report provider CARFAX to fighting curbstoning. “We brought the issue to the station’s attention,” CARFAX public relations manager Chris Basso said. “Tennessee is one of the biggest hotbeds for curbstoning, but it’s a nationwide problem. Whenever we hear about curbstoners in a particular area, we work to get the word out about the potential problems with the cars these people are selling and how to avoid them. “Most curbstoners are selling cars reputable dealers won’t touch – cars with hidden damage or rolled-back odometers or such – because they’re trying to make a quick sale. Anyone buying a used car needs to be wary of not only the car but of who they’re buying it from.” Basso said CARFAX has contacted other media outlets, including stations in Nashville and Phoenix, with similar tips, as part of the company’s ongoing efforts to help educate and warn consumers and dealers about emerging issues involving used cars in their area. By Andy Wise Action News 5/WMC-TV

A police report revealed a car buyer intends to press theft charges against the son of a woman who is fronting used car sales from her home for a dealership, a practice called “curbstoning.” Bill Sullivan filed a complaint with the Germantown (Tenn.) Police Department on May 23. The complaint alleged he gave $4,500 to Thomas Coleman, son of Deborah Coleman, to purchase three vehicles. When their delivery was delayed,

Sullivan pressured Coleman to produce the cars’ sales documents. Once Coleman finally presented the sales documents, Sullivan said they revealed something else. “The cars were never purchased by them on my behalf,” Sullivan said. “They were purchased by somebody else.” According to the sales documents, that “somebody else” was The Auto Connection, an auto dealership at 1419 E. Broadway St. in West Memphis, Ark. Sullivan’s police report alleged Coleman pocketed his $4,500 and never purchased any cars with his money. The cars the Colemans claimed to have purchased with his money, Sullivan said, were actually cars they sold on behalf of The Auto Connection. “Correct,” Sullivan acknowledged. “They split the profits.” The Action News 5 Investigators pinpointed Deborah Coleman as a curbstoner when the vehicle history tracker CARFAX warned that unlicensed or unforthcoming auto dealers have agents posing as private sellers on CraigsList and in classified ads. “Somewhere between 80 and 90 percent of [auto sales] classified ads are believed to be curbstoners,” CARFAX’s Chris Basso said. “These are dealers posing as private sellers who are selling cars that have a lot of hidden problems.” Coleman has posted numerous listings for used car sales on CraigsList, all found while running searches based on her cellphone number. Kayce Wyatt of Arlington, Tenn., answered one of Coleman’s ads for a 2001 Nissan Maxima, thinking Coleman was the vehicle’s private owner putting it up for sale. She met Coleman at Coleman’s home. That’s where the car was stored, Wyatt said. After taking a test drive and negotiating the deal – but failing to run a vehicle history report or to have the car inspected – Wyatt paid $3,500 for the car, according to the paperwork. It’s when Coleman handed Wyatt the

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title that Wyatt realized something was up. “I got the title and it said ‘The Auto Connection,’ ” Wyatt said. The dealership, owned by Jimmy Smith, is licensed with the Arkansas State Police to sell used cars in Arkansas. But according to the records of the Tennessee Motor Vehicle Commission, The Auto Connection is not licensed to sell cars, new or used, in Tennessee. It wasn’t long until Wyatt started having trouble with the Maxima. The “Service Engine Soon” light stayed on. The radio’s power switch malfunctioned. The brakes, pads, rotors, spark plug and oxygen sensor had to be replaced. She nearly paid as much to repair the car as she did to buy the car. If she had run a vehicle history report, she would have discovered The Auto Connection had Deborah Coleman curbstone Wyatt a car that had been in an accident in Michigan. Neither Coleman nor The Auto Connection disclosed the accident to Wyatt. “So it’s been wrecked,” Wyatt said. “I cried and cried and cried about it, but I had to do what I had to do. I didn’t have a way out of it.” An undercover producer of The Action News 5 Investigators answered one of Coleman’s ads for a Volkswagen Jetta. The test drive revealed the “Service Engine Soon” light was on. “That’s because it’s due for an oil change,” Coleman said to our producer. A CARFAX report revealed nothing of concern with the vehicle’s history. Both the Jetta and a Cadillac Coleman was selling outside her home had Arkansas dealer temporary tags. When our producer asked about the out-of-state tags, Coleman admitted she was selling the vehicles for The Auto Connection. “[The] business is over in Arkansas, and it just saves all the [document] fees, and it saves me about $1,500-$1,600 dollars per car,” said Coleman, who is also not licensed to sell automobiles in Tennessee, according to state records.

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CARFAX Helps TV Station Take Aim at Curbstoner According to the Tennessee Code Annotated, 55-17-109, “it is unlawful for any person to engage in business … as a motor vehicle dealer [or] motor vehicle salesperson ... without first obtaining a license as required in this part.” “Tennessee law says that if you sell more than five vehicles in a year, you have to have a dealer’s license,” Basso said. “These are people who are skirting that law, selling hundreds of cars without getting a dealer’s license, costing the state and local dealers hundreds of thousands of dollars” in tax revenue. Coleman refused to answer questions when confronted. Smith agreed to an oncamera interview, then abruptly canceled the interview the next day. On the phone, he said Coleman “is my agent. She sells cars for me. Sometimes it’s from her own driveway. Sometimes it’s from a [drug store] parking lot. She’s just trying to feed her kids.” Germantown police department records revealed another car buyer reported Coleman in December 2010. According to the complaint, the buyer blew the whistle on Coleman after he said he witnessed her and her son altering a temporary drive-out tag on a vehicle. Coleman told the police officer who wrote the report that she sold the car on behalf of Star Auto Mart, in Collierville, Tenn. “No, sir,” Star Auto Mart owner David Fleming said. “She’s never sold for me. Never had a salesman’s license here. Never anything.” Germantown police determined there wasn’t enough evidence to charge Coleman with a crime and decided it was a civil issue. “It’s a lose-lose situation with curbstoning,” Basso said. “The state loses money. The [licensed] dealers lose money and the consumer gets ripped off. “If you’re looking online, especially through sites like CraigsList, you really need to be careful about what you’re buying.” Coleman’s curbstoning operation may be in violation of a Germantown city ordinance that prohibits “receiving persons at a residential property for the purpose of buying, selling, ordering or picking up products in connection with a business.” “Code compliance has had contact with [Coleman] in the past,” said Stacey Ewell, spokesperson for the city of Germantown. “We did provide notice for unlicensed vehicles in the street in November of 2010 but have not had anything vehicle-related since. In addition, there is no business license for” Coleman’s address.

INDUSTRY CORNER

Pace of Dealers Adding Inventory Slows

Used car dealers have become less aggressive in bidding for inventory at wholesale auctions in recent weeks, Black Book vice president and managing editor Ricky Beggs said. Beggs noted that the retail market has backed off slightly and dealers have gotten less aggressive with bidding activity for the latest model years. Every car segment showed rate of decline and only two truck segments – compact SUVs and full-size crossovers – were up in May. “While there are seasonality trends currently taking place in the retail markets, we’re starting to see hesitance of dealers to refill used car and truck inventory,” Beggs said. “Some of the rental companies are pushing a few more models into the market with a lesser demand for the 2012s and 2011 models, thus getting less aggressive bidding activity for the latest model years.”

Report Shows Auto Credit Loosening

Average credit scores for consumers buying a vehicle have dropped to near prerecession levels in the first quarter of 2012, Experian Automotive reported. According to Experian’s quarterly automotive credit analysis, the average credit score for financing a new vehicle dropped six points to 760 and fell four points to 659 for used vehicles. For comparison, average credit scores for the first quarter of 2008, just before the economy sagged, were 753 for new vehicles and 653 for used. Lenders continued to set favorable terms for consumers during Q1 of 2012. Interest rates were lower and loan terms longer than in the first quarter last year, giving consumers access to potentially lower monthly payments. The average interest rate dropped to 4.56 percent for new vehicle loans and 9.02 percent for used, while the average loan term increased by one month for both new (64 months) and used (59 months) vehicles. “Our report shows automotive lending is as healthy as it’s been since the market bottomed out in 2008,” Experian director of automotive credit Melinda Zabritski said. “With consumers doing a good job of paying back loans on time and the percentage of dollars at risk reaching its lowest point in six years, lenders are able to extend terms and provide lower rates. “This thawing of the credit pipeline has been good for everyone, from consumers to lenders to automotive.” The analysis also showed an increase in the average amount financed, which rose $589 to $25,995 for new vehicles and $411 to $17,050 for used vehicles.

Rising Sales Lift Floorplans

Rising U.S. new and used auto sales have boosted dealership profits in 2012 and are strengthening already solid performance of dealer floorplan assetbacked securities, the financial ratings service Fitch reported. Dealer floorplan asset performance has been solid this year, with most trust performance metrics at some of the strongest levels seen in the sector. Monthly payment rates are elevated above historical levels, dealer inventory agings are very low and dealer defaults are at record lows for most of the trusts. Given the favorable conditions currently supporting U.S. auto dealership networks, Fitch’s outlook for both asset and ratings performance in 2012 is stable. The report also discusses the health of U.S. auto dealerships in 2012, including sales levels, expenses and profitability, along with detailing other financial dealer metrics and overall industry health. The report, “U.S. Dealer Floorplan ABS: Robust Dealers in 2012,” is available at www.fitchratings.com.

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L E A R N H O W T O S E L L B A S E D O N VA L U E , N O T P R I C E

What Your Customers Really Want How many times do you hear, “Customers only care about the price?” Most dealers will say they hear it all the time. But price is only an issue when it is presented as the only or primary benefit. Regardless of the industry, product or economy, a company does not need professional salespeople to sell price. For that, all they need is a website or catalog and a payment processor. If a company wants to increase sales and margin, it needs to teach the sales team how to establish real value. Once that happens, they need to practice doing it over and over. The difference between an amateur and a professional is a professional practices his skills – he doesn’t just play the game or go on sales calls assuming the sales call is practice. The key to overcoming price is not a scripted catchphrase. Rather, it is learning how to create a real value partnership. In order to do that, one must practice. Selling value is more than making statements like, “We offer great customer service,” or, “We have experience and expertise,” or, “Our people make the difference.” When salespeople are asked about the value offered, those are the most common answers given. That’s no different than a person going on a job interview and telling the interviewer he should be hired because he is a self-starter, a team player, a people person, motivated and loyal. Those answers are generic and do not differentiate you from the next person. Value is determined by the prospect. “What value do you add?” is a trick question because it can only be answered after the sales professional understands what the prospect or client defines as value. To determine what the buyer perceives

as value, a sales professional must ask the prospective customer purposeful questions and ask a lot of them. The more the sales professional learns and understands, the more likely he will be able to establish value according to the prospect. Though many salespeople know that, very few truly implement it. Too many salespeople flood a prospect with information about what they have to offer without knowing whether what they are saying will be of value to a client or prospect. It cannot be stressed enough – ask questions first before explaining the value you bring. Asking questions is more than just asking open-ended or leading questions. Most salespeople ask questions like, “Would it be a benefit to you if we could give you more of this for less money?” In most cases it is a rhetorical question – the customer has no choice but to respond, “Yes.” That is like asking a child if he’d like to have more candy, play all day and not do homework. Asking purposeful questions allows the sales professional to truly understand a prospect, not just his service needs so he can “sell” him. Here are three easy steps to make sure you’re able to sell on true value and not price. Write down your questions and take them with you: This does not make a salesperson less of a professional or less of an expert. In fact, this will allow you to show a client or prospect how important it is to fully understand his needs and desires. The order of your questions is important as well. Start your questions wide – industry-companyperson-current vendor, then finally about the product or service. Help the prospect understand what makes you and your company

successful: A partnership is a two-way street – remember the sales professional is responsible for both ways. That means a sales professional shares with the prospect what makes him successful without making it difficult or inconvenient and shows the why and value for both sides. Practice, practice, practice: Practice your sales every day beforehand rather than talking about it afterward and calling it practice. That goes for all sales managers, too. If the sales leader does not mandate ongoing practice and get involved himself, it will never happen. It’s just like a sports team that will not practice if the coach does not require it and get on the field to work with the team. If the prospect cannot truly afford the product being offered, do not lower the price and the perceived value. Instead, find a new prospect. By admitting your product is not a fit, you will gain more buyers long-term than you will by forcefeeding a product or service and losing value along the way. Every customer wants the most for the lowest price. That is not a bad thing once a sales professional learns how to help the prospect understand he really wants success for the best price. Success cannot be provided by just a vendor. It can only be provided by a true partner. Sales professionals need to prepare and practice so the next time the prospect says, “I want the cheapest price,” the salesperson is confident and ready to take control of the situation, and will never sell (or lose) on price again.

BY NATHAN JAMAIL

NATHAN JAMAIL, BEST-SELLING AUTHOR OF THE PLAYBOOK SERIES, IS A MOTIVATIONAL SPEAKER, ENTREPRENEUR AND CORPORATE COACH. THE FORMER EXECUTIVE FOR FORTUNE 500 COMPANIES AND OWNER OF SEVERAL SMALL BUSINESSES, TRAVELS THE COUNTRY HELPING INDIVIDUALS AND ORGANIZATIONS ACHIEVE SUCCESS. FOR MORE INFORMATION, VISIT WWW.NATHANJAMAIL.COM OR CALL (972) 377-0030.

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BHPH Perspectives At the recent National Alliance of Buy Here-Pay Here Dealers (NABD) Dealer Academy in Las Vegas, NIADA and NABD jointly announced the details of their inaugural BHPH Certified Master Dealer training program, scheduled to be held in September in Dallas. Though NIADA has been conducting its successful Certified Master Dealer retail program for several years, this new initiative marks the industry’s first BHPH certification program. At a very important time, during which the BHPH industry faces many challenging legal and regulatory issues, this certification program is designed to help establish new operating and financial standards for industry leaders. Participants in the inaugural training program must meet certain operational standards,

BHPH CERTIFIED MASTER DEALER PROGRAM SET TO KICK OFF

including, but not limited to: •Five years of successful operating performance •Membership in good standing in NIADA, NABD or both •Having a chief compliance officer •Affirming that all dealership operational documents and transactional forms have had a positive legal and compliance review from a qualified attorney •Maintaining financial statements prepared in accordance with generally accepted accounting principles. In addition, the dealer’s historical performance must approximate the key industry benchmarks published annually by NABD and Subprime Analytics for debt/equity ratio, allowance for bad debts, average cash in deal, average gross profit per vehicle sold, average portfolio

delinquency, average net loss per charge off and average default rate. A complete copy of the most recent BHPH industry benchmarks can be downloaded free at www.subanalytics.com or by obtaining a copy of NIADA’s Used Car Industry Report for 2012, which will be available at the NIADA Annual Convention & Expo on June 11-14 in Las Vegas. The eligibility criteria were established with an emphasis toward encouraging compliance with all industry laws and regulations, prudent financial management and successful operating performance, and sound systems and processes. Those traits will distinguish graduates to both capital providers and their industry peers. The inaugural session is planned for 2 1/2 days at a training site in the Dallas area to be announced in the near future.

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BY KENNETH SHILSON K E N N E T H S H I L S O N , C PA , I S P R E S I D E N T O F S U B P R I M E A N A LY T I C S ( W W W. S U B A N A LY T I C S . C O M ) , A C O N S U LT I N G C O M PA N Y T H AT P R O V I D E S P O R T F O L I O A N A LY S I S S E R V I C E S A N D C U S T O M C R E D I T S C O R I N G S O L U T I O N S , A N D I S P R E S I D E N T A N D F O U N D E R O F T H E N AT I O N A L A L L I A N C E O F B U Y H E R E - PAY H E R E D E A L E R S ( W W W. B H P H I N F O . C O M ) . H E C A N B E R E A C H E D AT K E N @ K E N S H I L S O N . C O M . U P C O M I N G N A B D C O N F E R E N C E S I N C L U D E T H E E A S T C O A S T B H P H C O N F E R E N C E AT T H E G E O R G I A I N T E R N AT I O N A L C O N V E N T I O N C E N T E R I N AT L A N TA O N O C T O B E R 2 1 - 2 3 , 2 0 1 2 . F O R M O R E I N F O R M AT I O N , V I S I T W W W. B H P H I N F O . C O M O R C A L L ( 8 3 2 ) 76 7 - 47 5 9 .

The program goal is to provide training for outstanding operators in the BHPH industry. As a result of the training and their commitment to ethical practices and high business standards, graduates should become even more successful. Becoming a BHPH Certified Master Dealer is recognition of a dealer’s dedication to the industry and his or her record of proven stability, reliability and ethical business practices. The instructors include several of the nation’s leading experts and most successful operators. The course curriculum provides interactive training and networking and will initially include: •Economic overview, benchmarks and trends •Financial management, accounting, taxes and metrics •Vehicle acquisition and reconditioning •Keeping vehicles running and

customers paying •Sales and marketing strategies •Underwriting best practices •Collection best practices •Maximizing recoveries •Legal and compliance •Systems/processes/technology •Much, much more It is contemplated that changes will be made to the curriculum in the future based on input from the participants. The curriculum is designed for graduates to enhance their management skills, improve their advertising and financial management, build more positive consumer relationships and stay compliant. Graduates will receive their BHPH Certified Master Dealer designation and use of the CMD seal for a period of 36 months. Each CMD graduate must subsequently obtain a minimum of 12 credit hours of NIADA/NABD-approved continuing

education during each 36-month period in order to retain the designation. At least 12 hours of continuing education opportunities will be offered throughout the year. It is expected that some of these hours can be earned by attending the NIADA Convention and NABD training events. NABD will hold an East Coast National BHPH Conference in Atlanta on October 21-23, 2012. The BHPH business requires specialized training and this program offers advanced sessions focused on achieving operating and financial excellence. Operators who strive to distinguish themselves from their industry peers are urged to participate. Operators interested in participating can obtain an application by calling NIADA at 1-800-682-3837 or emailing georgia@ niada.com, by contacting NABD at (832) 767-4759, or by emailing Joe Kearse at joe@bhphinfo.com. Space is limited.

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BACK TO THE BASICS: GO ALL IN

A Service Department Can Be a Big Edge for Dealers Willing to Make the Commitment For independent dealers, having a service department isn’t something that should be taken lightly. Not all dealerships offer service – it isn’t for everybody – but for those that do it should be an integral part of the business, used to give the dealer an opportunity to attract, retain and better understand customers. Joe Lescota, the NIADA’s new director of dealer development, said he knows many dealers who lose money in the service department because the money that comes in through service goes into one big pot. “There’s a whole process in operating a service department,” said Lescota, the longtime instructor for NIADA’s Certified Master Dealer program. “Dealers think they are selling service when what they’re really doing is selling time. “A dealership only has so many hours in the day to operate. So a dealer should take the number of techs he has and multiply that number by the number of hours in operation. So a dealer might have 80 hours a day of time to sell. From a profit standpoint, it doesn’t matter if the dealer is changing oil or dropping an engine.” Doug and Nyla Borgmann, owners of Creighton Auto, Inc., in Creighton, Neb., manage to keep their mechanic and their body man pretty busy, which is good for their business. That means doing repairs for everyone, not just customers. “Offering service works for us,”

Doug Borgmann said. “We advertise on our store sign. Service accounts for between 25 and 30 percent of business. Our mechanic has been with us since the early 1980s. He’ll retire in four or five years and that has me worried. Replacing him will be hard. Our body man has been with us for about three years. Before getting him, we had a hard time getting someone full time to do our body work.” J.R. Westbrook, owner of Tyro Auto Sales in Bay City, Texas, has been offering service at his store since 1971. He does outside work in addition to working on the cars of customers, but he doesn’t advertise. He depends on word of mouth. Westbrook has kept his technician for years, operating on the theory that it’s easier to keep the person you have happy than go out and find new people. Staff is a key component to offering a good service department. Getting good help was one of the reasons Randy Yates, owner of Yates Motors in Gering, Neb., closed his service center. Yates is a third-generation dealer. His lot has been around for 66 years, and for much of that time, it offered service. Eventually, though, it wasn’t worth the trouble. “We got rid of our old service center, must be around nine years ago,” Yates said. “It was hard getting and keeping good people. I’d train people and they would get the skills they needed to do the job. But then they’d go to

dealerships, often franchise operations, that would pay better wages and I’d have to start the process all over again.” Yates said he realized he was better off if he stuck to what he did best – sell cars. Now he sends his cars to be fixed by people who do what they do best – repair and recondition cars. By letting the work get done by specialists, he doesn’t have to bother with the hassle of hiring and training technicians, then replacing them as they leave his business. Yates said he ended up spending a lot of time trying to drum up business for his mechanics instead of selling cars. “If the mechanics aren’t busy all the time, then they aren’t making as much money as they could be,” Yates said. “It finally came to the point where it became too much work for me to find work for them and for myself. Now I have less headaches just selling the cars and farming any mechanical work out.” He also didn’t have to keep up with the expense of getting new equipment all the time. For one thing, the types of tools a service provider must own has changed dramatically. Gone are the days when a mechanic could do all his work with a lift and some wrenches. Cars now are computerized, and dealers and shop owners have to invest their own money in the purchase of scanners and other electronic devices used to communicate with a vehicle’s electronics. Lescota said Yates’ situation reflects a reality of operating a service department – it’s not easy. But, he C O N T I N U E D O N PA G E 1 8

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IN THE KNOW

AFC Offers Expanded Financing for RV Dealers Those Underinflated Tires Could Kill You Today’s tires are engineering marvels, improving performance and fuel economy, even if they tend to be largely ignored by motorists. That’s also a problem that can turn a tire into a killer. A new government study warns that as many as one in 20 crashes could be linked to tire-related problems, with underinflated tires posing an especially high risk of causing a problem. “Tire problems are inherently hazardous to vehicle safety,” said the report by the National Highway Traffic Safety Administration, which based its study on crashes covering a three-year period from 2005 to 2007. The report found underinflation was the biggest problem, with tires 25 percent below their rated pressure three times more likely to be involved in a crash. Part of the problem is that a low tire reduces the vehicle’s stability even under ideal conditions, and it makes it significantly more difficult for a driver to maintain control in bad weather or during emergency maneuvers, such as swerving to avoid an obstacle in the road. Problems also can result from worn tires, especially those that have gone bald or have damage to the tire that could lead to a catastrophic blowout. The study noted that tire problems, in general,are more likely to lead to accidents in bad weather. Industry officials say the study underscores the need to properly maintain tires, repairing or replacing those that are damaged while always keeping tires at the proper inflation. That message should weigh doubly on the minds of consumers these days because properly inflated tires also deliver significantly better fuel economy. A low tire can reduce mileage by as much as 5-10 percent, according to various estimates. Regulators and industry officials alike have been paying more attention to tire safety since the recall of 13 million tires used on the Ford Explorer a decade ago. That has led many manufacturers to adopt more advanced TPMS technology, such as the kind that will be available on the 2013 Nissan Altima, that provides specific inflation information on each individual tire.

Floorplan provider Automotive Finance Corporation (AFC) has expanded its inventory finance product offerings to include more options for recreational vehicle dealers. AFC said its RV inventory financing includes no restrictions on the type of RV unit a dealer can purchase – no make, model or year constraints. “Many providers only finance a dealer’s new RV inventory”, AFC director of business development Neill Waters said, “and we consequently saw many RV dealers seeking financing that better met their used RV purchasing needs.” AFC will advance 100 percent of an RV dealer’s auction purchases at more than 1,000 AFC-approved auctions, and the company’s financing gives dealers have an extended time to pay off their units on floorplan for used inventory purchased from auction or taken in on trade. AFC’s RV financing applies to used motorhomes, travel trailers, fifth-wheel campers and other towable units.

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I I A D A

G O L F

C O N T I N U E D F R O M PA G E 1 6

T O U R N A M E N T - A W A R D S

D A Y - T R A D E

| A Service Department Can Be a Big Edge for Dealers Willing to Make the Commitment |

added, the payoff can be tremendous when the job is done right. “It’s always a challenge to get good technicians,” Lescota said. “So I suggest that dealers go the technical schools and start grooming technicians before they even graduate. Also, you have to give someone a reason to stay at your dealership.” Usually that means giving them enough to do. As Yates discovered, if technicians don’t have enough to do, they’ll go somewhere where their skills will be in more demand. It might also mean giving them more money. After all, technicians have to eat too, Lescota said. “When I hear that a dealer can’t keep a technician, my thoughts first run to him not getting either enough work or enough money,” Lescota said. “And you can’t cheat on the equipment. It’s the cheap man who pays the most for things. By trying to save money on new equipment needed to work on today’s computerized cars, a dealer will end up having to spend a lot of money trying to keep technicians. “People like to work in comfortable environments and technicians are no different from anyone else. I always say if a dealer can’t keep good mechanics, it can usually be traced back to poor lighting, poor parts and poor work conditions. There’s a demand for technicians and they’ll go where they feel most comfortable.” Having a service department is a full commitment, Lescota said. And getting good technicians is a competitive sport between dealers. Maybe that tech left to go to a franchise operation because the boss there promised to send him to an ASE-certified program, where the tech could improve his skill set. Independent dealers should consider similar actions. Bill Elliff, owner of Elliff Motors in Harlingen, Texas, is an example of a dealer who is committed to his service department. His lot provides a full variety of services, and he long ago realized that in order to have a service department, he had to have enough service work to keep his employees busy. To better service his customers, his dealership can do anything from changing oil to engine replacement. He owns a couple of lots with a total

of seven service bays and 10 people working them. He advertises in print and on the signage around his lots. He said finding qualified people isn’t that hard. Finding qualified people who are dependable and can be counted on to show up on time ready to work every day is the tough part, Elliff said. But the effort is worth it. By hiring the right people, a dealer can have a service department that drives potential customers to the store, Elliff said. While they’re getting their car worked on, many of his service customers will wander around the lot and take a look at inventory. Maybe that person is looking for something new, and if he sees something he likes that service customer can be converted into a vehicle customer. Elliff estimates his service department accounts for about 20 percent of his total business. He said some of his fellow dealers don’t realize that a service department has to be able to make it on its own. It shouldn’t be a loss leader. Additionally, he sees dealers actually short-changing themselves when it comes to pricing their cars. A dealer might, for example, put $100 worth of reconditioning in a car he bought for, say, $5,000. When it comes time to price the car, he’ll want $1,000 profit. So he’ll price the vehicle at $6,100, Elliff said. That’s a mistake. Any work put into a vehicle using the dealership’s own service department should be reflected positively in the price of the vehicle. If $100 of work was put into the car, that should translate into adding, say, $200 to the back-end value of the vehicle. So that car should be priced at $6,200, not $6,100. “As an owner, you have to put the money in to develop the infrastructure needed to run a good service department,” Elliff said. “That means having the latest diagnostic equipment. But if you charge right for your services, you will always come out ahead.” Ultimately, having a good service department should mean more than another revenue source, Lescota said. By having a service department aimed at serving the public at large and not just his current customer base, Elliff is bringing in new potential buyers to look at his inventory.

S H O W

BACK TO THE BASICS: GO ALL IN

He’s creating a captive audience. But a good service department can do even more. When a customer brings in a car, a dealer can glean all sorts of information about the customer. It’s built-in market research. “The smart dealer should now know all sorts of things about that customer,” Lescota said. “The dealer should know how that service customer uses his car. Does he baby it or does he really run it through the ringer and wear it out? With that knowledge, the dealer can better help the customer make an informed decision on the best vehicle to buy when it comes time to get another car.” By having a complete service department, a dealer can get a customer used to bringing his vehicle to his dealership. Need an oil change? Bring the car to good old Joe’s. In an accident? Have the car towed to Joe’s. Need some engine work? Go to Joe’s. “There comes a time in every car’s life when it becomes counter-productive to keep putting more money in that vehicle,” Lescota said. “If you have a good relationship with your customers, and they bring their cars to you for service, you can tell that customer when it’s time to get a new car.” A service department can also help Buy Here-Pay Here dealers with their bottom line, Lescota said. It’s a rule of that segment of the used car business that when a car stops running, the payments stop coming. If a dealer has a service department, the customer can bring the car in to get fixed and the cost of repairs can be added to the payment schedule. A customer might not have $300 on him right then and there, but he can usually make his payments if that $300 is spread out over the rest of the payment schedule. “A good service department gives dealers control,” Lescota said. “It gives the customer a reason to keep coming back to you. But if you’re going to have a service department, you can’t go in halfhearted. As they say in poker, you have to go all in – but the rewards can be huge. “These days, dealers need every edge they can get. Now more than ever, dealers who don’t keep up, fall behind and go out of business.”

BY JIM STICKFORD

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D O N O T M A K E A N Y M A R K E T I N G D E C I S I O N S W I T H O U T F I R S T U N D E R S TA N D I N G YO U R D ATA .

Avoid These Marketing Potholes It seems as though every day, new marketing technologies and trends emerge as the hottest thing around. From Google Analytics to Twitter to personalized URLs, something is always changing in sales and marketing. While that provides many new options and opportunities, it can also be overwhelming and confusing for dealers. So how do you know where, how and when to spend your marketing dollars to get the best return on investment? And how do you know what to avoid? The answer is simple – data is king, and the good news is used car dealers have been dealing with it for years, tracking, testing and tailoring data to predict sales and budget. Marketing strategies and technology should deliver more data, telling you more about what’s working and what is not. There are still potholes in the road, but if you steer clear of the four biggest marketing potholes you will see the impact on your growth and bottom line. Not knowing your data Do not make any marketing decisions without first understanding your data. That is crucial. Track your data every week, or even more often, so you can be proactive with any potentially costly marketing mistakes. Track how many potential buyers are calling your dealership or submitting lead forms daily, monthly and yearly. If you don’t track those items you will never know how or if your marketing campaigns are working. Use Google Analytics. It’s a free service that can show you important information about how people are using your website. You can track how much traffic is coming to your site, how long viewers are there and which pages are

most popular. It can also show you problem areas like high bounce rates, low time on site and poor goal conversions. You also need to know if you have inventory people are looking for. Consistently review your SRP to tell you if you have the vehicles people want and if you’re merchandising your cars properly. On average, you should be getting twice the number of Internet and phone leads as your traditional UPs. If your numbers are not close, you should work with someone to better analyze your data to see what is not working and make changes. The worst thing you can do with poor results is ignore them. Ignoring Google Places You only get one chance to make a great first impression. This is also true for your image on the web. Google has changed its algorithm so the Google Place pages, which include business reviews, are high atop the search engine results. No amount of paid ads will fix this in the long term. If your Google reviews are negative, your buyers will look elsewhere for their cars. You want to get your existing customers to give you positive reviews when they are most likely to do so – when they’ve just bought their car. Incentivize it by offering them a review card that will give them discounts on service at very little cost to you. Not having a search engine strategy Search engine optimization is key. If you are optimized, you should show up on page one of any search. Accomplishing that requires a longterm strategy. You cannot rely on ranking alone. Your strategy needs to include proper keyword research, updated and useful content, and conversion tracking.

Consumers search in many different ways so you need to build landing pages and write copy for websites to make sure all search results are covered. Not having a solid media strategy Today, you need to have a social media presence. If you don’t, you’re missing out on some big opportunities. The bigger problem is using social media without a cohesive strategy. You need a plan for Facebook, Twitter and Pinterest, not just an account where you randomly post and tweet. For people to “Like” you on Facebook or follow you on Twitter, you need to give the consumer value. Research shows the top three reasons people connect with brands on Facebook and other social media are for the games, contests and promotions; to learn about new products; and to show they are fans. Use this information to create an engagement strategy and study the results. It is all about getting consumers involved, not trying to sell them. Extend your brand through social media, but also be sure to take advantage of all the free monitoring and data analysis tools the social media channels offer. Don’t get your business caught up in these common marketing mistakes. If you feel you are stuck, re-evaluate what you are doing and make strategy changes for the long term based on hard facts. With changes in these four areas, you will see improvement in all aspects of your business.

BY BRIAN BAKER

BRIAN BAKER IS EXECUTIVE VICE PRESIDENT AND CHIEF CLIENT OFFICER FOR STREAM COMPANIES, HANDLING STRATEGIC PLANNING AND DAY-TO-DAY OPERATIONS FOR THE AUTOMOTIVE SALES AND CLIENT SERVICES TEAMS.

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V I S I T W W W. D I G I TA L A I R S T R I K E . C O M O R W W W. FA C E B O O K . C O M / D I G I TA L A I R S T R I K E .

STUDY: Most Car Buyers Use Social Media Almost 70 percent of car buyers said social media aided their shopping process and a similar number said online reviews affected their choice of dealers according to a new study by the automotive social media and reputation management company Digital Air Strike™. Digital Air Strike said the 2012 Automotive Dealership Social Media and Online Reputation Study, completed in April, is the first automotive-specific study to analyze the use of social media and review sites by car buyers during the dealership selection process while concurrently auditing how car dealerships engage with consumers on these sites. The study measured usage trends on Facebook, Twitter and Google+ while identifying the top four dealership review sites – Edmunds, Cars.com, Yelp and Google Reviews – based on consumer use and traffic.

The consumer study surveyed 275 car buyers who purchased a vehicle in the last six months and found that 69 percent of consumers said social media sites helped their vehicle purchase decision and 68 percent of car shoppers said dealership reviews impacted which dealership they visited when shopping for a vehicle. Fifty percent said reviews affirmed their original choice of dealership, while 18 percent said they either selected a dealership based on the reviews or changed their choice after reading reviews on multiple dealerships. The dealership audit, which included 600 automotive retailers around the nation, compared engagement levels from 300 dealerships that managed their social media marketing in-house with 300 that used a vendor to manage their social media sites and online reputation. It showed 90 percent of those handling it in-house did not respond to negative

online reviews, and 95 percent did not respond to positive reviews. In addition, 27 percent of dealers managing social media in-house utilized “crowd sourcing” techniques, compared to 87 percent of those with a social media partner, and dealers using outside vendors had more than double the number of followers on the top two social media sites. “This ground-breaking study highlights the importance of social networks and review sites in the car buying process,” Digital Air Strike co-founder Alexi Venneri said. “Dealers who work with a social media partner can gain a significant advantage from increases in consumer engagement and related website traffic.” For more information, visit www. digitalairstrike.com or www.facebook. com/digitalairstrike.

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MISS-LOU Convention August 2-5, 2012 • New Orleans, Louisiana

MISS-LOU CONVENTION

The Astor Crowne Plaza Welcomes the MISS-LOU Independent Dealers

LOCATION Located at the corner of world famous Canal and Bourbon Streets, the Astor Crowne Plaza is poised to offer our guests the best of both worlds — the Old World allure of the French Quarter, with its elegant Creole restaurants, worldrenowned art galleries and antique shops — and the bustle of Canal Street, New Orleans’ Champs-Elysées and downtown shopping thoroughfare. Just 25 minutes from the Louis Armstrong New Orleans International Airport. AT A GLANCE • Recent award-winning $11 million renovation of all rooms, meeting space, public areas • Executive Level with Club Lounge • 693 luxurious guest accomodations • 33 elegantly appointed suites MEETING FACILITIES & SERVICES • 32,000 square feet of versatile public function space • Elegant ballrooms hosting events for as many as 800 guests with exterior balcony access over Canal, Bourbon and Iberville Streets • State of the art audio visual and communications services are available • 24-hour Business Center with complimentary internet • Full VIP concierge services

SURROUNDING ATTRACTIONS • Harrah’s Casino • World renown antique shops • French Quarter and Bourbon Street • Aquarium of the Americas and Insectarium • National D-Day Museum • The Children’s Museum • Upscale shopping at Canal Place • The Riverwalk Mall • Louisiana Superdome & New Orleans Arena • New Orleans Museum of Art • Audubon Zoo RECREATION • Outdoor pool and gardens • On-site fitness center • Golf courses nearby • Boating on Lake Pontchartrain • Charter fishing • Tennis courts nearby • A wide array of scheduled tour options

ALL ROOMS & SUITES FEATURE • Executive work desks with two dual-line phones, modem and/or high-speed internet • Coffeemaker with complimentary coffee and tea • Complimentary weekday USA TODAY® newspaper • Crowne Plaza Sleep Advantage® amenities • Valet service • Makeup mirror; hairdryer • Plush custom-made mattresses • Foam and feather pillows • Digital alarm clock/radio and CD player • Iron and ironing board • Individual climate control • Electronic door locks • In-room safes • 37” HD Flat Screen Television with pay-per-view movies and premium cable/satellite service DINING & ENTERTAINMENT • Dickie Brennan's Bourbon House Restaurant & Oyster Bar a New Orleans fine dining experience! • 24 hour in-room dining and service • Cocktail Lounge

THE PLACE TO MEET.

739 Canal at Bourbon Street New Orleans, LA 70130 Toll-Free: 888-696-4806 • Direct: 504-962-0500 www.astorneworleans.com

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PLEASE PRINT OR TYPE ALL INFORMATION:

MISS-LOU ANNUAL CONVENTION

FIRST NAME: ________________________ LASTAtNAME: _________________________ The Astor Crowne Plaza

TENTATIVE AGENDA THURSDAY, Aug. 2 1- 5 p.m. Exhibitors set up – Grand Gallery 7-10 p.m. Welcome Reception – Hospitality area, Grand Gallery FRIDAY, Aug. 3 9-10 a.m. Coffee/refreshments – Hospitality area 9 a.m.-4 p.m. Exhibitors display – Grand Gallery 10 a.m. Golf tournament tee time – TPC Louisiana 1-4 p.m. Carriage rides/French Quarter tour – Grand Gallery (1 p.m.) 7-10 p.m. Mardi Gras party – Grand Ballroom C & D (light food, musicD.J., cash bar) 10 p.m.-2 a.m. Hospitality area – Grand Gallery Welcomes the MISS-LOU

MISS-LOU Convention August 2-5, 2012 • New Orleans, Louisiana

MISS-LOU Convention August 2-5, 2012 • New Orleans, Louisiana

739 Canal Street (at Bourbon) COMPANY NAME:___________________________________________________________ New Orleans, LA 70130

MISS-LOU CONVENTION FORM

AUGUST 2-5, 2012 Email: ______________________________________________________________________ PLEASE PRINT OR TYPE ALL INFORMATION:

ADDRESS: __________________________________________________________________

FIRST NAME: ________________________ LAST NAME: _________________________

CITY: ____________________STATE:______________ZIP-CODE___________________

COMPANY NAME:___________________________________________________________

TELEPHONE: _________________________CELL:________________________________

Email: ______________________________________________________________________

BADGE INFORMATION:

ADDRESS: __________________________________________________________________

The Astor Crowne Plaza The Astor Crowne Plaza

LOCATION SATURDAY, Aug. 4 at the area corner of world famous Canal and Bourbon 9-10 a.m. Coffee/refreshments – Located Hospitality the Astor Crowne Plaza is poised to offer our guests 10 a.m.-4 p.m. Exhibitors display –Streets, theGrand best ofGallery both worlds — the Old World allure of the 11:30 a.m.-1:30 p.m. Lunch – Grand Ballroom C &itsDelegant (lunch, giveaways, French Quarter, with Creole restaurants, worldfundraising auction, speakers) renowned art galleries and antique shops — and the bustle of Canal Street, Ballroom New Orleans’A,Champs-Elysées and down1:30-3:30 p.m. LIADA board meeting – Grand MIADA board town shopping thoroughfare. Just 25 minutes from the meeting – Grand Ballroom B Armstrong New Orleans International Airport. 3:30-4:30 p.m. MISS-LOU Auction Louis Group/Convention Committee

meeting – Grand Ballroom A AT A–GLANCE 6-7 p.m. Grand Banquet cocktail hour Hospitality area • Recent award-winning $11 million renovation 7-11 p.m. Grand Banquet dinner – Grand Ballroom & Dpublic (dinner, of all rooms, meetingCspace, areasmusicband, drawing, cash bar) • Executive Level with Club Lounge 8-11 p.m. Band (TBA) • 693 luxurious guest accomodations 9:30-10:30 p.m. Cash/grand prize• drawings 33 elegantly appointed suites 10:30 p.m.-2 a.m. Hospitality area – Grand Gallery

MEETING FACILITIES & SERVICES SUNDAY, Aug. 5 • 32,000 square feet of versatile 9-10:30 a.m. Bloody Mary/light breakfast – Hospitality areapublic function space

• Elegant ballrooms hosting events for as many as 800 guests with

exterior balcony access over Canal, and Iberville Streets For additional information and to reserve space, please callBourbon the LIADA • State of the art audio visual and communications services office at (225) 275-8088 are available • 24-hour Business Center with complimentary internet • Full VIP concierge services

NAME: _________________________________________________________

___MEMBER

___NON-MEMBER

NAME: _________________________________________________________

___ MEMBER ___NON-MEMBER

NAME: _________________________________________________________

___MEMBER

CITY: ____________________STATE:______________ZIP-CODE___________________

Welcomes the MISS-LOU Independent Dealers Independent Dealers TELEPHONE: _________________________CELL:________________________________ ___NON-MEMBER

BADGE INFORMATION: LOCATION SURROUNDING ATTRACTIONS NAME: _________________________________________________________ ___MEMBER SURROUNDING ___NON-MEMBER ATTRACTIONS Located at the corner of world famous Canal and Bourbon • Harrah’s Casino • Harrah’s Casino NAME: _________________________________________________________ ___MEMBER ___NON-MEMBER theHAVE Astor Crowne Plaza is poised to offerREQUIRE our guests AN ACCOMMODATION. • World renown antique shops • World renownCHECK antique shops _______PLEASE HEREStreets, IF YOU A DISABILITY AND MAY the of both worlds —DISCUSS the Old World allure of the NEEDS. • French Quarter and Bourbon Street WILL BEbest CONTACTED TO YOUR SPECIAL • French Quarter andYOU Bourbon Street NAME: _________________________________________________________ ___ MEMBER ___NON-MEMBER French Quarter, with its elegant Creole restaurants, world• Aquarium of the Americas and Insectarium • Aquarium of the Americas andrenowned Insectarium art galleries and antique shops — and the___MEMBER bustle NAME: _________________________________________________________ ___NON-MEMBER June 1, 2012 ) REGISTRATION June 1,D-Day 2012)Museum EARLY BIRD REGISTRATION (BEFORE • National • National D-Day Museum of Canal Street, New Orleans’ Champs-Elysées and down-(AFTER ____ $300 COUPLEtown shopping thoroughfare. Just 25 minutes from ____ $350 COUPLE the • The Children’s Museum • The Children’s Museum NAME: _________________________________________________________ ___MEMBER ___NON-MEMBER ____ $200 SINGLE Louis Armstrong New Orleans International Airport. ____ $225 SINGLE • Upscale shopping at Canal Place • Upscale shopping at Canal Place _______PLEASE HERE IF YOU HAVE A DISABILITY AND MAY REQUIRE AN ACCOMMODATION. • The Riverwalk Mall • The RiverwalkCHECK Mall ATBE A GLANCE YOU WILL CONTACTED TO DISCUSS YOUR SPECIAL NEEDS. • Louisiana Superdome & New Orleans Aren PLEASE MAKE CHECK PAYABLE TO MISS-LOU CONVENTION AND MAIL WITH THIS FORM TO: • Louisiana Superdome & New Orleans Arena • Recent award-winning $11 million renovation L.I.A.D.A. (1, 225) 275-8088 • New Orleans Museum • New Orleans of Art of all rooms, meeting space, public June 2012 ) areas REGISTRATION (AFTER June 1, 2012) of Art EARLY BIRDMuseum REGISTRATION (BEFORE 15481 Airline Highway • Audubon Zoo • Audubon ____ Zoo $300 COUPLE ____ $350 COUPLE • Executive Level with Club Lounge ____ $200 SINGLE ____ $225 SINGLE Baton Rouge, LA 70817 guest accomodations • 693 luxurious RECREATION RECREATION • 33 elegantly appointed suites WHEN CAN WE EXPECT YOU TO ARRIVE? Outdoor • Outdoor pool and gardens PLEASE MAKE CHECK PAYABLE TO MISS-LOU CONVENTION AND MAIL WITH THIS• FORM TO:pool and gardens THURSDAY _____FRIDAY _____SATURDAY_____ L.I.A.D.A. (225) 275-8088 • On-site fitness center • On-site fitness center MEETING FACILITIES & SERVICES 15481 Highway • Golf courses nearby • Golf courses nearby • 32,000 square feet ofAirline versatileROOM public function $119 FOR STANDARD RATE space Baton Rouge, LA 70817 • Boating on Lake PLEASE PAYABLE MISS LOU CONVENTION AND WITH THIS FORM TO: Pontchartrain • BoatingMAKE on LakeCHECK Pontchartrain ballrooms hosting events for as many as 800 MAIL guests with • ElegantTO Charter fishing L.I.A.D.A. •balcony 15481 Airline Highway •andBaton exterior access over Canal, Bourbon IbervilleRouge, Streets LA •70817 • Charter fishing (225)275-8088 ***Reservations with the Astor Crowne*** WHEN CAN WE EXPECT YOU TO ARRIVE? • Tennis courts nearby • State of the art audio visual and _____SATURDAY_____ communications services • Tennis courts nearby Call this number: THURSDAY _____FRIDAY $119.00 STANDARD ROOM RATE are availableFOR(888) • A wide array of scheduled tour options • A wide array of scheduled tour options 696-4806 FOR STANDARD ROOM RATE • MENTION 24-hour Business Center withCall complimentary internet THAT YOU ARE ATTENDING THE ***Reservations with the $119 Astor Crowne*** this number: (888) 696-4806 MISS-LOU CONVENTION! • Full VIP concierge services ***Reservations with the Astor Crowne*** MENTION THAT YOU ARE ATTENDING THE MISS-LOU CONVENTION!

Call this number: ALL ROOMS &(888) SUITES FEATURE 696-4806 • Executive work desks with two dual-line phones, modem MENTION THAT YOU ARE ATTENDING THE and/or high-speed internet MISS-LOU CONVENTION! • Coffeemaker with complimentary coffee and tea • Complimentary weekday USA TODAY® newspaper • Crowne Plaza Sleep Advantage® amenities • Valet service • Makeup mirror; hairdryer DEPARTMENT OF THE TREASURY • Plush custom-made mattresses IRS ENTERPRISE COMPUTING CENTER • Foam and feather pillows • Digital alarm clock/radio and CD player P.O. BOX 33116 • Iron and ironing board DETROIT, MI 48232-0116 • Individual climate control • Electronic door locks • In-room safes HD Flat Screen Television with pay-per-view movies Person to Contact: • 37” forms and premium cable/satellite service approximately every three Dail Hughes, years and financial institutions must THE PLACE TO MEET. THEID#02-37367 PLACE TO MEET. providing in-depth insights into dealer sales performance, DINING & ENTERTAINMENT DINING & ENTERTAINMENT Tax Law Specialist submit the most current version of 739 Canal at Bourbon Street 739 Canal at Bourbon Street • Dickie Brennan's Bourbon House Restaurant & Oyster Bar Bourbon House Restaurant & Oyster Bar • Dickie Brennan's vehicle registrations and consumer demographics in their New Orleans, LA 70130 NewNumbers: Orleans, LA 70130 a New Orleans fine diningaexperience! a New Orleans fine dining experience! Telephone form. Please resubmit the form(s) market. Dealers can use that information to evaluate their Toll-Free: 888-696-4806 • Direct: 504-962-0 Toll-Free: 888-696-4806 • Direct:• 24 504-962-0500 • 24 hour in-room dining and service 1(866)270-0733 option# 3hour orin-room dining and asservice soon as possible and no later www.astorneworleans.com than www.astorneworleans.com sales performance against• the competition, track sales • Cocktail Lounge Cocktail Lounge

ALL ROOMS & SUITES FEATURE • Executive work desks with two dual-line phones, modem and/or high-speed internet • Coffeemaker with complimentary coffee and tea • Complimentary weekday USA TODAY® newspaper • Crowne Plaza Sleep Advantage® amenities • Valet service • Makeup mirror; hairdryer • Plush custom-made mattresses • Foam and feather pillows Experian Automotive announced the launch of • Digital alarm clock/radio and CD player ® AutoCheck Elite, a program givesboard car dealers • Ironthat and ironing • Individual climate control information and insights into the market, the vehicles and door locks the people who buy them.•• Electronic In-room safes In addition to the vehicle history the original • 37” HD Flatdata Screen of Television with pay-per-view movies andallows premium dealers cable/satellite AutoCheck, AutoCheck Elite to service access reports

Experian Enhances Its AutoCheck Reports

trends of the most popular makes and models, and better understand the consumers in their market. And AutoCheck Elite dealers receive other features, including access to AutoCheck best practices training, a sales event marketing guide and enhanced showroom materials. For more information, visit www.experianautomotive.com.

(313)2346146 Refer Reply to: SE: S:/FBSA:PO:DCC: CTR SG120487 Date: April 5, 2012

Dear Sir or Madam, The Financial Crimes Enforcement Network (FinCEN), via the Internal Revenue Service Enterprise Computing Center-Detroit (ECC-D), has received the Form(s) 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business, dated February 27, 2012. We are unable to process the Form(s) 8300 because you did not submit the correct form version. FinCEN updates Bank Secrecy Act

10 business days upon receipt of this letter. Failure to properly file a BSA form may result in fines or other penalties. If you need to resubmit this form(s) on paper, please visit FinCEN’s website to obtain and download the most current version of the form: http://www.fincen.gov/ forms/bsaforms/. Make sure that you mail the form(s) to the address identified in the “When and Where to File” section of the particular form. Do not mail the form(s) to the address at the top of this letter. If you have any questions about this letter, please contact Dail Hughes @ 1 (866) 270-0733 option #3. Thank you for your assistance.

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Mississippi’s Used Auto Dealer Pre-licensing Seminar Required by the Department of Revenue Seminar Location: MIADA Home Office 1705-A Old Whitfield Road Pearl, MS 39208 Office: (601) 939-9866 Fax: (601) 939-9882 Seminar dates are as follows: q July 21 / 8 a.m.- 5 p.m.

q August / 8 a.m.- 5 p.m.

q Registration Fee - $175.00 Please submit registration with payment to MIADA at least seven days prior to the date of the seminar you plan to attend. Your seat will be reserved and certificates will be presented at the end of the seminar. Dealer Resource Manual - $75.00 Late Registration Fee - $25.00 Late registrations are accepted the week before class and walk-ins are accepted on the morning of class. However, the late fee is applied to the original registration fee and certificates for walk-ins will be mailed out the following week. *On the day of the seminar, No checks will be accepted.* Transfer Fee - $50.00 If you wish to transfer your registration to another scheduled seminar date, a 72 hour notice is required and a transfer fee is applied. Cancellations - $50.00 All cancelations are to be made 72 hours in advance in order to receive a refund, minus the cancellation fee. *Please Note* Due to limited and reserved seating, we can not allow sit-ins. Also, if you have any disabilities that require you to bring an assistant, please let MIADA know at the time of registration so we can reserve adequate seating.

Full Name_______________________________________________________________ Address________________________________________________________________ City___________________________State__________________Zip________________ Phone______________________________Fax_________________________________ Email __________________________________________________________________

Business Name__________________________________________________________ Address________________________________________________________________ City___________________________State__________________Zip________________ Phone______________________________Fax_________________________________ Email __________________________________________________________________ Payment Method ___Check Enclosed

___Money Order

___VISA

___MC

___DISC

___AMEX

Account #________________________________________________________

Exp________________

Account Name____________________________________________________

Zip_______________

Aimee Smith Pruitt is MIADA’s Pre-licensing education specialist. With more than five years experience in pre-owned dealership management and more than four years in education development and instruction for MIADA, she is our greatest asset. She has made major contributions to the curriculum that was first offered in July 2007. Education class participants continually rate this class as superior.

Registration Fee $_________________ + C/C Proc. Fee $ 3.50 = Transaction Total $___________________ Signature of Authorization______________________________________________________________________ 24

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AIMEE’S DEALER QUIZ When we check with the Mississippi Department of Revenue Title Commission, they tell us proper submission of titles is a major issue. The Mississippi Dealer Education Seminar offered monthly through MIADA stresses how this process should be completed for a dealer to be compliant with the state. Use the quiz below to test your dealer knowledge of Mississippi regulations and process. You might find you need to update your company’s policy in order to comply.

1.) There is no order to how the dealer puts together the title paperwork when submitting it to the state. Title application numbers are not important. _____ TRUE _____ FALSE 2.) T  he buyer must sign his or her name exactly the same on the title application and the back of the title. The title transfer must match the title application. _____ TRUE _____ FALSE 3.) The dealer has 20 days to submit the title work to the state. _____ TRUE _____ FALSE 4.) T  he miles on the vehicle at the time of the sale must move sequentially from the front of the title to the back with every reassignment in order to have actual miles or code 00 with current miles on the title application. _____ TRUE _____ FALSE 5.) When the dealer receives the title work from the previous owner/ dealer, additional paperwork could be attached, such as an affidavit of correction or statement of repossession. These original documents must remain with the title when sending title transfers to the state. _____ TRUE _____ FALSE 6.) When a vehicle is eight years old, the miles on the title and title application are listed as exempt with the code, 17-000000. _____ TRUE _____ FALSE 7.) M  ississippi uses dealer numbers on the back of titles being transferred for an out-of-state sale. _____ TRUE _____ FALSE

Answers: 1: FALSE. When submitting title work to the state it needs to be in the following order: white copy of the Title Application, the reassigned title and the original of any support documents, all attached with a single staple in the center. Place applications in numerical order and list on Title Application Remittance Advice. 2: TRUE. All title work must be signed exactly the same on all paperwork. 3: TRUE. Title work must be submitted within 20 days of the sale of the vehicle in order to perfect the lien. If the lien is not perfected there are repercussions for bankruptcy and repossession. 4: TRUE. 5: TRUE. You are to submit the original power of attorney, affidavit of correction or statement of repossession when submitting paperwork to the state after the sale. 6: FALSE. The vehicle is exempt once it is more than 10 model years old. 7: FALSE. State of Mississippi does not use dealer numbers, but when the title asks for one and is transferred out of state, use your designated agent number. 8: TRUE. 9: FALSE. All dealers, including Buy Here-Pay Here dealers, should submit title information within 20 days of the sale of the vehicle in order to perfect the lien. BHPH dealers should be sure to list their dealership on both the back of the title and the Title Application to ensure the original title lists the dealer as the lienholder. 10: FALSE. As Mississippi dealers, we do not submit title work for other states. However, it is in your best interest to ensure the lienholder’s interest is secure. It is good policy to attach a letter highlighting the lienholder’s name and submit title paperwork directly to the buyer’s DMV in his county and state. 11: FALSE. MS dealers must use MS extension forms.

8.) A dealer is required to keep a copy of every document submitted to the state for a title transfer to the new owner. _____ TRUE _____ FALSE

12: TRUE. An affidavit of correction is required for errors or changes on titles. Put a single line through the change and write the correct information above.

9.) A Buy Here-Pay Here dealer can just hold onto titles until the buyer completes the payment agreement. _____ TRUE _____ FALSE

13: TRUE. You can never white-out, erase or black out any incorrect information on title work.

10.) It is an out-of-state buyer’s responsibility to perfect the lienholder when registering a purchased unit in his home state. _____ TRUE _____ FALSE 11.) A Mississippi dealer uses the out-of-state extension form when an out-of-state title arrives with that document attached. _____ TRUE _____ FALSE 12.) An error on a title must have an affidavit of correction attached and it must be notarized. _____ TRUE _____ FALSE 13.) White-out cannot be used on a title transfer. _____ TRUE _____ FALSE 14.) It is not necessary to have a power of attorney if you are signing a buyer’s name on the title. _____ TRUE _____ FALSE 15.) When the dealer submits title work to the state, he uses a Remittance Advice document. The buyer pays $10 for the title to be transferred. The State gets $9 and the dealer keeps $1. _____ TRUE _____ FALSE

14: FALSE. It is always best to have the customer sign the back of the title at the time of purchase. If that is not possible, a “Power of Attorney for Transfer of Ownership to a Motor Vehicle” is required in order to sign buyer’s name in regards to the title. This is Mississippi state form 78-004-10-1-1-000. 15: TRUE. If you got 100 percent correct, the state of Mississippi Title Division will rarely need to return your paperwork. If a title is returned to you for correction, the buyer will be notified there is an issue as well. To avoid issues, we recommend you attend our next dealer education, set for July 21 or Aug. 18. The registration form for the class is located on page 24. If you need additional Title Application and Remittance Advice forms, contact Mississippi Print Shop at 601-923-7880. The forms are available free of charge from the state. Aimee Pruitt

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COMPLIANCE OVERDRIVE

Look Before You Lease When I attend industry events, I enjoy meeting dealers and hearing their takes on current challenges and trends facing the industry. One topic that has come up recently is leasing. I have heard a number of dealers comment on how they would like to expand their dealership and start leasing vehicles. While that might sound like a natural step in growing a business, dealers must consider the differences between selling and leasing. To be clear, by “lease,” I mean a contract allowing a customer to use your vehicle for a period of time (minimum: four months). At the end of the lease, the customer returns the vehicle and doesn’t owe you any more money as long as the vehicle has only reasonable wear and tear and was driven no more than the agreed mileage. If there is an option to purchase, the option price bears some relation to the vehicle’s expected market value at the time the option is exercised. In other words, the lessee doesn’t have the option to purchase for $1 because that would really be a sale, disguised as a lease.

Adding leasing to an independent dealership might sound simple. You’re already arranging loans and payments for the vehicles you sell, so why not expand your in-house financing to offer customers another option? But it’s not as easy as it looks. Here are key areas to consider when making your decision. Licensing: Make sure your license for selling vehicles also allows you to lease vehicles. Your current license might not be broad enough to authorize leasing. Insurance: When you sell a car, the title is transferred to the buyer. You focus on receiving timely payments and confirming the buyer has sufficient insurance to protect your security interest in the vehicle. You probably have property and liability insurance to protect your inventory and sales. However, when a dealer leases a car, he still owns it. If the vehicle is involved in an accident, you might be subject to liability as the owner. As part of researching a leasing operation, meet with your legal counsel and insurance carrier to make sure you protect against liability exposure with appropriate insurance coverage. Pricing: Determining the sales price of a vehicle is pretty straightforward. You know your costs to purchase and prepare the vehicle for sale, sales costs and profit margins, and sell the vehicle for more than your costs. You know at the time of sale whether you are making money on the deal. With a lease, the calculations are more complicated. It might be easy to determine what the vehicle is worth today, but how do you know what it will be worth when the lease is up, say, two or three years from now? That depends on factors such as how many miles it will be driven and how well it is maintained. There are also unknown variables. What if gas prices rise drastically and the vehicle is a gas-guzzler? That could impact the market value at the end of the lease (residual value). In most consumer leases, the dealer is on the hook if the residual value is less than predicted. You won’t really know if you’re making money on a lease until you find out how well you predicted the residual value. You might be two or three years into the lease program before you realize you’ve set your residual values too high – and by then it’s too late. Documentation and disclosures: You can’t just modify a retail sales contract to make it a lease. If you are planning to include leasing, you must make sure

your documents meet state and federal consumer lease requirements. The federal Consumer Leasing Act and its implementing Regulation M are the lease disclosure equivalents of the Truth in Lending Act and Regulation Z for consumer lending. Reg M requires dealers to provide a great deal of specific pricing information in lease contracts. Many states require additional disclosures and consumer protections. As part of your leasing startup, you will need to create a unique document set of disclosures and contracts. Taxes: In a lease you retain ownership, so you might roll your sales taxes to purchase the vehicle into your costs and lease calculations, but you might also need to collect use or other taxes on the payments throughout the lease term. Contact your accountant and/or the state to understand your tax obligations and how they differ for leases. Collections: If a buyer doesn’t make timely retail contract payments, you can repossess the car. Fear of losing the car can help motivate a buyer into making past due payments. In a lease, the lessee doesn’t own the car and may expect to return it and walk away at the end. That might make it a little easier for the lessee to emotionally handle repossession, but it might mean the lessee isn’t afraid of having the car repossessed and isn’t as motivated to make past due payments. As with a financed sale, once you repossess a vehicle, the lessee has even less motivation to pay any balance still due. If a car is returned with wear or damage beyond what’s agreed on in the lease, it can be difficult to collect money to cover those costs. You can use the lessee’s damage deposit, so make sure you set it at a practical amount – it might be the only money you end up recovering for excess wear and tear. These are only some issues to consider when starting a lease program. You can identify more by simply reading a motor vehicle lease contract. The differences between selling and leasing are dramatic and can’t be overlooked. Your operations and compliance can be affected by the type of transaction, the vehicle and the state in which you are doing business.

BY CHIP ZYVOLOSKI

CHIP ZYVOLOSKI IS A SENIOR ATTORNEY FOR INDIRECT LENDING AT WOLTERS KLUWER FINANCIAL SERVICES. FOR MORE INFORMATION, VISIT WWW.WOLTERSKLUWERFS.COM/ INDIRECT.

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Mississippi Spark Plug July/August 2012  

Mississippi Independent Auto Dealers Association