Texas Dealer September 2022

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In this issue:

– Michael W. Dunagan: Dealer Questions About Sales Tax on GPS Units and Air-Time Fees – Can Great Recession Lessons Help Dealers in 2022? Loss Statement Isn’t Good for Your Dealership – 6 Key Areas You Might Be Wasting Your Local Marketing Spend

TIADA Welcomes 2023 President

Ryan

Winkelmann


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TIADA Board of Directors PRESIDENT Ryan Winkelmann/BJ’s Autohaus 5005 Telephone Road Houston, TX 77087 PRESIDENT ELECT Eddie Hale/Neighborhood Autos PO Box 1719 Decatur TX 76234 CHAIRMAN OF THE BOARD Mark Jones/MCMC Corporate 264 Exchange Burleson, TX 76028 SECRETARY Vicki Davis/A-OK Auto Sales 23980 FM 1314 Porter, TX 77365 TREASURER Greg Phea/Austin Rising Fast 8024 IH 35 North Austin TX 78753 ICE PRESIDENT, WEST TEXAS V (REGION 1) Brad Kalivoda/Fiesta Motors 2599 74th Street Lubbock, TX 79423 ICE PRESIDENT, FORT WORTH V (REGION 2) Greg Reine/Auto Liquidators 39670 LBJ Freeway Dallas TX 75237 ICE PRESIDENT, DALLAS V (REGION 3) Chad Lancaster/Chacon Autos 11800 E. Northwest Hwy Dallas TX 75218 ICE PRESIDENT, HOUSTON V (REGION 4) Russell Moore/Top Notch Used Cars 900 East Davis Conroe, TX 77301 ICE PRESIDENT, CENTRAL TEXAS V (REGION 5) Robert Blankenship/Texas Auto Center 6809 Suite B S IH35 Austin, TX 78744 ICE PRESIDENT, SOUTH TEXAS V (REGION 6) Armando Villarreal/McAllen Auto Sales, LLC 4215 S. 23rd St McAllen, TX 78503 ICE PRESIDENT AT LARGE V Lowell Rogers/11th Street Motors 1355 N 11th St, Beaumont, TX 77702 ICE PRESIDENT AT LARGE V Cesar Stark/S&S Motors 7699 Alameda Ave. El Paso, TX 77915 TIADA EXECUTIVE DIRECTOR Jeff Martin 9951 Anderson Mill Rd., Suite 101 Austin, TX 78750 Office Hours M-F 8:30am – 4:30pm 512.244.6060 • Fax 512.244.6218 jeff.martin@txiada.org

Vo l u m e X X I I / I s s u e 9 / S e p t e m b e r 2 0 2 2

TexasDealer contents

4 Officers’ Message

by Greg Phea, TIADA Treasurer

8 Board of Directors Meeting Minutes 12 2022 TIADA Conference & Expo Wrap-Up by TIADA Staff

14 2022 TIADA Awards Wrap-Up by TIADA Staff

17 Legal Corner: Dealer Questions About Sales Tax on GPS Units and Air-Time Fees by Michael W. Dunagan

18 Upcoming Events 20 TIADA Auction Directory 22 TIADA Membership Application 24 On The Cover: TIADA Welcomes 2023 President Ryan Winkelmann by TIADA Staff

27 A uto Dealer Bond Claim Process in Texas: Everything You Need to Know by Eric Weisbrot

31 Can Great Recession Lessons Help Dealers in 2022? by David Meyer

35 Watching Your Profit & Loss Statement Isn’t Good for Your Dealership by Harlene Doane

39 6 Key Areas You Might Be Wasting Your Local Marketing Spend by Jamil Zabaneh

42 House of Delegates Meeting Minutes 43 Local Chapters 43 New Members 45 Behind the Wheel by Jeff Martin

Did You Know? The 2022 TIADA Conference and Expo was the largest in association history, with 320 dealers in attendance! Notice to all members concerning services and products: TIADA was established in 1944 to develop professional standards of service and conduct for the independent auto industry. Opinions expressed herein are not necessarily those of the TIADA management, the Board of Directors or the membership. Likewise, the appearance of advertisers or their indemnifications of TIADA does not constitute endorsement of the products or services featured.

Editor: Stephen Pallas

Magazine Ad Sales: Patty Huber, 512-310-9795


officers’ message by

On Making Connections Through Celebration and Positivity

Greg Phea

Austin Rising Fast (Austin) TIADA TREASURER

J

uly 27th marked my wife’s and my 30th anniversary. It was so significant and joyous to be embraced by friends, family, staff, and even customers. Remarkably, this social event led to a boost in sales and reengagement with my business’ social media. It was even a wonderful opportunity to get new online reviews from those customers. The experience was so remarkable, that I began thinking about the power of connection and how I could use those strong feelings to bolster my business even more. People gravitate towards celebration and positivity. My team and I celebrate every single deal with a miniature party: music plays, and all staff cheer and thank our customers. Celebration is my favorite part of our process. We might do deals all day, every day, but for most customers, a vehicle purchase is a big deal, done only a few times in a lifetime. We want them to feel embraced. My company is always orienting messaging and digital communications around providing a family-like environment and positive experience. However, there is always room for improvement. One thing I have resolved to do since the TIADA Conference’s Dealer Education Sessions is to bring

customers’ stories and experiences online. No one is a stranger to the unique challenges the last two years have brought to the car business. Physical restrictions brought sales online and being able to conduct remote transactions represented a strong draw to many shoppers. So why not bring customers joy and celebration online as well? It is more crucial than ever to continue to connect with previous customers in meaningful ways. I truly value relationships, and whenever I find myself looking at the sales and find them lacking, I always revisit the foundation: loyal, repeat business.

It is more crucial than ever to continue to connect with previous customers in meaningful ways. 4

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Collect the Cash, Not the Car Dealer Academy Presenter

This has been one of the most challenging years in the Buy Here, Pay Here industry. Dealers are finding that every collection opportunity needs to be capitalized on and that’s where this seminar can help.

Collect The Cash, Not The Car is designed Brent Carmichael,

Executive Conference Moderator, 20 Groups. NCM Associates, Inc.

Time

9:00am - 4:00pm

Cost

to help you and your collection teams maximize your collection opportunities. Through this 1-day course you can expect to learn: • How to overcome the • How to maximize the common and not so collectability of every customer common customer objections • Effective skip tracing methods and tools • Effective phone collection techniques

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To register visit 6

Txiada.org or by phone at 512.244.6060. T e x a s

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board of directors meeting minutes

July 24, 2022 | Kalahari Resorts, Round Rock, TX

compiled by Texas Dealer staff

Board Members in Attendance:

Robert Beck, Mark Jones, Ryan Winkelmann, Eddie Hale, Vicki Davis, Cesar Stark, Chad Lancaster, Greg Reine, Russell Moore, Robert Blankenship, Armando Villarreal, Brad Kalivoda, Greg Phea

TIADA Staff in Attendance:

Jeff Martin, Earl Cooke, Teresa Orkun

Moved by Russell Moore, seconded by Armando Villarreal. –PASSED

Treasurer’s Report

Vicki Davis presented the Treasurer’s Report. A motion was made to accept the report.

President Mark Jones called the meeting to order at 9:02 a.m.

Moved by Ryan Winkelmann, seconded by Greg Reine. –PASSED

Minutes of Last Meeting

President’s Report

A motion was made to accept the minutes.

Executive Director’s Report

Secretary Eddie Hale presented the minutes from the last meeting.

Mark Jones presented the President’s Report. He thanked the board for the past year. Jeff Martin presented the Executive Director’s Report, including a discussion of the FTC Safeguards Course and conferences attended (NIADA, Ignite, Tax Assessor Collectors).

Conference & Expo

Save the Date July 23-25

2 23 JW Marriott Hill Country Resort San Antonio, TX

Save the Date 8

New Business

A motion was made to accept the 2023 proposed budget. Moved by Eddie Hale and seconded by Greg Reine. –PASSED A motion was made to pay off the mortgage of the association’s office space. Moved by Eddie Hale, seconded by Russell Moore. –PASSED A motion was made to adjourn the meeting. Moved by Vicki Davis, seconded by Robert Blankenship. –PASSED Mark Jones adjourned the meeting at 11:15 a.m. Respectfully submitted, Eddie Hale, Secretary A complete copy of any reports referenced in this document and more detailed notes from the meeting are on file at the TIADA office and available upon request.

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L CORPORATE PART NER IONA NAT

GOLD

PROUD MEMBER OF


Thank you to all those who have contributed to

Please fill out the form on the next page to help our efforts at the Capitol!

INDEPAC in 2022!

A List of Our Contributors through July Top Ten Donors Blankenship, Robert and Erika Davis, Brad Gregory, Jason Hale, Eddie Ingram, Blake Alderson, Sam Allen, Scott Barragan, Cesar Beck, Robert Brown, Mark Carlson, Mike Chaney, Greg* Chapman, Kyle Cochran, Kip Cockerell, Clint Cooke, Earl Davis, Vicki Dobbins, Allen Donnelly, Chris* Downey, Mike Edenfield, Robert* Endsley, Jennifer Fox, Andy Goodman, Jason* Gregory, Tommy* Greig, Steven J. Hagler, Keith* Hanson, April*

Hobson, James Hudson, Richard Hudson, Robert Ireland, Alden Johnson, James Keate, Kyle Klein, Daniel Labaj, Kanton Lancaster, Chad Lathrop, Phillip Levine, Stephen Maroney, Rick Martin, Jeff Martinez, Mario Middaugh, Tom Moore, Russell* Munoz, Jose Murphy, Bill Paredez, Sonny Phea, Greg Rhodes, Brent Rose, Jay Ruckel, Matt

Jones, Mark* Kaya, Selcuk Reine, Greg Rogers, Lowell Simmons, Tyler* Sabillon, Christina Sabillon, Juan M. Sabra, Ramzi Scott, Paul Siddiqui, Irfan Silva, David Simonsen, Nelsen Smith, Jerry and DeDe Smith, Jesse Smith, Russell and Linda Stark, Cesar Stazzone, Rich Stoll, Kevin Sumrall, Cal Trevino, Miguel (Mike) Turan, Jon Valdez, Sergio Villarreal, Armando Wilson, Erik Winkelmann, Ryan* Zak, Gregory* Zak, Michael

*Monthly Donor

Total Contributions in 2022 10

$78,500 T e x a s

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Yes, I would like to help with TIADA’s grassroots effort! ______________________________________________________________________________________

Please list me as a sustaining donor. I would like to support my industry by making a monthly credit card donation of $______________ Add me to the KEY-PERSON list! I know (Name of Legislator) _______________________________________________ as a ____ Acquaintance

____ Personal Friend

____ Professional Contact

I would like to attend political fundraisers in my area I would like to support my industry by pledging a one-time donation of ___$1,000

___$500

___$250

___$100

Other $________

______________________________________________________________________________________

____ Personal Check Payable to INDEPAC

_____Personal Credit Card

Name_______________________________________________________________________________ Company ____________________________________________________________________________ Home Address________________________________________________________________________ Email _______________________________________________________________________________

** Personal Check or Personal Credit Card only. Corporate contributions are prohibited by state law. Contributions are not tax deductible as charitable contributions for federal income tax purposes. ** Charge my Credit Card V MC D AM __________________________________________________ Exp: _____/_____ CVV: _____ Name on Card: ____________________________________________________________________________ Card Billing Address (if different):

______________________________________________________

______________________________________________________________________________________

Or donate online at www.txiada.org >> Resources >> Advocacy >> Political Action Committee

______________________________________________________________________________________

c/o TIADA 9951 Anderson Mill Rd

Referred by:

Suite 101, Austin Texas 78750

PHONE 512.244.6060 FAX 512.244.6218 EMAIL accounting@txiada.org

September 2022

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feature

2022 TIADA Conference & Expo Wrap-Up by TIADA Staff

T

IADA members traveled to Round Rock in July to attend the 2022 Conference & Expo. It was the largest, and one of the most successful and memorable events, in the association’s history, with 320 dealers in attendance. Many of these dealers were first-time attendees, who enjoyed several hours of educational breakout sessions presented by leaders within the industry. The revamped dealer-driven roundtables were also a huge success, with several dealers commenting how much they enjoyed discussing issues affecting dealerships of similar size and scope. The variety of these discussions covered many important topics within the industry, including BHPH operations, dealership management, special finance and retail, technology, marketing,

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and compliance. Dealers also attended an entertaining opening keynote address by dealer Chad Randash and master magician Armando Lucero. On Tuesday, FTC Senior Attorney Tom Carter gave an important keynote address to help dealers stay compliant with the FTC Safeguards Rule and Used Car Rule, followed by an insightful question-and-answer session from the audience and an association update from TIADA Executive Director Jeff Martin. These presentations, sessions, and events were highlighted by an atmosphere of excitement and camaraderie, as dealers face some serious challenges in inventory and other areas. Attendees were enthusiastic to participate in the largestever TIADA Conference. In addition to the educational sessions and roundtable discussions, dealers attended a jampacked expo hall, which featured over 100 vendors. Don’t forget to mark your calendars for July 23–25, 2023. We will be heading to the JW Marriott Hill Country Resort in San Antonio, and we can’t wait to see you all again!

September 2022

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feature

2022 TIADA Awards Wrap-Up by TIADA Staff

T

IADA announced the winners of several awards at the final event during the 2022 Conference & Expo, which took place from July 24–26 at the Kalahari Resort in Round Rock. The awards banquet is always one of the event’s major highlights, and several members of the community were honored for their work over the past year. Greg Reine, owner of Auto Liquidators, was named the 2022 Texas Quality Dealer Award. It is the most prestigious award the association gives each year, and the award committee bases its selection on the individual’s character, association participation, political involvement, and business acumen. Earlier, the first award winner was Breanna Simmons, who was given the Marvin Norwood Scholarship for her promise as a student and leader in the community. Scott Allen, who presented the award, also announced that TIADA was able to award additional scholarships to every one of their applicants this year, thanks to a generous donation from Steve and Susan Babinksy’s Triple J Family Foundation. Texas State Senator Carol Alvarado was awarded the

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organization’s Independent Award, which recognizes individuals outside of the industry who work to support independent automobile dealers. Senator Alvarado has worked hard to move legislation to prevent catalytic converter theft and has attended numerous local HIADA chapter meetings. Next, outgoing TIADA President Mark Jones presented Sergeant Darren Schlosser with the Presidential Award. Sergeant Schlosser leads the Vehicle Fraud Unit in the Auto Theft Division of the Houston Police Department and has brought a set of standards and practices to help the industry efficiently combat fraud. He also regularly attends the TIADA Conference. Blake Ingram then announced the first-ever TIADA Lifetime Achievement Award, which was given to Michael Dunagan for his decades-long service to the industry and to the association. And former TIADA President (and current NIADA President) Scott Allen has become the newest member of the TIADA Hall of Fame for his ongoing representation, leadership, and advocacy for Texas dealers at the Capitol in Austin. Congratulations to all this year’s winners!

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legal corner

Dealer Questions About Sales Tax on GPS Units and Air-Time Fees Dealer Question: One GPS vendor is telling me that sales tax on GPS devices and air time charges are not subject to state sales tax and thus tax would not be included on my invoices. I’ve been told by another vendor that I have to pay sales tax on GPS devices, even though I buy them from out-of-state and install them as accessories on the vehicles I sell. The second vendor includes sales tax on its invoices. What gives? Answer: The Comptroller’s office, in audits of dealers, and in discussions with TIADA, has taken the position that GPS units, purchased by dealers for installation on vehicles sold as a way of tracking collateral, are taxable purchases by the dealer. The taxable amount includes shipping and handling charges billed by the seller. Additionally, the Comptroller’s office has taken the position that air-time charges billed to the dealer are taxable service charges. As to the purchase of the device itself, the Comptroller says the item is taxable as “tangible personal property.” All tangible personal property purchased for use in Texas is subject to sales tax unless specifically exempted. The state’s tax office has taken the position that there is no exemption that applies to GPS devices purchased by dealers for the primary purpose of locating collateral. Dealer Question: If I buy a part to install on a vehicle that I intend to resell, I don’t have to pay sales tax on the part when I purchase it. Can’t I argue that the GPS unit is like an accessory that I purchase for installation on a vehicle that will be included in the motor vehicle sales tax? Answer: There is an exemp-

tion for an “accessory” that a dealer would purchase to install on a vehicle that is resold. The theory behind the accessory exemption is that the sales price of the object to which the accessory is installed (in this case a motor vehicle) will be enhanced by the product which results in sales tax being recovered at the ultimate retail sale (in this September 2022

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Michael W. Dunagan by

TIADA COUNSEL

The official opinion of the Comptroller’s office is that GPS devices are taxable regardless of whether they remain the property of the dealer, and regardless of whether or not they are removed.

case, motor vehicle sales tax on the vehicle). The accessory exemption doesn’t apply to GPS devices, the comptroller’s office says, because they are primarily purchased and installed for the use and benefit of the dealer (or other lien holder), not the consumer. Even if the device stays with the vehicle, and is available for the buyer to use after repayment is complete, the initial purchase and installation were primarily for the dealer to locate the vehicle for repossession purposes.

Dealer Question: A dealer down the street from me who uses GPS devices was recently audited by the Comptroller’s office. He was told by the auditor that since he didn’t

remove units from cars he takes back and from paid-off units, the units would be considered to be nontaxable accessories. Can I rely on the auditor’s statement to that dealer?

Answer: The official opinion of the Comptroller’s office is that GPS devices are taxable regardless of whether they remain the property of the dealer, and regardless of whether or not they are removed. The decision of an auditor in the field is probably not binding on the Comptroller’s office. We can expect future audits to consistently take the official position. Dealer Question: If I buy a book or DVD on-line from a company that is located out-of-state, 17


I usually don’t pay sales tax. Why do I have to pay sales tax on a GPS device that I purchase from an outof-state company that doesn’t have an office in Texas?

Answer: According to the

Upcoming Events TIADA DEALER ACADEMY Online registration available. www.txiada.org

October 2022 3 Collect the Cash Not the Car

Hilton Garden Inn Dallas Market Center 2325 N. Stemmons Freeway Dallas, TX 75207

December 2022 12 Keeping Your Dealership

Legal & Compliant Sheraton Houston Brookhollow Hotel 3000 North Loop West Houston, TX 77092

OTHER TIADA EVENTS October 2022 24 Board of Directors Meeting Austin, TX

February 2023 6-7 Board of Directors Meeting and TIADA Day at the Capitol Austin, TX

April 2023 23 Board of Directors Meeting Austin, TX

July 2023 23 Board of Directors Meeting Followed by TIADA Conference and Expo San Antonio, TX 18

Comptroller’s office, you do technically owe sales tax on the books and DVDs and many on-line retailers are not collecting and remitting sales tax on purchases sent to Texas residents. There is a provision of the Texas Tax Code that says there is an equivalent “use tax” owed by the purchaser on items purchased out-of-state but brought into Texas to be used. As a practical matter, Comptroller personnel are not going to audit every household for taxable purchases. Dealers, however, are subject to audits on motor vehicle sales taxes, and inquiry can easily be made by an auditor of taxable purchases. A separate but related issue on the question of sales tax on outof-state purchases has to do with when a seller in another state must sign up to collect Texas sales tax on purchases made by Texas residents. This question has been the subject of much litigation. The general answer is a seller must collect Texas sales tax if the seller has “nexus” to the state. That is, does the seller have sufficient contacts with the state to give the state jurisdiction over the selling entity? According to the Comptroller’s office, almost any type of contact with the state is sufficient. For instance, having an office, a warehouse, or employees in Texas creates “nexus.” But what is not commonly known is that just having a sales rep (even an independent agent) calling on customers in Texas, or appearing at a convention or trade show in Texas are sufficient contacts. By the way, whether or not a seller has sufficient contacts or “nexus” to require collecting and remitting sales tax is totally separate from the issue of whether the purchase of a product from a seller is taxable to the buyer. That is, even if an out-of-state seller

has no contacts with Texas at all, the “use” tax is owed by the purchaser on taxable items.

Dealer Question: My GPS vendor refuses to collect sales taxes or even put sales tax on my invoices. How can I pay sales tax to avoid being assessed penalties and interest if I’m audited by the Comptroller? Answer: The dealer can pay sales taxes that are owed but aren’t collected by the seller by adding the amount of tax owed to his or her Texas Limited Sales Tax report (not to be confused with the Motor Vehicle Sales Tax report on deferred sales taxes) and remitting the appropriate taxes directly to the Comptroller’s office. This same procedure has been recommended for paying sales taxes on repossession fees when repossession agents refuse to add sales tax to their charges. By the way, unlike motor vehicle sales tax, which is uniform throughout the state, the limited sales tax rate varies from location to location as there are optional types and amounts of taxes local governmental units can add to the state’s portion of the sales tax. Dealers need to determine what that rate is (usually in the range of 8.258.75 per cent) at their locations. Dealer Question: Why do I have to pay sales taxes on air-time fees that I am charged by my vendor for access to satellite tracking information and for activation of shutoff devices? Answer: The Comptroller’s office takes the position that such charges are taxable as “security services” and/ or “telecommunication services” which are taxable under the Texas Tax Code. The Tax Code lists certain services that are subject to sales tax even though they don’t involve the purchase of tangible personal property. Dealer Question: I have been audited in the past, but nothing was said about owing sales taxes T e x a s

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on the GPS devices I had bought. Can’t I rely on the absence of being assessed for the taxes in a prior audit to establish that the purchases are not taxable to me?

Answer: The Comptroller’s

Office has always taken the position that its failure to raise an issue in an audit can’t be relied upon to excuse non-payment of a tax due assessed in a subsequent audit.

Dealer Question: What does TIADA recommend for dealers who purchase and use GPS devices? Answer: Until further clarification is received from the Comptroller, the administrative process, or, ultimately, the courts and the legislature, the best practices procedure is for the dealer to either pay sales tax as invoiced from the GPS vendor, or, if sales tax does not appear on the invoice, to pay the tax directly to the

Comptroller using the Limited Sales Tax report discussed above. Dealers may wish to consult sales-tax specialists for further guidance.

Dealer Question: Can I pass through a charge for GPS devices to a vehicle finance customer on a motor vehicle retail installment contract? Answer: The Office of Consumer Credit Commissioner (OCCC) has taken the position that charges for GPS devices are not authorized charges that can be passed through. And like the Comptroller’s Office, OCCC cites the fact that GPS devices are primarily for the benefit of the creditor, not the consumer. When such charges have been found on contracts (usually during routine investigations or audits) of licensees, the dealers have been required to refund or credit the charges.

Also, in the federal Consumer Finance Protection Bureau (CFPB) opinion in the Herbies case (see the May, 2016 issue of Texas Dealer for a more complete discussion of the case), the placement of a charge for GPS devices on retail installment contracts was found to be one of the violations. First, such charges may be violations under state law (as is the case in Texas). Additionally, the CFPB found that the charges were in fact finance charges as defined in federal Truth in Lending (TIL). But since they were not added to the disclosed finance charges, and were not included in the annual percentage rates, TIL violations had occurred. Michael W. Dunagan is an attorney in Dallas, Texas who has represented the Texas Independent Automobile Dealers Association for over 45 years. He has written a number of books and hundreds of articles for trade journals and law reviews. His clientele includes dealers, banks, finance companies, auto auctions and credit unions.

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TIADA Auction Directory

Save thousands on buy or sell fees at these participating auctions! * VALID FOR SELL FEE ONLY AT INSURANCE AA LOCATIONS ** ONLINE AUCTION AVAILABLE

Abilene ALLIANCE AUTO AUCTION ABILENE

www.allianceautoauction.com 6657 US Highway 80 West, Abilene, TX 79605 325.698.4391, Fax 325.691.0263 GM: Brandon Denison Friday, 10:00 a.m.

$AVE : $200

C.M. COMPANY AUCTIONS, INC. www.cmauctions.com

2258 S. Treadaway, Abilene, TX 79602 325.677.3555, Fax 325.677.2209 GM: Gregory Chittum Thursday, 10:00 a.m. $AVE : $200

IAA ABILENE*

www.iaai.com 7700 US 277, Hawley, TX 79601 325.675.0699, Fax 325.675.5073 GM: Shawn Lemke Thursday, 9:30 a.m.

$AVE : up to $200 Sell Fee

Amarillo IAA AMARILLO*

www.iaai.com 11150 S. FM 1541, Amarillo, TX 79118 806.622.1322, Fax 806.622.2678 GM: Shawn Norris Monday, 9:30 a.m.

$AVE : up to $200 Sell Fee

Austin ADESA AUSTIN

www.adesa.com 2108 Ferguson Ln., Austin, TX 78754 512.873.4000, Fax 512.873.4022 GM: Michele Arguijo Tuesday, 9:00 a.m.

$AVE : $200

ALLIANCE AUTO AUCTION AUSTIN

www.iaai.com 2191 Highway 21 West, Dale, TX 78616 512.385.3126, Fax 512.385.1141 GM: Geoffrey Rabb Tuesday, 9:00 a.m.

$AVE : up to $200 Sell Fee

METRO AUTO AUCTION AUSTIN www.metroautoauction.com 8605 Cullen Ln., Austin, TX 78748 512.282.7900, Fax 512.282.8165 GM: Brent Rhodes 3rd Saturday, monthly

$AVE : $200

Corpus Christi CORPUS CHRISTI AUTO AUCTION

www.corpuschristiautoauction.com 2149 IH-69 Access Road, Corpus Christi, TX 78380 361.767.4100, Fax 361.767.9840 GM: Hunter Dunn Friday, 10:00 a.m.

$AVE : $200

IAA CORPUS CHRISTI*

www.iaai.com 4701 Agnes Street, Corpus Christi, TX 78405 361.881.9555, Fax 361.887.8880 GM: Patricia Kohlstrand Wednesday, 9:00 a.m.

$AVE : up to $200 Sell Fee

Dallas-Ft. Worth Metroplex ADESA DALLAS

www.adesa.com 3501 Lancaster-Hutchins Rd., Hutchins, TX 75141 972.225.6000, Fax 972.284.4799 GM: Allan Wilwayco Thursday, 9:30 a.m.

$AVE : $200

ALLIANCE AUTO AUCTION DALLAS

www.allianceautoauction.com 1550 CR 107, Hutto, TX 78634 737.300.6300 GM: Brad Wilson Wednesday, 9:45 a.m.

www.allianceautoauction.com 9426 Lakefield Blvd., Dallas, TX 75220 214.646.3136, Fax 469.828.8225 GM: Robert Kersh Wednesday, 1:30 p.m.

AMERICA’S AA AUSTIN / SAN ANTONIO

AMERICA’S AA DALLAS

$AVE : $200

www.americasautoauction.com 16611 S. IH-35, Buda, TX 78610 512.268.6600, Fax 512.295.6666 GM: Jamie McCollum Tuesday, 1:30 p.m. / Thursday, 2:00 p.m.

$AVE : $200 20

IAA AUSTIN*

$AVE : $200

www.americasautoauction.com 219 N. Loop 12, Irving, TX 75061 972.445.1044, Fax 972.591.2742 GM: Ruben Figueroa Tuesday, 1:00 p.m. / Thursday, 1:00 p.m.

$AVE : $200

IAA DALLAS*

www.iaai.com 204 Mars Rd., Wilmer, TX 75172 972.525.6401, Fax 972.525.6403 GM: Bob Bannister Wednesday, 9:00 a.m.

$AVE : up to $200 Sell Fee

IAA DFW*

www.iaai.com 4226 East Main St., Grand Prairie, TX 75050 972.522.5000, Fax 972.522.5090 GM: Julissa Reyes Tuesday, 9:00 a.m.

$AVE : up to $200 Sell Fee

IAA FORT WORTH NORTH*

www.iaai.com 3748 McPherson Dr., Justin, TX 76247 940.648.5541, Fax 940.648.5543 GM: Jack Panczyk Tuesday, 9:00 a.m.

$AVE : up to $200 Sell Fee

MANHEIM DALLAS**

www.manheim.com 5333 W. Kiest Blvd., Dallas, TX 75236 214.330.1800, Fax 214.339.6347 GM: Rich Curtis Wednesday, 9:00 a.m.

$AVE : $100

MANHEIM DALLAS FORT WORTH**

www.manheim.com 12101 Trinity Blvd., Fort Worth, TX 76040 817.399.4000, Fax 817.399.4251 GM: Nicole Graham-Ponce Thursday, 9:30 a.m.

$AVE : $100

METRO AUTO AUCTION DALLAS**

www.metroaa.com 1836 Midway Road, Lewisville, TX 75056 972.492.0900, Fax 972.492.0944 GM: Scott Stalder Tuesday, 9:00 a.m.

$AVE : $200

El Paso AMERICA’S AUTO AUCTION EL PASO www.epiaa.com 7930 Artcraft Rd., El Paso, TX 79932 915.587.6700, Fax 915.587.6700 GM: Luke Pidgeon Wednesday, 10:00 a.m.

$AVE : $200

IAA EL PASO*

www.iaai.com 14651 Gateway Blvd. W, El Paso, TX 79927 915.852.2489, Fax 915.852.2235 GM: Jorge Resendez Friday, 10:30 a.m.

$AVE : up to $200 Sell Fee T e x a s

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MANHEIM EL PASO

www.manheim.com 485 Coates Drive, El Paso, TX 79932 915.833.9333, Fax 915.581.9645 GM: JD Guerrero Thursday, 10:00 a.m.

$AVE : $100

IAA MCALLEN*

www.iaai.com 900 N. Hutto Road, Donna, TX 78537 956.464.8393, Fax 956.464.8510 GM: Ydalia Sandoval Tuesday, 9:00 a.m.

$AVE : up to $200 Sell Fee

BIG VALLEY AUTO AUCTION**

www.bigvalleyaa.com 4315 N. Hutto Road, Donna, TX 78537 956.461.9000, Fax 956.461.9005 GM: Lisa Franz Thursday, 9:30 a.m.

$AVE : $200

Houston ADESA HOUSTON

www.adesa.com 4526 N. Sam Houston, Houston, TX 77086 281.580.1800, Fax 281.580.8030 GM: Brian Wetzel Wednesday, 9:00 a.m.

$AVE : $200

AMERICA’S AA HOUSTON

www.americasautoauction.com 1826 Almeda Genoa Rd., Houston, TX 77047 281.819.3600, Fax 281.819.3601 GM: Ben Nash Thursday, 2:00 p.m.

$AVE : $200

AMERICA’S AA NORTH HOUSTON www.americasautoauction.com 1440 FM 3083, Conroe, TX 77301 936.441.2882, Fax 936.788.2842 GM: Buddy Cheney Tuesday, 1:00 p.m.

$AVE : up to $200 Sell Fee

www.autonationautoauction.com 608 W. Mitchell Road, Houston, TX 77037 822.905.2622, Fax 281.506.3866 GM: Juan Gallo Friday, 9:30 a.m.

$AVE : $200

HOUSTON AUTO AUCTION

www.houstonautoauction.com 2000 Cavalcade, Houston, TX 77009 713.644.5566, Fax 713.644.0889 President/GM: Tim Bowers Wednesday, 11:00 a.m.

$AVE : $200

IAA HOUSTON*

www.iaai.com 2535 West. Mt. Houston, Houston, TX 77038 281.847.4700, Fax 281.847.4799 GM: Alvin Banks Wednesday, 9:00 a.m.

$AVE : up to $200 Sell Fee

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IAA PERMIAN BASIN*

www.iaai.com 701 W. 81st Street, Odessa, TX 79764 432.550.7277, Fax 432.366.8725 Thursday, 11:00 a.m.

$AVE : up to $200 Sell Fee

ONLINE

MANHEIM HOUSTON

E-DEALERDIRECT**

$AVE : up to $200 Sell Fee

www.manheim.com 14450 West Road, Houston, TX 77041 281.924.5833, Fax 281.890.7953 GM: Brian Walker Tuesday, 9:00 a.m. / Thursday 6:30 p.m.

$AVE : $100

MANHEIM TEXAS HOBBY

www.manheim.com 8215 Kopman Road, Houston, TX 77061 713.649.8233, Fax 713.640.6330 GM: Darren Slack Thursday, 9:00 a.m.

$AVE : $100

Longview ALLIANCE AUTO AUCTION LONGVIEW www.allianceautoauction.com 6000 East Loop 281, Longview, TX 75602 903.212.2955, Fax 903.212.2556 GM: Chris Barille Friday, 10:00 a.m.

$AVE : $200

IAA LONGVIEW*

www.iaai.com 5577 Highway 80 East, Longview, TX 75605 903.553.9248, Fax 903.553.0210 GM: Edgar Chavez Thursday, 9:00 a.m.

Lubbock

AUTONATION AUTO AUCTION - HOUSTON

Midland Odessa

www.iaai.com 2839 E. FM 1462, Rosharon, TX 77583 281.369.1010, Fax 833.595.8398 GM: Adriana Serrano Friday, 9:30 a.m.

$AVE : up to $200 Sell Fee

$AVE : $200

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www.iaai.com 16602 East Hardy Rd., Houston-North, TX 77032 281.443.1300, Fax 281.443.4433 GM: Aracelia Palacios Thursday, 9:00 a.m.

IAA HOUSTON SOUTH*

Harlingen/McAllen

September 2022

IAA HOUSTON NORTH*

IAA LUBBOCK*

www.iaai.com 5311 N. CR 2000, Lubbock, TX 79415 806.747.5458, Fax 806.747.5472 GM: Chris Foster Tuesday, 9:00 a.m.

$AVE : up to $200 Sell Fee

TEXAS LONE STAR AUTO AUCTION** www.lsaalubbock.com 2706 E. Slaton Road., Lubbock, TX 79404 806.745.6606 GM: Dale Martin Wednesday, 9:30 a.m

ACV AUCTIONS**

www.acvauctions.com 800.553.4070

$AVE : $250

www.e-dealerdirect.com chris@edealerdirect.com

$AVE : Up to $500/month

San Antonio ADESA SAN ANTONIO

www.adesa.com 200 S. Callaghan Rd., San Antonio, TX 78227 210.434.4999, Fax 210.431.0645 GM: Clifton Sprenger Thursday, 10:00 a.m.

$AVE : $200

IAA SAN ANTONIO*

www.iaai.com 11275 S. Zarzamora, San Antonio, TX 78224 210.628.6770, Fax 210.628.6778 GM: Paula Booker Monday, 9:00 a.m.

$AVE : up to $200 Sell Fee

MANHEIM SAN ANTONIO**

www.manheim.com 2042 Ackerman Road San Antonio, TX 78219 210.661.4200, Fax 210.662.3113 GM: Mike Browning Wednesday, 9:00 a.m.

$AVE : $100

SAN ANTONIO AUTO AUCTION**

www.sanantonioautoauction.com 13510 Toepperwein Rd. San Antonio, TX 78233 210.298.5477 GM: Brandon Walston Tuesday, 10:00 a.m. / Thursday, 1:30 p.m.

$AVE : $200

Tyler GREATER TYLER AUTO AUCTION www.greatertyleraa.com 11654 Hwy 64W, Tyler, TX 75704 903.597.2800, Fax 903.597.3848 GM: Wayne Cook Tuesday, 5:00 p.m.

$AVE : $200

$AVE : $75/Quarterly

Waco

Lufkin

ALLIANCE AUTO AUCTION WACO

LUFKIN DEALERS AUTO AUCTION

www.lufkindealers.com 2109 N. John Reddit Dr., Lufkin, TX 75904 936.632.4299, Fax 936.632.4218 GM: Wayne Cook Thursday, 6:00 p.m.

$AVE : $200

www.allianceautoauction.com 15735 I-35 Frontage Road Elm Mott, TX 76640 254.829.0123, Fax 254.829.1298 GM: Christina Thomas Friday, 10:00 a.m.

$AVE : $200

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texas independent automobile dealers association

Become a TIADA Member

TIADA texas independent automobile dealers association

Business Name: ____________________________________________ Select one:

Dealer Member

Associate Member

Contact Person: ____________________________________________

Membership Dues:

Address: __________________________________________________ City: __________________________________ State: _____ Zip: ______ County: ______________ Cell Phone: __________________________

$499* Renewing Member

Office Phone: __________________________ Fax: ________________________

Email: _______________________________________________

$250* New Member (*Membership is thru 12/31/2022. Dues include NIADA and local chapter membership where applicable.)

Dealer P Number: ___________________________________________ Who referred you to TIADA? __________________________________ Mailing Address (if different from above): __________________________________________________________ City: ____________________________State: _______ Zip: ______________

PLEASE INDICATE PAYMENT METHOD: Check or Money Order payable to TIADA Check # __________ Credit Card Card Number: __________________________________________________ Sec.Code: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ Expiration Date: ____________ Monthly Payments - $41.58 per month Via Credit Card (Please enter card information above) Via Bank Draft (Authorization Agreement required - contact state office)

Mail or Fax Application To: TIADA Membership Services, 9951 Anderson Mill Rd., Suite 101, Austin, TX 78750 FAX 512.244.6218

www.txiada.org

512.244.6060

Dues are not deductible as charitable contributions for income tax purposes but may be deductible as miscellaneous itemized deductions, subject to IRS restrictions. It is estimated that 20 percent of your dues dollars is used for lobbying activities and is therefore not deductible.

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W hy Choose Us? W hy Choose Us? • 40 Years Serving Texas Dealers • 4.9 Star Avg. Customer Rating • Independently Owned

Visit Us Online for Customized Solutions & Helpful Insights Visit Us Online for Customized Solutions & Helpful Insights M U L L ENINSU RANC E.C O M

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M U L L ENINSU RANC E.C O M


on the cover by TIADA Staff

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IADA 2023 President Ryan Winkelmann is a secondgeneration dealer who started in the independent automobile industry while he was still in high school. His family has a long heritage in the association, with his mother, Janette Winkelmann serving as TIADA president back in 1997. But Ryan is much more than a product of his family’s success. As a partner in BJ’s Autohaus in Houston, he helped manage the dealership for his first 20 years, and then purchased the family business ten years ago, making this his 30th year in the industry.

TIADA Welcomes 2023 President

Ryan

Winkelmann Ryan Winkelmann’s Legacy: Past, Present, and Future

Ryan will be the first to admit that he has lived firmly in the shadow of his parents for much of his time in the business. His mother dedicated over 20 years to the independent automobile industry and was the first-ever female president of TIADA. His father, Bill, served as president of the Houston IADA, and coached Ryan through nearly every department of the company during those same 20 years. “I’ve had a tremendous amount 24

“I want to show people the true internal benefits of what TIADA does for their business. We have enormous potential as a leader in the association industry, and we look forward to attracting as many good, healthy, and strong dealers as possible.” T e x a s

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of love, support, and encouragein our local and state associations industry in the short and long term. ment, not only from my parents, from the time I was in sales,” said In addition to what promises to be who built an extremely successRyan. a busy legislative session for TIADA, ful life and business in the auto dealers have been facing inventory industry but also many of you in shortages and staffing issues for sevOn the Future of TIADA this room,” Ryan said at the Awards eral months. Ryan is optimistic that During Ryan’s tenure as President Banquet. these issues will be somewhat easier of TIADA, he plans to focus his efBut Ryan has become an incredto manage in the coming year. forts on growing membership and ibly successful dealer in his own “I’ve spoken with many dealers member engagement and on payright. BJ’s Autohaus currently who have taken this time as an oping close attention to the upcoming employs six staff members and portunity to retain and hire quality Texas legislative session that begins historically sells between 250-350 employees with a drive to work,” in January 2023. cars annually. As a he said. “We see the dealer, Ryan emphareturn of a willingness sizes customer loyalty to work. We also see “I’ll work hard to deliver and retention; as an vehicle prices starting to employer, he ensures stabilize and becoming the best results possible for his staff members are more realistic from the efficient and reliable dealer side, which hopewhatever challenges present representatives of the fully means an end to company. the crushing inventory themselves during that time. “I pride myself on shortages we have seen Some of my initial goals are to running a debt-free this past year.” operation with little On a more direct continue responsible growth overhead and almost level, Ryan expressed no employee turnover,” a desire to grow the in our membership and said Ryan. association. He is as dedicated a “I want to show education, and to have one of dealer and employer people the true internal as he is a husband and benefits of what TIADA the most productive legislative father. He opened his does for their busispeech as incoming ness,” he said. “We have sessions possible.” President at the 2022 enormous potential as a Conference and Expo leader in the association by celebrating an anniversary with industry, and we look forward to at“As your incoming President next his wife. His speech ended with a tracting as many good, healthy, and year, I want you to know that I’m chorus of “Happy Birthday” for his strong dealers as possible.” excited about serving our associa5-year-old daughter Mia. TIADA’s new five-year strategic tion,” Ryan said. “I’ll work hard to “If you happen to see my daughplan begins in 2022, and Ryan will deliver the best results possible for ter running around the resort, her oversee various initiatives at the whatever challenges present thembirthday falls during the conference outset of this plan to expand memselves during that time. Some of my every year,” said Ryan. “She thinks bership and engagement, increase initial goals are to continue responthis entire event is all for her.” non-dues revenue from a growing sible growth in our membership Ryan has been actively involved number of quality programs and and education, and to have one of in his local chapter of TIADA for a services, and enhance the associathe most productive legislative seslong time. It is ingrained in him as tion’s communications strategy. sions possible.” an integral part of his business. As “I see the penetration that we The legislative session almost one of the more active participants could have with licensed dealers invariably includes bills that the in the local Houston Chapter, Ryan across the state,” he said. “We want association needs to address to probecame the first person to be electthem to know what our current tect the interests of the independent ed for two terms of the local chapmembers already understand: that automobile dealer in Texas. Ryan ter. He also served on the Houston we offer some of the best educaanticipates there will be some surAutomotive Board for eight years. tion and services for Texas dealers prises along the way, but that the “It was recommended and honand that we are committed to doing association is ready to tackle any estly mandatory that I get involved even better in the years ahead.” bill that may negatively impact the September 2022

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Auto Dealer Solutions


feature

Auto Dealer Bond Claim Process in Texas: Everything You Need to Know by Eric Weisbrot

Chief Marketing Officer, JW Surety Bonds

Everything to Know About Texas Auto Dealer Bond Claims

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ndependent automobile dealers in Texas must purchase an auto dealer bond to obtain their license and operate their business. While you may not have dealt with claims against your bond, you should understand how it works if you ever have a claim against you.

What is a Surety Bond?

The government requires surety bonds to protect consumers and other third parties from financial harm caused when dealers violate licensing laws. Surety bonds are legal agreements involving the following three parties: P rincipal – The auto dealer seeking the bond. Obligee – The governmental agency requiring the bond. Surety – The bonding company issuing the bond as a guarantee of the principal’s legal compliance. September 2022

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When you purchased your surety bond, you had to sign an indemnity agreement with the surety company. By indemnifying the surety company, you agree to reimburse the surety company for any amount it pays on your behalf. If you fail to reimburse your surety for a bond claim judgment, the surety company can pursue legal action in court to recover what it paid and any legal costs it might incur. In Texas, a bond claim can be made for only the following reasons: F ailing to provide a title to a customer who purchases a vehicle. Failing to pay for vehicles/issuing bad checks to pay for vehicles. Before a person can file a bond claim, they must first file a legal action in court against a dealer. They must prove that they suffered financial harm because the 27


dealer either issued a bad check to pay for motor vehicles or failed to provide a valid title for a motor vehicle. A claimant can include attorney fees in the claim if the dealer is found liable.

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Filing the Judgment With the Surety

After a judgment is won, the person can then contact the surety company to make a claim up to the face value of the bond. In instances where the amount exceeds $50,000, the person making the claim can seek other legal remedies for the amount exceeding $50,000.

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Payment and Indemnification

Once the surety pays the bond judgment, the surety company will request you to reimburse them. Suppose you don’t timely repay the surety. In that case, the surety company will likely seek reimbursement from you through the court and any legal fees it expends to recover compensation from you under your indemnity agreement.

Impact of Bond Claims

In some situations, a valid auto dealer bond claim could result in the revocation of your dealer license. However, even if your license is not revoked, a bond claim can affect your ability to renew your bond or secure a new one, which will remain on your record.

Maximize Your Sales Potential with the TIADA CPO Program.

Participating in the certified pre-owned program means your dealership and the CPO vehicles you offer are held to a higher standard.

For more info, visit Txiada.org/TiadaCPOprogram or call 512.244.6060. 28

Bond claims come with a substantial financial obligation for you. You will have to repay the surety up to the full amount of your bond. If you fail to pay the surety for the entire amount it paid to the claimant, the surety company can file a legal action in court to enforce your indemnity agreement. This could result in a court order forcing you to repay the surety company for what it paid and any legal costs incurred by filing the legal action against you. If your license is revoked, you will no longer be able to operate your dealership legally. You might also face prosecution in criminal court if the claim involves criminal allegations. A poor bonding history can also impact your ability to obtain surety bonds in the future. Since your bond is not permanent and must be renewed regularly, you might be forced to shop for a company willing to issue a bond to you. Any bond for which you are deemed eligible will likely be at higher premium rates because of the increased risk you pose to the surety company.

How to Avoid Bond Claims

Because of the potential repercussions of a surety bond claim on your business, it should be clear that you should do everything possible to avoid potential claims. To prevent valid claims, you should do all the following things: Retain documents about each transaction as required by your state. Have systems and processes in place to guarantee you promptly provide titles and report sales. Strive for accurate accounting and financial management to ensure all vehicles are properly paid for. It is a good idea for you to retain an attorney if a claimant files a legal action against your bond in court to avoid a judgment against your bond. No matter what else you do, you must comply with the provisions of your bond and your indemnity agreement when a judgment is issued. If your surety contacts you and allows you to pay a claim, it’s best to pay it instead of forcing your surety to file a legal action against you. Failure to pay a valid bond claim can result in higher costs for the claim and any future bond you might need to purchase. If you lose your license, it means the forced closure of your business. Eric Weisbrot is the Chief Marketing Officer of JW Surety Bonds. With years of experience in the surety industry, he is also a contributing author to the surety bond blog. www.jwsuretybonds.com T e x a s

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feature

Can Great Recession Lessons Help Dealers in 2022? by David Meyer

President, Advantage Automotive Analytics

S

igned into law in June 2009, the $3 billion Car Allowance Rebate System (CARS) law, commonly called “Cash for Clunkers,” by President Barack Obama, had many long-lasting effects on the automotive retail industry. The similarities — and differences — between 2009 and what automotive retailers face in 2022 can give dealers insights into risk mitigation and avoiding financial losses.

The Great Recession and Cash for Clunkers

A global economic crisis resulting from a meltdown in mortgage-backed securities market resulted in home prices plummeting and borrower defaults. Huge financial losses spread to every corner of the globe. That caused the 2007 mortgage crisis, the 2008 financial crisis, and the Great Recession. It was the worst recession since the Great Depression. That’s a very simplified version of a series of serious and complicated financial mistakes by financial institutions, legislators, government regulators, and consumers. In a move to save several major U.S. auto manufacturers from bankruptcy, lawmakers passed CARS giving consumers up to $4,500 toward the purchase of a brand new vehicle for their old “running” vehicle. The older vehicle could not be re-sold. The program was designed to spur new car sales, and, importantly to the Obama Administration get older, higher polluting vehicles off the road and replace them with cleaner, more energy-efficient vehicles, as evidenced by the rules governing the law. Qualifying vehicles had to have fuel efficiency of 18 mpg or less, and consumers had to purchase a new vehicle that had an average efficiency of at least 22 mpg. More than 750,000 vehicles, many of which would have been traded in, wholesaled, and sold by BHPH and subprime dealers, were removed from the U.S. auto fleet. The program did have its desired effect in prompting new car sales, but had many unforeseen and undesirable consequences for used car sales. Effects on the used car industry were immediate and long-lasting. Wholesale prices of older vehicles not eligible for the Cash for Clunkers program jumped from $2,000 at the time, to $4,000 to $5,000. BHPH dealers who relied on these vehicles to make their in-house September 2022

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financing models work had difficulty finding the inventory they needed, at the right price.

What’s Happening Now?

Today, BHPH dealers and subprime finance companies face similar inventory shortages and high values for very different reasons including: C hip shortages in the new car industry P ent-up consumer demand as a result of the Global Pandemic D irect government stimulus payments to consumers T rillions spent to bolster the economy spurring inflation A nother $1.4 trillion to be spent for U.S. infrastructure These challenges have made it difficult for subprime and BHPH finance companies to find the inventory they need at the cost they need to make their models work. The economics of the BHPH and subprime business models are the same now as they were back in 2009. Consumers have trouble securing a large down payments, have a maximum weekly or bi-weekly payment that they can afford, and require regular attention from collectors to help keep them on track to make timely payments. Today, record-high used vehicle values, near doubledigit inflation, rising costs of floorplanning or lines of credit, and higher wages for employees are putting pressure on the BHPH business model in ways that have never been experienced to this degree. Dealers can take a page from dealer response to the economic challenges of the Great Recession. Then, dealers asked for: A higher down payment L engthened the loan term, and I ntensified their collections efforts and secured their collateral as quickly as possible in the event of a default. Those efforts are being made now, but they can only be taken so far. Adding too many months to a finance contract results in greater default rates. Consumers, challenged by higher food and fuel prices, have only so much they can put down on a new car. 31


Good News?

Economic contractions and recessions have boded well for the subprime and BHPH markets in the past. Prime consumers who take a credit hit, become subprime customers. Subprime customers who take a credit hit become BHPH customers. In each case, finance companies typically get better quality customers that are more accustomed to paying bills on time and maintaining their vehicles. 2021 TLSAA Lubbock_TIADA ad.pdf

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This is likely to occur again should the economy take a significant downturn, as banks, investment corporations, and economists have begun predicting. How it will play out, exactly, in terms of consumer demand and creditworthiness is difficult to predict, but a downturn is more likely to occur than not.

Protecting Your Assets

Twenty years ago the collateral protection industry was relatively 2/28/21

4:11 PM

young. Many thousands of BHPH and subprime finance companies were using GPS tracking and payment reminder devices. Discussions in dealers Twenty Groups weighed the pro and cons of adding $150-$250 to the cash in deal for every unit they sold. Many dealers opted not to use GPS tracking and payment reminders. Today, GPS tracking units cost less and generate valuable data analytics. They are generally considered the cost of doing business. Most subprime finance companies and BHPH dealer chains require GPS and/or payment notification devices. Being able to avoid the tremendous losses from having just one vehicle abandoned or impounded makes financial sense for the entire finance portfolio. Having information instantly sent to mobile devices for vehicles exiting or entering geofenced areas, device tampering, real-time vehicle location, all assists finance professionals in loss and risk mitigation.

Economic Outlook

Thirteen years ago political and economic pundits suggested it could take 20 years for the U.S. economy to recover from the Great Recession. Fortunately, while the effects were devasting and business-ending for thousands of dealers and many other small businesses, within just several years there were green shoots everywhere. Technology made huge improvements for consumers and businesses, making products and services less costly and far more beneficial. Economic challenges in the U.S. economy today are numerous, and in many cases have little precedent. Thirteen years ago, there was almost nothing the mortgage and banking crises could be compared to in the past, except the Great Depression. We survived those extreme challenges, and we’ll survive these.

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On-Demand Offerings

Featured Courses TIADA designed and implemented some important on-demand courses to give dealers quality educational programs they can access throughout the year. These programs are essential for dealers to stay compliant. They offer flexibility, so you can complete them according to your schedule. These courses are designed for any dealers with questions related to various regulations that affect their businesses.

Repossession 101: What You Need to Know In this two-part video course TIADA counsel Michael Dunagan answers repossession related questions for both the dealer starting out and those dealers who want a refresher. Dunagan goes through the basics of self-help repossession, repossession when a client has filed bankruptcy, and using the courts to regain collateral through sequestration. The course also covers all the repossession letters and includes a downloadable deck of slides to follow along with the course.

$98 for two 1-hour videos

The Basics of Transferring Titles Want to avoid having your title transfer paperwork rejected at the tax office? This online course is designed to walk you through the title transfer process and is best suited for people new to transferring titles or those who want to brush up on the basics. This course has been reviewed for accuracy by the Tax Assessor-Collectors Association of Texas.

$48 for the course

To register visit Txiada.org/on-demand Call us at 512.244.6060 or email us if you need assistance.

Texas Independent Automobile Dealers Association


YES! I would like to serve on TIADA Committees Check the committee(s) you wish to join. All Dealer Members are welcome to participate. We need your input! Please complete form and return to info@txiada.org or fax to 512.244.6218.

Committee members will be appointed at the October 2022 board meeting Standing Committees: Awards Committee Budget and Finance Committee Legislative Committee Political Action Committee (INDEPAC) Bylaws Committee Ad hoc Committees: Ad hoc committees will be appointed by the president to focus on specific issues and given a specific timeframe. Issues may include but are not limited to: education, conference, compliance, member services, membership recruitment, website, magazine and surveys. Committee members will be notified prior to a committee being appointed to determine interest. Name___________________________________________________________ Dealership_______________________________________________________ Title __ __________________________________________________________ Email ___________________________________________________________ Phone________________________ Mobile_____________________________ 34

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feature

Watching Your Profit & Loss Statement Isn’t Good for Your Dealership by Harlene Doane DealerStrong

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work with many dealerships, both franchise and independents, on accounting-related projects. Some of the projects are Dealership Management System (DMS) conversions and some are fill-in work when a controller leaves or passes away. Some of the projects are what we consider to be clean-up projects. Clean-up projects are when a dealer has had a lousy controller/ office manager or a theft issue, or sometimes when the dealership has had so much growth that they have outgrown their current processes and need an outside perspective. Clean-up projects come in all sizes and levels of complexity. For example, a dealership has a DMS system but hasn’t reconciled their bank statement in the system in 8 years — those are complex. Another example is a dealership attempting to run accounting on Quickbooks and other products. Those are usually messy and complex because Quickbooks isn’t designed for proper automotive accounting. We often find independent dealers who have never worked in a new car store with a high level of structure,

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so their current dealership doesn’t have the necessary structure. What might work with 10-20 cars a month in sales, doesn’t always work well as the business grows. With growth comes the need for stronger processes. When I begin discussing processes with dealers, we usually start with some dealership basics. Questions like “How many vehicles do you retail?” Then I move quickly to questions like, “Can you tell me the last time your ledger was reconciled to your floor plan?” “Why is your sales tax payable account so large?” Dealers often have no answers to these questions. They believe the ledger inventory is correct because they are good at ensuring the inventory feeds are correct online. However, your ledger inventory is only accurate if you can identify every unit in the ledger by the stock number with the actual cost of your vehicle plus all expenses for repairs, transportation, gas, etc. I’ve lost track of the number of times the value provided to me has been misstated. The disconnect is that the dealer is focused on the profit and loss and I’m asking questions about the balance sheet. 35


Watching your profit and loss statement without watching your balance sheet is a formula for a disaster. The first reason is that someone can hide a lot of sins on the balance sheet which can wipe out your profits. The second reason is that profits don’t equate to cash flow, but that’s a different topic for another day. So let’s look at a few ways to wipe out your earnings by cleaning up your balance sheet. If you fail to reconcile your finance inventory to your general ledger inventory, you will wipe out profits. Most dealers are shocked by how many units and dollars are not posted properly here. I’ve never had a dealership with additional profits when cleaning up their inventory files. Instead, it’s always additional costs sitting in inventory on units long since sold. Cleaning it all up means reducing your profits. Another spot is the failure to review prepaid expense accounts. Oftentimes, items are recorded to expense in future months but then are forgotten. They become a big adjustment at the worst possible time and reduce your income. Then there are down payments and receivables that don’t get cleared properly because no one is focused on collecting your money. By the time the spotlight is on it, your ability to collect has diminished immensely, so they become write-offs that reduce your net profits. Next we have the bank statement issues. When the bank statement is not properly reconciled daily, the number

of entries that are not made or made backwards can add up to substantial dollars over an extended period. Recently we had a client take a $190,000 hit for years’ worth of expenses that were being taken from the bank account but not recorded in the ledger. Here’s one most dealers wouldn’t even think twice about. Tag & title fees are on the balance sheet’s liability side, and there is always a credit there, right? You should be able to reconcile that account at any point in time to match the exact tags not processed yet. In many stores, we find stock numbers with debit balances. This is caused by the dealership paying additional fees to title vehicles, but it’s not posted correctly to the ledger. Those fees must be written off, adding to your expenses again reducing your net profits. If a dealer only cares about the profit and loss statement and never pays attention to the balance sheet, they can’t be sure their net profits are real. Additionally, they are setting themselves up for embezzlement or other theft issues. A dishonest employee can hide a lot on the balance sheet and not get caught for a long time. Dealers should require their accounting staff to justify the balance sheet account balances every month. Then review the information for accuracy because only when we know the balance sheet is accurate can we truly believe the profit and loss statement and keep your profits in your pocket.

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feature

6 Key Areas You Might Be Wasting Your Local Marketing Spend by Jamil Zabaneh

President, J&L Marketing

L

ocal marketing campaigns are critical to long-term growth and continued profits for those running a small business. These campaigns allow companies to target key local audience segments, promoting ongoing growth and customer retention. This is particularly important for those operating a business in the service sector where customers are searching for where to do business on a hyper-local level. For these small businesses, marketing spend is limited, and every penny needs to count. But unfortunately, many businesses waste their local marketing spend. According to a report by Proxima, between 40-60% of digital marketing spend is being used ineffectively. Small businesses cannot afford to lose half of their budget to wasted spend, making it imperative for these companies to look for where the waste is happening and

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reinvest that money into an improved marketing strategy. If your small business is not seeing the results you should from your local marketing tactics, take a deep dive into the following six areas where you might be wasting your local marketing spend.

1

By Targeting A Broad Audience

Local marketing works well when the efforts are aimed at a hyper-specific audience segment. Unfortunately, too often, businesses looking to market in a local area pick campaign strategies that are too broad, wasting a large amount of money on an audience that will never convert to a sale. Today’s consumer is not interested in seeing irrelevant ads. Digital tools have made it possible for brands to understand their customers on a deeper level. By using 39


data, you can ensure that your marketing reaches a particular audience. For a dealership, this is particularly important. If someone is right out of high school and a potential firsttime buyer, and your inventory is made up primarily of family style vehicles like minivans or large sedans, targeting them with ads is a waste of money.

What to Do About It

If you are concerned that your local marketing efforts are wasted on the wrong audience, use digital marketing to spend your money on the right audience segments. A great place to begin is via Google Ads (though you can apply this same strategy to other digital channels such as Facebook or Instagram). When running an ad via Google, you can target a particular audience segment based on the type of campaign you are running. For Display campaigns, you can combine your data with two other segments referred to as affinity and intent. Your data will allow you to target people who previously interacted with your business specifically. Affinity segments will reach groups of people based on their lifestyle, buying habits, and long-term interests. Intent segments allow you to focus on people actively researching products or services. Depending on your goals, you can determine which of these audience segments to include down to a granular level when creating a campaign. And, when running a video campaign via Google, you can also add life events and other detailed demographics to your audience segments. This allows you to target customers based on milestones, such as graduating from college or becoming a parent, and by groups of people of people with shared common traits. Over time, as you begin to see which segments convert at the highest rate, you can double down your efforts on these segments and reduce spend on segments that don’t lead to profitable conversions.

2

By Sticking To The Same Strategy

This is a common issue for small businesses that have been in operation for a long time. The company has handled marketing one way for decades, and there are no plans to change. However, marketing strategies should not be stagnant. What worked ten years ago does not work the same way today. Further, what worked one year ago, or even a month ago might not be the ideal strategy. Digital has created a fast-paced world where marketing strategies must continually be tweaked, and businesses must adapt to changing consumer demand.

What to Do About It

When was the last time you did an audit of your marketing tactics? Have you relied on the same strategy for 40

years, perhaps even decades? If so, there is a good chance you are wasting a large amount of the money you spend on these marketing strategies. It’s time to do an audit. How are you tracking the return on your marketing dollar? If you don’t have a method to do so, set one up. You need to be able to measure your conversion rates and determine what tactics might now be outdated and are hemorrhaging money. If you don’t run your marketing in-house, request an audit from the agency you work with and ask about where every penny is being spent.

3

By Dumping Money Into Poorly Performing Channels

For many small businesses, it can be concerning when marketing channels are not performing as expected. If you planned to earn 20 new customers a month via a specific channel, and, instead, it seems that you are losing more customers to your competition than gaining new ones, a natural reaction is to think that your budget might not be high enough to compete. This leads many businesses to simply dump more money into poorly performing channels hoping that they will be able to outpace the competition in spending. Unfortunately, this strategy rarely works. It is usually not money that is the culprit behind a poorly performing marketing channel. Dumping more money into the situation simply results in more money lost.

What to Do About It

Before spending another cent on a poorly performing channel, take a deep dive into the analytics around the campaigns you are running. In many cases, you can actually lower your spend while increasing your reach simply by improving how your campaign operates. For example, if you are seeing a poor return on your Google Display Ads, it might not be because you aren’t spending enough; it could be because your ad copy is hard to read or your call to action button isn’t working. Maybe your display ads are sending customers to a broken webpage or one that is difficult to understand, causing customers to drop off before converting. Truthfully, numerous factors could cause your campaign to perform poorly. It can take time, but it is well worth the effort to dig deep and determine the root cause of the issue before spending more money.

4

By Settling For Surface Level Reports

Many small businesses have learned the importance of pulling reports on their marketing campaigns. Rather than walking blindly into each new quarter, they actually take the time to see what tactics have performed well in the past and which ones aren’t providing a high enough return. T e x a s

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However, when looking at these reports, too often, business owners are handed surface-level information from marketing teams. These reports might show basic metrics, such as click-through rates or the number of new visitors to a website. Perhaps there has been an uptick in both of these numbers, leaving business owners to walk away satisfied. Unfortunately, surface-level reporting doesn’t tell the whole story, which can lead to spending money on tactics that look good but aren’t actually resulting in profits for the business.

What to Do About It

Next time you look over your company’s marketing reports, whether they are provided in-house, from an agency, or you pull them yourself, make sure you look at information beyond the surface level. For example, if your company saw a large uptick in new website visitors, what happened next? Did any of those visitors go on to schedule an appointment with your dealership? If not, why? An uptick in website visitors can be a good sign of a well-run campaign, but it can also be a sign of wasted spend. Funneling a large number of new visitors to your website will do you little to no good if those weren’t the right target audience. Unfortunately, many marketing companies rely on surface-level reporting to paint a pretty picture. Don’t settle for the basics. Dig deeper and find out what is actually earning you measurable, profitable results.

5

unimaginable happens — customers who were poised to convert suddenly drop off. Behind the scenes, unbeknownst to you, a customer who was ready to call up your business to schedule a service saw a litany of negative online reviews. Glancing at the complaints surfaced by Google, they also noticed a trend from your business — radio silence. When you don’t pay attention to the reviews your business is getting and you are absent from the conversation, you can waste a lot of money paying to show customers your poorly managed reputation.

What to Do About It

Put into place a strategy for managing your online reputation. Your company must know which customers are leaving you reviews and for you to actively manage this. This means responding to new reviews as they come in. It means actively seeking out positive reviews from satisfied customers. And it means monitoring your reputation to ensure that you aren’t marketing your business during a slump in your business’ perceived credibility.

6

By Using A Weak Call To Action

In some cases, the failure of your marketing campaign rests

solely on the shoulders of your ad copy. When you pay to surface an ad to a customer with a weak or non-existent call to action, you run the risk of wasting a lot of money. If a customer glances at your ad and they don’t know within seconds what they are supposed to do next, you are most likely throwing money down the drain. People have short attention spans, and when they see an ad, they don’t want to have to guess what to do next.

What to Do About It

Sit down and go through each ad you are running. Ask yourself: W hat is the call to action? H ow is a customer supposed to take this action? If you can’t answer these questions within seconds, you need to rework your ad copy. Keep in mind, as well, that it can be beneficial to get a second set of eyes on your ads, particularly if you helped write them. Often, what seems obvious to someone on the inside of a business is confusing or unintelligible to someone on the outside. Additionally, beyond your own analysis, a good indication that your call to action isn’t effective is when your ads are receiving a high number of views with an incredibly low goal completion rate.

By Ignoring Your Customer Reviews

Perhaps you are running perfect marketing campaigns. You’ve honed in on the key audience segments that best represent your ideal customer, and you’re getting your business’ name out there and in front of the right people. But then something

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HHHHH 41


house of delegates meeting minutes July 24, 2022 | Kalahari Resorts, Round Rock, TX

compiled by Texas Dealer staff

At its meeting on Sunday, July 24, 2022, TIADA took the following actions: President Mark Jones called the meeting to order at 12:00 p.m.

2023 Officer Elections

With no contested races, Chairman Robert Beck asked for a motion directing the Secretary to submit a single ballot for the following candidates: Chairman of the Board: Mark Jones; President: Ryan Winkelmann; President-Elect: Eddie Hale; Secretary: Vicki Davis; Treasurer: Greg Phea; Vice President Region 1: Brad Kalivoda; Vice President Region 2: Greg Reine; Vice President Region 3: Chad Lancaster; Vice President Region 4: Russell Moore; Vice President Region 5: Robert Blankenship; Vice President Region 6: Armando Villarreal; Vice President at Large:

42

Lowell Rogers; Vice President at Large: Cesar Stark. Motion to dispense made by Greg Zak, seconded by Keith Hagler – PASSED

Bylaws Committee

Motion to accept bylaws amendments as presented made by Brad Kalivoda, seconded by Cesar Stark – Passed. Motion to adjourn made by Blake Ingram, seconded by George Karlen – PASSED. Meeting adjourned at 12:45 p.m. Respectfully submitted, Eddie Hale, Secretary A complete copy of any reports referenced in this document and more detailed notes from the meeting are on file at the TIADA office and available upon request.

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Please Welcome Our Newest TIADA Members

Local Chapters CORPUS CHRISTI G.R. Moore

DEALER MEMBERS 7-11 Auto Group LLC Santiago Rodriguez . . . . . . . 711 W. Hildebrand Ave., San Antonio, TX 78212

The Car Shack

Auto Plaza Mike Hannon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1660 N Beltline Rd, Irving, TX 75061

(dates announced at

Automex Auto Sales Juan Rodriguez . . . . . . . . . . . . . . . . . . . 115 N Zapata HWY, Laredo, TX 78043

www.txiada.org)

AutoVida Steve Jordan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2812 Thomas Ave, Dallas, TX 75204 Brazil Imports LLC Hector Enriquez . . . . . . . . . . . . . . . . . . . . . 11230 Montana, El Paso, TX 79936 Cash for Cars BHPH Hassanain Aljanabi . . . 2541 South IH-35 Suite 200-329, Round Rock, TX 78664

EL PASO

Cherry Cars Ron Cantrell . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . P.O. Box 590, Whitesboro, TX 76273

Cesar Stark

DP Auto Sales Ltd DBA Byrider - Lubbock Lucy Alvarez . . 1211 19th St, Lubbock, TX 79401 EADO Automotive Zaiful Kazi . . . . . . . . . . . . . . . . . . . . . . . . . . . 6432 Gulf Fwy, Houston, TX 77023

S & S Motors

Engler’s Auto Brokers Jaime Engler . . . . . . . . . . . . 4004 San Pedro Ave., San Antonio, TX 78212

Meeting – 3rd Friday

evrdrive Brian Singh . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 211 Highland Cross Dr, Houston, TX 77073

(Monthly)

Fully Loaded Cars & Trucks Luz Cruz . . 14525 State Highway 249, Suite B, Houston, TX 77086 FYC Auto Abel Sanchez . . . . . . . . . . . . . . . . . . . . . . . . . . . 4501 S. County Rd West, Odessa, TX 79766 HiJolly Gohar Jaffery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129 Oram St., Arlington, TX 76010

FORT WORTH

I Drive-DFW John Le Unes . . . . . . . . . . . . . . . . . . . . . . . . . . . 2729 Lipscomb St, Fort Worth, TX 76110

Jerry Smith

ION Car Sales Steve Richardson . . . . . . . . . . . . . . . . . . . 3401 W Marshall Ave, Longview, TX 75604 Kayalar Motors Selcuk Kaya . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16230 FM 529, Houston, TX 77095

H J Smith Automobiles

Krissy Auto LLC Krystal Franklin . . . . . . . . . . . . . . . . . . 6301 E Lancaster Ave, Fort Worth, TX 76112

(dates announced at

Lone Star Auto Brokers, LLC Adam Jones . . . . . . . . . . . . 7445 US 287 HWY, Arlington, TX 76001

www.txiada.org)

Lufkin Auto Center Manuel Escalera . . . . . . . . . . . . . . . . . . . . . . . . . 210 FM 706, Lufkin, TX 75904 Lux Auto Centre Manny Abdulhadi . . . . . . . . . . . . . . 10903 Shady Trail, Ste 115, Dallas, TX 75220 Off Lease Only LLC Marissa Kaliman . . . . . . . . . . 1200 S. Congress Ave., Palm Springs, FL 33406 Preowned Cars of SA, LLC Alex Munoz . . . . . . . . . . 3438 SW Military Dr, San Antonio, TX 78211 RJB Auto Sales George Vasquez . . . . . . . . . . . . . . . . . . . . . . 5413 Viking Drive, Houston, TX 77092

HOUSTON April Hanson

Rockin’ H Motors Phillip Holt . . . . . . . . . . . . . . . . . . . . . . 300 E Sam Rayburn, Bonham, TX 75418

Coast to Coast Motors

Saga Autos Gabriel Mendoza . . . . . . . . . . . . . . . . 11585 South US Hwy 181, San Antonio, TX 78223

Meeting – 2nd Tuesday

Si Auto Inc. Martin Gutierrez . . . . . . . . . . . . . . . . . . . . . . . . . 911 W. Mayfield Rd, Arlington, TX 76015 Superior Motor Company Michael Stanley . . . . . . . . . . 3924 Texoma Pkwy, Sherman, TX 75090

(Monthly)

Triple B Motors Raul Ernesto Fong . . . . . . . . . . . . . . . . . . . . . 917 East TX 495, San Juan, TX 78589 Webb’s Motor World Robby Webb . . . . . . 10010 South Padre Island Dr, Corpus Christi, TX 78418

SAN ANTONIO

ASSOCIATE MEMBERS

Jose Engler

Glo3D Inc. Sean Toussi . . . . . . . . . . . . . . . . . . . . . . . 2323 Yonge St., Unit 503, Toronto, ON M4P 2C9

Irving Motors Corp

North American Auto Care Carlton Lancaster . . . . 6864 Cape Cod Dr, Grand Prairie, TX 75054 Visitor Chat Dana Abramson . . . . . . . . . . . . . . . . . . . . . . 88 Elm St, Suite 304, Rochester, NY 14604 September 2022

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(dates announced at

www.txiada.org) 43



behind the wheel Goal Number Five

T

his is the last in our series of articles focusing on the association’s five-year strategic plan. This month, we are thinking about the ways we plan to enhance TIADA’s digital marketing and communications strategy. We plan to do everything we can to make sure our members’ experience, in terms of the ways it engages the association, is efficient and modernized. It is essential for us to provide our members with timely updates and communications, and so we are working diligently to increase our efforts in digital marketing and communications by improving the website and engaging with members by providing high-quality content on social media. These are the central focus of goal number five in our five-year strategic plan.

Goal #5 — Enhance digital marketing and communication strategy, resulting in an 18% increase in organic users at txiada.org and a 10% increase in total social media followers and page likes annually while maintaining a social media engagement rate at or above 5%. Social engagement rates and impressions: Th e engagement rate is the number of engagements divided by impressions. E ngagements are interactions with an update: reactions, comments, shares, and clicks. I mpressions are how many people see a given update on their feed.

Jeff Martin by

TIADA EXECUTIVE DIRECTOR

STRATEGIC PLAN: By Year-End FY’22

A udit website content and analytics to optimize user experience and functionality on desktop and mobile devices. D evelop benchmarks for average pageviews, LinkedIn followers, Facebook likes, YouTube subscribers, and engagement rate. E nhance our content strategy to include industry insights and organizational stories on the blog. A nalyze social media performance to evaluate key performance indicators for all campaigns. C reate various content for social media channels to promote brand awareness, increase program attendance, and establish relationships between members. E valuate how social media campaigns are driving increased website traffic and program attendance.

By Year-End FY’23

A udit website content and analytics to optimize the user experience and functionality on desktop and mobile devices; implement any new best practices available. E valuate website user flowchart and traffic patterns; increase access to popular landing pages. C reate a sponsored content program for social media channels. B ased on KPI analysis, increase successful content types and frequency on social media. A dd a testimonials page to the website.

We plan to do everything we can to make sure our members’ experience, in terms of the ways it engages the association, is efficient and modernized. September 2022

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By Year-End FY’24

Who Makes More Money Finance more customers and sell more cars. Be your own captive finance company.

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A udit website content and analytics to optimize the user experience and functionality on desktop and mobile devices; implement any new best practices available. C reate a “store” on the website where members can purchase the educational programs, forms, resources, and merchandise. E valuate SEO best practices, ensuring our continued use of targeted keywords for all content. U pdate website URLs to make the website easier to find.

By Year-End FY’25

A udit website content and analytics to optimize the user experience and functionality on desktop and mobile; implement any new best practices available. S eek professional development opportunities to implement the latest best digital marketing and communications practices. H ire a third party to evaluate our digital marketing and communication strategy.

By Year-End FY’26

A udit website content and analytics to optimize the user experience and functionality on desktop and mobile devices; implement any new best practices available. I mplement new strategic digital marketing and communication opportunities for website content and social media. E xplore new avenues of communication: software, programs, and social media channels. B ased on the third-party evaluation, determine the next steps for improving the website and social media channels.

© 2022, Agora Data, Inc. All rights reserved.

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