Latest / Crossroad Conversations with the Lewis Brothers / Ep. 88 - "You Don't Run a Business. You Run a Network."

Transcript

Ep. 88 - "You Don't Run a Business. You Run a Network." · Crossroad Conversations with the Lewis Brothers

0:00
SPEAKER_00: You'll hear us say every once in a while the easy part's selling the car.
0:04
SPEAKER_00: The fun parts on Saturday talking to customers and selling the cars.
0:07
SPEAKER_00: And you're like, what are you talking about?
0:09
SPEAKER_00: Well, the other part you've heard on other podcasts, the employees, the benefits, the software, the vendors, all of these pieces.
0:21
SPEAKER_00: And if you're not managing your network and all the software, you won't have enough people here to sell a car to, to service a car.
0:33
SPEAKER_00: Hey everyone, welcome to Crossroad Conversations with the Lewis Brothers, where we aim to share real stories about running a successful family business, working through adversity, and pouring back into the community that keeps our door open.
0:45
SPEAKER_00: We're your hosts, Matt, Shelby, and Taylor, and we bring you relevant local business advice and automotive insights that are sure to change the way you look at running a business.
0:54
SPEAKER_00: And maybe even throw in a plug for you to do business with us.
0:58
SPEAKER_00: Hey, welcome back to Crossroads Conversation Podcast.
1:01
SPEAKER_00: We are the Lewis Brothers.
1:03
SPEAKER_00: Shelby and I are in studio today and ready to talk about episode 88.
1:07
SPEAKER_00: Shelby, we're going to talk about you don't run a business, you run a network.
1:12
SPEAKER_00: Right?
1:13
SPEAKER_00: Man, and is that true?
1:14
SPEAKER_00: Especially when you take the time to pause and start counting it.
1:18
SPEAKER_00: I can promise you out there, for anybody that will pause and think about their network of vendors that they have, it's way more than they initially would have said.
1:30
SPEAKER_00: In fact, the average car dealership runs with 20 to 50 different vendors.
1:36
SPEAKER_00: And we've got five rooftops.
1:37
SPEAKER_00: So you do the math.
1:39
SPEAKER_00: The company is touching somewhere north of a hundred vendor relationships every single day.
1:45
SPEAKER_00: That's a lot.
1:46
SPEAKER_00: That's a whole lot.
1:47
SPEAKER_00: And that's before you even count the ones we don't think about.
1:50
SPEAKER_00: So start, stop and ask yourself how many does your business have?
1:54
SPEAKER_00: Most owners can't get past 10 before they stall out.
1:58
SPEAKER_02: That's pretty wild.
1:59
SPEAKER_02: So before we fully dive into that, think about last week.
2:03
SPEAKER_02: We talked about fear as fuel.
2:06
SPEAKER_02: So we talked about fear and when that creeps in, how it becomes a problem, what you do with that, and turning into what scares you to what motivates you and moves you.
2:14
SPEAKER_02: So that was a fun episode that we broke down.
2:16
SPEAKER_02: You can go and uh find that at Crossroad Conversation Podcast.com, Spotify, uh Apple Podcasts, wherever you get your podcasts at.
2:24
SPEAKER_02: And make sure to always visit visit us at LewisSupert.com for our latest and greatest specials discounts and sometimes our service specials.
2:32
SPEAKER_02: Absolutely.
2:33
SPEAKER_00: Hey, what's in the garage today?
2:34
SPEAKER_00: It's summertime.
2:35
SPEAKER_00: The weather's nice.
2:37
SPEAKER_00: And in Northwest Arkansas, we live in an adventurous area.
2:40
SPEAKER_00: You know, whether it's going to the parks, just going to the ball game or the river or the lake, or finding some of those gravel roads on the back roads.
2:50
SPEAKER_00: And no more fun way to do that than in the Jeep Wrangler.
2:53
SPEAKER_00: You know, the iconic off-road adventurous vehicle.
2:56
SPEAKER_00: And we have an amazing, I don't know if you've driven through there lately, but the selection and colors.
3:02
SPEAKER_00: And it's exciting because Jeep has gotten back to its roots of all the fun mocks.
3:08
SPEAKER_00: You know, and the colors and the new Willie's edition that's got the, you know, the uh Army green wheels on it.
3:15
SPEAKER_00: Yeah.
3:15
SPEAKER_00: And like all the cool stuff.
3:16
SPEAKER_00: We need to get the 35s and the Extreme Recon package.
3:20
SPEAKER_00: And we have some of them with the soft tops, which are really nice to be able to take down or put back up if it's rainy like it it's been lately, is you don't uh worry about getting caught up out in the rain.
3:29
SPEAKER_00: But I want to talk about our two-door.
3:31
SPEAKER_00: Our two-door is the original Jeep, and it is at an amazing price point where it makes it affordable for somebody as a daily driver, or somebody as a fun vehicle or one that they can put behind their RV and tow.
3:44
SPEAKER_00: It's the two-door Wrangler.
3:46
SPEAKER_00: They now all come with hard doors.
3:48
SPEAKER_00: They all come with power windows, power locks, big screen on them, automatic transmission.
3:53
SPEAKER_00: They drive incredible compared to what you're used to in a Jeep.
3:58
SPEAKER_00: The top's easy to take up, put down, and get this.
4:02
SPEAKER_00: This is this is real deal numbers too.
4:04
SPEAKER_00: And I know we've talked a lot about this, but you can walk in today and buy it for this, okay?
4:08
SPEAKER_00: You don't need coupons, no haggling.
4:10
SPEAKER_00: $33,900, and that's a 26 model.
4:14
SPEAKER_02: For a brand new, gets a Lewis exclusive 10-year,$120,000 mile powertrain warranty, and it's everybody's.
4:20
SPEAKER_02: You don't have to have owned this or be from this, this, this, and this.
4:24
SPEAKER_02: It is real deal sub 35.
4:27
SPEAKER_02: Now, that was a soft top.
4:29
SPEAKER_00: Yeah.
4:29
SPEAKER_00: Okay, and I'm calling it straight out.
4:30
SPEAKER_00: It's a soft top, but it's got air conditioner, it's automatics.
4:33
SPEAKER_00: Power one does power lock.
4:34
SPEAKER_00: Still take it through the car wash.
4:35
SPEAKER_00: Uh, yeah, this is not your old soft.
4:37
SPEAKER_00: Not your old soft.
4:38
SPEAKER_00: But the reason I call that out is you're like, no, I wouldn't buy it unless that is a hard top.
4:41
SPEAKER_00: Great.
4:42
SPEAKER_00: We've got hard tops on special for 35.9.
4:45
SPEAKER_00: So we have a huge selection.
4:46
SPEAKER_00: We have over 60 Jeep Wranglers in stock to choose from.
4:50
SPEAKER_00: So come check out those and many more specials here at Lewis.
4:54
SPEAKER_00: All right, so let's do a vendor reality check.
4:57
SPEAKER_02: Oh, fun.
4:58
SPEAKER_02: Right?
4:58
SPEAKER_02: We're talking about our network, and our network is our venance.
5:01
SPEAKER_02: Uh and we got to think about that you are so much more dependable.
5:06
SPEAKER_02: The dependable.
5:07
SPEAKER_02: We're hoping they're dependable.
5:09
SPEAKER_02: Thank you.
5:09
SPEAKER_02: Dependent on them than you think.
5:12
SPEAKER_02: The vendors, you were so much more dependent.
5:14
SPEAKER_02: Like walking through this list, our CRM, so that's our management of our customers, of all things relations, and how we talk and how we communicate, our banks, 27 different banks that we work that have 75 different lending options, our insurance availability and the coverage, our inventory, who supplies our inventory online, who manages its age and its pricing, our photo people that have the photos for that, uh, our OEM and all the 9,000 different things that they have us click on and the partner vendors, our shippers, our parts suppliers, our IT, our software, our marketing, our utilities, our payroll, our HR, our legal advertising facilities, cleaning, security, fuel, uniforms, training programs.
5:59
SPEAKER_02: And that's just kind of off the top of it.
6:02
SPEAKER_00: When I start getting overwhelmed when you say all those things on the list, once my emotions die down, then I start listening and I'm like, yeah, but you miss this.
6:12
SPEAKER_00: And you miss pricing, and you missed our text communication with our customers and our video communication and our email communication platform and this and that.
6:21
SPEAKER_00: The list just keeps going.
6:23
SPEAKER_00: And we're in a unique position to talk about this.
6:26
SPEAKER_00: And she'll be able to remember this.
6:27
SPEAKER_00: At the first of the year, we challenged our teams to fill out all these sheets of all the vendors and all the software they used her department.
6:35
SPEAKER_00: Yeah.
6:36
SPEAKER_00: And it was a gorilla of an expense.
6:39
SPEAKER_00: It was massive.
6:40
SPEAKER_00: Massive.
6:41
SPEAKER_00: And so we went down this journey of which ones can we eliminate to reduce expense?
6:47
SPEAKER_00: Where are they duplicated?
6:49
SPEAKER_00: Which ones do we not need that we forgot about?
6:51
SPEAKER_00: And in our business, the ones you forget about, they're not the real expensive ones.
6:56
SPEAKER_00: They're the$399 a month, the$199 a month, the$999 a month.
7:00
SPEAKER_00: They're not the$5,000 a month.
7:02
SPEAKER_02: You know, so you start taking a list of a hundred of them, and this used car manager has a preference for this.
7:08
SPEAKER_02: This service manager wants to use this uh person for warranty, and this person wants to use this, and this person wants this, the list gets astronomically long.
7:17
SPEAKER_02: And if it's just$5.99 a month or$9.99 a month, you think, oh my gosh, I'd pay attention.
7:22
SPEAKER_02: Well, you know, when you're talking about a massive amount of expense, that$500 or$900, it's pretty low on the list if you look at all the expenses per month.
7:33
SPEAKER_02: And so we start to say, are they still relevant?
7:36
SPEAKER_02: Sure.
7:36
SPEAKER_02: Are they still bringing us value?
7:38
SPEAKER_02: And could we will, could we, would we survive without them?
7:42
SPEAKER_00: Well, that's 100% correct.
7:44
SPEAKER_00: Now, the knee-jerk reaction of all of our managers, which we talk a lot about on this podcast about not having knee-jerk reactions, very few things in life actually need you to do a fight or flight reaction.
7:55
SPEAKER_00: The knee-jerk reactions of managers were like, yes, we need that, yes, we need that.
7:59
SPEAKER_00: So then we challenged them and we said, Well, when was the last time you had a review call with them?
8:05
SPEAKER_00: When's the last time you reviewed your usage within your department?
8:09
SPEAKER_00: You said it was a great software, and I'm not debating that.
8:12
SPEAKER_00: What I'm debating is what's your utilization of it?
8:15
SPEAKER_00: Are you using it to its potential?
8:18
SPEAKER_00: And it's also time to revisit those vendors and say, do they now offer an extension of their product that could replace another product?
8:25
SPEAKER_00: So then it's all integrated into one.
8:28
SPEAKER_02: You know, and oftentimes you see that when you think about if you've been with your phone carrier for a while, and then you get a new phone or you call to update a plan, and they're like, you're on the old plan.
8:38
SPEAKER_02: Oh my gosh.
8:39
SPEAKER_02: And you thought you were on the fastest, latest and greatest, and you had the best deal locked in.
8:43
SPEAKER_02: To be competitive, they have come out with something that is better, that is faster, and that is generally less expensive.
8:49
SPEAKER_02: So you, when you think you're getting the absolute best and you're using all corners and facets of it, you're not at all.
8:56
SPEAKER_02: And what I saw is that we started asking our department heads, like, hey, could you do without this and could you do without this?
9:03
SPEAKER_02: There's FOMO in not having it.
9:05
SPEAKER_02: It's their safety blanket.
9:06
SPEAKER_02: But if you switched it over to usage, if there was a usage report or a watchdog report that shows the usage, and then if there was ROI that even helped even more, they say, look, the last login was 18 days ago.
9:18
SPEAKER_02: That's right.
9:18
SPEAKER_02: Like, what do you mean you have to have this?
9:21
SPEAKER_00: That was a great way.
9:22
SPEAKER_00: And we're flipping over here, but we're trying to give some advice on how to manage these and manage your managers at the same time.
9:29
SPEAKER_00: And don't just be one of those reactive owners that goes around and just jerks a carpet out from each person, is we put it back in their court.
9:37
SPEAKER_00: We're like, okay, yeah, it is a great product.
9:40
SPEAKER_00: I want you to come back to me and show me your usage report, like you said, when you have a call with the rep, the performance manager, on how we're doing and what we could do better.
9:50
SPEAKER_00: And some of them came back and they're like, you know what?
9:53
SPEAKER_00: You're really not using that as much as we thought.
9:55
SPEAKER_00: And it is a great product, but I can't get any of my employees to use that.
10:00
SPEAKER_00: Now I'm gonna play the flip side of it.
10:02
SPEAKER_00: I want to bring something up because we went through all that and we were able to eliminate a little bit.
10:08
SPEAKER_00: I would say But not near as much as we want to.
10:10
SPEAKER_00: No, and I I don't want to use the word disappointment, but I went in that gun's blazing going, man, we are getting ready to reduce our expense by$15,000 to$25,000 a month across the five rooftops.
10:22
SPEAKER_00: And we didn't.
10:23
SPEAKER_00: It didn't happen.
10:24
SPEAKER_00: I think what happens is your dependency.
10:26
SPEAKER_00: I think the dependency, but I think what did come out of that is we did not get to reduce our expense, but we upped how much we were actually using the software.
10:40
SPEAKER_00: We brought awareness to you better get after and you better utilize what you said and you talked us into in enrolling.
10:47
SPEAKER_02: Which should then, in turn, whatever that vendor is, be a better customer experience.
10:53
SPEAKER_02: Should make things efficient, communication better, understanding better, quicker to get parts, quicker to have these things, better to be organized.
11:00
SPEAKER_02: So we said, okay, you got to have this system, need to have this system, then you're going to.
11:06
SPEAKER_02: So then we had new vendor calls set up, not for new vendors, but for those vendors to have performance calls.
11:11
SPEAKER_02: That's right.
11:12
SPEAKER_02: So we would hop on to the beginning of that vendor call and say, here's our expectation.
11:17
SPEAKER_02: You are not to say, hey, do you need help with anything right off the cuff?
11:21
SPEAKER_02: You need to come in with an action plan and say, hey, I've been going over your metrics for the last 30, 60, 90 days.
11:26
SPEAKER_02: Here's what I see change.
11:27
SPEAKER_02: Here's where I see there's low-hanging fruit, and here's where I see that no one's been on this side of the portal.
11:32
SPEAKER_02: So we set that expedic expectation with those vendors right from the get-go.
11:36
SPEAKER_02: Yeah.
11:36
SPEAKER_02: So then our managers understood that conversation.
11:38
SPEAKER_02: So then we could hop to the next vendor conversation, the next vendor, and then circle back around three months later and have the same conversation again because one time will not fix.
11:47
SPEAKER_00: That's a great point that Shelby just brought up.
11:50
SPEAKER_00: And I'm going to take everybody back to middle school, junior high, high school, is everybody's gung ho from a management or an owner level on getting involved when we're first implementing something.
12:03
SPEAKER_00: And then it grows and you let it go.
12:06
SPEAKER_00: And then all of a sudden you look up two, three, four years or months down the road and it starts to take a nosedive.
12:12
SPEAKER_00: Well, when was the last time you jumped back on that call?
12:15
SPEAKER_00: You don't have to be on every single call.
12:17
SPEAKER_00: You don't have to micromanage it for the rest of its life.
12:19
SPEAKER_00: You got to micromanage it at first.
12:21
SPEAKER_00: That's not a bad word, by the way, but that's a whole different podcast.
12:24
SPEAKER_00: Um, you do have to micromanage it first for it to get off the ground, but then you need to circle back around.
12:30
SPEAKER_00: And when they don't even know, like last Friday, I had jumped back on a call.
12:33
SPEAKER_00: They had no clue I was gonna be on there.
12:35
SPEAKER_00: I was silent.
12:36
SPEAKER_00: I didn't try to take over the call until it was needed as the owner, until it was needed.
12:41
SPEAKER_00: And then I would just, and you know what I did?
12:43
SPEAKER_00: I didn't tell them how to do it.
12:44
SPEAKER_00: I asked a question that I knew would get them back on track.
12:47
SPEAKER_00: That would get the answer to get them back on track.
12:49
SPEAKER_00: I'll track.
12:49
SPEAKER_00: And then I went back silent, let the other managers, because I don't want to be the one talking the whole time because it means my managers aren't engaged.
12:56
SPEAKER_02: Yeah, and the next thing is the vendor will start asking you questions.
12:58
SPEAKER_02: That's right.
12:59
SPEAKER_02: You need them to be asking the people that need to know about the department.
13:03
SPEAKER_00: Okay, so I said I was gonna take you back to junior high and high school.
13:06
SPEAKER_00: Well, I want you to think about when you were sitting in class, and all of a sudden one day, who came to sit in the back of the classroom?
13:12
SPEAKER_00: The principal would show up.
13:13
SPEAKER_00: The principal showed up, didn't they?
13:15
SPEAKER_00: Mm-hmm.
13:16
SPEAKER_00: What were they doing in that class?
13:17
SPEAKER_00: It's not because your class had bad behavior.
13:19
SPEAKER_00: We always thought that.
13:21
SPEAKER_00: It's because they were checking up on how's the structure of the class.
13:24
SPEAKER_00: How's the teacher?
13:25
SPEAKER_00: How's the teacher?
13:26
SPEAKER_00: How's the kids doing?
13:27
SPEAKER_00: How are they reacting?
13:28
SPEAKER_00: Do you need to change anything different?
13:30
SPEAKER_00: You don't even know that at that point in time, but I look back now, that's what they were doing.
13:34
SPEAKER_00: Yep.
13:35
SPEAKER_00: That's what they're doing.
13:36
SPEAKER_00: So you need to take those same grade school principles that you saw administration doing and implement it into your business.
13:43
SPEAKER_00: Yeah.
13:43
SPEAKER_00: I'm gonna go the flip side on the vendors.
13:45
SPEAKER_00: Um, because we actually we added a vendor.
13:48
SPEAKER_00: Okay.
13:49
SPEAKER_00: We were out to reduce expenses and we added a vendor.
13:52
SPEAKER_00: Here's why we added a vendor.
13:54
SPEAKER_00: And we've talked about this and we'll continue to talk about it is our processes that we had in place when a couple years ago when we were across town that had got us to year 77, year 78 of our business helped us be very successful.
14:09
SPEAKER_00: Some of those were not scalable to the level of business we're doing now.
14:14
SPEAKER_00: One of those were how we process used vehicles.
14:18
SPEAKER_00: Used to be on eight or nine acres, we walked around every single day.
14:22
SPEAKER_00: And before you know it, we had every vehicle memorized and we knew where they were.
14:26
SPEAKER_00: And then we'd walk back through the service manager and say, hey, what about that blue F-150?
14:31
SPEAKER_00: What about that green Wrangler over there?
14:32
SPEAKER_00: What about that silver focus?
14:34
SPEAKER_00: So, where were we at with that?
14:36
SPEAKER_00: I've seen that sitting for a day, and it'd be top of mine awareness.
14:39
SPEAKER_00: Well, you move to 26 acres and you double what you're doing in used business, and all of a sudden you look up at what used to be our average time of recondition.
14:49
SPEAKER_00: So that's the time that we trade for it to the time that it's on the front line with pitchers ready to go, where that used to be between three and five days.
14:58
SPEAKER_00: We looked up, what was it, a couple months ago?
15:01
SPEAKER_00: Maybe it's three months ago, and that had creeped up to 15 days.
15:05
SPEAKER_00: It was a three or four X.
15:08
SPEAKER_00: And when you start looking at that, you're like, okay, now I need a system to better manage that, because in our case, our holding cost is$92 per day on used vehicles.
15:18
SPEAKER_00: So if you add an extra$10 onto that, it cost you$920 per unit because you didn't have the right system.
15:26
SPEAKER_02: Yeah.
15:26
SPEAKER_02: So that was in a case where we added on, right?
15:29
SPEAKER_02: We realized there was a need for it to help us manage and maintain.
15:32
SPEAKER_02: It gave facts.
15:33
SPEAKER_02: That's the most important thing we talk about being able to manage with facts is like, hey, no, it does actually take this technician an average three days, or it takes uh the detail part, or it takes a manager approval two days.
15:46
SPEAKER_02: And so we had the facts to point that out.
15:48
SPEAKER_02: And so we're going through that, figuring out how to tighten each one of those to be able to get it to the lot so that we can sell it quicker.
15:54
SPEAKER_02: So that's a good thing of realizing your vendors, making sure you're getting the value out of that, and not just say how often should you do a vendor check within your network?
16:03
SPEAKER_02: I should say at least every single month, you need to have, and we moved a lot of our uh where that was going over to software expense per the department.
16:14
SPEAKER_02: And so we have a report, and then we look at that, and I would say at least, at least every 60 days, but if not every 30 days, you look at that.
16:22
SPEAKER_02: What am I still paying to?
16:23
SPEAKER_02: You know, sometimes you see those advertisements for like rocket money or something, like, hey, how many Hulu subscriptions do you have?
16:28
SPEAKER_02: It's like, I think I just had one.
16:29
SPEAKER_02: It's like, no, you have three.
16:31
SPEAKER_02: It's like, what?
16:31
SPEAKER_02: How do you have three?
16:32
SPEAKER_02: Well, you signed up on Google and they'll keep signing you up, they'll keep signing up.
16:36
SPEAKER_02: So just a realization of, and the vendor somehow will just, hey, no, we had one for Springdale Ford, one for Lewis Ford, and one for Chrysler.
16:44
SPEAKER_02: Well, the Chrysler one's gone dormant.
16:45
SPEAKER_02: They've taken the scanner that we paid for, yeah, it's in the closet and it's not even plugged in, and we're still paying a$58 a month activation.
16:54
SPEAKER_00: Because in case you didn't know, they're not going to reach out to you and say, hey, we see that you guys have not been utilizing this.
17:00
SPEAKER_00: I probably should cancel.
17:02
SPEAKER_00: They I've never had a vendor.
17:04
SPEAKER_00: Ever.
17:04
SPEAKER_00: Never.
17:05
SPEAKER_00: And you know what your managers will do?
17:06
SPEAKER_00: They'll add on a new system and not delete the old system.
17:11
SPEAKER_02: And sometimes they'll cancel them out.
17:12
SPEAKER_02: Sometimes they'll be sending opposing emails to your customer.
17:15
SPEAKER_02: You know, people have talked about AI.
17:17
SPEAKER_02: That was in our last 20 group.
17:18
SPEAKER_02: People were talking about AI for customer communication, and they were like, you need to be careful because we signed up for that, because we have some people in our group that'll sign up for anything under the moon.
17:26
SPEAKER_02: Anything.
17:26
SPEAKER_02: And they forgot to turn the campaign off from the CRM.
17:29
SPEAKER_02: And then they had their text platform, but then they had AI chat.
17:33
SPEAKER_02: And so they were, they were completely waterboarding their customers and they're like, why am I getting so many different texts from so many different people?
17:41
SPEAKER_02: So you have to remember that.
17:43
SPEAKER_02: Yeah, for sure.
17:44
SPEAKER_02: Manage your network, manage your vendors, uh, of realizing that you got to treat it as a vendor relationship, but a professional relationship.
17:52
SPEAKER_02: And none of those meetings that we have are at top golf.
17:55
SPEAKER_02: None of those meetings are over lunch, none of those are like, hey, let's go play golf.
18:00
SPEAKER_02: It's a professional meeting, it's with an agenda before you go into it, and it's a checkup of ROI.
18:06
SPEAKER_02: Am I getting what I paid for?
18:07
SPEAKER_02: And am I getting more than what it's supposed to be doing?
18:11
SPEAKER_00: All of them have some type of report, some type of report that has facts associated with it.
18:19
SPEAKER_00: And we have developed a very good track record of if somebody brings up a thought on what they think's going on, we'll write it down, and and you'll see Shelby or I, we'll kind of go silent during one of the meetings.
18:34
SPEAKER_00: And if we can pull it up right then, we will before it comes out of our mouth what we're feeling.
18:38
SPEAKER_00: And we'll go, oh, well, by the way, I want to circle back to what you were talking about a minute ago.
18:44
SPEAKER_00: Here's some facts I pulled up that it actually is.
18:48
SPEAKER_00: There is no easier and efficient way to manage than facts.
18:54
SPEAKER_00: Yeah.
18:55
SPEAKER_00: Now you have to take the facts, that's the starting point, that's the identifier, and then you put together the action plans on how you're going to move the metrics.
19:04
SPEAKER_00: Yeah.
19:04
SPEAKER_00: All right.
19:05
SPEAKER_00: Time for automotive fun fact quiz of the week.
19:08
SPEAKER_00: How many vendors does a franchise dealer work on average?
19:13
SPEAKER_02: So we talked about that a little bit in the beginning.
19:16
SPEAKER_02: That the thought was just in general business, 20 to 50.
19:19
SPEAKER_02: Okay.
19:20
SPEAKER_02: But I think in the automotive, it it could scale to be more than that.
19:24
SPEAKER_00: I I think it'd be well over 100 when you start looking at, you know, some of them have two or three connected within them.
19:31
SPEAKER_02: Yeah, yeah, yeah.
19:32
SPEAKER_02: Yeah, thinking of you sign up for a V Auto, but then it has provision, then it has Stockwave, and then it has an add-on for an auction over here.
19:41
SPEAKER_02: Think about you have Auto Trader and then it has this and this and this and this and this and this.
19:45
SPEAKER_02: It's like, wait, hang on.
19:46
SPEAKER_02: Everything you showed me isn't part of the base package?
19:48
SPEAKER_02: Like, no, that's got the add-on chat, that has the ad on AI.
19:51
SPEAKER_02: So if you individualize, I'm gonna say on average, the average dealership, which it's over 90,000 dealerships in the United States, is over.
19:59
SPEAKER_00: I'd say it's over 100.
20:00
SPEAKER_00: If you take something as simple as, hey, I've got a website and you think that's the software, it's like, well, hey, what all feeds the website?
20:07
SPEAKER_00: How does it get its information?
20:08
SPEAKER_00: Yeah, it's uh it's very it's just a lot.
20:10
SPEAKER_00: Which is a good and bad thing.
20:12
SPEAKER_00: It is a good and bad thing.
20:13
SPEAKER_00: And I think when you when you start talking about some of y'all are gonna get overwhelmed because then you're gonna do a list and you're gonna go, well, dang, I've got 50.
20:20
SPEAKER_00: How do I manage that?
20:22
SPEAKER_00: And I'll just give you a tip here.
20:24
SPEAKER_00: And I heard an entrepreneur talking about this, and they made a list, and the list was once a day, once a week, twice a month, once a month, once a quarter, twice a year, once a year.
20:35
SPEAKER_00: So you you you list that out, and then you put in there those checkups.
20:40
SPEAKER_00: Everything's not once a day.
20:42
SPEAKER_00: Everything is not once a week, everything's out once a month, but it falls into a category somewhere so you can keep your thumb on it.
20:48
SPEAKER_02: Yeah, most important.
20:49
SPEAKER_00: When vendors screw up, what's the right way to handle it?
20:54
SPEAKER_02: You know?
20:55
SPEAKER_02: Yeah, I mean, you gotta think about the same way you would as an employee or a customer.
20:59
SPEAKER_02: Like the last thing you want to do, they're a partner with you.
21:02
SPEAKER_02: I know you pay them for it, but they're a partner and you want them, you know, they've got, we just talked about the average dealer as 100.
21:06
SPEAKER_02: That means if they're a good vendor, they've got thousands of dealers on there.
21:10
SPEAKER_02: You want to be high on their list.
21:11
SPEAKER_02: You do, you do.
21:12
SPEAKER_02: You don't want to be high on their biting list, yeah.
21:14
SPEAKER_02: So you got to handle it properly.
21:16
SPEAKER_00: And I'm gonna be honest, I have not handled it properly before.
21:20
SPEAKER_00: And I and I've handled it properly before.
21:23
SPEAKER_00: And since they're a vendor and they're not an employee and I can hang up the phone and move on, I've pulled out my sledgehammer before and sledgehammered a vendor.
21:32
SPEAKER_00: And then I get off and I'm like, what did that really accomplish?
21:37
SPEAKER_00: What is my goal here?
21:39
SPEAKER_00: Is my goal to keep this vendor just to get the actual rep to do what they need to do?
21:44
SPEAKER_00: Or is it to cancel?
21:45
SPEAKER_00: And if it's to cancel them, just cancel.
21:47
SPEAKER_00: You don't need to do that.
21:48
SPEAKER_00: But if it's to keep them, and this happens all the time in the vendor world, is reps change all the time.
21:56
SPEAKER_00: Companies get bought out.
21:58
SPEAKER_00: You first need to have A discovery call with them if a new rep and say, here's how we've been doing it, here's what we expect, here's what we need help with.
22:06
SPEAKER_00: And you know, sometimes you got to get after them, but you need to give them a fighting chance.
22:12
SPEAKER_00: We just had a rep changeover with the auto first of the year, and it wasn't going well because we were used to how the previous vendor did it.
22:21
SPEAKER_00: And we had some other managers, uh, including if Taylor was on here, that was really frustrated with that rep.
22:27
SPEAKER_00: And so the first time I got a hold of him, I hammered him.
22:30
SPEAKER_00: And then a week went by and nothing really changed.
22:33
SPEAKER_00: And I was like, did I handle that right?
22:35
SPEAKER_00: Because it really didn't change the outcome.
22:37
SPEAKER_00: So I went back and reapproached it and said, Hey, XYZ, here's what I need help with.
22:44
SPEAKER_00: And I know I came at you pretty hard.
22:46
SPEAKER_00: We want to keep you guys your good software.
22:49
SPEAKER_00: Here's our frustration, here's what my managers need help with.
22:52
SPEAKER_00: Do you have any ideas or solutions how we can be a better partner?
22:56
SPEAKER_00: Yeah.
22:57
SPEAKER_02: And that, and that's right, right?
22:58
SPEAKER_02: That is gonna give a better landing, you know.
23:01
SPEAKER_02: I've understand.
23:02
SPEAKER_02: Here's where the problem happens.
23:04
SPEAKER_02: If there's a change over on either side, on our side or on their side, because here's what happens.
23:11
SPEAKER_02: Like uh our our car wash company the other day, uh, that's been doing it forever, sold their company.
23:18
SPEAKER_02: Don't blame them for a second, and then it just transitioned over to be the same as the new owner has the same company and is doing the same thing.
23:27
SPEAKER_02: But what did not transfer over, and I'm not saying there's a problem, I'm just using this example, is the expectations that we have.
23:34
SPEAKER_02: When to do it, how to do it, how thorough we inspect, what what the cost of that product is, and when all the things of expectations.
23:43
SPEAKER_02: So when a new rep for a vendor or new vendor comes out, when it's a new vendor, generally they have that discovery call.
23:49
SPEAKER_02: When a new rep comes in, they try to not make waves.
23:52
SPEAKER_02: Let's just try to handle, but they don't know the history.
23:57
SPEAKER_02: And so it's they should, as a good rep, to not get hammered, they should come in and say, Hey, I see all the notes that they left in your system.
24:06
SPEAKER_02: But is it okay if they do a quick 15-minute discovery call?
24:09
SPEAKER_02: That way I have complete understanding of how you guys want to be managed, what your performance call needs to look like.
24:15
SPEAKER_02: And you need to do that with the high-level people, so then they can say, actually, here's three good things that they did, and here's three things that I wish they would have done.
24:23
SPEAKER_02: They waste their call on this, this, and this.
24:25
SPEAKER_02: And he's like, Oh, no problem.
24:26
SPEAKER_02: Thank you.
24:26
SPEAKER_02: We had that on our uh personnel for our warranty company.
24:31
SPEAKER_02: Yes.
24:31
SPEAKER_02: We had a new person come in.
24:32
SPEAKER_02: We were having frustration.
24:34
SPEAKER_02: So instead of completely just saying, hey, you need to fire this person, get somebody else in here, we said, hey, this person might not be the proper person to train and implement for these aspects.
24:42
SPEAKER_02: And so that guy did a really good job and said, Hey, let me understand your expectations so then he could curtail his presentation to exactly what you thought.
24:52
SPEAKER_00: And that's a great example because we didn't ask him to fire Erwin rep.
24:57
SPEAKER_00: When we came to him or we went to the upper level, you know, with vice president of one of the divisions and said, Hey, we see some really good things out of the rep in these areas, these other areas we feel like he may be over his head or we're doing something wrong.
25:12
SPEAKER_00: I think we're missing a boat here and we're asking the rep to do too much.
25:16
SPEAKER_00: Yeah.
25:16
SPEAKER_00: What are your solutions here?
25:18
SPEAKER_02: And they were they were so aggravated, upset, and angry by the end of it, but that was on them.
25:24
SPEAKER_00: That was not on us.
25:25
SPEAKER_00: It was.
25:26
SPEAKER_00: So I think, you know, when it talks about the next line here, you know, when to give grace and when to draw a line.
25:31
SPEAKER_00: What we found as being most successful is clear expectations.
25:37
SPEAKER_00: And whether you think it should be your job or not, again, is what is the end goal?
25:43
SPEAKER_00: And if it's to keep the vendor, you're gonna have to sometimes replay what maybe happened a year or two years ago when you signed up with a new rep and say, hey, let's have a quick 15-minute call, just like Shelby said, and let's review what's been going well, what we've been working on, and what we need help with.
26:00
SPEAKER_00: Um, and you give them a fighting chance at it.
26:03
SPEAKER_00: Yeah.
26:04
SPEAKER_00: And then if that does not get put into place, then you start drawing a line in the sand.
26:10
SPEAKER_02: And that's one of those things of, hey, I need this done, ASAP.
26:13
SPEAKER_02: Hey, can you help me this?
26:14
SPEAKER_02: Hey, is there any way to squeeze this in?
26:16
SPEAKER_02: But then if you're not getting there, then it becomes, hey, I need this completed by Tuesday, the 18th at 7 p.m.
26:22
SPEAKER_00: So back on our warranty company, we did that, and we first started to give the fighting chance of the rep.
26:30
SPEAKER_00: And this went off for a couple months.
26:32
SPEAKER_00: Here's what we need, here's the email, here's the in-person, I need you to work on these, so on and so forth.
26:38
SPEAKER_00: So we gave them a fighting chance.
26:39
SPEAKER_00: So we gave Grace there.
26:40
SPEAKER_00: Hey, it's somebody new.
26:41
SPEAKER_00: We told our managers to do that.
26:43
SPEAKER_00: And then after a couple months, after multiple emails and conversation, then it's like, okay, I need to go to who's in charge of you and lay that out to them.
26:52
SPEAKER_02: The funny thing is, if you rewind one step further, we we switched companies because we realized what had got us to 75 years, and we haven't been with this company forever, but it's a company that helps us out uh to be able to offer the coverage that we have.
27:08
SPEAKER_02: Been with them for almost 30 years.
27:10
SPEAKER_02: Long time.
27:10
SPEAKER_02: Yeah, right.
27:11
SPEAKER_02: And they'd done a good job.
27:12
SPEAKER_02: They just weren't rising as quickly as we were.
27:15
SPEAKER_02: Yep.
27:16
SPEAKER_02: Right?
27:16
SPEAKER_02: The performance and the expectations we had and the policies that we're that the customers were asking for, that finance said we needed, they were just still kind of, and what we found was they were really close to retirement.
27:28
SPEAKER_02: Most of their group is close to retirement, and so they weren't doing wrong, they just weren't rising.
27:31
SPEAKER_02: So we had those discovery conversations.
27:33
SPEAKER_02: So we ended up completely switching companies altogether.
27:36
SPEAKER_02: Yeah.
27:36
SPEAKER_02: With within the company.
27:38
SPEAKER_02: Yeah, yeah, yeah.
27:39
SPEAKER_02: So that there were there was a branch within that that they said, hey, this group is way more on par of the performance situation.
27:46
SPEAKER_00: They did.
27:47
SPEAKER_00: They did.
27:47
SPEAKER_00: But that was by a proper conversation.
27:49
SPEAKER_00: Yeah, it was by a proper, proper conversation.
27:52
SPEAKER_00: So, you know, what what are your thoughts on this?
27:55
SPEAKER_00: Why, how you handle a vendor's mistake teaches you how to handle that within your own team.
28:03
SPEAKER_02: So I'll say this.
28:04
SPEAKER_02: You said that you were upset, because generally it's a Strawberry's camel's back.
28:09
SPEAKER_02: You've been seeing misperformance, misperformance, misperformance.
28:12
SPEAKER_02: You get on a call with that person and they just bring what they think is doing so well, and you're already upset about misperformance, and so then you drop the humor.
28:19
SPEAKER_02: That's right.
28:20
SPEAKER_02: And sometimes it was insert dominance.
28:22
SPEAKER_02: No, I'm paying you.
28:23
SPEAKER_02: You need to do it right.
28:24
SPEAKER_02: Yep.
28:25
SPEAKER_02: But then you realize nothing changed.
28:27
SPEAKER_02: That wasn't the proper approach.
28:28
SPEAKER_02: And so then a week later, you the story that you just told, you come back to it and you're like, hey, I see an opportunity.
28:35
SPEAKER_02: Generally is what we'll see.
28:36
SPEAKER_02: Hey, see an opportunity here.
28:37
SPEAKER_02: Could we do this, this, and this?
28:38
SPEAKER_02: And so then they handle it completely different, and you get way different results than just hammering that.
28:44
SPEAKER_02: Well, that I'm not gonna say that that's a throwaway, but that's not your own employee.
28:49
SPEAKER_02: So you learn that.
28:50
SPEAKER_02: So then when you approach your employee with an issue or a missed performance or not hitting the KPIs, you're able to you've learned from your vendors how to approach that person.
28:59
SPEAKER_02: Now, on your employee, you can almost have a perfect delivery.
29:02
SPEAKER_00: One of the things that takes a while to develop this I or this skill set for, but I've been fortunate enough to now it's in my brain, is to not always be in defense mode.
29:14
SPEAKER_00: And we just had a conversation before this podcast started about even when your brain starts to go there, of hitting pause and going, okay, let me at least see if something's there.
29:25
SPEAKER_00: When I am dealing with something either personally or through a vendor at work, and I'm not getting great service and what I want, I now have the eye and the ability to go, I wonder if this is happening anywhere in our business.
29:40
SPEAKER_00: Yeah.
29:41
SPEAKER_00: And I better check up on it because I'm oblivious if I think that every single system and every single issue with or transaction with a customer is being handled perfectly.
29:53
SPEAKER_00: Yeah.
29:55
SPEAKER_00: So it's always a great reminder to go, I better dive in and make sure what I just experienced, our customers are not experiencing as well.
30:03
SPEAKER_02: And the good news is with that, why that's so important, is that you can use the experience that you had in a story.
30:10
SPEAKER_02: I explained that in Monday morning sales meeting, talking about, you know, I think it was last week or the week before we talked about controlling what you can control and the things that and so I told the story that uh I was at a basketball game with my son, and every we lost.
30:25
SPEAKER_02: We lost by a lot of points, right?
30:27
SPEAKER_02: 20 plus points.
30:28
SPEAKER_02: Uh, and everyone in the stands were mad at the refs, they were mad at the other coaches, they were mad at the kids because when they were draining threes, they were hitting the this, and I don't know, the end of it.
30:40
SPEAKER_02: So they were they were doing good, right?
30:42
SPEAKER_02: And we weren't doing good, and uh so I could hear and it it drove me nuts.
30:46
SPEAKER_02: Like I I sit like on my own island at these games, and I'm like, what are we doing?
30:50
SPEAKER_02: Like, why?
30:51
SPEAKER_02: And so I I said to my wife and all the women that were there, I said, Hey, do you think because we were it was it wasn't even our team, it was you know, a friend of a friend needed some players.
31:00
SPEAKER_02: I said, Do you think that coach knew when he recruited all these kids that he'd have so many assistant coaches?
31:05
SPEAKER_02: And they all looked at me like, shut your mouth.
31:08
SPEAKER_02: And so then I just did my own thing.
31:10
SPEAKER_02: And so I walked out, and and this was Elliot, and he's such a student of the sport, and he's such a good player, and he listens well and he takes everything to heart.
31:19
SPEAKER_02: And uh I said, Hey, you did he scored seven of the 12 points.
31:22
SPEAKER_02: I said, Hey, you did great, and the opportunities you got, you did what?
31:26
SPEAKER_02: Um he's like, Yeah, he said, those refs.
31:29
SPEAKER_02: I said, Those refs, what?
31:31
SPEAKER_02: He said, Those refs tossed the game, they weren't calling this.
31:35
SPEAKER_02: I said, son, they scored 20 plus points more than you.
31:38
SPEAKER_02: The refs didn't score one of them.
31:40
SPEAKER_02: I said, Can I so I explain to controlling what you control, like not trying to control it?
31:45
SPEAKER_02: So it's the same thing in uh people's and process and vendors of realizing controlling what you control.
31:50
SPEAKER_02: So when you're able to share that story of, hey, this happened when I was at this place, and I want to make sure it doesn't happen within our store.
31:57
SPEAKER_02: And so then you get to tell that story and controlling what you can control, then they're like, you know what?
32:02
SPEAKER_02: I might sometimes like I divert my customer when they call because I'm busy, and I probably should just pick it up and say, Hey, I apologize, I can't talk right now, but I didn't want you to think that I couldn't take your call.
32:12
SPEAKER_02: Is it okay if I call you as soon as I'm done?
32:14
SPEAKER_00: That's right.
32:14
SPEAKER_02: Right.
32:15
SPEAKER_02: And so with that story, they get to relate.
32:17
SPEAKER_00: I think the point is there too, is don't miss the opportunity to use one of those stories to benefit within your organization.
32:24
SPEAKER_00: Yes, because I'm just telling you it's happening.
32:28
SPEAKER_00: Maybe not the exact same thing, but something's happening within your organization that you could improve on.
32:34
SPEAKER_01: Yeah.
32:34
SPEAKER_00: So the the keys to that are number one, don't have a wallet.
32:41
SPEAKER_00: Be protective, be proud of your business, but don't have a wallet.
32:45
SPEAKER_00: Be willing to at least listen.
32:47
SPEAKER_00: Be willing to uncover and going, okay, I know there's no way we're perfect.
32:50
SPEAKER_00: We're very successful, but we can't be perfect.
32:53
SPEAKER_00: How can we improve?
32:55
SPEAKER_00: And two, use those situations with those stories to teach your own team to help discover on how to be better.
33:03
SPEAKER_00: And then the vendors you fired versus the vendors you fought for.
33:08
SPEAKER_00: And we've been there.
33:10
SPEAKER_00: And we each have our own vendors that we've individually brought to the table.
33:14
SPEAKER_00: Yeah.
33:15
SPEAKER_00: And and why is that?
33:16
SPEAKER_00: Because when you move into a position, you want to bring value, you want to be proud, you want the you know, executives above you to see what you're doing to move the mark.
33:29
SPEAKER_00: So there are at that point in time, there are vendors that you fired, but then there's also vendors you fought for.
33:37
SPEAKER_00: And I'm gonna circle back around here because this is this is a tough one.
33:40
SPEAKER_00: There are vendors that I've fought for because they're ones that initially I brought on and they helped me move the mark, but they may not be as relevant today.
33:51
SPEAKER_00: Yeah.
33:52
SPEAKER_00: And I have to remind my, and I'll listen to you and I'll listen to Shelby, and I'll listen, I mean, I'll listen to Taylor and I'll listen to managers and go, okay, I want to defend these vendors because I'm the one that brought them on, but maybe they're not doing as good a job as when I originally brought them.
34:08
SPEAKER_02: And is your defense from the original said what they said they can do, or is it from what they're currently doing?
34:13
SPEAKER_02: That's the difference.
34:14
SPEAKER_02: And so it's tough because you have buy-in, which is really good.
34:17
SPEAKER_02: Yes, that you say, hey, you know, when we worked on the reconditioning tool, you know, of speed of reconditioning, I challenged Chet, our inventory manager.
34:25
SPEAKER_02: I said, Hey, I want you to find the top three vendors and I want you to do demos, see what you like, what you don't like.
34:32
SPEAKER_02: And he's like, Hey, here's ones I found.
34:34
SPEAKER_02: I was like, okay, go back, go again.
34:35
SPEAKER_02: And so I just kept sending him through the gauntlet.
34:38
SPEAKER_02: It was like, hey, if we're gonna spend the money, I want to make sure it's right, want to make sure that it operates from service good to R side good to recon, all those things.
34:46
SPEAKER_02: I said, okay, now give me those three that you still feel confident, you know the pricing.
34:50
SPEAKER_02: Don't share with me the pricing, tell me what the companies are, because then I'm gonna go see them in person.
34:55
SPEAKER_02: So at N A DA, I got to go see all three of them, non-biased, and say this, this, and this.
35:01
SPEAKER_02: But then that person has ownership in it.
35:03
SPEAKER_02: So they want them to survive because they're the ones that vetted them and said they're good.
35:07
SPEAKER_02: But you still need to reevaluate are they still relevant now?
35:10
SPEAKER_00: What I like too about our team, and I wouldn't say that everybody has gotten to this point, but a good majority of them have.
35:18
SPEAKER_00: They know the questions we're gonna ask on a discovery call.
35:21
SPEAKER_00: They know what'll frustrate us and feel like a waste of time.
35:25
SPEAKER_00: And I can remember Chet telling me about when he was researching the different recon software, and he said, But this one I'm not ready for him to present because I know you would get frustrated about that because they haven't done your homework that you always ask for, which was relevant, which was good.
35:43
SPEAKER_02: That means that before it got to the level making the decision, he thought they were good enough, but they needed to work on having all the facts so that you would at least give them the opportunity to talk.
35:52
SPEAKER_00: That's right.
35:52
SPEAKER_00: That's right.
35:53
SPEAKER_00: And that was that was cool.
35:55
SPEAKER_02: Yeah, you know, it's that's good to see that they adapt for that.
35:57
SPEAKER_02: I mean, I adapt for that if I'm on a call and I know you're coming on the call is like, hey, here's the thing.
36:01
SPEAKER_02: We're going over this, this, and this.
36:03
SPEAKER_02: And when he gets on, you better be ready for this, this, and this.
36:05
SPEAKER_02: You're you're not gonna get a shot.
36:07
SPEAKER_02: Yeah, you know, of just understanding that.
36:10
SPEAKER_02: Uh, and let them pitch their dinner before you just judo chop them and then set it aside and let's go through the rest of it.
36:16
SPEAKER_02: Um, that's so good.
36:18
SPEAKER_02: What talk about this?
36:19
SPEAKER_02: What's the vendor turnover in a year's time across the automotive industry in a year's time?
36:24
SPEAKER_02: If you have 100 vendors, what percentage will turnover in a year?
36:27
SPEAKER_00: Um, actually, the number, this is one of those, I think the number is lighter than I thought it would have been.
36:33
SPEAKER_00: Yeah.
36:33
SPEAKER_00: I really do.
36:34
SPEAKER_00: You know, the number is six to 24%.
36:37
SPEAKER_00: Yeah.
36:37
SPEAKER_00: I would have thought it would have been closer to 50%.
36:40
SPEAKER_00: Yeah.
36:40
SPEAKER_00: Um, and here's the only reason why is especially in the small vendor world, we're seeing those small vendors being bought up by large vendors all the time.
36:50
SPEAKER_00: Yeah.
36:50
SPEAKER_00: And usually when that happens, we lose the personalized connection of those people.
36:57
SPEAKER_02: Yeah, most certainly.
36:58
SPEAKER_02: But also if you think about that, if you've got a hundred vendors, if you know, if you're placing six to twenty four of them, yeah, then that's like, wow, that's a lot.
37:06
SPEAKER_02: Yeah.
37:06
SPEAKER_02: Thinking of that, you know, the startup, the integration, the onboarding, it's like, and oftentimes that's why you don't fire them because you like, oh my gosh, bringing on a new one is gonna be so loss of production, like it's gonna take my brain space and all this stuff.
37:22
SPEAKER_02: Because you know, because you've been through so many of them.
37:25
SPEAKER_00: Yeah.
37:25
SPEAKER_00: Uh I think when I sit here and and talk, and this isn't even in the notes to talk about, but I'm just sitting here digesting, you know, all this vendor stuff.
37:33
SPEAKER_00: And if you've been around Shelby or I or Taylor, you'll hear us say every once in a while the easy part's selling the car.
37:41
SPEAKER_00: The fun parts on Saturday talking to customers and selling the cars, and you're like, what are you talking about?
37:46
SPEAKER_00: Well, the other part you've heard on other podcasts, the employees, the benefits, the software, the vendors, all of these pieces.
37:58
SPEAKER_00: And if you're not managing your network and all the software, you won't have enough people here to sell a car to, to service a car.
38:07
SPEAKER_02: Yeah.
38:08
SPEAKER_02: That's so important.
38:09
SPEAKER_02: Think of that.
38:10
SPEAKER_02: Because you're like, man, why do you guys have you know, if you have no clue the vendors, you know, you're thinking like, well, you only have so many coke machines.
38:16
SPEAKER_02: Like, that's not the vendors we're talking about.
38:18
SPEAKER_02: It is one of them.
38:19
SPEAKER_02: It's one of them.
38:20
SPEAKER_02: But your uniforms, yeah.
38:22
SPEAKER_02: There's like, you know, CentOS, like, well, there's other options, and you know, and that and spend expense creep is real there, you know, so all those things.
38:30
SPEAKER_02: But we have tons and tons and tons of vendors that are lead providers, yeah, that are social promoters and all these things that you have to measure those constantly so that it stays relevant.
38:41
SPEAKER_02: And so that's the tricky part.
38:42
SPEAKER_02: And that's we'll dive in here is the long game.
38:44
SPEAKER_02: So vendor relationships that outlast trends, techs, and turnover.
38:48
SPEAKER_02: So we've been with some advertising vendors for a long time that realize that maybe they bring in a new person that says, Hey, I want you to follow trends and see what's a new way to serve an ad.
38:59
SPEAKER_02: How does it become relevant in an Instagram story or a reel?
39:03
SPEAKER_02: Or how does this show over here on a display ad or on Google My Business?
39:07
SPEAKER_02: How are we relevant?
39:08
SPEAKER_02: Or how does it now show up in chat when somebody's searching in an AI platform?
39:12
SPEAKER_02: So the vendors that have stood the test of time, yeah, they have realized how to stay relevant.
39:20
SPEAKER_00: They've realized how to stay relevant.
39:22
SPEAKER_00: And I'm gonna go back to what I said just a minute ago.
39:24
SPEAKER_00: The ones we've had for over a decade, they're usually the bigger ones.
39:28
SPEAKER_00: Um, unfortunately, in our business, the smaller ones that are wildly successful get bought up by the bigger ones.
39:35
SPEAKER_02: Oh yeah, it's a it's a story of create a business, bring big worth, and then it's an IPO, and they just they just sell it.
39:42
SPEAKER_00: They just sell it.
39:43
SPEAKER_00: Um, so that's what, if you ask us what keeps us from having more vendors over a decade, it's it's that.
39:49
SPEAKER_00: Yeah, it's that.
39:49
SPEAKER_00: And then the reps get gobbled up because it's it's a partnership.
39:53
SPEAKER_00: And I think that's one of the things that we have spent a lot of time understanding.
39:59
SPEAKER_00: None of it's a light switch, it's a partnership.
40:02
SPEAKER_00: And some of those I talked early on about this, like what do you do once a day, what do you do once a week, what's twice a month, what's once a month, what's once a quarter, yada, yada yada.
40:12
SPEAKER_00: And so, for example, CentOS.
40:14
SPEAKER_00: CentOS is uh once a year for me, once a year for me, that we review the contracts, we review who has authorizations to add or delete things, so on and so forth.
40:26
SPEAKER_00: So I only deal with that once a year, unless something pops up.
40:30
SPEAKER_00: Now, the managers within the departments, I've set the guardrails because it's eight hounch before.
40:36
SPEAKER_00: Oh, yeah.
40:37
SPEAKER_00: But that's not something that I deal with once a day.
40:40
SPEAKER_00: Uh let's let's take a software that's once a week.
40:42
SPEAKER_00: Once a week, that's relevant time invested for that is our pricing tools, you know, our merchandising tools, uh, the recon tool we're talking about, service software, uh, training on how to utilize the CRM.
40:58
SPEAKER_00: That type stuff, it is once once a week, as maybe for a performance call.
41:03
SPEAKER_00: From a management standpoint, our sales managers, a lot of that's once a day.
41:07
SPEAKER_01: Yeah.
41:08
SPEAKER_00: So you really just have to look, and I know that's not answering the question about the the decades, but you have to look at how you manage each one of them, and each one of them is different.
41:17
SPEAKER_00: But you got to have a process or strategy there.
41:19
SPEAKER_02: You know, and one of those things that we've learned to do, and they they should be a-okay with this because of the turmoil of having to delete a vendor and add a vendor.
41:27
SPEAKER_02: But one of the things that we've transitioned over, because it says a vendor you've used for 20 years.
41:31
SPEAKER_02: Well, a big one we've used is our DMS, CDK.
41:34
SPEAKER_02: And you have to sign long-term contracts.
41:37
SPEAKER_02: But on the on the opposite side of that, like, because I try to now with every vendor do a 30-day out.
41:44
SPEAKER_02: I'm not signing your contract, yeah, as small as I can go, to say if I want out, and their guarantee should be if you want out, we haven't done our job and we should let you out.
41:55
SPEAKER_01: Yeah.
41:55
SPEAKER_02: You know, uh CDK, we would have been out long ago.
41:58
SPEAKER_02: But here's the thing we've now gone from a long-term contract to now a month-to-month contract.
42:03
SPEAKER_02: Yeah.
42:04
SPEAKER_02: They should be okay with that because it is such a struggle to move to someone else of all the things that affects their.
42:12
SPEAKER_02: So realizing sometimes it's just the pain and suffering of moving from one to the other, but you got to make sure that vendor is still giving you value.
42:20
SPEAKER_00: You know something on CDK, though, and I know nobody on CDK is listening to this, um, but send it to them.
42:26
SPEAKER_00: I don't care.
42:26
SPEAKER_00: Yeah.
42:27
SPEAKER_00: Um CDK, you're getting the should have it on their radar of why has Lewis been okay with a monthly increase of month to month since December.
42:39
SPEAKER_00: Yeah.
42:39
SPEAKER_00: So we've had six or seven months now, and zero talk from CDK has happened on trying to get us back under contract.
42:48
SPEAKER_00: Yeah, that should be a flashing red light saying, hey guys, a track record of somebody going month to month and not talking about going back under contract means they're looking to replace us.
42:59
SPEAKER_02: Yeah, and the problem there is that they're looking, okay, we're bringing up our revenue because we just were able to increase this rent.
43:06
SPEAKER_02: Hang on, you're your person who's renting your house that you're increasing the rent by 1% every single month.
43:12
SPEAKER_02: You think it's all fine and dandy.
43:14
SPEAKER_02: Meanwhile, they haven't moved out yet because they haven't found the next best thing, but they're looking they're looking for it.
43:20
SPEAKER_02: And that when we went to NADA, it's funny, we didn't go talk to CDK, but we went through CDK, we went and looked at the other main providers, and so we were super excited to talk to all the other providers.
43:30
SPEAKER_02: We knew what we were struggling with.
43:32
SPEAKER_02: So we got to use that in that conversation with the new providers, and then we laughed at CDK at their here's what's going on, here's how things are so good.
43:41
SPEAKER_02: And they were the company that's bought so many small companies, so they had so many plugins.
43:46
SPEAKER_02: It was like, this is them, and they look this big, but it's a bunch of these little add ons, and they were just like, Everything's going so good, and everything's so great.
43:56
SPEAKER_02: And we had the struggles every single day with them.
44:00
SPEAKER_00: Not fixed, I did get into a whole CDK, Reynolds and Reynolds, big Goliath of the DMS deal, they had not taken the time to address the center nucleus.
44:13
SPEAKER_00: And they just added on all these pieces.
44:15
SPEAKER_00: And I think it's a great reminder in business is if you keep adding on these vendors, it it shows itself an AI.
44:23
SPEAKER_00: You keep adding on these vendors and you think it'll fix an issue in your business, all it will do is either enhance how good you are at something or how bad you are at something.
44:34
SPEAKER_00: You think if you hire an AI software that it's gonna fix your problems, it's not going to amplify.
44:40
SPEAKER_00: It'll amplify.
44:41
SPEAKER_00: It'll either amplify how good you're doing at something or how bad you're doing at something.
44:46
SPEAKER_00: Yeah.
44:46
SPEAKER_00: So so remember that before you just sign up for something.
44:49
SPEAKER_00: And that was in our case on going, hey, we want to move our used sales from 100 a month to 200 a month to 300 a month, but we hadn't fixed our reconditioning issue.
45:01
SPEAKER_00: Yeah.
45:02
SPEAKER_00: So all that did when we were ramping that up is amplify our issue over here.
45:07
SPEAKER_02: Yeah.
45:08
SPEAKER_02: That's good to understand, right?
45:11
SPEAKER_02: Of understanding that you can't now you need to work on it, but you need to make sure you're working on the right pieces at the right time.
45:16
SPEAKER_02: That's right.
45:17
SPEAKER_02: So realizing this, the building of vendor network becomes a competitive advantage.
45:22
SPEAKER_02: And how that does, if you have a good relationship with a vendor, but more or less with the rep of that vendor, it allows you to say, hey, we're going into March.
45:32
SPEAKER_02: Here's what we want to do, but we want to put more ad spin in this direction.
45:36
SPEAKER_02: Because of that relationship, you're going to have that conversation and say, hey, we're looking in June to switch over to this, we want to send out direct mail for this, or how do we send out more service offers, or how do we get in front of people to show that we have no appointment needed for oil changes?
45:51
SPEAKER_02: So we go to that vendor and say, because if you have that good relationship, you don't go to Google and say, hey, what's the best way to get in front of people about your oil changes?
46:00
SPEAKER_02: Sure.
46:00
SPEAKER_02: You go to that vendor, and because that good relationship and that network, you say, here's what I want to do.
46:05
SPEAKER_02: What do you have?
46:06
SPEAKER_02: And if it's a good, if it's a really, really good relationship, they're gonna honestly say, I've got that, and here's this department, here's this guy, they'll handle it.
46:15
SPEAKER_02: Or they will say, Look, here's the thing, Matt.
46:18
SPEAKER_02: We're not good at that.
46:20
SPEAKER_02: But because I appreciate you as a customer, I've got a referral.
46:23
SPEAKER_02: I've got somebody over in Florida that is amazing with that.
46:27
SPEAKER_02: I'm gonna shoot them a text.
46:28
SPEAKER_02: Some they're calling you, I'm gonna shoot share of their information, they'll take care of you.
46:31
SPEAKER_02: I'm gonna handle this side of it, they're gonna handle this side of it.
46:34
SPEAKER_02: And so you're now not going to replace vendor A with a vendor B.
46:38
SPEAKER_02: You're just gonna add on to it because vendor A was loyal and took care of you.
46:43
SPEAKER_02: And so they're gonna be an add-on, an extra.
46:45
SPEAKER_02: Yeah, but because that network that you've built, it's gonna help you in there the trust that's built in there.
46:50
SPEAKER_00: That that that's great advice there.
46:52
SPEAKER_00: I would also tell you, too, and some of you may do this, and some of you may have not ever thought you even could do this.
47:00
SPEAKER_00: You can have multiple vendors on a discovery call with you.
47:05
SPEAKER_00: Yeah.
47:06
SPEAKER_00: If they're if they all have to do with helping your website out, put a call together on the one that does the photos, the one that does the pricing, the one that does the descriptions, and the one that does the feeds.
47:18
SPEAKER_00: Get them all on that same phone call.
47:20
SPEAKER_00: Because I'll bet if you're anything like me, you know enough to ask the right questions, but you don't know all the ins and outs.
47:28
SPEAKER_02: But you can be the host and the fun and the productive part about that conversation is there's not a I need to get with them, or it's Matt that can't do it.
47:37
SPEAKER_02: That's right.
47:37
SPEAKER_02: Or I we can do it, but they can't do it.
47:40
SPEAKER_02: And so if you get them all on that call, you can get a lot done.
47:42
SPEAKER_00: Uh this this past couple of weeks, I've put together a couple of those calls, and and on those calls, I had legal on there, so attorney, I had tax people on there, I had estate planning people on there, and then I had future tax people on there too, all working together.
48:04
SPEAKER_00: Because what would happen is they'd tell me something, I'd get off the phone call, make another phone call.
48:08
SPEAKER_00: I probably didn't translate.
48:08
SPEAKER_00: They'd say, What do you mean?
48:10
SPEAKER_00: They'd say, What do you mean?
48:11
SPEAKER_00: I'm like, I really don't know.
48:12
SPEAKER_00: I'm just regurgitating this.
48:13
SPEAKER_00: Let me go ask them.
48:14
SPEAKER_00: Then I'll come back and then I'll ask you again.
48:16
SPEAKER_00: And I'm like, okay, I'm smarter.
48:18
SPEAKER_00: It'd have been two weeks.
48:18
SPEAKER_00: Two weeks, and we still would have got it wrong.
48:20
SPEAKER_00: So I just put them all together, make them play nice because I'm paying all the bills.
48:24
SPEAKER_00: All of them either paying all the bills, and then you just sit there and facilitate it.
48:28
SPEAKER_00: Yep.
48:29
SPEAKER_00: That's it.
48:29
SPEAKER_00: You become the moderator, you're the customer.
48:32
SPEAKER_02: It's funny because it was a little bit awkward and not awkward in the way that you think.
48:35
SPEAKER_02: It was awkward because it was so far over our heads.
48:38
SPEAKER_02: This is but as the moderator, as the person that brought the conversation, I was on this call and not saying a word, but I was thinking in your shoes, like, okay, what question do you ask next?
48:51
SPEAKER_02: Because you don't know what they're talking about.
48:53
SPEAKER_02: And so then the question would just be like, okay, that seems to be an option.
48:58
SPEAKER_02: What's a second option?
49:00
SPEAKER_02: And they're like, What do you mean?
49:01
SPEAKER_02: He's like, well, that can't be the only option.
49:03
SPEAKER_02: What's another option?
49:04
SPEAKER_02: Like, you're not saying, hey, what about a 731, 642 said hutt?
49:09
SPEAKER_02: Because you don't know, because that's why you have them.
49:11
SPEAKER_02: That's why.
49:12
SPEAKER_02: But when we got to the because they weren't pitching anything, right?
49:16
SPEAKER_02: They were just answering questions.
49:17
SPEAKER_02: It's like, well, what if we do this?
49:18
SPEAKER_02: And so then uh this person, the tax person, might talk about all this.
49:23
SPEAKER_02: Then you say, All right, that's good.
49:25
SPEAKER_02: Legal.
49:26
SPEAKER_02: Is there any downside to that?
49:28
SPEAKER_02: And they're like, no.
49:29
SPEAKER_02: And so then investment, is there anything we're missing here?
49:33
SPEAKER_02: Or could we do that or should we do that?
49:34
SPEAKER_02: And they're like, and then an attorney is like, hey, is there any reason why we should or shouldn't?
49:39
SPEAKER_02: And they're like, and so then we're like, okay, let's go back to the tax person.
49:43
SPEAKER_02: You heard what they said.
49:44
SPEAKER_02: Now what's your thoughts?
49:46
SPEAKER_00: You bring up a good point there, and without even knowing it, you're right.
49:51
SPEAKER_00: Way over my head.
49:53
SPEAKER_00: Okay, didn't have a degree in any of that.
49:55
SPEAKER_00: But what I do have a degree in, and so do you, is being a really good listener, taking notes and designing what you're gonna ask in the middle of the process.
50:05
SPEAKER_00: Yeah.
50:05
SPEAKER_00: That's no different with an employer or the customer.
50:08
SPEAKER_00: You don't know where that conversation is gonna go, but you're a really good listener.
50:12
SPEAKER_00: You ask questions to hear what they're gonna say.
50:17
SPEAKER_00: So I was sitting there making notes, I had another screen up and I would type in a word they said that was pulling it up, you know, pulling it up, going, okay, I don't know what that means.
50:26
SPEAKER_00: I'd pull it up.
50:27
SPEAKER_00: Tell me about a 731.
50:28
SPEAKER_00: And I'm like, okay, what is a 731?
50:30
SPEAKER_00: So then they're talking, then I'd ask another question, so they'd get to talking about it.
50:33
SPEAKER_00: And I'm just writing all these things down to spider web it together as discovery.
50:37
SPEAKER_00: Like if you're watching, you know, a CIA thing or this or that.
50:41
SPEAKER_00: And by the end of it, we we've come up with solutions.
50:44
SPEAKER_00: Yeah, yeah.
50:44
SPEAKER_02: And so then you can recap it and send an email.
50:47
SPEAKER_02: It's like, hey, we went over a whole lot, appreciate you.
50:49
SPEAKER_02: Here's the four things that are still in question.
50:51
SPEAKER_02: That's right.
50:51
SPEAKER_02: Should we do this, this, this?
50:52
SPEAKER_02: And so then by the end, you you seem to be pretty well versed in what was going on.
50:57
SPEAKER_00: I would find myself too, when I knew that other people on the phone call, like our CFO or one of our legal, would know the answer or could translate it better than I could.
51:09
SPEAKER_00: I would ask them.
51:10
SPEAKER_02: You could see it on their face.
51:12
SPEAKER_02: But they weren't saying anything.
51:13
SPEAKER_02: You could say, hey, so and so.
51:15
SPEAKER_00: Yes.
51:16
SPEAKER_00: What's your thoughts on it?
51:17
SPEAKER_00: I would say, hey, Missy, what do you see this?
51:20
SPEAKER_00: What are the questions do you have in this area?
51:22
SPEAKER_00: Again, I'm just facilitating and moderate.
51:24
SPEAKER_00: I'm just driving the ship.
51:25
SPEAKER_00: Yep.
51:26
SPEAKER_00: Yep.
51:26
SPEAKER_00: Yep.
51:27
SPEAKER_00: So you can do that with your vendors too.
51:29
SPEAKER_00: I know that's very high level, but that happens with our vendors too.
51:32
SPEAKER_00: Yeah.
51:32
SPEAKER_02: On feeds and on this.
51:34
SPEAKER_02: Listen, hey, what's your thought here?
51:35
SPEAKER_02: Why is this photo taking so long and so forth?
51:37
SPEAKER_02: So all right, frequently asked questions to wrap this thing up.
51:40
SPEAKER_02: Matt, how do you know when to let go of a vendor that has done good before, but there's better options?
51:47
SPEAKER_00: When you challenge them and you take the time to look at other options out there.
51:53
SPEAKER_00: And it's very hard to see if you don't see what else is out in the marketplace.
51:58
SPEAKER_00: And that's one of those things we looked at at NADA that wasn't the main focus, but was a filler focus.
52:04
SPEAKER_00: Hey, go look and see what else is in inventory, what else is in communication with the customer, what's out there.
52:11
SPEAKER_00: And then that educates you about what's in the market right now.
52:15
SPEAKER_00: And you go back to that vendor and they're like, no, I I can't, I can't integrate with TikTok right now.
52:19
SPEAKER_00: I'm only in Facebook.
52:20
SPEAKER_00: Yeah, yeah.
52:21
SPEAKER_00: I think that's good.
52:21
SPEAKER_00: So flipped on your side, how long do you give a vendor to decide if they're worth keeping or if you need to change?
52:29
SPEAKER_02: That's a really good question.
52:31
SPEAKER_02: So you got to at least give them, I would say, 90 days to get integrated.
52:36
SPEAKER_02: And that that's a sure one.
52:38
SPEAKER_00: That's a short one for integration.
52:39
SPEAKER_02: You know, it's generally gonna be six months, but you're like, oh my gosh, you're month to month, but oh my gosh, that's gonna be expensive if it doesn't work.
52:46
SPEAKER_02: I feel like you at least got depending on what the vendor does, right?
52:49
SPEAKER_02: You might need to pull the plug quicker or sign up for a longer contract quicker, but you're gonna at least give them that that 90 days to realize to get integrated, then get your team to properly use it and give it its ability and then give it time to average.
53:05
SPEAKER_02: So it might be that it wasn't a good time of the year to push that.
53:09
SPEAKER_02: Yep.
53:09
SPEAKER_02: You know, you were trying to sell pop signals in the middle of winter.
53:12
SPEAKER_02: Like that's bad on your part.
53:14
SPEAKER_02: That's not the vendor.
53:15
SPEAKER_02: That I mean, the pop cycle was still a good pop cycle, it was just cold outside.
53:18
SPEAKER_02: So at 90 days, we'll realize that then at that point, if you have your KPIs that you think they're not performing to that metric of what they said they could, because they'll generally tell you how they could perform.
53:27
SPEAKER_02: Then you measure yours against their performance, see, am I at below or above that?
53:32
SPEAKER_02: Like, what happened?
53:33
SPEAKER_02: I thought you were a 400% guy.
53:34
SPEAKER_02: That's right.
53:35
SPEAKER_02: This is only at 32%.
53:37
SPEAKER_02: Then from there, you're gonna put them on notice of, hey, I expect a little bit more of like a 30-day.
53:42
SPEAKER_02: Here's what we need to do, here's our action plan.
53:44
SPEAKER_02: At the end of that 30 days, if we didn't at least don't have to be at it, but if you're gaining going that way, then we're saying, okay, we're making headway.
53:51
SPEAKER_02: Let's look at the next 30 days.
53:52
SPEAKER_02: How do we get to that and continue to perform above that?
53:56
SPEAKER_00: That that that's a great point.
53:57
SPEAKER_00: Remember, too, you can always challenge a vendor that no payment starts until you go live.
54:02
SPEAKER_00: That's a good one that we've learned.
54:04
SPEAKER_00: You know, no payment and until that point.
54:06
SPEAKER_00: No setup fee.
54:07
SPEAKER_00: No setup fee.
54:08
SPEAKER_00: They'll hit you with that every time.
54:09
SPEAKER_00: So on and so forth.
54:11
SPEAKER_00: 50% on the first month while you're working all the irons out, like all that stuff you can ask for.
54:17
SPEAKER_00: So hey, it's been a great conversation today about vendors and juggling all that to your advantage.
54:22
SPEAKER_00: And it's one of those that you either do manage, or it's by the wayside and becomes an expense instead of a great ROI for yourself.
54:32
SPEAKER_00: As always, check out our inventory on Lewis Superstore.com and check out this episode and over 80 more on Crossroad Conversation Podcast.com.
54:42
SPEAKER_00: Hey, thanks for joining us today, and we hope you enjoyed this episode.
54:45
SPEAKER_00: Make sure to give it a like, share it with your friends and family, visit our website, and send us some questions.
54:50
SPEAKER_00: We want to know what you'd like to hear, who you'd like to hear from, and what you want to see, or maybe even some questions for us to answer about either the automotive industry or just business in general.