Day in and day out your BDC department turnover ratio should be well over 150% if you’re trying to maximize ROI without increasing your monthly nut. Your seats need to turn over three times a day!!
It's how you man (and woman) those seats and how the turnover is calculated that will add directly to your bottom line. You need product specialists talking to your potential customers and following up with sold customers. Who does the customer have the strongest relationship with – the person they agree to spend money with, that’s who.
Operate with "Universal Soldiers"
Put a revolving door on your BDC and have your salespeople filling those seats on a daily basis. They don't need to be there all day. They need to be setting appointments with fresh leads and following up with their sold and unsold customers. If they are good enough to put on the point to sell cars for you they better be good enough to talk on the phone and email your customers. If they can't do that, you don't have a process problem, you have a hiring problem.
Give customers a single point of reference and let your sales people work the customer cradle to grave. Dealers and OEM's spend thousands of dollars supporting sales staff but adding personnel to do the work you are paying the sales people to already do creates an expense that you can never out run. It's the law of diminishing return.
For Example:
8 BDC reps x $30,000 per year plus a $60,000 manager = $300,000 in salary expense. In order to break even on salary expense alone a dealer would have to sell an additional 150 cars at a $2,000 average gross just to break even, not including return on capital expense, additional sales commissions, benefits, or employer matching. If you were able to realize an additional 300 cars per year from adding a dedicated BDC your expenses would increase geometrically just in added bonuses and increased cost of goods sold in the form of sales commissions.
If you create a process where every sales person works every lead from start to finish and help them increase their bottom line you will accomplish several things:
·Sales people will take ownership of the process
·You’ll return more using less without increasing overhead or potential liability
·Develop more loyal customers and let them identify with your employees
The investment then would be in training and helping your most important employees to do their jobs better, which in turn will help you attract and retain talent and cut down turnover on the front end.
It really boils down to your philosophy. You can outsource BDC, have professional greeters, product specialists, closers, F&I managers, delivery specialist and outsourced customer follow up or you can let your front line really represent you and your store. The choice is yours…
Chris Vitale is Vice President of Sales at iMagicLab. He has over 15 years of successful in dealership experience and is quick to call it like he sees it. If you want a no holds barred look into effective CRM deployment and use follow Chris @thecrmgod on Twitter.
Comments
Hello Chris I can understand your argument but in today's car industry it seems the old ways have gone away. I grew up in the car business, my father Sold/Managed and Operated dealerships my whole life just about. His number one belief was constant customer contact, through follow up calls and letters. Today's Sales Associates and I would say around 80 percent don't do that effective. Now to my real point about the BDC you put the $300k for cost and they must sell 150 on average gross, most good BDC's will do that 150 in either one month or two months maybe 3 at most. So if you take about 70 sold units month from BDC (we will stay on low side) you will end up with 840 Sold units fromm the BDC for the year and at an average gross of $2000 is 1.6 Million. So you would have around a 500 percent ROI, that is why the BDC's have become effective.