Kim Macpherson
January 2007
"Selling cars and making money, that’s what we do.” That is exactly what a small used car dealership in Halifax, Nova Scotia is doing. This small city with little more than 350,000 people feels a lot bigger when you are standing in this dealership’s showroom, packed with customers and sales people and managers writing deals one week before Christmas.
Daniel Taylor, owner of Manufacturers Auto Exchange, is originally from New York. He grew up in the car business with his family that owned dealerships all over the state. From washpit to owner, large in personality and size, he can seem intimi-
dating at first – until you watch him go through his showroom talking to his customers and staff.
Manufacturers Auto Exchange is quite a success story. It has been in business for over three years. Small city, small store, big success! This dealership has achieved the gold award from the Bank of Nova Scotia for gross sales achievement. However, 80 percent of the deals written at Manufacturers Auto Exchange are sub-prime. This dealership averages $4,200 in gross profit per deal and is selling on average between 82 to 98 cars per month. I must highlight the fact that the dealership can only park 60 cars in inventory at any given time, it is very small.
Manufacturers Auto Exchange’s team has a sales process for both prime and sub-prime customers. The following are a few things they do to ensure success in dealing with their subprime customers.
1. Discover the sub-prime customer before vehicle selection.
2. Discuss credit with customer and prepare case for the lender.
3. Teamwork between used car buyer and finance manager so the cars meet certain criteria and can be booked out for maximum profit.
4. Salespeople, sales managers and finance managers work as a team, not in individual departments.
5. Every customer is greeted by a manager before leaving the store.
5. One manager is the chief; he runs the sale process from the meet and greet to delivery straight through to funding.
6. Code of ethics ensuring each customer is treated with respect.
7. Constant training and review in every department to make sure there are no short cuts in the sale process.
8. Proper collection of all bank documents before delivery.
9. Proper and efficient packaging of each deal.
Mr. Taylor ends our conversation with a chuckle, “Subprime is the largest profit centre in the entire store. It always makes me laugh when other dealers warn me about ‘that kind of customer.’ Any dealer still not selling to ‘that customer,’ who is neither ‘special’ or ‘sub’ anymore, is just not in the game and they are losing thousands of dollars.”
I have to say, I have been in many dealerships across North America from Ocala, Florida to Detroit, Michigan. I have negotiated with the best of them in Toronto and have had many laughs in Newfoundland. This dealership is different.
I will leave you with one of its success stories about a customer that had come in three years ago and purchased his first car at close to 30 percent. The salespeople told him to always make his payments on time and come back in a year. He did. His credit situation had changed and they traded in his car and refinanced him on another at around 15 percent. They told him to come back the next year and to keep making his payments on time always. He is now approved for the third time at the Bank of Nova Scotia on a newer and nicer car. The dealership never lost a dime on those deals. In fact, it not only made money selling that customer a car, but he is one of the best advertisements in Halifax for Manufacturers Auto Exchange!
If that is not enough to convince you to get into the business of sub-prime, you should get out of the business.
Email: kim@sellitsmartcanada.com
Address: 1 Pinehill Dr, Unit #1
Lower Sackville, NS B4C 1N4
PH: 902.818.1373
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