On vacation in Mexico with my wife last year, I bought cowboy boots. At the time I did not think of the possible symbolism.
But as my retirement date from Dixon Hughes approaches and I reflect on nearly three decades of working with car dealers, I guess I do see myself as a “cowboy.”
I spent nearly 25 years with George B. Jones & Company, a CPA firm that traces its roots to a subsidiary of General Motors Corp. and only served the retail car world.
We made our firm the largest of its type in the country by being cowboys in the suit-and-tie world of CPAs.
Shortly after our merger with Dixon Hughes (Dixon Odom at the time), stampedes from the likes of the Enron and WorldCom fiascos changed the CPA world and forced it into a much more narrow and structured framework than this cowboy cares for.
So when July 1 comes around I am hopping on my 300 horses (a 1963 Corvette) and riding, not into the sunset, but west. Well, west of New York City. I'll be moving to New Jersey to start down a new career trail with the DCH Auto Group. DCH has dealerships in New Jersey, New York and California.
As I prepare for that, I think about the changing surroundings of the retail car world.
There are seemingly as many state and federal laws and regulations to which dealerships must comply as there are stars in the sky.
As technology and society continue to evolve, there will be even more of these rules. So dealers had better make sure they are in compliance.
It will get worse. The cost of compliance may even force some dealerships to sell. As this happens, let's hope auto makers will use these transitions as a time to consolidate franchise points.
With the various brands available to the consumer today, it would make sense for a single dealer to have exclusive rights to a market or sub-market and minimize the cannibalization of the brand.
This could allow for fewer, but larger car sales outlets and also satellite service centers strategically placed in the dealer's market.
This would let dealers make enough money to take care of the customer, while at the same time not take away brand choices from those consumers.
Now I want to vent about a burr under my saddle: uninformed consumer groups attacking legitimate finance and insurance practices in dealerships.
These groups are going to pressure lenders to pay flat fees to dealerships to arrange financing.
Will dealerships be the loser? Probably not. If the flat fee is less that the store has traditionally made on a deal, you will simply see an increase in front-end gross like in the old days.
The loser will be consumers with marginal credit. No longer will the F&I department spend all the extra time it takes to get these folks financed. Why should it when the F&I office effectively will not get paid for the extra time and work?
My Dixon Hughes colleague and good friend, John Davis, will start contributing a column in this space. You will find John's columns very interesting, useful and thought provoking.
I am remaining in the car business and hope that our trails will cross as the future unfolds.
But until then, as Roy Rogers and Dale Evans used to say: Happy trails to you, until we meet again. Happy trails to you, keep smilin' until then.
Don E. Ray is a CPA with the Dixon Hughes Dealer Services Group. He's at 901-684-5643 and [email protected].