I was invited to speak recently to a group of new-vehicle dealers who shared challenges in their pre-owned vehicle operations and an expressed a desire to get better.
I spent the day with them discussing things the past and present pre-owned vehicle market, and the changes in thought regarding today's retail environment.
We focused on departmental metrics, best practices and some proven daily management processes utilized by industry leaders, things that should be emulated in an effort to improve.
When the meeting was over, I left with a sense of accomplishment. I felt like progress was made and eyes were opened. I seemed to even sleep better that night, restful in the knowledge that, as a group, the participants had agreed they needed to go back to the store and make some changes if they are going to succeed and improve their pre-owned vehicle operation.
Well, flash forward to today. I had the opportunity to spend a couple of hours with that same group of dealers. I was excited to see how they were doing since our last meeting.
With great anticipation I stood before them and asked, “As a result of our last meeting, when you got back to your store, what did you actually implement or change, and what were the results?”
It got so quiet I swore I heard crickets chirping. I could feel the blood starting to flush my face and a growing sense of frustration. Then almost at the boiling point, a thought crossed my mind: “Maybe Pareto was right.”
Okay, Uncle Tony, who the heck is Pareto and how many pre-owned vehicles did he sell? Heard of the 80/20 rule? Well, it's that guy.
Vilfredo Pareto was an Italian economist in the early 1900s who realized 80% of the wealth was owned by 20% of the people, and like any good obsessive compulsive, he started seeing that ratio everywhere.
The 80/20 principle was further refined by another deep thinker, Joseph Juran, who recognized a universal principle that he called “The Vital Few and The Trivial Many,” basically stating that 20% of something is always responsible for 80% of the results.
As I stood before my silent audience, I realized 20% of the dealers in the room accounted for 80% of the production in the group. Not only that, but only about 20% of the room, after some prodding on my part, had returned home after the last meeting and made any changes.
My intent is not to drive you 100% crazy with this. But look at your sales crew. You will probably find 20% account for 80% of the gross (The Vital Few).
Meanwhile, it seems only 20% of the pre-owned vehicle managers have solid daily processes. The rest claim there are not enough hours in the day. It appears to me that roughly 20% of franchise dealers are successful pre-owned vehicle operators. The rest claim the market isn't that good in their area.
The great news: If the 80/20 principle truly is a universal law (by law I mean we have no choice in the matter), we do have the absolute right to decide which group to be a part of.
So the question of the month. Do you want to be one of the Vital Few or one of the Trivial Many?
Before you spend more on training, or enlist the help of the current expert or sales guru, make a decision. What group do you want to be in? Now, go ahead and sign yourself up for the needed training. Sit in the classroom, listen, learn and absorb right alongside the Trivial Many.
But when it is over, proclaim your right to choose to be part of the Vital Few by your actions and what you actually do with the information.
The Vital Few say very little, are seldom heard, but often observed. They listen, learn, do. The Trivial Many are seldom observed, but often heard, mostly stating, “I was there, I listened, I learned and, well, I just haven't been able to get to it yet.”
Go sell something!
Tony Albertson is executive conference moderator for NCM Associates. He can be reached at [email protected].