Recently, the team here at Nextup wrote about how some analysts are seeing a slowdown in car sales month over month in 2017 (as much as 4% by the end of the year). If our markets are truly “flattening” it could be time to look inward. Time to course correct some bad habits on our sales floors before the affects of less traffic really take hold.
Let’s take a look at some data we already know based on our 28 million data points. Staff, on average, have 5 hours a day where they are not in front of a customer. This isn’t “breaking news” by any extent. We’ve been sharing that insight with dealers all over North America.
I challenge a dealership employing an open floor to walk me through where their staff is dedicating their time or even where they are throughout the day. Even those stores with their own “up systems” can’t properly identify where and how staff is using their time.
A magnetic board with names on it just isn’t cutting it.
But I digress
Now without going into a tangent on the inefficiencies of up systems or open floors, I want to go back to what those industry analysts said. Car sales will slowdown by 4% month over month until the end of the year. Let’s use that 4% to build a scenario on the dramatic affects a slowdown in traffic could have.
Stay with me here…
Let’s say Dealership X has 10 staff on shift every day. Right now, our data shows us that Nextup stores average almost 10 walk-ins/day* – great! That means each sales person “should” get 1 opportunity each (not taking into account open or managed floor here).
10 staff with 1 walk-in each.
Get Your Calculators Out
If staff have an average of 5 hours NOT in front of a customer we can deduce that these 10 staff on any given day spend 2 hours with a walk-in. 10 staff x 2 hours a day = 20 hours of time dedicated to customers by your entire sales team each day.
That also means, each day, that same team is combining 50 hours where they are NOT in front of customers. Not really a number anyone really wants to look at as a whole. It’s so much easier to digest one staff member at a time. Unfortunately, most of you employ more than one sales person.
Now let’s take the projections back into Dealership X and see what “could” happen. Let’s hypothetically say that the showroom traffic dips at 40% (I’m increasing the percentage here to make a better “visual”). Now the daily walk-in traffic is reduced to 6 visits a day. 10 staff taking 6 visits a day, leaving 4 sales staff with extra time on their hands.
The daily combined time in front of customers staff is now down to 12 hours. Time NOT spent in front of customers grows to 58 hours.
While I understand there are times where you will have staff busy with appointments or prepping cars for delivery etc, the data still stands up. The interesting part is, while the industry heads towards this “flattening” how many dealerships out there truly have the accountability of each and every person on the floor. I would harbor a guess that it isn’t many.
What Does That Look Like Monthly?
Maybe if we spread the math out further it will be easier to see the impact these 5 hours have. Maybe it could help to take more ownership of the process and accountability and ensure maximum customer experience on the showroom floor. *Numbers are based on our team size of 10 over a 6 day work week.
- Hours NOT spent in front of customers/day by salesperson: 5 hours
- Hours NOT spent in front of customers/day by sales team: 50 hours
- Hours NOT spent in front of customers/week by sales team: 300 hours
- Hours NOT spent in front of customers/month by sales team: 1200 hours
Let’s add the numbers with the 40% reduction in traffic example from above.
- Hours NOT spent in front of customers/day by salesperson: 5 to 7 hours
- Hours NOT spent in front of customers/day by sales team: 58 hours
- Hours NOT spent in front of customers/week by sales team: 348 hours
- Hours NOT spent in front of customers/month by sales team: 1392 hours
The monthly amounts are staggering.
Now For The Tough Questions
While we’ve focused on the daily numbers (and let’s be honest they’re easier to digest) if we are headed to this “flattening” in our market, isn’t it time to truly look at what is happening on our floor in regards to real transactional data? There’s no better time to begin assessing the time your staff could be working on retention strategies, getting your CRM up to date or hone their follow up skills.
I asked it earlier in the year, is your dealership capable of change? Re-examine that now before you find your store lagging behind your competitors.
It’s more important than ever to start taking a harder look at those 5 hours. At any given time of the day, can you honestly and quickly take stock of every member of the sales team? Are they making a productive use of their 5 hours or are they standing by the front doors watching the walk-in traffic dwindle? Are they complaining that the opportunities are drying up yet avoid the CRM or stopped following up on leads provided by your BDC? Is your management team championing a culture of accountability and process or are they just coddling one or two sales people getting them their bonuses?
These are easy questions to answer, but they’re terribly tough to ask. Most of us already know the answers.
What’s your next move? Apparently, we have a lot of time on our hands to figure that out.
