Tuesday, February 26, 2008

"I Want to Think About it"

Ah--the dreaded statement! It has made people crumble in fear--fear that they would either hear it or fear that they just heard it.

I was once a computer salesperson at Sears. It got to the point where everyone said "I want to think about it." I even told a fellow salesperson that if I heard it one more time today, I was going to quit. Of course, that was before I learned to sell. Now, I love when people say it because it gives me an opportunity to close a sale.

First off all, why do people say that they want to think about it?

I'll tell you why I say it when I'm out shopping.

1) I say it when I don't think I can afford a product or when the price is not what I want to spend.

2) I say it when I don't want to hurt a salesperson's feelings--especially if he spent a lot of time with me.

3) I say it when I have questions and am too afraid to admit that I don't know something.

4) I say it when I don't like a product.

5) I say it when I don't like the salesperson and don't want him to have my business.

You know what? Your customers pretty much say it for the same reasons. As a matter of fact, 99% of the time, you can narrow "I want to think about it" into one of three reasons (or objections if you'd rather...)

  • The customer doesn't like the product (or has questions about it)
  • The customer doesn't like you (or you confused them)
  • The customer doesn't like the price
Your job as a salesperson is to find out which objection it is, to isolate it, rephrase it if needed and overcome it to sell a car.

OK--here's how not to handle "I want to think about it"

Customer: I want to think about it?
You: What's there to think about?
You: How much time do you need?
You: No you don't.
You: OK--here's my business card. Call me after you think about it.

Here's the correct way to handle it.

Customer: I want to think about it.
You: No problem. (Customer relaxes)
You: Let me ask you this. I've been selling cars for a long time and I've discovered that when people say they want to think about it, it's usually one of three things they want to think about. It's either the car, something I said or did or the price. Which one of those do you need to think about?
Customer: The price. It's too high. (They will say price probably 80-90% of the time)
You: (Isolate the price objection) Besides the price, is there anything else you want to think about?
Customer: No--just the price.
You: (Rephrase the objection to make it easier to handle) Is it the actual cost of the car or the payment?
Customer: The payment.
You: Well, we're at $320 and that is actually a great payment on the car. What were you expecting?
Customer: $250.
You: Well, if we could figure out a way to get the car to fit within your budget is there any other reason why you won't take it home right now?
Customer: No.

It really is that easy. Now you may be saying, "Marv--we're still $70 apart--it's not that easy!" Yes it is. How can you bump a customer $70?

Here are some tips. When you ask them what kind of payment they have set aside in their budget, stretch out your hand (palm up) and raise it up and say, "Up to..."

Customer: $250
You: Up to...?
Customer: Up to $275
You: (Raising palm again...) No more than...?
Customer: No more than $280.
You: Let me ask you this--what if we found you the perfect car--it had everything you wanted and it was just a few dollars higher than $280--you wouldn't let a few pennies a day keep you from your perfect car--would you?

Later, when you hit them at $320--you can remind them that they said a few pennies a day wouldn't keep them from their new car. $45 per month is only a little over a dollar a day--a candy bar, a pop, a bag of chips, 4 cigarettes, etc. You get the picture. Raise them!

OK--another technique.

You: Where do you want to be?
Customer: $250
You: (Suck a deep breath through your teeth.) Ooooh. I'll try but I gonna need a little help from you.

Yet another technique: The Gas Saving Close (See my earlier blog about that closing technique)

Yet another technique--work them for money down! What a concept! Try this: "Were you going to put the standard 10% down that the banks like to see?"
Customer: How much is that?
You: About $3500. (Watch their face drop but don't pause) But you can always put more down if you want to lower your payment.

Later when they try to get a lower payment, remind them that it would take money OVER the 10% down to do that--just like you told them earlier. If they balk at money down (like most people here in Michigan do...) use it as a closing opportunity. "Normally, the banks like to see the 10% down--especially with today's credit problems--but if I can work it out with no money down, will you take it right now?" Sometimes the initial money down is more important than payments down the road...most people (myself included) think very short term.

By now, you know that I like to ramble so I'll stop the rambling. Listen to salespeople around and hear how many hear "I want to think about it" and let their customers walk. How many sales are they missing? How many have you missed (hopefully none!) I missed a ton before I learned how to overcome that excuse but I never just let it fly by in the wind anymore.

Wednesday, February 20, 2008

2008 Lunar Eclipse Pictures I Took

Hey, Everyone. Here are some pictures of the Total Lunar Eclipse from 2/20/08 that I took. I used a Canon digital SLR with a telephoto lens. These were tough pictures to take. For one thing, it was about 10 degrees out (maybe colder) and the other thing--it was very hard to focus. These 3 are the best out of maybe 100 pictures that I took.

Click for a closer view!

This first one below is about 10 minutes before the total eclipse. The bright part is the sunlight reflecting from the moon and the dim part is caused by the earth blocking the sunlight--the moon is in our shadow!

This one below is the moment of total eclipse! The Moon is totally in the Earth's shadow. You can notice a faint reddish glow to the moon. In effect, what you are seeing is the refraction of all the sunsets all over the world as well as dust in the atmosphere (sometimes the reddish dust from volcanic debris in the air!)

This one below is a pretty cool shot--a little wider angle. The blue star towards the top is Regulus in the constellation of Leo the Lion. The bright thing in the lower left is actually the planet Saturn. Maybe you can see the outline of the rings? Through my nice telescope in the garage, Saturn looks fantastic!

All Pictures (C) 2008 Marvin S. Chomer All Rights Reserved

Tuesday, February 19, 2008

Car Sales Assistant 2008 Update Coming

Hi! I want to thank all of you have tried Car Sales Assistant 2008 and I would especially like to thank the people who have purchased it.

I am working on some updates right now--hopefully they will be done in the next week, or so.

Here are some of the things it will have:

1) Some people have reported that the program will not run at all. This is usually a problem with the copy protection. I am in works with the people who wrote the copy protection and will have a different version on the next update that should get rid of that problem. The only drawback will be that people who have already registered will have to email me a new code unless I go to the online registration (see below somewhere.)

2) I am currently working on the code to convert data from CSA 2007 to 2008. Earlier versions like 4.0 and 3.0 will come next. There are no plans for updates of CSA 2.0 or CSA 1.0 data at this time.

3) Some people have reported that they cannot delete a customer. That will be fixed.

4) There is a crash if you put more than $999 in your commission. That will be fixed.

5) Hopefully I will be adding email support on the next update. Email is so touchy--I just want to make sure it works for 99% of the people out there.

6) Speaking of the new copy protection--I may try out a new licensing system where you can visit my website to obtain your license code instead of having to wait for me to email it to you. This should alleviate a lot of headaches--mostly yours!

7) Down the road--I'm going to develop a--well, let's call it a "person list" of your customers that you can default to. For example, if you want--it can show you everyone you sold this month as well as your working customers--or whatever 5-10 options you desire. This is still in the planning stage and down the road.

Also--I will be working on more tutorials. I had some video files but everyone said they could only hear me talking and couldn't see the video. Whoops! It worked on my computer! So--I'm opting more for tutorials with screenshots and text instead of me talking--I talk fast anyways so I'm sure I'm hard to understand. You can see the current tutorials here.

Check back here from time to time or at my website for further updates and when it is done.


Monday, February 18, 2008

How to Treat a Customer

How do you like to be treated? Yeah--me too.

OK--here are some tidbits on how to treat customers. I'm sure a lot of this is old stuff to you but sometimes we all need to be reminded.

1) Never ever argue with a customer. There is the old adage that the "customer is always right." You know what? Even if they aren't--pretend that they are--if you are married, you'll know what I'm talking about.

2) Never back yourself into a corner. Don't ever tell a customer that you are on your bottom dollar unless you are because if you have to lower the price later, you will lose credibility real fast.

3) Don't try severe pressure on a customer UNLESS it is a last resort. Subtle pressure and building value works best.

4) Tell a customer that it is "alright" to purchase a car. They work hard for their money and they deserve the new car, don't they? Sometimes just telling them that it is OK to buy a car is enough to push them over the edge of making a decision.

5) If they say they are going to buy right now, ask again just to be sure. "Now--just so I'm clear--if I get this worked out--you are taking the car right now, right?" (Always use "right now" instead of "today." Today ends a midnight and there are a lot of other dealerships between us and midnight if you get my drift.

6) Never think you know everything because we don't!

7) Find something that you like about your customer and tell them that you like it. It could be their car, how polite their kids are, they choice in car, etc.

8) I once went to a computer store and told the guy working there that I was there to look at a specific model. The salesperson said, "Great choice!" Whether it was or not, just him telling me that I made a great choice put that guy high in my book and I bought.

9) Find common ground and build rapport.

10) Lets say you have a customer who has false information and is going to shop you on it. For example, they have been low-balled at another dealership and you know for a fact that they have bad info. Lets say you try to discredit the info but your customer is convinced that the person had given them good info (hope I haven't lost you --I think I lost myself!) Well, what I'm trying to say is this: if your customer leaves and then realizes that you were right and that they were wrong, there is a great chance that they will never come back to your dealership because they want to "save face" and not be made to look like they were wrong. Here's what I like to do. I like to say something like, "Bill, do me a favor. I've had this happen before. I had customers get what turned out to be bad information from another salesperson. And you know what happens? Sometimes they still buy from the salesperson who gave them the bad information because they don't want to come back to me and admit that they were misled. Do me a favor--if it does turn out that they gave you bad information, please don't feel that there is any obligation to do business with them and please don't feel like I'm going to rub it in or anything. I just have been doing this for a long time and know how other salespeople can be--I know the tricks they pull to keep you from buying anywhere else."

11) I know there is an election coming up. Don't talk politics to customers! If they ask you say something like, "I haven't given it much thought. I've been too busy trying to sell cars to worry about it."

12) If you get someone who is a veteran, thank them for their service!

13) If you win the battle, you might lose the war. Did I already mention not to argue with customers?

14) Try to sell the customer the car they want. If they ask what car they should buy, PICK THE LEAST EXPENSIVE CAR WITH THE STUFF THEY WANT! If someone wants to be at $300 per month, don't show them a $50,000 vehicle though. Show them the best car in their price range or just above it (you can raise people a little, can't you?)

15) Give your customer a way to win.

16) Lets say someone offers you a great deal right off the bat. Do not hook right up--if you do, they may have the bit of doubt in their heads and they may think they left money on the table. I have a friend of mine today who went and looked at new model homes. They had one he kinda liked for $239,000 but it had none of the cool things he wanted--9' ceilings, granite counter-tops, the size he wanted, etc. So, he priced out everything he and his wife wanted and it came out to be $289,000. He offered $249,000 and the salesperson hooked right up and said they would do it. My friend expected them to counter-offer and they didn't. You know what? It sounds like he got a great deal but you know what he is thinking? He is thinking that he left money on the table and I think he is right. Now--while they are building the house--he is always going to have this in the back of his mind..."Did I get the best deal?"

Well, it's getting late--there are a million more tips but I'm going to bed.

Saturday, February 16, 2008

How to Set Goals

What is the difference between a goal and a dream?

Dream: Something you fantasize about. Something you hope will happen one day.
Goal: Something you take steps to reach. Something that WILL happen one day.

My dad, until the day he died, dreamed of being a country music musician. He had the talent--he could beautifully play the guitar and he had an excellent voice. He was also a pretty good song writer. The problem was that he would always talk about being a country star but he would never take the steps to do it. He didn't have a clear cut plan--just the hope that someone would "discover" him as he sat on his porch, in the middle of the country a hundred miles from Nashville, picking at his guitar. Once again--he had the raw talent--he just lacked a plan to put the talent to use to accomplish his dream.

We are like that in the car business. We hope to sell X amount of cars but really don't know what we need to do to sell X amount of cars. In other words, how many people do we need to talk to? How many do we need to get into a test drive? How many do we need to write up?

When I got into the car business, the owner of the dealership used to have us fill out a daily work plan. Basically, we would forecast our sales using this formula.

Our plan was to get 75% of the people we talked to into a test drive. We were to get 50% into a write up situation. If we did both of those, we were expected to sell 20% of the people we would talk to. So--if we wanted to sell 2 cars, we needed to talk to 10 people, get 7.5 into a test drive, write up 5 to sell our 20% which is 2. Want to sell 20? Multiply those numbers by 10.

Our owner swore up and down that he had never seen that formula fail in his 20 years of being in the car business and you know what? I believe him.

OK--how do you achieve goals?

1) You have a concrete destination. "I want to sell 10 cars this month."
2) You figure out what you need to do to accomplish these goals. "I need to talk to 50 people and get 75% of them to test drive and 50% of them into a write up situation."
3) You break them down into smaller steps. "So--with 20 working days this month, I'll need to talk to 2.5 people each day (hope the math is right--too lazy to get out the calculator)
4) You need to remind yourself of your goal. Put it on a business card and look at each day. Put it on your mirror so you look at it when you brush your teeth in the morning. You get the picture.
5) You need to track your progress. Keep a graph of where you are and where you need to be. By the way, my Car Sales Assistant 2008 software does this for you--it will let you set goals and track your progress towards them.
6) You need to do everything in your power to reach your goals.
7) You need to set realistic goals. "I want to sell 500 cars this month" isn't that realistic. 20 is.
8) You need to reward yourself WHEN (not IF) you reach your goals. Take your spouse out to dinner. Buy that video game you've wanted. Buy a nice piece of jewelery.
9) Rinse and repeat next month.

OK--here are some stats I remember. I might be a few percent off but you will get the picture.

3% of people set goals. 97% of the wealth in this country is held by 3% of the population.

In World War 2, if the American generals would have sat around and simply said, "We want to win the war" then the war would not have ended like it did. Instead, they said "To win the war, we need to take Berlin." In order to accomplish that, "We need to storm the beach at Normandy" then "we need to storm across France" then "we need to pop into Germany" and "we need to take Berlin." Then they broke down those broad steps into smaller steps. "To take Normandy--first we need to land thousands of solders on a beach" and then we need to get them to "storm the beach" and then "take out the pill boxes," etc.

Uh--get the picture? Set your realistic goals and you will reach them and be very successful. There is no doubt about it. Don't just sit there waiting for something to happen. Set your goals and make them happen.

Thursday, February 14, 2008

All About Leases and How to Convert Buyers to Leasing

Living in Michigan, the leasing capitol of the country, I can probably say that I have a good working knowledge about leases. I'm going to share a few things I have learned over the past few years about leases and how to convert people from purchases to leases and WHY you should ever want to do such a thing.

First of all, here are some terms you should know in regards to leasing.

Residual Value: What percentage of the MSRP will the vehicle be worth at the end of the lease? If the MSRP is $10,000 and the residual is 50% then the residual value will be $5000. The customer can choose to purchase the vehicle for this price at the end of the lease (plus tax, of course.)

Rate or Money Factor: Almost like an interest rate--basically it is a lease charge for a company to fund the lease.

Cap Cost Reduction: Basically a rebate on a lease.

Start Up Fees: The minimum money required to lease a vehicle. Usually first payment, doc fee, title fees, taxes on the rebates and security deposit. NOTE: You can "roll" in the start up fees on leases--roll them into the payments but the payments will go up.

Down Payment: "Money Down" over and above the start up fees to lower payments. That's why people can advertise "only $1000 down" and hit people for $1652 when they show up.

Security Deposit: Money required for a new leasing customer--usually refunded at the end and usually the payment rounded up to the nearest $25. For example, $212 payment, the security deposit will be $225.

Mileage: How many miles a year the customer will drive. Usually 12K, 15K.

Mileage Charge: How much they get charged if they go over their miles.

GAP: On some leases, gap is included. If they have active insurance and their is a total loss, the vehicle will be paid off regardless of what is owed on it.

Residualized Item: Some things, like sunroofs can be "residualized" which means they add to the value of the vehicle and a person pretty much only pays depreciation on them. For example, if a bedliner costs $150 and you can residualize $150, it is pretty much free--or close to it.

Pre-Paid Lease: Paying the entire contract amount up front--usually, there is a break on the rate so the ultimate paid amounts will be lower than monthly payments.

Lease Pull Ahead: Sometimes the manufacturers will let a person turn in their lease early and waive a couple of months if they purchase another vehicle. Not as exciting as they used to be--I've seen them waive 10-12 payments before--man, those were the good old days! Now it is only 2.

Disposal Fee: A fee a customer pays if they turn in the vehicle at the end and don't lease/purchase another one. GMAC doesn't charge it but some others do.

Why you should lease cars instead of selling them...

  • Lower payment for customers
  • Low money down
  • Easy to roll in a lot of negative equity
  • Have a much higher chance of having a repeat customer since they will turn the vehicle back in to you and be in the market for another car
  • No problems such as trade in value when they are back in the market--they turn in the vehicle and get a fresh slate
  • Easy to sell aftermarket items and make you more money because you can residualize a lot of stuff
How to Convert Someone to a Lease:

  • Easy one first: lower payment as opposed to financing most of the time.
  • Gap is included--usually $495 on a finance contract.
  • If they say, "I drive too many miles" then here's what you say. Then leasing is your best option. If you are driving 20,000 miles per year and finance for 5 years--what will your vehicle be worth when you pay it off and have 100,000 miles? Probably nothing. If you lease it for 3 years, you will have 60,000 miles on it and believe me, by then you will be ready for something new.
  • If they say that they absolutely do not want to lease and they want you to figure a finance payment, write Finance: $443 (or whatever the payment is) and write Lease: $320 on the other side of the paper. When you put it in front of them say, "I told him you didn't want to lease. Don't look at that..." as you point to the lease payment. Of course, the first thing they will do is look at the lease payment and hopefully they will notice that it is a lot cheaper. Then say something like, "Are you sure you don't want to lease? Man--it could save you $123 a month!"
  • If they say, "I like to own my vehicle so I'm not going to lease" say something like, Mr. Customer--when you finance a car for 5 years--who really owns it--you or the bank?
  • If they say, "I like to keep my cars forever," say this: Mr. Customer--I've heard that a lot over the years. People say they will keep their cars forever and then you know what happens? I see them 3 years later and they want to trade. And you know what happens? They always owe more than their car is worth and they are stuck in it. If they would have leased, they would have had a lower payment and not had to worry about trading. Plus, if you absolutely love the car, you can purchase it at the end of the lease for a fixed price.
  • "I don't want to lease because I'm afraid that the car will get damaged and I will have to pay for it." This is an easy one: If you got in an accident--wouldn't you file a claim with your insurance anyways?
  • And last but not least: "I want to pay off my car and not have a car payment." Use the old "feel/felt/found" closing technique. A lot of my customers feel the same way. I actually had one the other night that felt the same way but you know what he found out? He found out that he traded every three years anyways and will always have a car payment so he was better off saving over $100 a month leasing. I think leasing will be best for you, don't you?
All in all, if you lease someone a car, you have probably a 75% to 90% chance of them buying from you again but if you sell them a car, it is probably 10-20%. As long as you get them enough miles, they will love you for talking them into leasing. Good luck and hope you lease everyone!

Wednesday, February 13, 2008

The "Hamster" Close

This one is a little devious but it works! I read it in a book (the name fails me) about 10 years ago. I know it is on my bookshelf somewhere. If I find it, I'll post the name.

OK--here's what you do. You have a cute little hamster in a cage at your desk or even a goldfish in a bowl.

If you have a family, the first thing the kids are going to do is look at your "pet." They will probably ask something like, "What's his name?"

Here's what you say. "I haven't named him yet. What do you want to name him?"


"Well, I'll tell you what. If your parents buy a car from me today, I'll let you take Scruffy home and keep him." Smile and wink at the parents and let the kids do all the closing for you!

Tutorials and CSA 2008 Update Now Live!

Hi! For all of you who are trying Car Sales Assistant 2008 or have already purchased it, I have fixed and tweaked a few things. The build date on the main screen should be 1.0.5 2/13/2008

If it is not, download the update here. Want to know how to get the update going? Read on!

I have also added a page with 8 tutorials on it (and more to come all the time!) As of right now, they are in AVI format and can be downloaded to your computer or opened on the spot and viewed through windows media player.

You can view the tutorials here.

In no particular order, the tutorials are...

  • How to Update CSA2008 to the newest version
  • How to backup your data
  • How to log a customer (sold, unsold, phone up, etc.)
  • How to complete your phone calls (you know--the number after the phone calls on the quick link section)
  • How to license software after you purchase (it is copy protected after all...)
  • How to create automated follow up
  • More info about the customer/prospect screen (what everything means on it)
  • An overview of Car Sales Assistant 2008
I will be adding more tutorials and will probably put them in a different format to make downloading a little faster. Please feel free to contact me if you have any questions or comments.


I'm Still Offering CSA 2007

I just wanted to let you all know that I am still offering Car Sales Assistant 2007. Some people reported to me that they like it better than CSA 2008 (maybe some people just resist change...who knows.) so I decided to make it back available at the low price of $59.99 per copy.

I firmly believe that Car Sales Assistant 2008 is my best program yet and I urge you to give it a try right now but if times are tough and you want to save a few bucks, by all means--try CSA 2007. Please keep in mind--I am no longer working on CSA 2007 since I am putting all of my efforts into CSA 2008.

Download CSA 2007 Here or Download CSA 2008 Here.


Wednesday, February 6, 2008

"Up Selling"

"Would you like fries with that?"

"Would you like garlic bread with your pizza?"

"Do you want pom-poms?"

OK--you get my picture. But what about the pom-poms? My five year old daughter went to cheerleading today. I decided to take her because we had a bunch of freezing rain and snow and I just bought a Tahoe and I just didn't trust my wife to drive it quite frankly--she is from Tennessee and doesn't have much experience driving in the snow. I had trouble and I have been driving in the snow for 25 years!

OK--back to the pom-poms. It cost $7 to register and $7 for today's class. Not that much--I sold 2 cars today so I can afford that. When I got there, though, there were a million girls around my daughters age and they were selling pom-poms for $16! Not the big pom-poms you see at the football game but the cheapest dollar-store pom-poms you have ever seen. You know what? People were buying them like crazy. I declined their kind offer with a snicker and then went upstairs to watch my daughter--about the only kid without them. After the class, she gave me that spoiled-girl look and told me she "needed" pom-poms. Needless to say, I went downstairs to buy them and they were out! Uh--explain that one to a 5-year-old!

Next class, she will have pom-poms. Also, they sell $41 dollar uniforms that she "needs to have if she wants to compete." Ugh!

If they buy a truck, sell them a bed-liner. If they want a sunroof, get one installed. You get the picture. You can easily make $100 extra a unit if you sell aftermarket and your dealership will love you--from the top to the service advisor.

Not much in techniques today. I just wanted an excuse to tell you about the pom-poms!

Monday, February 4, 2008

The "Outrageous Payment" Close

I saw my manager use this one today.

I was trying to sell a customer a car and the payment was around $530 per month. They told me that they wanted to be between $475 and $480 per month but they would not make a commitment today. We had the exact vehicle they wanted and they said that they wanted to "sleep on it." (usually an excuse)

I said, "Look--I've been selling cars for 12 years and usually when someone says they want to sleep on it, something is bothering them. It's usually the car, the price or something I said or did. Which one is it?"

She said, "He just started a business, I just lost my job and our house payment is $1800 per month--we just have to make sure we can afford it."

I wanted to say, "Then what are you doing here?" but instead, I tried again at a commitment to do business right now. They said they loved the vehicle and that they were pretty sure that the $475-$480 would work but that they really had to go home and do the math. I did the right thing and brought my manager over for a T-O.

He asked them, "If the payment was $450, would you take it right now?" I almost swallowed my tongue!

They answered, "No--we really have to talk about it."

He laughed and said, "Good--because I can't get there" and they all laughed. He told them to stop by in the morning and that he would try his best to make it work for them. They left on a good note and I think I have a 50/50 chance of selling them.

After they left, I asked him about the "$450 thing." He said, "I was just testing the water. I wanted to see if they would take the vehicle at any price."

"What if they would have said yes?" I asked.

"Then I would have said, So, there is a price that you would do business at today. Let's go ahead and work some numbers and get you closer to where you need to be."

Looking back, what he did was very smart. Number 1, he put an ever better price in their heads than where they want to be and I think that will increase my chances of getting them back up to the dealership and Number 2, he discovered that in their case, price wasn't the issue.

There is certain point in people's thinking where they will go from not being there to buy to crossing the line mentally to being there to buy. That is why you get a signed offer when someone makes them--the process of signing the piece of paper makes them feel, in their mind, that they are buying a vehicle. If my customers would have said yes to his $450 thing, it didn't mean that we would have to get there to sell them a car--it would just mean that they mentally got off of their having to sleep on it to actually making a decision to buy a car right now.

By the way--when closing a customer, don't say will you do business today? Today is from now until midnight--plenty of time to shop. Say, will you do business right now? You always want to "spot deliver" customers so they don't have time to second guess themselves.

By the way--I just bought my dream vehicle today. A 2003 Chevrolet Tahoe with 77K miles--just broken in for a Tahoe. My wife has been wearing me out all evening... "Did we do the right thing? Did we get a good deal (we did by the way...) Don't you think we should have gotten something cheaper? Your mom said we shouldn't have bought it." I am firmly convinced that if we wouldn't have done the paperwork this evening, she would be doing everything in her power to talk me out of getting the perfect vehicle at the perfect price. Exactly what happens to your customers if you give them time to think about it. They will always find a better deal, people will always tell them that they got a bad deal and they will always second guess themselves (maybe we should wait until we get our income tax...) Don't let it happen! Sell them on the spot.

NOTE as of 2/6/08: The people came back and bought from me today.

Saturday, February 2, 2008

The Dangers of Pre-Qualifying

Do we all pre-qualify customers? I don't know. I'll be honest, though--I do sometimes and it is the wrong thing to do.

I have 2 cellphones. Well, I had 2--my wife accidentally flushed hers down the toilet. I won't even begin to describe how! Mine, I accidentally left in my pants and they got washed and dried. Believe it or not, the phone still works--it just won't shut off and I can't use the camera anymore. I still had an old cellphone that we thought we lost (we reported it as lost or stolen) but we later found it. When I called my cellphone provider, they told me that they couldn't let us use that phone because we reported it as lost or stolen.

What do cellphones have to do with pre-qualifying? I've had the major urge to get a new phone for myself. I still sell cars and our internet is extremely blocked so I can't check my email from work and since I run a business selling software, it makes it hard on myself and my customers because sometimes it may take 10-13 hours to answer an email and I'm sure it bothers my customers when they email and don't hear from me--especially after purchasing my software!

OK--I'm babbling. I've had the urge to get one of the new modern cellphones that would allow me to check email, internet, etc.

I walked into the cell phone store and told them my situation, flushed phone and all. They looked up my record. My contract expires in 9 months so the salesperson said, "If I were you, I would wait." Wow! Was he trying to flush me?

"I really want a new phone," I told him--practically begging him to sell me one.

"It will be very expensive," he told me. "It will cost you $549 but if you wait until July, you can get one for $249"

"Is there not anything you can do?"

"No." I turned to walk out and said, "The bummer is that I have another phone at home but when I called my provider, they told me that I reported it as lost or stolen."

Suddenly, his eyes lit up. "Do you still have the phone?"


OK--no more prequalifying. The dude figured out a way to add a 3rd phone (the internet one), change my "lost/stolen" one to my wifes old number and my old, washed one, I would just pay an extra $7 a month until the contract expires. I spent $350 today on a new phone and if I wouldn't have mentioned the old phone, the guy who was instantly wanting to flush me for an easier sale would not have gotten a $350 phone sale and a new 2 year contract.

How does this relate to the car business? Let me tell you.

I sell cars in Michigan. We are a broke state full of people who are losing jobs by the thousands, we have 3 casinos in Detroit that made over $1.4 billion in profit last year and we have the 3rd highest foreclosures in the country. Gas is around $3.00 a gallon and people are trying to get out of their gas guzzler trucks and into something more economical.

It was thursday night, around 7:00pm and I was honestly counting down the last 2 hours of the day. A guy pulled up in a GMC 2500HD Extended Cab truck--just the thing that most people are buried in. I turned to a girl that I sit next to and pre-qualified him like an idiot. I said, "Man--I hope someone else catches them. I've had enough buried people this week." She pre-qualified in agreement.

Needless to say, my manager looked right at me as they walked in so I had to greet them. I did so with a tired smile on my face and they guy said he wanted the red Chevy HHR LT2 that we had--they had been buy during our closing hours and saw it. I said, "Let me go get it so you can drive it."

"I don't want to drive it. She already has one and I want to know what my truck is worth first."

Great,I thought. I know this guy is buried and that he's gonna want too much for it.

I grabbed his keys and got the truck appraised. It was worth $11,000 and I just knew for a fact that they guy probably owed $20,000 on it. I have been selling cars for 12 years and I knew for a fact that I had nothing here.

I came back, told him that his truck was worth $11,000 and you know what? The guy hooked right up and you know what else? He didn't owe a dime on the truck. You know what else? I had him in and out within an hour and made around $800.

What is the moral of this story? You guessed it. NEVER PREQUALIFY!

I once had a guy in Tennessee who told me that he was going to get a settlement check the next day--he dressed like a bum and everyone else ignored him. Guess what--he came in with the check (he negotiated it himself) and I helped him open a bank account with the check for $90K that he had in his pocket (he never had a bank account before.) He bought 3 cars off of me in a 1 year period.

Four years ago, a guy came in with cut-off sleeves and told me that he wanted a price on an Avalanche. Everyone else ignored him but I greeted him and he paid cash, literally, for the truck (he had a bag of $100 bills in his car.)

I have dozens more of these stores.

You read the story--even after all of my years in this business, I still find it hard not to prequalify. I tried to do so 2 days ago and it almost cost me my house payment.

Don't be an idiot like me. You are costing yourself $1000's of dollars by prequalifying if you do so. Selling cars is a number game. The more people you talk to, the more people you demo and the more people you write up, the more people you will sell. Period. Talk to everyone and give them all 100% and you will do what 90% of the other salespeople (myself included sometimes) and you will be successful in this crazy business.