A little bitesize sales meeting episode on good old cash conversions! Yes, they are still relevant in 2023, as customers think they will get a better deal.
We look at a few techniques for sales people and business managers alike, to maximise these opportunities.
Here are the highlights:
{01:02} Stop asking the funding question
{02:15} Savings or loan
{02:51} Assumptive
{03:20} Budget
{06:53} Depreciation
{07:14} Offers
About Symco Training:
Symco Training was founded in 2000 by Simon Bowkett and it was his belief that the business had to offer its clients something different. That difference was clear to Simon from his days in the dealership when he experienced many sales trainers who had all the answers, but were unable, unwilling or both to actually show the delegate how they could be implemented. It remains the ethos of the business today. You see, Symco only employ trainers that are committed to delivering not only in spiring and insightful training, but are equally as happy to demonstrate these skills and techniques with real customers in your own showroom. We believe in order for sales training to be effective and in Simon’s words ‘real world’, it needs to be tried and tested in the only place it matters the showroom floor. There is no room for theory when your goals are for your team to sell more cars, hours or parts and retain more profit. In dealerships around the world the focus applied by many of the sales executives is to try and sell a deal. Symco specialise in getting your teams to focus on selling themselves, the product and then supporting this with the deal.
To find out more visit
www.symcotraining.co.uk
Welcome to the Selling in the Motor Trade Podcast, an association with Symco Training. This is the weekly podcast where we share best practice tips and ideas on how to sell more cards, improve your service department and generally put more profit into your dealership or dealer group. I'm your host, Simon Bowkett. As some of you probably already know me as skipping, I will start with saying thank you for taking the time to listen to this podcast. Hi and welcome to another episode of Selling in the Motor Trade. We're going to bite size one for you today, cash conversions. A real quick one for you. Far too often, we get business measures saying, how do we deal with the customer that says, no, no, no, it's cash for me. My mother always said, if I don't know, can't afford it, don't buy it. She's always done me a good stead. Firstly, I would say to the business measures, the sales measures, listen to this, stop asking your sales people how you're funding the car or how's your customer funding the car. Tell you why. If you say to your salesperson, how they funding the car, okay, how they funding it, your salesperson repeats the question pretty much exactly the same way to the customer. When you say to a customer, how you funding the car, guess what every customer still says in 2023, cash, because they think they're going to get a better deal. Now we know the customer's not going to get a better deal of his cash, but you still have a website out there like we buying a car saying, listen, sell your car to us, you may get a better deal if you're a cash customer. You might get a tradesman coming to your house and say, right, to do that job, the Sparky might say it's $600, 600 pounds. How much the cash mate? They might knock a bit off because they're not paying tax. We can't do that stuff in the motor trade, but actually people still feel like they might get a better deal if they say cash. So the first thing is stop saying how you funding the car. Oh, by the way, I know that some sales trainers teach people say, hey, where's the cash coming from? A savings account or loan account? I know I was taught that and it's been taught in good intentions, but I'd really recommend avoiding it. Because when you say to a customer, where's the cash coming from? A savings account or a loan account? What are you actually calling the customer? You're right. You're calling them a liar. And whenever you ever call the customer a liar and got away with it, just doesn't work. Go down to your sump-do fruit. You want to turn around and say, hey, Mr or Mrs. Customer, how many payments do you have left on your car? Or when's the next payment due? Or what's your guaranteed minimum future value? When's your optional final payment due? Something like that to assume the customers are on finance because, let's be honest, lots of people are. That's the first thing, a sump-tiff, a sump-tiff. And by the way, if you're one of the dealerships that you want your salespeople to say to a customer, what budget do they have in mind for that new car? Please be careful. In fact, in this current market, I'd say be careful actually on saying to a customer, what are your currently payments? 400 a month. Because you know, and I know, the next line is, oh, what did you want your payments to be this time? Well, 410. But what chances have you got to get that customer into the similar car for the same payments, what they were back in 2019, 2020? You got more chances swimming to Australia from the UK than you have, okay? Because we know what's happened with interest rates. We know the price of the customers traded and went up, up, up. It's starting to come back down now, okay? And the price of new cars went up. That's a real dangerous situation. Now, on our sales fitness training program, we talk about lots of different ways to qualify the customer's budget in the right way. However, if you do say to a customer, what budget did you have in mind? And they say 30,000. Change the wording, it just had what monthly budget did you have in mind? 500 a month. I still love this line. Hey, Mr or Mrs. Customer. If I had a car that was over 500 a month, should I tell you about it? Or should I keep it to myself? What do they always say? Well, tell me about it. What if they said you could do their budget? Now, again, though, I'd be very cautious about asking that budget. And if you want to look at different ways how to deal with that, have a look at our sales fitness master class specifically, we took lots of different ways to find that customer's budget without directly asking it because they're going to kick you in the soft bits and then you're in a funny place called knackered. OK, so that's some different ideas on that. Firstly, don't ask how are you funded a car, a sumpter for sumpter for sumpter. But here's one of the quickest and easiest cash conversions. In fact, I forgot about this, but I want to reintroduce some of you guys to this. And this, again, might be one of those episodes you want to play in your sales meeting, your morning sales meeting. You might try this one. If a customer doesn't say, oh, no, cash for me, my mother always said, if I can't afford it, don't buy it. It's always put me in good stead. You know what? I used to think that, Mr. Customer, tell her, realize that most customers take advantage of Volkswagen banks, low rate finance, they're doing at the moment. You see, can I ask you a cheeky question? If your house was worth half or what it was worth in three or four years time, would you rent it or would you buy it? Honestly, think it through, guys. If your house was going to be worth half or what it was worth three or four years time, would you rent it or would you buy it? Guess what? You'd probably rent it because why would you ever put your hard earned money into a depreciating asset? Okay? You see, Mr. and Mrs. Customer, before I started the Motor Trade, I would see that monthly payment at four or nine, nine a month, or two, six, nine a month and think it was kind of like dead money. Kind of like rent. Here's the difference. Rent might be dead money because houses tend to go up in value. Cars unfortunately tend to go down in value. Okay? So if your house was going to be worth half or it was worth in three or four years time, would you rent it or would you buy it? No, you'd rent it. Why would you ever put your hard earned money into a depreciating asset? Now here's another one you might want to have a look at. Quickest cash conversion. Go to your manufacturer's website. Have a look at some of the finance offers they've got. And if a customer's looking at a Tiguan, I might show this example on a Tiago or something like that. If they're looking for a polo, I might show this example on the Tiguan. But you might do this. You say, and by the way, I always use the offers on your manufacturer because we know they tend to have great finance deposit contributions, finance deposit allowances on it, the low rate finance because they're the offers our manufacturers trying to push. So a customer says, I'm cash. I'm going to pick up an example of, let's say a Tiago in the Volkswagen world. And again, I'm going to say, and it's a customer, I used to think that was the best way to buy a car until I realized that most customers here take advantage of Volkswagen banks, low rate finance. Because a cheeky question, but if your house was going to be worth half, what it was worth in three or four years time, would you rent it? Would you buy it? Well, let's have a look at this example here in Ireland. The payments on this example, it works out on the Tiago at 269 a month. I used to see that as dead money, almost like rent. The difference is houses tend to go up and go, cars tend to go down and down. You see that car's a 13 one, 470 euro car. But you see, lots of cars lose about half the value in three or four years time. Now, everyone knows that Volkswagen is a lot better than that. So instead of that being worth 31,000 in three years time, let's just say it's worth 18,000, something like that. You know, that's cost you 13,470 euros, purely in depreciation. Now, if you do that over 36 months, that's going to work out at over 300 euros anyway, purely in depreciation. You know, to be fair, Mr. and Mrs. Customer, to get that offer price down to 269, there's a big old deposit there. That's going to be 30% the maximum. But you're still going to have 20,000 in the bank for a rainy day. But listen, what are those? I'll work out some numbers and let you decide. It's the quickest and easiest cash conversion I've ever seen. Just take an account, the depreciation of the car. Now, that's why we pick a car, not that they're buying. So let's just say 18, it still costs you 13,470 euros. I've had three years to drive the car, purely in depreciation anyway. Or if we have a look at a, if I can remember numbers, we looked at a Tiguan. That Tiguan was had a offer of 499 euros a month. That Tiguan's probably going to be 44,000 euros, something like that. I can't remember the number. But Mr and Mrs. Customer, that 499, I used to see that as dead money. But if you take the 44,000 for the price of the car, if we look at that over three years time, most cars lose about half the value, about three years time. Now, the Tiguan's going to be a lot better than that. I haven't got a crystal ball here. But let's just say that car's worth, I don't know, let's just say it's worth 26,000. Take the 44,000 from the 6,000. Guess what? That car's going to cost you 18,000 if my maths right there. Okay. Over the next three years, divide that by the 36 months. That's going to work out at something like 480 or 460 euros a month to drive that car. So actually to finance that car, it's only costing you 30 euros a month. Now to be fair, there's a big old deposit to get that low rate at 499 a month. Or sorry, that low payment of all nine months. Even if it's 30%, you're still going to have what 26, 28,000 euros in your bank for a rainy day. But listen, don't worry. I'll work out some numbers, let you decide. I think the last bit's important because what I also love to do is with the users of 4 Square, please, if you're not using 4 Square, speak to us. Get on the phone. Ask me personally. I'll talk you through about how it can really, really help your business there. But then we're going to offer finance to every single customer every single time. And listen, I'll work out some numbers, let you decide. You might just be amazed how many times cash customers say, what any PR is that? Okay. Oh, how's that PCP that I told you before was the work of the devil. Does that work again? And might be a great way to get your business manager speaking to the customer. Anyway, some different tips, different ideas for you to try on this one here. So if you like this sort of stuff, this is what we talk about on our sales fitness program. Our sales fitness programs where we send a video a day in a structured format to people who have just started the process in the in the modern industry, I should say, experienced people in the masterclass in today's service advisor. Spits of guys in the office, when get you guys set up, it's just $2.99 a month. So you get three months of training for a hundred pounds a month. It's the cheapest training and very cost effective. And these are some of the things we talk about there all the time. We kick around lots of different ideas to drip feed the information. Anyway, that does it for now. And thanks again for subscribing to the selling in the Motor Trade podcast. I know lots of people do because you get the notifications all the time. I really do appreciate it. And send this through to as many people as you can, because this is going to help someone out there to overcome that objection. That just leads me to say that all details of this episode and other episodes on the selling in the Motor Trade can be found on our website simcotraining.co.uk. Go there to get a copy of our book, Words That Sell Cars. Go there to sign up to a free trial of our sales fitness online sales training program. Easiest way to get hold of me is Simon Bowkett, food link to him. Thank you.
