Ninety percent of a successful used-car dealer’s time, money, energy and efforts typically go into the processes that take place before a customer ever contacts the dealership: buying, reconditioning, photography, etc.

When I was in sales, many years ago, my first manager would always say, “Let’s go take our unfair share of the market!” At the time, our dealership was already No. 1 in our area, but we were trained to want more than just our fair share.All of this was said in reference to new-car sales, processes and procedures.

I believe the new-car market is a finite market, with very few variances. Manufacturers track market data, and dealerships are armed with concrete information about the sales that their market produces.

The goal of a new-car dealer is to outsell its market (pump-in versus pump-out) and have a greater market share in its city or area than its nameplate. There are, of course, limits to this – if a dealership’s nameplate has a 3 percent market share, it is unrealistic for the dealership to acquire 30 percent of the market.

This concept creates a finite market that new-car dealers really have no control over. However, what new-car dealers do have control over are sales processes and procedures — and, rightfully so, that is where the majority of their focus goes.

I like to call it the 90-10 rule: typically, 90 percent of a successful new-car dealer’s time, money, energy and efforts go into the interaction that sales associates have with customers. Good dealers consistently measure results in areas related to customer interaction in order to better improve their sales and take their unfair share of the market.

The other 10 percent of a successful new-car dealer’s efforts are typically put into other operations such as marketing, displays, POP (point-of-purchase), etc.

Does the 90-10 rule apply to used cars? I believe the answer is “yes,” but with one major difference — it’s backwards.

Ninety percent of a successful used-car dealer’s time, money, energy and efforts typically go into the processes that take place before a customer ever contacts the dealership (things such as buying, reconditioning, photography, etc.).

The other 10 percent of a successful used-car dealer’s efforts are typically put into direct customer interaction and sales.

When we try to sell used cars the way that we sell new cars, we are forgetting one major advantage that new-car sales has: the OEM. When you sell new cars, you are an agent of the OEM, and you receive all of the benefits that go along with the mutual goal of selling vehicles.

When you sell used vehicles, the concept of the OEM doesn’t exist, and you are essentially the OEM and the agent — a situation that has its own set of pros and cons.

Recognizing this void is the first step to filling it, and filling it requires a lot of work, but the benefits are massive. This is where the 9010 rule comes into play. We need to do for used cars what OEMs do for new cars. It’s worth mentioning that OEMs are doing a lot with CPO programs to assist dealers, but the reality is that they need to focus the majority of their efforts on new cars.

The lack of an OEM for used cars means that processes and procedures that don’t exist with new cars are a reality for used-car sales. Some new-car dealers haven’t put enough focus and attention on this point within their used-car operations.

These back-end processes include buying, reconditioning and market pricing each vehicle, as well as gathering all relevant historical and other information about a vehicle. All of this, properly done, will produce a qualified customer and will lead to a quick and profitable sale. The vehicles, dare I say it, will “sell themselves.”

We saw it happen with Japanese imports back in the early 80s, and why was that? Was it because when they started selling vehicles in North America they were able to attract the best sales associates and create a dominating sales process?

No. I believe it was because they created a superior product to what was available in the market at the time, and demand outpaced supply. As a result, the vehicles essentially sold themselves, and sales associates became product advisers and customer service representatives.

The market is ready to reward the dealers that can create a superior used-car product and experience.

If you put the work into what happens before the customer ever finds you, demand will outpace supply and the vehicles will “sell themselves.”

Remember, it all starts with you.

Richard Macdonald is the founder of RPM Solutions. Richard provides consulting, training and co aching services to new-car franchise stores to help them maximize their used-car department profits. For more information, contact Richard at (416) 894-1475 or, or visit