NextGear Capital and 10 independent dealers evidently see the potential benefits of meeting regularly in a digital space — something like we’ve all done often throughout the pandemic.
In an effort to stay connected with clients beyond just surveys and anecdotal feedback, NextGear Capital this week announced the creation of the DRIVE Dealer Advisory Board to stimulate dealer growth and success.
The floorplan servicer explained that the purpose of the group is to provide a platform for open and direct dialogue between NextGear Capital leadership and dealers to help identify ways to best address their business needs and drive NextGear Capital’s future planning and investments.
Over the past two years, the company highlighted informal dealer feedback contributed to many of the recent enhancements to Account Portal, NextGear Capital’s account management platform, reinforcing the value of creating a more structured approach.
The board’s inaugural meeting took place virtually in April with NextGear Capital president Scott Maybee and members of his leadership team in attendance.
Going forward, NextGear Capital said the board will continue to meet monthly in a virtual setting.
“Our goal is to gain first-hand perspectives from this advisory board about what matters the most to our dealers,” Maybee said in a news release. “Through collaborative interaction, DRIVE will help us better serve our 20,000-plus independent dealers, creating new solutions to reduce their pain points and providing a client experience that delivers value every day.”
To obtain varied viewpoints and wide-ranging feedback, NextGear Capital explained that it selected a diverse group of dealer clients based on the following criteria:
—Varying lines of credit
—Minority and female-owned dealership representation
—Operators who are quick technology adopters, as well as slow adopters
—Manheim and non-Manheim buyers
—Both long-term and new NextGear Capital clients.
The company added the 10-person advisory board also represents a cross-section of NextGear Capital’s national footprint from Florida to California.
The advisory board members are:
• Imran Ahmed, A.I. Monroe LLC in Bountiful, Utah
• Chris Tingler, Car Shop, Inc. in Covington, Va.
• Alex Balk, CARite LLC in Fort Pierce, Fla.
• Nicole Kogan, Cosmo Motors, Inc. in Hickory, N.C.
• Marcos Esquivel, Esquivel Auto Depot, Inc. in Rialto, Calif.
• Heather Moreno, Lightning Motorsports, Inc. in Grand Prairie, Texas
• Garrick Hatfield, Motor Trends of Houston in Alvin, Texas
• Michael Rudman, Scottsdale Wholesale Direct LLC in Phoenix
• Kathy Ward, Ward Motor Co., Inc. in Amarillo, Texas
• Angel Wright, Wright Car Sales LLC in Lake Worth, Fla.
“I have worked in the automotive industry for 35 years and appreciate the importance of learning to grow and evolve an independent dealership,” Ward said in the news release.
“It’s an honor to be part of the DRIVE Dealer Advisory Board and pay it forward by providing up-and-coming dealers with solutions to make their day-to-day operations easier, through insights and strategic planning with the other board members on how to best advance us into the new age of doing business,” she went on to say.
Sometimes, having an extra cook in the buy-here, pay-here kitchen can be helpful.
At least that’s the intention of the new relationship between Buckeye Dealership Consulting and Auto Dealer Services Group (ADSG).
Buckeye, a national provider of re-insurable finance and insurance products for BHPH and independent dealerships, recently teamed with ADSG, a division of Peachtree Planning Corp. and one of the nation’s largest financial planning firms with a team that specializes in working with independent dealers on reinsurance investment strategies and succession planning in a tax advantageous manner.
According to a news release, this arrangement will provide Buckeye’s customers with greater opportunity to invest and control the revenue in their reinsurance companies and better manage their financial resources now and plan for retirement and future business succession.
“By creating their own reinsurance company, dealers can share in the underwriting products for F&I products they offer in the dealership including how funds in the reinsurance company will be invested,” Buckeye chief executive officer Rob Fox said in the news release.
“Teaming with ADSG was natural opportunity to connect our dealers with a source to further help them accomplish their long-term planning goals,” Fox continued.
ADSG said it has an “unparalleled” track record of helping independent dealers find financially beneficial places to hold these types of accounts.
“We help owners with both personal and business planning to increase cashflow, reduce taxes and transition their businesses to the next generation in a tax efficient way,” ADSG president Mark Burkholder said.
“Although we are not under the same roof as Buckeye, we’re of one mind when it comes to assisting with and protecting the financial health and well-being of our clients,” Burkholder
Buckeye executive vice president and chief legal officer Shaun Petersen was a part of helping to put the venture together, pointing out how both firms immediately recognized the numerous benefits to independent dealers of all stripes of working together.
“Combined, the services Buckeye and ADSG provide will give dealers comprehensive resources to build their business and protect it for their families now, through retirement and beyond,” Petersen said.
Ignite Consulting Partners chief legal and compliance officer Steve Levine returned for another visit; this time recapping on the Auto Remarketing Podcast how cathartic it was to host the firm’s compliance training event again in person.
Levine also described how buy-here, pay-here dealerships are sharpening their compliance skills again after navigating through the worst of the pandemic.
To hear the conversation, click on the link available below, or visit the Auto Remarketing Podcast page.
Download and subscribe to the Auto Remarketing Podcast on iTunes or on Google Play.
Chuck Bonnano is the vice president of dealer development at the National Independent Automobile Dealers Association. Brent Carmichael is the 20 group moderator, consultant and instructor with NCM Associates.
As engaging as both Bonnano and Carmichael are, a Zoom meeting just could not be the conduit for successful 20 group gatherings each dealership training and consulting expert has orchestrated for years.
“We realized right away that I couldn’t do a 20 group virtually for three days,” Bonanno said in an interview with BHPH Report after the NIADA tried to organize sessions for a fraction of that span when lockdowns began at the outset of the pandemic last spring.
During an episode of the Auto Remarketing Podcast recorded before the pandemic reached the one-year mark, Carmichael described why dealers are thirsty to learn through 20 group gatherings that are held in-person like they’ve been for decades.
“The engagement part of it is probably the biggest aspect of it,” Carmichael said. “You can’t do eight hours straight on a Zoom call. It seems like I have over the last nine months having four, five, six or more a day. It just doesn’t seem to work well for my dealer clients.
“That in-person interaction, there are more free flowing ideas when you’re in person as opposed to looking at a screen with maybe 18 little blocks of video up there,” he continued. “You get more in-depth discussions. I guess eight hours doesn’t seem like as much when you’re in a meeting room with a break every two to three hours, time for lunch. The interaction you have on those breaks is huge as well. Everyone is ready for human contact, if that doesn’t sound too corny.”
What’s probably not so funny is what Bonnano is seeing as alternatives to 20 groups, which have costs associated with being a member as well as for travel and accommodations to attend and participate.
“We’re hearing a lot of interest (about the return of in-person meetings), but we’re competing with social media sites that give free advice,” Bonnano said. “All I ever tell them is that it’s priced accordingly. I’ve seen people giving legal advice on a Facebook Group. You don’t know who this person is or whether what they just told you is even legal.
“But it does tell me there’s a lot of hunger for knowledge, instruction and direction. We’re real excited about this year and beyond coming back to it,” he added.
Sharing best practices
Part of the reason for that excitement is how well independent dealerships — in particular buy-here, pay-here operators — have navigated through the pandemic.
“I think what you had in most cases because you have long-time buyers, long-time salespeople, long-time collection teams, they were seasoned, more independent workers so that when they worked from home or remotely or split shifts or any of the other different strategies that were used, they were able to keep moving right along/ They adapted really well,” Bonnano said
“Those dealerships that were already buying cars online and some sort of platform for digital marketing, the staff and the team were already aware of how to do all of that, they didn’t have to invent it like some of my dealers had to on the fly,” he continued.
“What I was so pleased by with very few exceptions — and the PPP loans helped — but they kept their teams together,” Bonnano said. “Very few people bailed. There were a few people with underlying heath issues who were unable to go forward. But like I’ve said. They’re car people. They’re not going to go hide in a bunker for a year. They wanted to work. And even those that went home to work in accounting and some of the marketing people as well as the underwriting and collections people, most of them were thrilled to get back to the office because they really like their team and the culture.
“Most of these smaller dealers, most people are cross-trained so that when you had split shifts or working from home you could do more than just one thing. I think that helped a ton,” he added.
Resilient operators
NIADA spotted indicators of what Bonnano described not long after COVID-19 was declared a global pandemic last March.
The NIADA COVID-19 Dealer Impact Survey of 846 independent operators conducted from last May 9-14 — a follow-up to a survey orchestrated by NIADA a month earlier — found 63% of the dealerships that had furloughed or laid off employees a month earlier have started the process of bringing them back.
Overall, NIADA indicated 34% of the independent dealers said they are rehiring staff, 20% said they are not and 47% said the question was not applicable, meaning they had remained at a full-staffing level throughout the COVID-19 pandemic That was the same percentage as the previous survey.
According to the results, 39% of operators who are rehiring said they had experienced no problems in doing so, but 31% acknowledged their employees were hesitant to come back because they were making more through the government’s enhanced unemployment benefits than they had made at their jobs, and 19% said fear of the coronavirus was an issue.
The survey also showed dealerships opening up again, with 44% doing business as usual (compared to 27% in April), 34% open by appointment only and 10% selling online only.
NIADA discovered just 11% of dealer survey participants remain closed temporarily — down from 27% — and 1% reported they have closed permanently.
“The leadership came out,” Bonnano told BHPH Report this spring. “They were very quick to adapt to what was going on. Looking back now a year later, those first few weeks some people were thinking is this the end of the world? And rather quickly we were deemed to be essential businesses and now we have to figure out how to continue to operate.
“Everybody jumped right in there and we learned that we can buy cars online. We’ve been telling dealers for a long time that the digital world of buying is here. We definitely learned that we can collect remotely. I’ve got some companies where their collectors are still at home. They’ve basically been given the option to work from home as long as their productivity stays high and the results are good. And we can sell cars by appointment, sell them remotely, do it digitally. Again, everybody adapted real quickly like that,” he continued.
“As moderators and trainers, we’ve been talking about digital retailing, not digital marketing, for a long time. Car dealers in general sometimes are slow adopters. But being pushed into this, they recognized rather quickly that we can make this work and they did,” Bonnano went on to say.
Byrider chief executive officer Craig Peters and vice president of franchising Chris Hadley stopped by for this episode of the Auto Remarketing Podcast, highlighting not only the company’s successes through the pandemic but also the growth potential through its revamped franchisee program.
To hear the conversation, click on the link available below, or visit the Auto Remarketing Podcast page.
Download and subscribe to the Auto Remarketing Podcast on iTunes or on Google Play.
Byrider is looking to make it easier for dealer operators and other entrepreneurs to gain a franchise in its network of buy-here, pay-here stores.
This week, the company announced the launch of its new franchising model, Byrider Direct, adding what executives believe is a new, simpler entry point into its franchising system.
Byrider said the new program has a lower initial investment that focuses exclusively on sales and service.
“Our team is excited to offer a new pathway to join in Byrider’s success,” Byrider chief executive officer Craig Peters said. “Underwriting and servicing a portfolio can be a very complex and capital-intensive part of the buy-here-pay-here business model.
“Byrider Direct addresses those potential challenges by allowing new franchisees to focus on retail and gives them a new access point in line with their experience and comfort level as they invest in a new partnership with us,” Peters continued.
Alongside Byrider’s traditional model, the company explained Byrider Direct can provide franchisees the opportunity to focus solely on the retail side (sales and service) and still garner strong returns.
Byrider Direct requires a lower capital investment and provides finance and portfolio support that can allow a new franchisee to harness the learned expertise of Byrider’s decades-long success.
“Byrider Direct is a leaner, meaner version of the traditional Byrider model, and it comes with everything a potential franchisee would expect, minus the financing arm,” Byrider vice president of franchise development Jack Humbert said.
“We’re engaging new investors with expanded investment level ranges to provide multiple options of entry to build a dealership and help consumers get a fresh opportunity to finance and own a quality vehicle,” Humbert went on to say.
Byrider pointed out the traditional franchise model continues to be an “incredibly” strong performer, requiring an estimated initial investment of around $1 million. That choice allows the franchisee full management of all operations, including underwriting and collection.
The company said exclusive territories are currently available for both Byrider Direct and Byrider’s traditional franchise offering.
For more details, go to www.byrider.com.
For buy-here, pay-here operators and other independent dealerships that haven’t gotten or used federal resources to aid their businesses, they now have more time to complete applications and secure funding.
Earlier this week, President Joe Biden signed the PPP Extension Act of 2021, extending the Paycheck Protection Program an additional two months to May 31.
“We’re pushing lenders to raise their game and provide more help to many small businesses. As you know, particularly Hispanic, as well as African American small businesses are just out of business because they got bypassed the first time around,” Biden said at the White House when signing the act on Tuesday.
“Today, I’m proud to sign the extension … of the Paycheck Protection Program. It is a bipartisan accomplishment,” he continued.
“Nearly 90,000 business owners are still in line, and there’s money left,” the president went on to say. “Without somebody signing this bill today, there are hundreds of thousands of people who could lose their jobs, and small and family businesses that might close forever. And, as you know, small business is the backbone of our economy, representing almost 50% of all the employees in America.
And for operators who have applied and are still waiting for a decision, the new law also gives the U.S. Small Business Administration an additional 30-day period to process applications that are still pending.
“Today, President Biden sent another strong message to America’s more than 30 million small business owners negatively impacted by the pandemic: help is here. By signing the PPP Extension Act of 2021 and the American Rescue Plan Act into law, the president is providing additional critical relief to the smallest of the small businesses — the mom-and-pop shops that line our Main Streets and keep our local and regional economies going,” said Isabella Casillas Guzman, who is the head of the SBA.
“More than 8.2 million PPP loans have provided struggling small businesses with the relief they need to keep workers employed and make ends meets during this pandemic. The SBA remains dedicated to reaching the heart and soul of the nation’s urban, rural and low-income communities — the smallest businesses — and removing barriers to access this vital relief,” Casillas Guzman went on to say.
Consumer Bankers Association president and chief executive officer Richard Hunt shared his perspective on what the new development means for his organization’s members who also are trying to help small businesses like dealerships.
“The banking industry has moved heaven and earth to remain a source of strength for small businesses and welcomes the extended timeline to assist even more of the hardest-hit businesses through this program,” Hunt said in a statement.
Perhaps triggered by the college basketball tournaments near their climax and Major League Baseball getting set for its season, Agora Data has outlined a competition where buy-here, pay-here could land $1,000.
According to a news release, Agora Data issued a challenge to commercial lenders providing credit lines to BHPH dealers. The challenge consists of a checklist for BHPH dealers and smaller finance companies to compare their current line of credit to AgoraCapital.
If a dealer can get its lender to match all the terms of AgoraCapital, Agora Data said it will offer its congratulations and send the dealer a check for $1,000.
The company explained specifics for the Agora Lender Challenge include lowering current interest rates, eliminating monthly borrowing base true-ups, removing burdensome financial restrictions and obtaining a wealth of services (free of charge) to help support and plan for growth.
After taking the Agora Lender Challenge, dealers are encouraged to contact Agora Data and explore all financing options that best align with their business and personal goals.
Dealers can find the Agora Lender Challenge details and checklist at www.agoralenderchallenge.com.
The company also mentioned dealers in good standing with their current lender are automatically eligible to refinance their line of credit with AgoraCapital at a reduced interest rate and receive a commitment to triple their borrowing capacity.
New dealers wanting to accelerate their portfolio can get started with various robust and low-cost financing options, according to Agora Data.
“Agora Data is changing the dynamic between dealers and lenders and issuing a challenge that gives dealers the power to identify the best financing options that support business goals and needs,” Agora Data chief executive officer Steve Burke said in the news release.
“The market has known for some time that financing innovation for BHPH dealers is long overdue, and with our AgoraCapital program, we have successfully removed the obstacles that previously hampered growth and profitability,” Burke continued.
“Agora Data is addressing barriers by providing BHPH dealers access to capital markets to help fuel their growth,” Burke went on to say. “Dealers to stop working for your lenders and start working for yourself.”
The Agora Lender Challenge follows Agora Data’s successful execution of what it believes to be the industry’s first-ever crowdsourced auto loan securitization on Dec. 29.
In addition, Agora Data recently announced its latest product offering, AgoraCredit, which is designed to transition dealers from their current senior lender into interim credit lines that work in harmony with the AgoraCapital securitization program.
Beyond access to AgoraCredit and AgoraCapital, Agora Data members connected to the platform also can receive free of charge additional insights and analytics to better understand their portfolio’s performance enabling dealers to make more informed business decisions as well as numerous other tools and services to help ensure success.
For more information, contact Agora Data at (877) 592-4672 or agoradata.com.
For the first time, America’s Car-Mart president and chief executive officer Jeff Williams joined the Auto Remarketing Podcast.
Williams highlighted how well the chain of buy-here, pay-here dealerships has pivoted its operations to meet protocols triggered by the pandemic as well as how the company is planning to celebrate its 40th anniversary later this year.
To listen to the entire conversation, click on the link available below, or visit the Auto Remarketing Podcast page.
Download and subscribe to the Auto Remarketing Podcast on iTunes or on Google Play.
Credit Acceptance founder Don Foss created his own dealership group 10 years ago.
And now a decade later, that operation — CARite — has 26 locations with the two newest ones coming into the group this week.
According to a news release, CARite added locations in Stratford, Conn., its second lot in the state, as well as Ann Arbor, Mich., raising the total within the group’s home state to 13.
“We’re thrilled to expand our presence in these communities and bring outstanding value and savings to families in Stratford and Ann Arbor,” CARite chief executive officer Jeff Bartlett said in the news release. “CARite brings a fresh approach to the car buying experience with a no-haggle sales process and no sales commission.”
CARite also said it plans to grow its network further, with five additional locations currently slated to open later this year.
