Bark's Bites: Here's What Bark Motors Would Look Like

Mark "Bark M." Baruth
by Mark "Bark M." Baruth

I come before you today to state a simple truth, a truth that is so obvious that it doesn’t even need to be said, yet it has never been properly addressed. The car franchise dealership, as we know it, is broken.

It’s too bloated. It doesn’t live in the now. It spends far too much to acquire its customers. It doesn’t focus on the things that matter. Some OEMs wish that they could eliminate it. In most cases, it’s owned by a guy whose only achievement in life is having been born to the owner of a car dealership.

It’s also the only business in America that intentionally operates in a way that is frustrating and oppressive to its customers. You could never run any other business in America the way that a car dealership is run. The posted price means nothing. Virtually no two people will pay the same price for a car. Even once the price is finally negotiated, surprises keep coming to the point where virtually nobody is entirely sure if he or she got a fair deal on his car.

But it doesn’t have to be this way. If I owned my own dealership (and, honestly, could I really be any worse at it than 90 percent of the guys who own dealerships?) here’s what I’d do to help my dealership make more money, sell more cars, be more ethical, increase customer satisfaction and loyalty, and even have more fun doing it.

Fire Everybody in the Building

Do you know why all car dealerships appear to be run nearly exactly the same? Because they’re all run by “Car Guys.” Car guys act like there is some mythical, deep magic involved with running a car dealership. Twenty years ago, maybe there was. But today? There isn’t.

Any process that needed a “Car Guy” can be done now, and done better, by software. Need to evaluate a trade-in? There’s software for that. Need to price your new or used car inventory? Yep, there’s software for that. Need to put together a “four square?” You guessed it. There’s software to calculate shop hours and rates. There’s inventory software for your parts department. Anybody who can read a software manual can run a dealership.

If we are going to change the culture at Bark Motors, we have to start by getting rid of the people who established the culture, and that includes all the Car Guys. Sorry, fellas, you’re out. Don’t worry, there are always dealers looking for F&I guys and Used Car Managers. You’ll be fine. But who are we going to replace you with?

Hire a Young, Diverse Staff and Pay Them Appropriately

The average dealership staff can be described with three words: stale, male and pale. Most dealerships are run entirely by older, white men. There’s no reason that this has to continue — we all know that the average customer is far more informed than the average salesperson is about the cars on the lot. The Lot Lifers don’t add any value to the dealership. So why do we need to keep them around?

My classified ad for hiring salespeople would look like this:

Young Professionals Wanted For a CAREER in Automotive Sales!

NO Dealership Experience Required OR Desired.

Work a 40-hour work week, and earn a base pay that will cover all of your bills PLUS a highly competitive commission plan.

Full Medical, Dental, and Vision coverage.

We LOVE College Graduates! Women Are Encouraged To Apply!

And then I’d watch the applications roll in. Young people can’t shut up about how terrible the job market is, and yet, you virtually never see young people working at car lots — or, if you do, they’re the overweight, khaki-wearing, GED-recipient type. Bark Motors would focus on removing the stigma that college graduates have about working in Automotive Retail. We’d pay more to college graduates— I’d love to see diplomas framed at every desk.

We would have a 50-50 male-to-female ratio on our sales staff. We’d do away with the misogynistic culture of the car dealership and make Bark Motors a friendly and safe place for women to work. We might even set the tone by hiring a female GM — most of the female GMs I have encountered are sharp as tacks and tougher than leather.

Not only would I hire a great, diverse team, I’d keep it by doing exactly what my ad promised. By getting rid of the 20-year, gold-watch wearing boat anchors in the management offices, I’d be able to pay my salespeople real wages AND provide them with opportunities to move up the ladder quickly. I’d appeal to the Millennials’ careabouts by getting the dealership involved in the local community by encouraging them to seek out ways that we could give back. I’d give them rotating weekends off, and I’d mandate a maximum of a 40-hour work week. Working at a car dealership doesn’t have to be a death march, and it doesn’t have to be a place where society’s castoffs work. Not doable, you say, Mr. Car Guy? Like Hell. Enterprise Rent-a-Car can do it. So can we.

In my opinion, this would be the most revolutionary and the most impactful change we could make. But, there’s a lot more that would need to be done.

The $4,000 Dollar Fantasy Is Dead, and We’d Drive the Stake Into Its Heart

We would do everything necessary to turn inventory quickly at Bark Motors. We’d buy an inventory pricing software suite, and we’d live by it. We’d quickly learn what our average front-end retail gross on a car was, and that’s where we’d start our used car pricing — no more trying to load up a car with profit when it’s fresh on the lot. The goal would be 12 inventory turns a year (meaning we’d sell our entire lot every month), and we’d have a hard 60-day turn policy. If a car is on the lot for more than sixty days, it would be sold at auction. We wouldn’t fear wholesale losses.

Used car inventory would be value-priced, meaning that while we wouldn’t necessarily be a one-price, non-negotiating store, we’d price the cars correctly from the outset and discourage discounting unless absolutely necessary. I picture a Progressive Insurance type of scenario, where we would show the customer a list of similar vehicles at other dealerships, and show the customer how our car compared to the competition. Sometimes we’d be lowest, and sometimes we wouldn’t.

New car pricing would start at invoice, minus any factory rebates or incentives. The sole purpose of our new car inventory would be to feed our Service and Parts departments, as well provide trade-ins to our used car department. Trade-ins would be valued fairly, but we wouldn’t overspend on trades to make deals happen, unless we needed to do so to hit our OEM bonuses.

Bark Motors Would Be a Digital Dealership, First and Foremost

According to the National Auto Dealers Association, around 80 percent of customers are doing research online before they visit a dealership. So Bark Motors would assume that every customer is an online customer. We’d have the same pricing on all of our third-party websites (we’d advertise on all of the major players), our website, and on the window stickers.

We would be diligent in using our customer relationship management tools to track our customer interactions, and we’d never assume that a customer was just a “walk-in.” While we would value phone calls and emails, we would also understand that, also according to NADA, most customers do not contact the dealership before arriving on the lot. For those customers who do contact us, we would attempt to conduct as much of the transaction online as possible and reduce the amount of time that they spent in the dealership, but we would not engage in self-negotiation — the pricing on the website would remain the sale price.

Not only would we ask where customers saw our cars, we’d ask where they did all of their research, including those customers who don’t buy. This would help us understand customer buying behavior and focus our efforts in the places where our customers prefer to study up.

Bark Motors wouldn’t spend a single dime on traditional, expensive forms of advertising, such as television or radio, unless it was funded by manufacturer co-op dollars (which are earned by selling new cars). We’d focus on the advertising media that targets in-market shoppers, rather than large swaths of the public who may or may not be interested in buying a car. We’d take our savings from eliminating that advertising and use it to cut the margins on our cars.

The Sale Would Revolve Around the Experience

I would implement an “up system,” so that customers wouldn’t be treated like chum in a shark tank — customers would be treated as guests, not enemies. We’d do our best to get the entire process completed in less than 90 minutes, including finance and delivery and we’d incentivize our sales reps for making that happen. We’d invest real money into a children’s play area, and we’d update the videos, games, toys and furniture semi-annually.

Salespeople wouldn’t specialize in new or used cars, they’d work the entire dealership. We’d focus on having our salespeople build relationships with customers, and we’d be as transparent as possible throughout the process. The computer screen on the desk would never face the salesperson — it would be placed where the customer and the salesperson could see all the numbers.

Since CSI scores are so incredibly important to franchise stores, I would ensure that no customer ever had a reason to ever give us less than a perfect score. While we’d focus on an expedient process, we’d also focus on providing outstanding customer service. If a customer chose not to buy from us, a manager would be sure to follow up with the customer to see what we could have done better to gain that customer’s trust and, ultimately, his business.

The Finance Office Would Stop Being Mysterious

Lastly, the customer would have one ambassador throughout the whole process, rather than turning them over to managers. The sales rep would walk the customer through their trade-in, their financing, and their delivery. No more “going to the manager” to discuss a deal — we’d have an open sales floor with no closed doors. No more long, awkward silences for customers. They’d have a friend throughout.

In the financing process, customers would be provided a copy of their credit score and a list of financing options. No more burying customers in order to make back-end profits. While we’d still want to make the F&I office profitable, it would no longer be a place to confuse and mystify customers. We’d ensure that the payments were within the customer’s stated comfort zone, and we’d offer only the best and most reputable insurance and warranty products.

So … is this Fantasy?

I don’t think so. Most dealers around the country are doing some of these things, but none that I’ve encountered are doing all of them. As long as the retail car business continues to be the incestuous mess that it is, with the majority of dealer groups owned by second- and third-generation car dealer families, it will be tough to break the mold.

However, I truly believe that the first dealership to fully embrace the new, customer-focused model I’ve described here will have an opportunity to break free from the pack. There are other items to address (inventory mix, lot size, the building itself, service and parts departments), but the customer experience is the one thing that dealers can nearly completely control, and yet, it appears to be the one thing that they focus on the least. Everything else is secondary until we fix the way our customers feels when they walk out of those doors.

So, tell me; would you shop at Bark Motors?

Mark "Bark M." Baruth
Mark "Bark M." Baruth

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  • Danio3834 Danio3834 on Dec 07, 2015

    To answer the question, would I buy from Bark Motors? If anyone is willing to pull their pants down that much as far as pricing is concerned, sure. I fear I might not be able to a second time though they aren't generating returns on sales. New car dealers still depend on that. $4,000 PNUR isn't out of the question in some cases.

  • Ruggles Ruggles on Dec 08, 2015

    RE: "I hope you don’t expect auto retail to rush to embrace your buying style." I shouldn't expect auto retailers to be honest? That's really all I'm asking for." Depends on what you call honest. The big debate in auto retail these days is what degree of transparency should be provided to a consumer. RE: "Offer me a price and make clear what's included in that price." The law specifies Monroney Labels on new vehicles. There are also regs on pre-owned vehicles. There is no reg that demands a seller quote a price good for an extended period of time. When the price is discussed, that's the time to buy or not. RE: "If I'm seeking financing, offer me financing terms." Unless you're a BHPH customer, the dealer doesn't offer financing terms. They shop for terms on behalf of buyers. The terms come from lenders, not dealers. Consumers are free to find their own financing, although dealers most often are able to do that to better advantage than an individual buyer. The exception would be that well established consumer with a 750 plus credit score, home equity, cash in the bank, and equity in the car deal. Those folks don't need anyone's help getting financing ALTHOUGH, if they want a subvented rate from an OEM captive, they'll have to do that through a dealer. A dealer can't tell you what "terms" might be available from various lenders until a deal is structured and submitted to the lender. Lenders might "tier" the deal differently from each other. Lending Terms might look better on a less desirable vehicle because of available incentives. Lending Terms might change from vehicle to vehicle. RE: "If I take you up on the offer, honor that price, and the financing terms if I choose to finance through you." If you both sign the deal, that's what happens. Again, unless you'[re a BHPH buyer, you aren't borrowing money from the dealer. The dealer is only the lender until the contract gets reassigned. RE: "The market will get rid of bad dealers, bad being unable to stay solvent." So your definition of "bad dealer" is based purely on the bottom line, and does not include any component of customer service or even basic business honesty?" The market tends to sort out definitions. After all, who would do business with a bad dealer? Someone you think is bad might please many others. RE "Of course, laws protecting the legal business contract between a local small business person and a behemoth multinational corp inconveniences the corp." This is not a situation of one small business versus a large OEM. This is a situation of a large affiliation of small businesses within the regulating state against what is usually an out-of-state OEM that has to manage its situation in 52 U.S. jurisdictions. Dealers, not the OEM, have the political power." Then why don't the OEMs just get rid of those pesky well organized dealers and sell direct or operate their own sales and service outlets? All they have to do is buy out their dealers or let the Sales and Service agreements lapse at end of term? But you have identified why dealers have formed associations. Ever follow the history of OEMs and their dealers over the decades? RE: "Dealers are profitable and selling record numbers of vehicles. Is there a problem?" I'm sure the OEMs think there's a problem when, particularly for non-luxury brands, most of the customers cite buying the OEM's product as one of the most stressful and unpleasant experiences in their lives." Most customers don't say that. You can get almost any answer you want depending on how you ask a survey question. But if the OEMs don't like it, see above. Ford, I know, has data on what their customer satisfaction numbers looked like when they did business the way consumers said they wanted it done on surveys. RE: "In case you haven’t noticed, there is all sorts of competition at the dealer level, and that’s the continued aim of the FTC." What now? How is there "all sorts of competition" if I want to buy a Lexus in Portland, Oregon? I have one -- one -- dealer to choose from. Similarly, if I want a dark green manual Chevy SS, there is one in stock in the entire country. There is plenty of competition only if 1) you are in a major metropolitan area *and* 2) you are buying a commodity car. Not surprisingly, my best car purchase experience ever was when I bought a totally standard Forester XT in Seattle, with 6 local dealers competing for my business. In my history that is very much the exception and not the rule." Then buy a commodity car. If you want something that is higher demand than supply, you'll pay more. You want to have your cake and eat it to? Do you know how markets work? HINT: They don't care if it gives you stress or not. RE: "What legally enforced lack of competition?" There is competition between dealers -- in some circumstances. But dealers do not have to worry about any competition from alternate business models. They have been legislated out of existence. My ideal car-buying experience would be to order directly from the manufacturer. I'd pay extra to do it that way, because I've had so many poor experiences with dealers. No can do, and the obstacle is legal, not market-based." You're right. Dealers don't have to worry about competition from alternative business models BECAUSE their OEM granted them a sales territory before they invested millions in their business. And those OEMs were THRILLED to do that to gain access to the dealers capital, expertise, and local connections. So they signed a Sales and Service agreement that provided benefits both parties needed to do what they do. And its worked well over the years. And if there is ever an auto OEM that wants to try to be a manufacturer and a retailer simultaneously, I'm sure the market will know about it. So far, Tesla is the only one to attempt it, and at some point they'll notice that the capital required to operate their own sales points will be sorely needed for product development and other critical purposes. Every manufacturing company eventually gets to a place where production smoothing and inventory buffering becomes critical. No one exists perpetually in a world where production and demand stay in balance. RE: "Such is life." You tell me this and then you try to tell me I'm ignorant when I complain about your business?" Well, you certainly don't understand how business works. You don't seem to understand the difference between a big ticket item and a gadget. You don't understand why a business person making a HUGE investment in a business requires guarantees from their supplier or why a supplier is EAGER to make sure their retailer is comfortable enough with the deal to make that investment. Dealers have to deal with the unschooled on a daily basis and end up getting blamed for everything from the mass of government required paperwork and fees to the negative equity situation on the consumers trade, to the terms dictated by lenders. Consumers have never had more information available and are probably less happy than ever. Of course, they lack the capacity to unpack all the information they have at their fingertips. And you seem to think you are entitled to a high demand low supply vehicle based on commodity pricing. Its been decades since I learned that threatening to be unhappy is a typical consumer strategy of negotiation. Its been decades since I learned consumers have no compunction about lying in a business deal. I'll never forget the lady that was looking at two cars. They were identical except for the color. The one she wanted was priced higher because it was built after a price increase had occurred. She was incensed because I wouldn't just switch the window stickers. RE: ""You can either tell me about my business as if you think you know" If you want to defend your business, you need to show me and the majority of the public that you can do it differently." I don't have to defend "my business." I don't operate dealerships any more. I defend facts. I don't need to show you anything. I don't need to satisfy any customers. I owe nothing to the public. Hell, I don't owe anything to car dealers. And if I were still a dealer, I wouldn't let the fear of ruffling a few feathers keep me from making profit on every transaction. Part of being successful in a business where the price is determined via negotiation is learning the strategies of buyers. I have a little experience with that. RE: "Public opinion holds, with more than ample justification, that honest dealings are the exception and that most of the people in your business are to be avoided except when absolutely necessary." Then please do so. Or find a dealer who satisfies you. Its really pretty simple isn't it. Its a two way street. You're frustrated because you can't have it your way. There's no guarantee your way is even reasonable. But you are free to make your best deal. If its too stressful for you, stay home. You'll probably be well served being an employee for life. You probably won't want to even be a manager. You won't invest in stocks or a business. Too much stress. But you'll be sure to complain.

  • SCE to AUX I've never been teased by a bumper like that one before.
  • 3SpeedAutomatic R&T could have killed the story before it was released.Now, by pulling it after the fact, they look like idiots!! What's new??
  • Master Baiter "That said, the Inflation Reduction Act apparently does run afoul of WTO rules..."Pfft. The Biden administration doesn't care about rules. The Supreme Court said they couldn't forgive student load debt; they did it anyway. Decorum and tradition says you don't prosecute former presidents; they are doing it anyway. They made the CDC suspend evictions though they had no constitutional authority to do so.
  • 1995 SC Good. To misquote Sheryl Crow "If it makes them unhappy, it can't be that bad"
  • 1995 SC The letters on the hatch aren't big enough. hard pass
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