your connection to ontario`s used car industry

volume 4, issue 2
YOUR CONNECTION TO ONTARIO’S USED CAR INDUSTRY
CARS, CASH &
THE CULTURE OF CREDIT
14
P
Second of a 3-part series
featuring auto finance companies
MARKETING TO MILLENNIALS
18
Requires multiple strategies
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#TRENDING
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Vehicle Safety Standards are
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volume 4 number 1
Used Car Dealers Association of Ontario
230 Norseman Street, Toronto, Ontario M8Z 2R4
Tel 416.231.2600 Toll Free 1.800.268.2598
email: [email protected]
www.ucda.org www.ucda.ca
Publication Mail Agreement #41890516
ONTARIO DEALER is published by
Laservision Graphics Ltd. four times a year
130 Industry Street, Unit #36, North York, ON M6M 5G3
Editor
Gina Monaco
[email protected]
1.647.344.9300 or 1. 289.456.4617
Advertising Sales:
Terry Coster
Direct: 416.360.0797 Office: 647.344.9300
Erinwood’s commitment to pre-owned car sales and cancer
awareness month (pink stripe Mustang)
Cover: photosbypierce.com
in this issue
5 The Driver’s Seat................................. Warren Barnard
Photograhy
photosbypierce.com
7 Editor’s Note.................................................. Gina Monaco
Contributors
Chris Chase, Sean Deasy,
Dave Kemp, Anja Sonnenberg
Lori Straus, Bill Sherk
Angela West
9 Member’s Corner ........................................... Bob Pierce
11 The Law Matters ........................................ Jim Hamilton
12 Sane Selling ........................................................ Dave Kemp
28 Tech Talk .......................................................... Angela West
32
31 The Common Lawyer ................... Justin M. Jakubiak
2016
33 The Old Car Detective .................................. Bill Sherk
35 Industry News..............................................................................
36 An Accounting Team Focused on Dealerships .......
.................................................................................... Lori Straus
The publisher of The Ontario Dealer reserves the right to turn down any advertising or
content submitted to it. The Used Car Dealers Association of Ontario and the publisher
accept no responsibility for claims or statements made by advertisers in this publication or
by the independent authors of articles appearing in this publication. All statements and
opinions appearing in this publication are those of the writers themselves and are not to be
construed as reflecting the position or endorsement of the Used Car Dealers Association
of Ontario or the publisher.
ONTARIO DEALER
3
feature stories
14
18
20
24
26
cars, cash and the culture of credit by Sean Deasy
Auto finance companies share their insights and strategies.
marketing to millennials by Angela West
What does tomorrow’s auto-finance landscape look like?
trending by Chris Chase
New Safety Standards are nearly here!
advanced crm techniques by Angela West
Your CRM is more than an email newsletter manager.
don’t do uber bad deals by Philomena Comerford
When a deal seems too good to be true, chances are it is!
If you are interested in having your personal opinion heard, please contact the editor at [email protected]
laservision
graphics ltd
4
ONTARIO DEALER
the driver’s seat
outstanding customer service
I
n today’s ultra-competitive vehicle sales
marketplace, you’d be hard-pressed to
find anything more important to a
dealer’s ongoing success than a reputation
for strong customer service. And that’s
the focus of the Driver’s Seat in this issue
of The Ontario Dealer.
With over 8,000 registered dealers in
Ontario, consumers have a lot of choice
when deciding where to purchase their
next used vehicle. Add the hundreds of
thousands of vehicles being sold privately
(many unfortunately, still sold by
curbsiders) and the need for any dealer to
distinguish itself and separate itself from
the crowd is obvious. Dealers need to
show that they’re, ready, willing and able
to go the extra mile …. well, the extra
1.6 kilometres … to ensure a happy and
satisfied customer.
Outstanding customer service isn’t an
easy thing to define. In fact, I don’t believe
that customer service can truly be defined
by a dealer. It can only be defined by the
dealer’s customer. Every customer will
have their own idea of what they expect
and what outstanding customer service
means to them.
Claiming to have the best customer
service will sound like a hollow promise
to any given customer if the dealer’s idea
of the best customer service is different
from the customer’s.
Having said that, I think the concept of
outstanding customer service can only be
meaningful if these four factors are
present.
Communication
Perhaps the most common failure in the
dealer/customer relationship is a lack of
clear and proper communication. Without
it, customers will feel let down, ignored,
resentful, angry and any number of other
negative emotions. It’s essential that
dealers continually communicate with
customers and do so in a clear and
straightforward way. Confusing and
inconsistent messages from a dealer can
be worse than no communication at all.
Dealers need to answer a customer’s
questions in an understandable way.
Patience
Customers want to be listened to and
understood. It can often be frustrating
and difficult during the hectic selling
process, but salespeople need to slow the
process down to a pace the customer is
comfortable with. Otherwise, the
customer will feel pressured and become
suspicious of the whole process. You need
them to trust the process.
Product Knowledge
It’s been said many times, and it’s true,
that with so much information available
on-line for customers, they often know
more about the product than dealers and
salespeople do. Salespeople need to take
the time to know what they’re selling, the
features and options and pros and cons of
any particular vehicle, and be able to
address any concerns arising from
negative product reviews that customers
may have found on-line.
End Goal
What’s the customer’s end goal? What
will it take for the customer to drive away
with their new purchase feeling 100%
happy … and to stay 100% happy?
Happy, satisfied customers will be back.
They’ll tell family and friends about their
experience … Of course, so will unhappy,
dissatisfied customers. What kind of
image do you want?
Here are some of the informative pieces
you’ll find in this issue of The Ontario
Dealer:
Warren Barnard, Executive Director, UCDA
Safety Standards ... There are some big
changes coming to Ontario’s safety
certification program July 1. Chris Chase
tells us all about them and how they will
affect you.
Marketing to Millennials ... Angela West
profiles today’s new, savvy customer and
what they expect from you.
Advanced CRM techniques ... Angela West
takes you beyond database-making lists
and into the fascinating world of customer
retention management.
Auto Financing, continued ... Sean Deasy
continues his discussion from last issue
about auto financing.
Here’s to a great Spring selling season and
a whole lot of happy, satisfied and repeat
customers!
As always, you can contact me at
[email protected] with your comments
and suggestions. OD
ONTARIO DEALER
5
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editor’s note
how my vehicle
saved my life
E
very car has a story. Let me tell
you about my 1998 Toyota Rav 4
that I purchased used in 2002. I
got a new job in sales, which required
that I be on the road four days a
week. I also needed the space of a
small SUV because I would be carrying
samples and products. The vehicle
was a workhorse and never let me
down for the seven years I owned it…
and it saved my life once, literally.
We went many places. Not only were
we on the road four days a week in all
parts of Southern Ontario, but we
ventured afar on weekends as well.
We travelled through the Eastern
United States and drove up north
every year in both the winter and the
summer. I have fond memories of
spending time sitting in the cargo area
while on Manitoulin Island at the
Perseids Meteor Shower Party,
enjoying the stars and the company
over a few beers – also slept in it too.
constant companion, through thick
and thin.
The Rav 4 was easy to drive, if you
know what I mean. That was a
common statement from friends who
borrowed it – you just got in and
drove it – easy.
Then one Sunday I was driving on the
QEW, from Hamilton to Burlington. I
was in the middle lane going along at a
decent clip of about 120kms.
It was mid-afternoon and traffic was
comparatively light, it wasn’t a
weekday. I knew there was a car in
the outer lane to my left but I
happened to glance at my side mirror
and saw another car trying to, actually
not really sure what he was trying to
do, but it looked as if he was trying to
pass in-between us.
I drove it down to the Finger Lakes
one summer for the Watkins Glen
International. I drove to a wedding in
the Adirondacks in upstate New York.
Just talking about where I’ve been in
my Rav 4 makes me feel nostalgic.
Before I knew it, it had hit the car to
my left and made it spin right into the
side of my car, which sent me on a
spin. I remember saying,” I am NOT
going to die today”. When I stopped
spinning I was in the outer lane on the
right side of the highway and thankfully
had not hit any other cars. They had
slowed and/or stopped.
I wonder if anyone else thinks about
their vehicles like that, as that one
I made it to the side of the road as
did the car that hit me. The other car,
Gina Monaco
the one that started it all, also drove
to the side with us, then drove off.
I was a bit shaken but managed to
calm myself and I called 911. The
driver of the car that hit me was
apologetic and confessed to the police
that he did indeed hit my car, after he
was hit.
Interestingly, he was a used car
salesperson. His car was hardly
damaged, mine, however was severely
damaged. I couldn’t get out the
driver’s side and when I looked at it I
wondered how I wasn’t hurt. It was
that solid steel framing that saved me.
Despite the damage, my Rav 4 was
repaired and we spent the next two
years together. I bought another make
of SUV in 2008 – a mistake. In 2014, I
bought a brand new Toyota Rav 4 and
haven’t looked back. OD
ONTARIO DEALER
7
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members’ corner
the unicorn
in the room
T
his phrase was used by George
Iny, President of the Automobile
Protection Association, when
describing Vehicle Manufacturers’ Price
Advertising for new cars … “to bring
you in at an impossibly low price but it’s
for an impossible vehicle that you will
almost never find.”
George was appearing on CTV’s W5
annual ‘mystery shopping’ program
filming sales people incorrectly
representing vehicle pricing; stating
that additional costs were government
fees that clearly were not.
Such ads are misleading at best and
dance on the knife edge of ‘bait and
switch’ at worst.
We are not talking about individual
dealer ads here, we are talking about
national campaigns across Canada by
some of the biggest companies in the
world – Honda, Ford, GM and so on
– that dealers piggyback onto. The
problem is dealers answer to local
Provincial regulators for the content of
their ads, while the Manufacturers do
not.
Let’s be fair, Manufacturers’ advertising
usually does include the required
disclosures that must be added to the
stated selling price of any vehicle. The
problem is they choose to achieve this
disclosure in a 500 word “mouse
print” statement at the bottom of the
ad or, worse, running vertically down
the side of the ad. Words that no
consumer reads (even if they could) or
would understand even if they did
read it.
This ‘fine print’ disclosure may meet
the requirements set out by the
Manufacturer’s legal department, but
it does nothing for the consumer. In
Ontario, as with some 4 other
Provinces, the ads also put the dealer
clearly at odds with the ALL-IN
PRICING REQUIREMENTS set out in
the Motor Vehicle Dealers Act.
How is this situation even possible? In
Ontario, as with other Provinces with
similar legislation, the Manufacturers
are exempt from the Provincial
requirements.
EDUCATION is the ANSWER…
The W5 program closed with a ‘no
comment’ from the Manufacturers
and a number of unfortunate
statements from some of the dealer
managers (in British Columbia) that
were featured in the broadcast.
Properly trained staff should know
freight and PDI are not “government
charges”. Properly trained staff should
know what their ads say and what
they mean.
Bob Pierce, Member Services Director
The response should have been
simple.
Dealer advertising requires all-inpricing and customers should be
directed to those ads ONLY. In the
rare event that the customer refers to
or has a copy of a Manufacturer’s ad
showing a different price, salespeople
and managers should be trained to
direct the customer to the dealer’s ad
showing the price and if necessary
point out that the Manufacturer’s
price DOES NOT include the
additional cost and fees that are
buried in the mouse print.
If nothing else, dealers will come off
looking a lot better on W5’s hidden
cameras and the blame can be fairly
left to rest where it belongs … in the
laps of the Manufacturers.
And what about the Manufacturers?
...continued on page 38
ONTARIO DEALER
9
Used Car Dealers
Association Of Ontario
MEMBER SERVICES
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VEHICLE HISTORIES
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EDUCATION • MEDIATION • REPRESENTATION
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NOT A MEMBER? ... JOIN NOW!
Application for
UCDA Membership
The undersigned hereby applies for membership in the USED CAR DEALERS ASSOCIATION
OF ONTARIO. Our annual membership fee of $200.00 + $26.00 HST = $226.00 is attached.
(Membership continues for 12 months from date of application.)
Dealer Trade Name
“D” Number
Contact Person
(Please Print)
HST Registration #108147174
First Name
Last Name
Tel: (
)
Fax: (
)
Title
Mailing Address
Postal Code
E-mail Address
Method of Payment:
Today’s Date
CHEQUE
CARD #
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MASTERCARD
EXPIRY DATE
NAME ON CARD
SIGNATURE
The UCDA is dedicated to protecting the rights of the used car industry in Ontario, and is organized to promote the continued growth of its members
and to inform the membership of pending issues which may affect their successful business operations.
UCDA 230 Norseman Street • Toronto • Ontario M8Z 2R4 • Tel: 416.231.2600 or 1.800.268.2598 • Fax: 416.232.0775 • Internet: www.ucda.org
10
ONTARIO DEALER
40289
the law matters
vicarious liability
I
n the distant past, if you loaned, leased
or rented your vehicle to someone,
and they had a mishap, the liability was
entirely on them, not you.
But this “judge” made law was seen as
too harsh to victims. Public policy
demanded that the net be cast wider and
include the owner of the vehicle in loss
claims. The thought was to save taxpayers
money. Lawmakers made this a reality by
amendments to Acts like the Highway
Traffic Act and “vicarious” liability was
born in Ontario.
The owner and the driver were now
liable for loss or damage caused by the
negligent operation of a vehicle, it didn’t
matter if the owner was blameless; he
was “liable” because the law said so.
Leasing and rental companies were never
wild about any of this. However, a lid was
kept on things to a large extent because
damage awards in Canada were never
quite as dramatic as we were used to
seeing in the United States, where you
could sue for millions of dollars if your
coffee was too hot!
Then, in 2005, a settlement was reached
to end a lawsuit over an accident in a
leased vehicle. A woman accepted a ride
home with a man she’d been drinking
with. The young man was drunk, the
vehicle rolled and the woman suffered
catastrophic injuries.
While the young man’s insurance paid $1
million, the leasing company was on the
hook for $10 million, after costs! At the
time, this was the largest settlement of its
kind in Canada.
The lid was off. Leasing and rental
companies raced to the Ontario
government’s door demanding relief from
what they saw as an unfair burden. They
sought to eliminate vicarious liability, and
extend liability to lessees/renters and
drivers.
They won … mostly. In 2006, the
Ontario government capped liability at
$1 million for lease/rental owners with
the lessee/driver’s insurance potentially
reducing that cap to zero.
This applies only to bodily injury and does
not excuse negligence on the part of
lessors/rental companies.
In Summary
• $1 million cap for lease/rental owners
applies only to bodily injury claims
•
Lessors/rental companies are still fully
liable for property damage claims or
loss caused by negligence
•
The liability of lessors is essentially
limited to $1 million minus any
insurance that the lessee or operator
of the vehicle has available
•
If other policies exist, the lessee’s
policy responds first, the operator’s
policy responds second and the
lessor’s policy responds third
Jim Hamilton, Legal Services Director
Wendy Victim is horribly injured. Victim’s
claim is for $3.8 million.
John Smithers has $1 million worth of
insurance, as lessee.
Tommy Tune is also covered on his own
vehicle insurance for $1 million.
Assuming Wendy Victim’s claim for $3.8
million is upheld by the court, Smither’s
lessee insurance will pay first, then Tune’s
(the operator) and Excellent Leasing’s
liability, because of the effect of the new
legislation, will then be reduced to $0.
As for the shortfall of $1.8 million, each of
John Smithers and Tommy Tune or both
of them, if you prefer, are still personally
on the hook for that.
Here’s how a typical claim might play out
in this context:
If neither Smithers or Tune had any
insurance, Excellent Leasing’s liability
would be capped $1 million.
Excellent Leasing leases a 2010 Honda
Civic to John Smithers. Smithers lends the
leased vehicle to Tommy Tune. Tune
wrecks the vehicle, but in the process
It’s not hard to see why these
amendments in 2006 were so important
to the leasing and rental industry! OD
ONTARIO DEALER
11
Sane Selling
by Dave Kemp
By Chris Chase
T
Just Kickin Tires
... Think Again
he most dangerous assumption
a salesperson can make is your
walk-in prospect is a tire kicker.
Don’t kid yourself, your vehicle
prospect does not just drop into your
dealership on a whim. Hey I have
nothing else to do right now so I will go
face down a salesperson at a car
dealership. Tell them I am not buying
today, just want a price on that truck
over there, the blue one. They are not
there to bug you, to waste your time
or theirs.
The second most dangerous
assumption, is when someone comes
into your dealership, that they are at
the beginning, just starting their
buyer’s cycle. Absolutely wrong! They
are at the end. I repeat! Your prospect
is at the end of his or her vehicle
buyer’s cycle when you meet them.
Most of your customers know what
they want to buy before they walk in.
12
ONTARIO DEALER
Automotivator Sales Fact
The decision to come to your
dealership is the conclusion, the final
act of days, weeks and months of the
journey to your store.
Your prospect is far more prepared to
buy than most salespeople are prepared
to sell. Your Internet-savvy customers
come on your lot armed with more
knowledge than some salespeople.
Customers know approximately what
the dealer had paid for the car they
were interested in and they know
what your competing dealers have in
stock.
So if you hear, I’m not buying, I just
want a price, or I’m just looking, or I’m
just shopping around today, kickin’ tires
and conclude this guy or gal is just not
a serious prospect ... think about this.
-- why now, why today, why your
place, why bother at all to come to
your place of business?
The difference between the sales
successes of one person over another
is, most often, the salesperson’s
expectations when they first meet a
prospect on the lot. The sales
professional who really makes money
and is successful expects each
prospect they meet to indicate they
are not a real buyer today.
prospect becomes extremely aware
of the incredible dealer advertising -sales events scream -- time to buy.
But they don’t come into your store...
yet. There are just too many
unanswered questions.
It is still the age old defence
mechanism that you and everybody
else uses when they meet a
salesperson. The true professional
knows that people only come in to a
full on face-to-face meeting when they
are ready. When they come into your
showroom you are on their final list.
They are motivated to get the deal
done. And...they want help making the
big decision.
2. They fear paying too much.
The true professional in our business
knows and understands the BUYER’S
CYCLE.
The Buyer’s Cycle
• Your vehicle buyer does not
suddenly make a decision to buy!
People don’t just drop into a
dealership to meet a highly
motivated commission-based car
salesperson. They only come in
after going through a period of
serious indecision—it’s called the
Buyer’s Cycle.
• The majority of people are driving
older vehicles, five, seven and nine
year old vehicles.
• Prime motivation to buy – to
replace a vehicle giving them
trouble. Most people become
extremely “car conscious” about
their present vehicle, as a result of
just completed, costly, mechanical
repairs, tires, brakes, exhaust,
body damage, windshields, tranny,
engine repairs.
• They correctly anticipate spending
even more money on expensive
vehicle repairs.
• They notice friends buying new
vehicles.
But know this; this person is not yet
quite ready to take the plunge. Close,
but not quite yet. Your future
1. They fear making a vehicle
mistake.
“I am glad you chose to look here. It
doesn’t matter whether you are
buying today, I am pleased to help you
while you are here.”
They have just found the person they
were looking for to buy their next
vehicle from, YOU! Now have some
fun and make more money. OD
Buyers Avoid Making a Mistake. Things
have changed since they purchased
their current vehicle. More kids, fewer
kids, no kids, wants a boat, needs a
trailer or no longer needs them.
They need to determine what is the
best vehicle for them. They want to
avoid making a mistake and make
payments on the wrong vehicle.
They focus on who is selling what they
need ... through the Internet—just like
you do. Over the next days and
weeks they notice dealer ads, go to
dealer’s websites and review used car
classified ads. At this point, they have
developed a strong preference.
Buyers avoid paying too much ... All
without having been to a dealership.
They go to the Internet for price and
payment information. They will call
banks or loan agencies for
approximate loan payments. They
decide on a price range, a payment
range, and approximate vehicle specs.
Information is easily available so no
need to kick tires.
Why? Because they fear you could
take advantage of them. Sell them the
wrong vehicle and stick them with
payments they can’t handle.
Buyer’s only come in when they are
ready. These people have eliminated
most of the vehicles in the
marketplace before they come into
your showroom. You have made the
cut. They are motivated to get the
deal done. Now they are really
buyers, their buying cycle is complete.
Your prospect only shows up when
they are ready to buy. Are you ready
to sell...really?
Automotivator Action Plan
Today, make the beginning of the sale
comfortable and easy. When you hear
“just looking” just tell them the truth,
Dave Kemp is president of
Automotivator Professional
Development and Trackstar
International Follow-up Systems. He is
a car industry expert with decades of
success training his sales strategies
with thousands of sales team
members across North America.
1-800-668-0362 Email – [email protected] www.automotivator.com/
ONTARIO DEALER
13
Cars, Cash and The
Culture of Credit
... What You Should Know
By Sean Deasy
A
How is the auto-finance
landscape unfolding in 2016?
In the second of a three part
series, Ontario Dealer asks
two of the more vibrant autofinance companies to share
the insights and strategies
that got them to where they
are today. And where they’ll
go tomorrow.
14
ONTARIO DEALER
uto financing continues to be a
dynamic narrative in the usedauto business. And as 2016
reaches the halfway point, The Ontario
Dealer reached out to two Canadian
leaders in auto-finance space – namely
Carfinco Financial Group Inc. and
Canadian Title Loan Corporation
(CTL), national players who typically
deal in the five to 10 percent market
share range – to discuss strategy,
philosophies and goals for the coming
months.
Along with asking about both firms’
defining characteristics, we wanted to
know what responsiveness and
efficiency means in their everchanging, tech-driven world. We asked
if it’s still crucial to build lasting
relationships with dealers. And
ultimately, we asked how success is
measured and what being a part of
the industry means to them.
Mission Control
Carfinco Inc. was founded in 1996,
and commenced operations the
following year. The initial concept was
actually repair financing, but that
product was discontinued in 2001.
After that, the firm began exclusively
financing used vehicles in the Canadian
marketplace. And the focus within the
Canadian marketplace was really in
the sub-prime and non-prime
segments of the market.
According to Troy Graf, Carfinco’s
Chief Operating Officer, the firm’s
purpose is, quite simply, to help
people and businesses prosper. “For
us, obviously, the people are our
consumers and our employees. In the
context of businesses, for us, it’s car
dealerships specifically,” says Graf.
“That’s a pretty broad statement, but
it still focuses us moving forward and
helping the people we interact with
on a daily basis.” Tied into that, says
Graf, is an aim to be an industry leader, but tempered with
ensuring they experience profitable growth and that they
create value for their shareholders at the same time.
The game-changer for Carfinco came in 2015, when the
Edmonton-based firm was acquired by Banco Santander, a
retail and commercial bank based in Spain. With a presence
in 10 major markets, Santander is the largest bank in the
Eurozone by market capitalization.
How has that impacted their mission and focus? “Prior to the
acquisition, we were really focused on sub-prime and nonprime,” says Graf. “After the acquisition, our focus is now on
a full spectrum of non-prime lending.”
CTL has been around since 2010, but really started kicking
into life in 2012 when they started growing and adding sales
reps and signing up more dealers across the country. Then,
in 2015, the company became national with its entry into
Quebec.
For CTL’s Chief Operating Officer, Sean O’Brien, the mission
is primarily about driving convenience and speed to the
dealer. Non-prime, he says, has an enduring reputation for
being a slightly more slow, cumbersome and potentially
difficult to deal with. CTL is about kicking that away, he says.
“We’re really saying, ‘There’s no difference for a dealer to
finance a customer through CTL than it should be financing
it through RBC.’ Once we say ‘yes,’ then we take the heavy
lifting.”
Yes, O’Brien says, they verify income, and undertake certain
steps that maybe they don’t do on prime. However, there is
a difference. “We do it so fast and so quickly and so
seamlessly to the dealer, it’s just like a bank approval. They
get it approved. They send us stocks, it’s funded,” he says.
“You can fund it the same day. We just really make it super
fast. Even though not a lot of our deals are auto adjudicated,
we scope our underwriting process to be lightning fast.”
With an average turnaround time under 10 minutes, O’Brien
says, a customer can walk in, get turned down and the
dealer can flip it over to CTL. “Customer goes for coffee,
comes back and they’ll know the future from there.”
Professionalism Beyond Optics
Without a doubt, optics have long been a massive part of
business – regardless of the type of industry. Firms must
focus on how they wish to be perceived, and that typically
stems from how they interact with clients, partners and
certainly, their customers.
“The definition of professionalism, for me, distills down to
customer service and then the components of customer
service: having a well-skilled and well-trained team in all
departments so that we’re able to service our clients,” says
Graf, who is careful to underscore that it applies not only to
customers but the dealerships, he says. “With the highest
level of service, and be able to communicate on a
professional level, as well.”
Let Our
CONSULTATIVE
APPROACH
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Dealership’s
Growth & Success
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representatives are the best trained in
the industry. Their comprehensive
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make them partners who are truly
dedicated to your dealership’s success.
Let our local representatives serve
as an extension of your staff!
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and get the financing and flexibility
you need to succeed in 2016.
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please see your local NextGear Capital representative.
...continued on page 17
ONTARIO DEALER
15
ALL-IN PRICE ADVERTISING
It’s putting the fun and excitement
back into car-buying …
and, IT’S THE LAW.
omvic.on.ca
cars, cash & the culture of credit
For Graf’s colleague, Galen Gower, VP
Business Development at Carfinco,
personnel is truly impactful. He feels
the firm has been fortunate to acquire
deep and experienced team members
who can project that professionalism
in the marketplace for them. “But it’s
also the internals,” he says. “What is
the process? How do we impact the
dealers when they call in? What is the
start-to-finish process? Making sure
that we’ve got a high level of service,
and it’s highly professional along the
way, as well.”
Gower also believes professionalism is
closely tied to transparency in
everything they do. “Some of the
decisions we make internally
aren’t always seen on the outside,
but they make sense and they’re
the right decisions to make for
both our customers and our
dealer partners,” he says. “So it
means looking at what we do
internally as a company and
making sure that we’re
professional on the inside, as well
as what we project to our dealers
and customers outwardly.”
While at CTL, O’Brien says the
meaning of professionalism is all about
consistency and reliability, and
understanding their customer, the
dealer. “We work really closely with
them. We’re not in this for a short
term, so true professionalism is
understanding the risks you’re dealing
with, pricing it appropriately and not
moving that around,” says O’Brien,
who notes that some other lenders
might fluctuate based on month in
demands, or how they’re doing on
their target, or availability of funding.
Whereas his firm, he says, has been
very disciplined and focused on the
long term. “We set out a 12-month
plan and we really try to stick to that
plan. It’s one of the disciplines, I think,
that’s helped this company be as
successful as it is.”
How Essential Is Growth?
While Carfinco is not focused on the
prime lending or the super-prime
lending segment in Canada, they have
>> continued from page 15
expanded their product offering to be
a full spectrum non-prime lender in
the Canadian marketplace.
While the firm has its centralized head
office in Edmonton, where the
majority of its support and operations
originate for 10 provinces, it also has a
key office in Laval, Quebec. Out of
that office, they do full servicing,
including credit funding and collections
for that province’s marketplace.
Graf traces the firm’s growth success
to focusing on providing a good
product to the marketplace and
supporting it with a professional team.
“I think we’ve provided a consistent
level of service and a consistent
product for a long period of time and
also, have had the appropriate capital
levels to service the business we were
doing,” he says. “We’ve gone through
a number of different economic cycles
and reacted appropriately to those to
provide again a great product for the
marketplace.”
Understandably, Gower agrees. And
he feels that one key to providing
great product for the marketplace is
listening to their dealer base. It’s based
on a belief that there’s no greater
feedback than getting the responses
from the front lines to see what holes
need to be filled in the market or
where tweaks need to be made.
“I think getting the ground-level
feedback as to what the dealers
require and then implementing them
has been part of our success,” says
Gower. “Especially in the last two
years, we’ve probably had more
change than in the last 20, and that’s
all come mostly from the feedback
from the dealers. We’re putting into
place what they’re asking for when it
makes sense for us on a risk level.”
At CTL growth is more of a leader
strategy. O’Brien and the founder, Jeff
Newhost, both believe growth allows
them to digest things at the right pace.
“We have a formula,” says O’Brien.
“We know how many underwriters
we need for new applications. We
know how many collectors we need
for the size of the portfolio.”
O’Brien says the focus is organic: his
assessment of the available universe of
car dealers reveals that across Canada
there are likely 3,200 franchise
stores and another 2,000 eligible
independent dealers – lots of
potential customers. “We are only
dealing with a fraction of that
today,” he says. “Our roadmap to
growth is very evident. Our
strategy today is purely organic
growth. Signing up more dealers,
adding reps, and then building it
across the country.”
Acquisitions is another ball game.
“If a deal came up and there was
an opportunity” he says, “I think I
would look at it for sure.”
Dealerships = partnerships
For Carfinco’s Gower, it simply doesn’t
get more important than the dealer
relationship because, he says, they’re
the face of the company. “Essentially,
when a customer walks into the
dealer and interacts with our
programs, they’re not interacting with
us directly,” he says. “It’s really with
the dealer, so having good dealer
partners is really putting a good face
on our company, as well. For me,
that’s the most important part.”
Gower also believes in the integrity
and trust that’s inherent in the
transaction process: trusting in the
asset and the paperwork and the
process that goes into it. “The dealer
partner is certainly a partner in risk, as
...continued on page 30
ONTARIO DEALER
17
Marketing
to Millennials
... Get Specific To Get Results
by Angela West
A
Marketing to younger
consumers requires
multiple needs-based
strategy
18
ONTARIO DEALER
ccording to a Fall 2015 survey
by American auto website
Edmunds.com, millennials prefer
used, practical vehicles. This is great
news for used car dealers. But savvy
marketers should be careful about
lumping everyone who fits into the
“millennial” age category into one
group. Marketing to the younger
consumer requires multiple needsbased strategies.
Canadian data from Abacus found that
38 percent of younger millennials had
purchased a vehicle over the course of
their lifetimes, while 48 percent of
older millennials had done the same.
The chief economist of the Canadian
Automobile Dealers Association,
Michael Hatch, stated in a National
Post article that customers in the
18-34 age range prefer used vehicles
because of the lower cost. This data
shows that there is no doubt that
used car dealers should be focusing on
millennials – but the key is in
subdividing the demographic into
targeted groups.
Who Qualifies As A Millennial?
Anyone born between the early
1980’s and early 2000’s is a millennial,
or “Generation Y”. When you
consider all of the developments
spanning three decades, you can begin
to figure out how marketing to the
entire demographic as a whole is
problematic. Someone born in the
2000’s is going to have a different set
of drivers and values than someone
born in the 1980’s. One may be a new
parent, while the other may be just
getting their first car and going to
college. One thing they all have in
common is that they were raised with
the Internet being around and, in the
case of younger millennials,
...continued from previous page
MARKETING TO MILLENNIALS
smartphones. So being where they
are as a marketer – online and
mobile-friendly – is essential.
Be On Social Media – Even Instagram
To appeal to the younger set in
Generation Y, your dealership should
be on social media channels. Facebook
and Twitter may no longer be enough
either – any dealership considering
selling to a younger demographic
should think seriously about getting on
Instagram.
While it’s not a platform for vehicle
listings, taking pictures of a few cars
which come into the lot weekly, as
well as your community outreach
efforts, will make younger people feel
like you understand their world a bit
more – which is key to gaining their
trust.
Ensure Your Website Is MobileFriendly
Most sites that you are listing on, such
as Carpages or Auto Trader, are
already mobile-friendly, which
means that your listings are
easily read on a smartphone.
Creating Smart Target Groups
Segmenting millennials into groups
makes more sense if it is done by life
stage as opposed to age. For instance,
a 35-year old urban-dwelling woman
will have very different needs from a
set of 25-year old suburban parents.
For marketing purposes, these are the
segments that make the most sense:
• New parents
• Young families with more than
one child
• Single women under 30
• Single women over 30
• Single men under 30
• Single men over 30
How To Hit Your Targets
There are two digital ways you can
market to your segments – social
media advertising and Pay-Per-Click
advertising with Google AdWords.
Google AdWords has similar targeting
options to Facebook, only instead of
attracting users to your Facebook
page, it will take them directly to your
website. You want to be on Google
AdWords if you want to reach people
on their smartphones who may be
looking for vehicles in your area, since
your ad may appear in the first results
on Google for people searching locally.
Once you get set up with both
services, look at the vehicles in your
inventory which would appeal to your
target segments, and write ads
specifically for them. On Facebook,
they typically take the form of
boosted posts, which are regular
posts that you put ad dollars into
promoting. With Google AdSense,
they are short, text-only ads that may
link directly to a listing, or to your
main website.
How would this look? For new
parents, you may want to write
ads for a budget family vehicle,
such as a station wagon or
larger sedan. Look at
vehicles in your inventory
that have easy access for
child seats and other
family-friendly features.
For young families with
more than one child,
consider vehicles such as
mini-vans and pricier
family-friendly vehicles
with more features, such
as Bluetooth, backup cams,
and smartphone connectivity.
You can measure through the
analytics on both Google and
Facebook how well each ad
performs, and tweak them to get it
right.
But make sure that your
own website has a
mobile-friendly design. If
a person searching for
dealerships in your area
can’t easily access and
scroll through your
website, you may lose
them to a nearby
dealership who has an
accessible design. Younger
millennials may only access
computers at school and
work, and do all of their
personal computing on a
smartphone.
Additionally, Google is starting to give
more weight to websites that are
mobile-friendly in its search engine
algorithms, meaning that a mobilefriendly website will outrank one that
is not when any user is searching for
vehicles in your area.
should be secondary to Facebook in a
paid social media plan for a dealership.
Facebook has a larger user base than
Twitter, and slightly more fine-grained
targeting methods, so if you are going
to start with social media advertising,
start with Facebook. A Twitter ad
campaign will get you more followers
and attract younger millennials, but it
In summary, being on social media,
having a mobile-friendly website, and
specifically targeting key millennial
groups will help you market smarter
to your new, younger customers – and
go a long way towards making them a
customer for life. OD
ONTARIO DEALER
19
#trending
by Chris Chase
T
Vehicle
Safety Standards
Are Changing
his summer, Ontario’s used
vehicle safety certification
standards will get their first
major makeover in more than 40
years, as the Ministry of
Transportation (MTO) gears up to
introduce all-new inspection rules for
pre-owned passenger and light-duty
vehicles.
The current Ontario Regulation 611,
which is written into Ontario’s
Highway Traffic Act, is the set of
guidelines a Motor Vehicle Inspection
Station must follow to declare a used
vehicle roadworthy and issue the
safety certificate the buyer needs to
register plates at an MTO licensing
office.
Ontario’s new Passenger/Light-Duty
Vehicle Inspection Standard will
replace the “611 standard” (as it’s
commonly known), a document
introduced in 1974 and largely left
alone since then. The new standard
20
ONTARIO DEALER
represents a from-the-ground-up
redesign of the rules governing used
vehicle safety, and it’s one that
stakeholders involved in its drafting
believe is long overdue.
“It’s about time,” said Rudy Graf,
President of the Automotive
Aftermarket Retailers of Ontario
(AARO), an organization that
represents auto service shops across
Ontario, and one of a number of
entities that worked with MTO to
write the new rules. “We’re quite
happy we were finally able to put
something together after 15 years.”
During that 15-year period, Graf said
the industry and MTO took “three
kicks at the can” to revise safety
certification rules. “But then
governments changed, peoples’ plans
would change, and everything would
go back to ground zero. It was time to
get real and move into the 21st
century.”
Why The New Standards?
The main driver behind development
of the new standard was the
evolution of vehicle technology over
the last four decades, according to the
MTO’s Sean Doussept, who manages
the Carrier Enforcement Program
Office.
“We had input from a lot of people
who use this inspection on a regular
basis, including AARO, the Used Car
Dealers Association of Ontario
(UCDA), and the Automobile
Protection Association (APA), among
others.”
technology, something Doussept said
will make it easier to work with than
the 611, because making changes will
no longer require revising a law in the
provincial legislature.
Read The Regulations
Graf said AARO held its own
information sessions with its members
to gather input, and used a lot of that
information in designing the new
system. Still, he says there is a lot of
misinformation out there, and is urging
his members to read the regulations
carefully before forming an opinion
about them.
“We were so tickled that the ministry
“Because the old standard was part of at least asked us to give them a hand
legislation, it didn’t evolve very well
and wanted to know what we wanted
with the new technologies that were
to see,” said Graf. “We wanted to do
coming into vehicles,” Doussept said.
it once and do it right, and this is as
“The intent at the time (the old
close as we could get.”
standard was written) was to create
this regime where we have a minimum The new standard is a “living”
document that can be adapted to new
standard at the time of sale so that it
would go out on the
DATE OF INSPECTION
Passenger/Light-Duty Vehicle Inspection Report
road in a relatively
safe condition. It was
/
/
a safety inspection
Unit of measurement being used
mms or
inches
designed to make
LEFT
FRONT
RIGHT
sure the operator
DISC
BRAKES
wasn’t injured by the
Rotor Thickness
vehicle.”
LICENCEE (MVIS) NAME, LICENCE NUMBER, ADDRESS & TELEPHONE #
Year
Month
Day
VEHICLE INFORMATION
YEAR
Doussept cited antilock braking systems
as an example of
common technology
... they’ve been
federally mandated
in new vehicles sold
in Canada since the
1990s—that was not
reflected in the old
standard: a used car
could be declared
safe even with a
defective anti-lock
brake system, as
long as the brakes
themselves worked.
“When we decided
to look at this
(standard) again, we
adopted the strategy
that we need to go
out to the industry
that actually does
these inspections
and the people
affected by those,”
Doussept explained.
MAKE
MODEL
mm/in.
mm/in.
Left
V.I.N. #
TIRE
ODOMETER READING OF THE VEHICLE AT THE END OF THE INSPECTION
KMS.
Right
Pad Friction Material Thickness
E
L
INNER
Tread Depth
MILES
mm/in.
Left
mm/in.
P
M
psi
TRADE CERTIFICATION NUMBER
3 1 0
PROVIDE ANY SAFETY STANDARDS CERTIFICATE NUMBERS ISSUED
INSPECTION RESULTS
PASS
FAIL
IS THIS AN ADDITIONAL OR SECOND INSPECTION?
NO
YES
A
S
Note: An additional fee may be charged if a second inspection
of a wheel brake assembly must be carried out before a safety
standards certificate is issued or before an annual inspection
sticker is affixed to the vehicle. mm/in.
Right
psi
If corrected by
more than 5psi:
Initial Reading
Shoe Lining Thickness
Initial Reading
Left
psi
mm/in.
mm/in.
psi
Right
Drum Diameter
mm/in.
Final Reading
mm/in.
Left
psi
Right
DISC BRAKES
TIRE
Tread Depth
mm/in.
Rotor Thickness
mm/in.
mm/in.
Left
Right
Pad Friction Material Thickness
INNER
Inflation Pressure
psi
Initial Reading
mm/in.
psi
psi
mm/in.
Right
BRAKE DRUMS
psi
Final Reading
Right
OUTER
Left
mm/in.
If corrected by
more than 5psi:
Initial Reading
psi
Final Reading
Shoe Lining Thickness
Left
mm/in.
mm/in.
Left
If corrected by
more than 5psi:
TIRE
Tread Depth
Inflation Pressure
mm/in.
INSPECTION REPORT DETAILS
Tell-Tales (an optical signal that, when lit, indicates the activation
or deactivation of a device, its correct or defective functioning or
condition, or its failure to function) indicating a fault:
mm/in.
BRAKE DRUMS (if Applicable)
Final Reading
It is a condition of a licence that the licensee not charge an additional
inspection fee if a vehicle is inspected at a station, repairs or adjustments
to the vehicle or its equipment are required to qualify it for a safety
standards certificate or for an annual inspection sticker or a semi-annual
inspection sticker, the inspection fee charged by the licensee is paid,
the required repairs or adjustments to the vehicle or its equipment are
made at a place other than the station; or the vehicle is brought back to
the station for issuance of the certificate or affixing of a sticker within ten
days after the original inspection.
mm/in.
Inflation Pressure
If corrected by
more than 5psi:
psi
IF YES:
Left
TIRE
Tread Depth
Right
OUTER
Inflation Pressure
MECHANIC’S NAME
mm/in.
mm/in.
Right
psi
Drum Diameter
mm/in.
Left
LEFT
Customer’s Signature (If Applicable)
2016
GAS
TANK
mm/in.
Right
REAR
1 4
RIGHT
1 2
One mechanic we
spoke to said he’s
concerned the MTO
hadn’t done a good
enough job
publicizing the new
standard (as of this
writing) among the
mechanics who
work at the 12,000
Ontario shops that
issue safety
certificates.
3 4
Indicate How Full The Gas Tank Is
“To my knowledge,
there hasn’t been
any official,
technician-specific
information
provided,” said
Brian, who works at
a Toronto-area
independent shop,
and asked us not to
use his last name.
“The process by
which the service
side of the equation
has been informed
and educated about
it – next to zero,
based on my
observations as a
mechanic – (has not
been) stellar.”
White: Customer Copy / Pink: Licensee Copy
Passenger/Light-Duty Vehicle Inspection Report. Now available from the UCDA.
...continued on
next page
ONTARIO DEALER
21
...continued from previous page
TRENDING
Brian is also concerned the new, more
detail-oriented safety check procedure
will add time to the certification
process and increase the price that
shops like his will have to charge to
issue a certificate.
That concern is shared by the UCDA’s
legal services director, Jim Hamilton.
He says dealers who sell mainly oldermodel vehicles will be most affected.
“You have to expect the cost of a
certification is going to go up because
it’s going to take anywhere from 10 to
30 minutes longer to do a lot of the
things that are now required that
weren’t before,” said Hamilton.
“Those who deal in older vehicles may
find their costs going up to get those
vehicles properly on the road again,
and for some vehicles it may make the
difference between being feasible to
put back on the road and being
scrapped.”
Clearer Guidelines
Doussept said the extra detail built
into the new regulation is meant to
help define things more clearly for
technicians doing safety checks.
definition of line-of-sight is different
for someone who’s five-foot-two and
someone who’s six-foot-two.”
By contrast, the new standard dictates
that cracks and chips in the windshield
cannot be larger than a certain size,
and--for the most part--cannot be
inside the “area swept by the wipers.”
Generally Takes The Same Time
Doussept said the MTO “actually ran
this inspection at a number of shops
and they basically came out to about
the same length of time. While
technicians have to look at
more, and different, things,
it’s a more efficient
process. We’re being
more prescriptive: The
(online) guide includes
links to describe what
the word ‘broken’
means for various
parts, for example.
We tried to make
this as
straightforward as
possible.”
That’s one change Ottawa mechanic
Matthew Torunski says he’ll be happy
to see. He says the current regulation
is vague and contains too many grey
areas.
Time To Get
Tech-Savvy
In spite of that
effort,
Doussept said
some less
computersavvy shops
“don’t
appreciate
the new
standard
because
they
don’t use the
computer very much.”
However, Graf considers computers a
necessity in modern repair facilities
and has little sympathy for those that
don’t use them.
“If there was an imperfection in the
windshield that was in the driver’s
line-of-sight, the car would fail the
safety,” said Torunski. “But the
“I tell my customers that if they walk
into a shop that doesn’t have a
computer, get out,” Graf said. “You’re
in the wrong shop.”
“We tried to take some of the
interpretation away from the
technician and make it clearer for the
end user,” said Doussept. “The guide
very clearly lays out what you’re
inspecting and what constitutes a pass
or not a pass. We wanted to (clarify)
what was being checked and why, and
to make sure the consumer better
understands what it really means
when we’ve issued a safety standards
certificate.”
22
ONTARIO DEALER
In Brian’s opinion, the new standard
“gets really specific on some stuff,
ridiculous on a few things, and still
allows interpretation on others.” He
calls out the section on exhaust
systems (which states that a “muffler
that meets the OEM (original
equipment manufacturer) standard is
required on every vehicle”) as one
that isn’t specific enough.
“Does this mean that aftermarket
mufflers are no good? OEM is
stainless on pretty much anything
made in the last 20 years, but most
aftermarket replacements are
aluminized steel,” said Brian.
“They’re not OEM
quality – do
they still
meet the
OEM
standard?”
Brian
mentioned
other parts of
the standard that
indicate to him
that the
government is
cracking down on
vehicle
personalization,
pointing to the
section on wheels and
tires that states a
vehicle cannot be
certified if the tires and
wheels on the car don’t
match the manufacturer’s
specifications.
Graf said the MTO actually
wanted to include more
finite rules about vehicle
modification, “but we had to
appease everyone. The
consumer has to be protected, but at
the same time we couldn’t drive it
into the ground and say, ‘no more
personalizing your car.’”
Measuring Now Mandatory
The new standard also requires
technicians to record measurements
on items like brake rotor thickness
and tire tread depth, where
“everything in the old regulation was
assumed,” said Doussept.
“We assumed that when a technician
checked the thickness of the brake
rotor that they were taking out the
caliper to actually measure it. But now,
we say that is what has to be done.”
Brian says he typically does visual
inspections of wear items like brake
linings, but only actually measures
them if they look questionable.
“There’s definitely an additional time
factor involved with this process,” he
said. “Even little things, like adjusting
drum gauges and looking up the
specifications for every vehicle, will
add time.”
“I suspect that most of the added
checks and record-keeping will
become rote, but I anticipate
considerably longer inspections as we
familiarize ourselves with the specific
details of the new (standard) and get
in the habit of making and recording
the necessary measurements.”
Graf said that, on average, the trial
inspections have taken about an hour.
“Under the old regulations, if you
were checking everything you were
supposed to, it was taking an hour
then as well,” he said. “As with
anything new, there’s always a learning
curve.”
Ultimately, Doussept said, the new
standard should benefit everyone
involved.
Easier To Defend Your Work
“From a technician’s perspective, it will
be easier to defend your work if a
certificate is challenged,” he said.
“Now, the stations have enough
information to be clear about what
they inspected and what they found.
This goes a long way toward assisting
them in understanding what they’re
inspecting and explaining to the
consumer what they inspected.”
Despite his reservations, Brian agrees
that the new standard is better than
the old one.
“It’s in clearer language, and it
provides much more solid definitions
for many items,” he said. “It also
addresses modern equipment that the
old standard did not.”
“The higher standard means the cost
of cars could go up, but you’ll have a
higher standard of used vehicles on
the road,” said Torunski. “The safety
aspect is the point of doing things
better. The standards should be
constantly changing, because vehicles
are constantly changing.”
Hamilton said the UCDA supports
the new regulations.
“Most of our members understand
the importance of having properly
safetied vehicles on the road,” he said.
“That’s good for business and it’s good
for the consumer.”
“If government could work like this
more often and ask for feedback from
people who are in the trenches doing
the work, we’d be a lot better off,”
said Graf.
“In the big picture, this will put a
better car on the road. It will cost
more, but that’s the cost of safety.
We’re satisfied that it’s going to be
beneficial to anyone purchasing a car.”
OD
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Contact Margi at
[email protected]
or 1-800-268-2598
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Inspector II Tint Meter
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and auto calibration promote
consistently accurate readings. For
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adhere the light source to the
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 The Inspector II is not affected by
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Standards, Carry Case
ONTARIO DEALER
23
Advanced CRM
Techniques
By Angela West
C
ustomer Relationship
Management (CRM) isn’t just
about blasting out email
newsletters and making sure leads are
followed up on.
Your CRM
is more than an
email newsletter
manager
There is a lot more your dealership
could be doing with the right CRM
system, such as logging calls, including
emails with customer records, finely
grained reporting on every aspect of
your business, and much more. But
the big first step is adoption, and the
second is choosing the right software.
Helping your staff get over CRM
reluctance
Sales and service staff at dealerships
are often reluctant to adopt a CRM
system, and there are many legitimate
reasons for this. They include:
• Excellent familiarity with existing
systems
24
ONTARIO DEALER
• Fear of change
• Annoyance at having to log every
interaction
• Steep learning curves
Customer retention is the main
reason for adopting a CRM system. If
you make customer retention a core
mission at your dealership with the
CRM as a tool to support it, you’ll get
more buy-in. Secondary benefits
include improving efficiency,
streamlining workflows, and ensuring
that hot leads don’t get cold for your
sales team.
Once you get buy-in from your team,
involve them in the selection process.
Ask key staff in your service and sales
departments what they want to see in
a CRM system, and then choose one
that meets as many needs as possible.
The more involved they are in initial
adoption, the more likely they’ll be to
use it.
Getting it right with ongoing training
One of the biggest reasons for failure
of CRM systems to generate results is
poor data quality. To make sure you
have good data in your CRM, choose
a system that makes it as easy for the
user as possible, with tools like
automatic spell check and automatic
e-mail checkers to ensure that emails
are good.
You should also have regular training
on your CRM solution to make sure
new hires are educated and your
employees are up to date on all the
latest features. It’s easy to get locked
in to using a CRM tool in only one
way, when there are so many features
your staff could be using to make their
lives easier.
The only way they can “discover”
them is through regularly scheduled
training. Some solutions offer
unlimited online training with an
interactive trainer, while others have
extensive video and training resources.
as a CRM tool. A DMS is primarily for
lead generation and inventory
management rather than customer
retention.
Some specialized automotive CRM
solutions are:
Auto Dealer CRM by DealerCraft
http://www.dealercraft.ca/products/
auto-dealer-crm.html
Connect CRM by VinSolutions
http://www.vinsolutions.com/
dealership-software/crm
DealerSocket CRM
http://dealersocket.com/
While non-automotive CRM solutions
like SalesForce offer an excellent
solution, their lack of tailoring to the
automotive market can mean an
increased learning curve and less
enthusiasm about their adoption from
your staff.
Choose an integrated
CRM designed for
dealerships
The best CRM solution is
the one that will integrate
with the tools you use every
day and that is designed for
your business.
The more information you can store
in a client record with minimal input,
the better. It’s important to note that
while a DMS solution has many
features you will use, it is not designed
Getting to know filters and rules
Your CRM can do amazing things –
you just have to tell it what to do and
it will do it. You can send automated
responses to initial emails from
customers that reference the time of
day that they send them.
You can route emails and phone calls
to the sales reps that are on shift
without them needing to be filtered
through a receptionist. You can offer
special promotions to customers who
haven’t bought a vehicle in the past
two years to get them back in to see
you.
All you need to do is get familiar with
the filters and rules that you need to
put in place – if they are too
technically challenging, you can
usually hire the manufacturer or
one of their representatives to
put them in place for you.
Automating your marketing
ensures your customers get
that personal white glove
experience, without it feeling
automated to them.
Your CRM should be used for
much more than an expensive
email newsletter manager, and
it’s up to you to make sure
your staff is trained enough
to use it properly.
A good CRM will give you the ability
to log and make calls, will save emails
to the appropriate customer record,
and have integration in place for other
software that you use on a daily basis,
such as Dealer Management Systems
(DMS).
more. You can set up automatic rules
to escalate to a phone call if the
customer has spent a certain amount
of money with your dealership in the
past year, or if they have purchased a
certain number of vehicles in a set
amount of time. In fact, these filters
and rules are the most powerful
aspect of a CRM.
Getting personal with your CRM
Customer retention is all about
reminding your customers that you
are there and you care about them.
You can use your CRM to send
automated emails – in some cases
even texts – to wish them a happy
birthday, happy holidays, and much
Check it with reporting
Generate monthly reports with your
CRM to ensure that it is working to
your satisfaction. If you notice low
opens on your email newsletters,
create a test group and send the email
newsletters to yourself and a few staff
and friends to see what isn’t working.
If you see that email addresses aren’t
being collected from customers,
address that with your sales and
service staff.
The more you stay on top of your
CRM solution, the more it will do for
you. OD
ONTARIO DEALER
25
Don’t Do Uber
S
S
ome opportunities, although
enticing on the surface, are not
quite as straight forward as they
appear.
When a deal
seems too good
to be true,
chances are it is.
by Philomena Comerford
President, Baird MacGregor Insurance Brokers
26
ONTARIO DEALER
Uber’s well publicized and
controversial peer to peer smart
phone app that matches drivers with
paying passengers, although attractive
because of its lower cost and
convenience, poses significant
insurance risks to users, other
motorists, pedestrians, cyclists,
corporations that encourage staff to
use the service and the UberX drivers
themselves.
In spite of the extensive media
coverage on the risks associated with
Uber’s rapidly expanding network into
various Canadian municipalities, a
peculiar tolerance for the proliferating
uninsured exposure persists with
various levels of government, law
enforcement and the public.
Following injunctions against UberX
drivers in Calgary, Uber reported in
the media its refusal to suspend its
operations in Toronto citing that it
was now dispatching 20,000 UberX
vehicles; double the 10,000 reported
in the City of Toronto Metro Licensing
and Standards report. This, even
though Toronto City Council had
passed a motion deeming UberX
illegal in September, 2015.
UberX drivers routinely hide the fact
that they carry paying passengers from
their insurers. Lying on an automobile
insurance application constitutes
misrepresentation and failure to
inform the insurer when the activity
begins after the application is made,
constitutes non-disclosure of a
material change in risk, violating the
statutory conditions of the auto policy.
And worst of all, when UberX claims
come in, these claims will be denied if
the activity comes to light during the
don’t do uber bad deals
>> continued
investigation. Policies will be cancelled
or voided. This apathetic phenomenon
is happening in spite of Ontario’s
Mandatory Automobile Insurance Act
that seeks to eliminate uninsured road
exposure and in spite of beefed up
insurance fraud penalties for lying on
an automobile application with fines of
up to $250,000 for a first offence,
$500,000 for a second offence and
even jail time.
Most UberX drivers use their own
vehicles that are insured under
personal automobile policies which
explicitly exclude the carrying of
paying passengers. In some instances,
UberX drivers rent vehicles and in so
doing, breach the conditions of the
rental agreement exposing the rental
car company to uninsured claims on
account of the automobile fleet
policy’s paying passengers exclusion.
Rental companies will likely seek
recourse against the UberX driver on
account of the violation of the rental
agreement which normally prohibits
the vehicle being used to carry
passengers for compensation. An
UberX vehicle was recently struck in a
high speed police chase and it has
come to light that the UberX vehicle
was a rental vehicle.
Automobile dealers are equally at risk
if their sales personnel or other garage
employees use inventory or demos to
moonlight for UberX or if customers
use courtesy vehicles for this purpose
because the garage policy also
explicitly excludes the carrying of
paying passengers.
throughout Ontario or by enabling
provincial legislative reforms, the
excluded use of carrying paying
passengers and the statutory
conditions of personal automobile and
garage policies are a very real concern.
Excluded Uses of the OAP 4 Standard
Garage Policy read as follows: ‘7.14
The insurer shall not be liable….
while…the automobile is used as a
taxicab, bus, sightseeing conveyance,
or for carrying passengers for
compensation or hire;…..or if the
automobile is being used, for the
carrying of goods or materials for
compensation.’
Should a dealer’s vehicle being used as
an UberX become involved in an
accident, the policy could be voided
or cancelled and the claim denied. The
dealer could face being held financially
responsible for any injuries and have
no recourse to recover for collision
damages to the dealer-owned vehicle
because of this type of policy breach.
Under the Statutory Conditions of
both the Standard Ontario
Automobile Policy (OAP #1) and the
Standard Garage Policy (OAP #4);
Prohibited Use reads as follows: “The
Insured shall not use or permit the use
of the automobile in a race or speed
test or for any illicit or prohibited
trade or transportation.”
Section 39.1 of the Highway Traffic Act
stipulates that any person carrying
passengers for compensation must be
licensed to do so and the required
licenses are normally issued by
Ontario’s various municipalities. Until
such time as UberX is legalized municipality by municipality -
There has been media coverage on
uninsured UberX claims where
personal insurers have denied claims
and voided policies where the UberX
activity came to light. The Uber
driver contract thrusts the
responsibility on the driver for injuries,
assaults, driver supervision and
insurance, not the other way around.
A dealer’s license to sell cars is
predicated upon maintaining a garage
policy in good standing. It is best to
take a strong stand with staff and
customers prohibiting use of dealer
vehicles for UberX work and get a
clear sign off on this prohibited use to
protect your dealership. OD
Taylor Leibow LLP Specializes in Tax, Accounting
and Advisory Services for Automobile Dealerships
We understand the specific demands and opportunities of the dealership business
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TL_1/3_Automotive_Ad_16v2.indd 1
taylorleibow.com
2016-04-08
ONTARIO DEALER
11:21 27
AM
#tech talk
We have the dish on
the latest in
industry comments
about how dealerships
should be using technology,
the newest apps,
child safety technology,
and a device that can turn
an older used vehicle into
a connected car.
by Angela West
28
ONTARIO DEALER
Dealerships should embrace Mobile
Apps texting for service
Sandy Schwartz, President of Cox
Automotive, urged dealerships to
provide a more connected digital
experience for their customers at the
American National Automobile
Dealers Association-J.D. Power
Automotive Forum.
Businesses under the Cox umbrella
include AutoTrader, VAuto and
Dealertrack. Schwartz said that
mobile apps are a particular area that
dealerships could work on developing
to make service appointments and
other tasks easier for customers to
schedule. They could also give clients
real-time insights into how the repair
is progressing and how long it will
take, saving phone calls and interruptions to work to check progress.
Don Hicks, a dealer who attended the
forum, said that younger people would
like to get a text notifying them when
their vehicle is ready, while boomers
still prefer an old-fashioned phone call.
Some automotive Customer
Relationship Management (CRM)
systems, which we discuss further on
pages 24 and 25, do allow for texts to
be sent to clients.
Sense-A-Life alert system designed
to save kids from being left in cars
The Sense-A-Life alert system was
designed by two dads who were
sickened by stories of infants being left
in extreme weather conditions in cars.
The device uses optical sensors to
determine if the parent and child are
both in the vehicle, and if not they are
sent a notification to their
smartphone. If there is no response, it
will alert the other parent or another
person that the driver parent sets as
an emergency contact.
While it may seem obvious that if you
get out of the car, you take your child
with you, this device would be useful
for situations in which the parent is
taken away from the vehicle and can’t
call for help. It would also be useful in
situations where the child is being
looked after by a caregiver, and the
parents want peace of mind that their
child is not being left in a vehicle
alone.
It isn’t in production yet – the
company principals are raising money
through the popular crowdfunding
website, Kickstarter, starting in April,
2016. Those who want to get the
device first will be able to do so if
they support the campaign.
For more visit the website at http://
www.sensealife.com/
Dash – Device and app turns any car
into a smart car
Now, customers can buy a used car
and turn it into a smart, connected
car with an Onboard Diagnostics
(OBD) device and the Dash app.
While many of these systems exist,
Dash is one of the only ones that
works in Canada. So how smart does
it really make your car?
Through the OBD device, Dash gets
information on your vehicle
diagnostics, and can decode general
warnings like the check
engine light so you know
what is wrong with your
vehicle. It also includes
pricing information on local
gas stations so you don’t
have to leave the app to find
out who has the cheapest
gas. You’ll also get some
information on vehicle recalls
and maintenance alerts from
within the app.
Dash also lets you gamify
your driving by giving you a
score based on driving
habits, helping you to
improve your fuel efficiency
and driving abilities by giving you
feedback on areas that need work. If
you perform lots of hard braking or
fast acceleration, it will alert you and
raise your score if you improve.
Dash also works with If This Then
That (IFTT - https://ifttt.com) so you
can set recipes to track trips in
Google Sheets for expenses, set
calendar reminders if you get
maintenance alerts, and more. Using
IFTT, you can design your own recipes
to interact with software, social media
platforms and other apps.
To get started, visit the Dash website
at dash.by, purchase the OBD device
that you prefer to use, and download
the app and link it once you receive
your OBD device. The OBD devices
range from $10-149 USD.
5-year old startup that was working
on a solution that could see a driver
with any smartphone get in their car
and be connected.
Want to know how long that light is?
EnLighten App will tell you
The EnLighten app promises to tell
you how long a light will last, if you
are about to miss the next green light,
and will beep as a light is about to
change. BMW recently announced
that it would be integrating the app
into its heads-up displays where
coverage is available, but that is the
catch – it’s only available in a few US
cities and Christchurch, New Zealand
at the moment. The company plans to
roll it out to more US and Australian
cities, but there is no word on when it
will land in Canada.
INRIX is a much larger company than
OpenCar and already has connections
in place with most major auto
manufacturers – in fact they bought
OpenCar in response to a coalition of
auto manufacturers approaching them
and asking them if they could develop
a solution for in-car apps that didn’t
tie users in permanently with Apple or
Google.
For more information, visit https://
connectedsignals.com/enlighten.php
INRIX acquires OpenCar to provide
OS-agnostic in-vehicle connectivity
Automakers aren’t keen to tie
themselves to one operating system
with Apple CarPlay or Android Auto
to run in-vehicle apps, for obvious
reasons. Different members of a
family who own one vehicle may have
different devices, or a driver could
want to switch from Android to
Apple or the other way around.
INRIX, which supplies data on traffic
and weather to the auto industry, may
have just pushed the ball down the
field towards an OS-agnostic solution
with its acquisition of OpenCar, a
INRIX will be able to leverage its
existing networks and technology to
move the concept closer to viable
production.
INRIX Traffic: The Google Maps
killer for your everyday drive
INRIX has just launched an app that is
arguably a Google Maps killer for
drivers. The app provides all
of the basics that Google
Maps does, including
notifying you of nearby
parking and real-time traffic
conditions. But where it
shines is its automated
learning of where you drive,
your usual routes, and
automatic rerouting to
account for accidents and
bad traffic.
INRIX draws on its vast
libraries of real-time traffic
data to suggest routes based
on real-time traffic flow and
weather, and includes
Canadian data.
INRIX Traffic will automatically read
events in your phone’s calendar and
add it to your trip itinerary, and
automatically includes places like
home, school and work that you visit
frequently, notifying you if you need to
leave earlier because of a traffic
accident or severe weather. It will also
automatically plan for a re-route of
your trip if traffic is severe.
INRIX Traffic is available on Google
Play and the Apple App Store, at no
charge.
http://inrix.com/mobile-apps/
ONTARIO DEALER
OD
29
cars, cash & the culture of credit
>> continued from page 17
Whether it’s your
business to sell
New cars or Used cars...
it’s our business
to keep all your
insurance needs covered
well,” he says. “They help us mitigate some of that risk by
following the correct process. At the start of the process,
they’re almost like an employee or member of the Carfinco
team because they are our direct face.”
Though indirect, the dealership partnership is also a key
channel for CTL. They don’t see the customer until after
they have booked the deal. So working with good dealers
that are spending the time to talk to a customer is seen as
essential for the firm. To drive that home, O’Brien points to
what his firm calls a rate-reducing contract, which means
that if a customer makes 12 consecutive months of perfect
payments with us, then they can call in and get the rate
reduced.
“We are just basically recognizing customers for good
payment history, saying, ‘Hey, we are trying to get it so you
can become a prime consumer again and get good rates.’
We have built that incentive right into our contract.” He
finds it to be an incredibly revealing process. “We like to
work with dealers that are coaching and helping the
customers understand that approach. All dealers understand
the business, he says. “But (then) there are some really
good ones who are really good at understanding it.”
O’Brien says his firm also remains vigilant about not abusing
the process. “A lot of these customers, they have been
declined. They are a bit on their heels when they are
negotiating. You have got to treat the customer with the
same respect you treat all customers and recognize that they
could be a long-term quality customer.” O’Brien says people
tend to become very loyal customers when you’ve helped
them out. “I think that is the point, to really help and work
with the customer, and not a point to abuse them.”
Then, he says, it’s also about good quality cars. “Finding cars
that are going to last the term, it is critical. If a car breaks
down and the customer has had trouble making payments
before, then that can often become a default point,” O’Brien
says. “We are trying to get good quality late-model vehicles
from dealers that are spending the time to work with the
customers.”
Ultimately, he says, CTL looks for dealers that are operating
from the same mindset. “Most are,” he says. “I think it is a
good group of dealers. We love working with them.”
Baird MacGregor Insurance Brokers LP
Partnering with the UCDA and Pitcher & Doyle
to Bring you Quality Insurance and
Excellent Customer Service at Competitive Rates.
Speed, Efficiency & Technology
Speed and efficiency are key cornerstones for the auto
industry’s loaners. Dealers expect quick turnaround times.
And in today’s world, a good file is approved instantly – the
vast majority of deals happen in under two minutes.
825 Queen St. E., Toronto, ON M4M 1H8
TEL: (416) 778-8000 TOLL FREE: (800) 268-1424
For the Carfinco folks, it’s one of the top-of-mind points.
Certainly, says Graf, program efficiency determines how
effective the dealer can be when delivering the vehicle. He
www.bairdmacgregor.com
30
ONTARIO DEALER
...continued on page 34
the common lawyer
to disclose or
not to disclose
By Justin M. Jakubiak
I
was recently confronted by a
scenario that I don’t think many of us
in the automotive industry would
have contemplated before September
2015: a client called me and asked
whether he should have any disclosure
concerns regarding a used Volkswagen
in his showroom.
As the owner of an established UCDA
dealership, my client is very familiar with
his disclosure obligations under the
Motor Vehicle Dealers Act, 2002 (the
“MVDA”) and the regulations
thereunder. However, his confidence
faltered when a prospective purchaser
came into his dealership interested in a
2012 VW Golf 2.0 TDI Highline Wagon.
The customer was happy to have found
this particular vehicle: it had a leather
interior, an automatic transmission and
the 4-cylinder diesel engine had only
clocked 89,000 kilometres. It was a
clean vehicle with no reported accidents
or other significant history to speak of.
My client further told me that, as was
his dealership’s practice, he had his staff
post in the vehicle’s window, among
other information, the manufacturer’s
numbers for estimated fuel economy for
the vehicle; in this case advertising
7litres/100km (City) and 4.9litres/100km
(Highway). Only in the course of
thinking about this particular
manufacturer did it click-in for my client
that this in and of itself was probably an
issue.
The prospective purchaser was not a
first-time car buyer and appeared
informed about VWs generally, and
knowledgeable of what he was looking
for. With the arrival of Spring he
wanted something that he and his wife
could use to escape from the city on
the weekends, with enough room for
the kids and the dog. He liked the car’s
safety features, the fuel efficiency of a
diesel engine and the practicality of a
wagon.
While at first my client saw this as a
straightforward sale, he began to
wonder whether perhaps he needed to
make special mention of the potential
for Volkswagen to issue a recall to effect
repairs to the diesel engine. My client
was confronting an interesting legal
dilemma, one caused by the still
unresolved diesel emissions reporting
scandal that broke in September.
We got to discussing how much a
Dealer is required to tell a prospective
purchaser. Of course there are the
standard disclosures that must be
addressed in a contract of sale, but
does the MVDA require a Dealer to go
beyond what are currently facts? What
about expected events that may lead to
Justin M. Jakubiak
a recall? Specifically in this case, is a
Dealership obliged to mention anything
about the ongoing, and as yet
unresolved emissions reporting scandal?
On the one hand, responsible and
professional dealerships want their
customers to purchase vehicles on a
fully informed basis. However, it can be
argued that this must be balanced
against the risk of providing too much
information to the consumer, to the
point of confusion or to the point that
the most relevant disclosure is lost.
In terms of the emissions scandal, it
seems impossible that anyone would still
be in the dark about it. And what if a
customer seems to like a car for reasons
totally unrelated to the scandal, like the
hatch-back and cargo space for a dog?
Since my client’s dealership was simply
reporting the manufacturer’s numbers
continued on next page
ONTARIO DEALER
31
the common lawyer
>> continued from previous page
in its promotional materials, everything was being fully
disclosed, right?
reasonable purchaser or lessee to buy or lease the vehicle on
the terms of the purchase or lease”
Dealers and their employees are likely very familiar with their
disclosure requirements, such as whether a vehicle has
previously been used as a taxi or limo, as a daily rental, or as
a police or emergency vehicle.
And so, despite not being covered by the explicit disclosures
required by the MVDA, the uncertainty over how VW will
resolve the issue makes the VW scandal a potential landmine
for dealerships. In the end my client and I agreed that this was
a potential headache for the Dealership and decided it was
best to steer well clear of it by making fulsome disclosure
both orally and in writing on the bill of sale.
The ongoing diesel emissions reporting scandal puts the
spotlight on a rather blurry area of the law. The tremendous
uncertainty surrounding the manufacturer’s efforts to finally
bring the thousands of vehicles currently out on the road into
compliance obscures what can be construed as a material fact
that should be disclosed.
The MVDA imposes obligations on Dealers with regard to
both ‘truth in advertising’, as well as disclosure. While Dealers
are prohibited from making “false, misleading or deceptive
statements in any advertisement” or marketing materials, the
disclosure obligations are established by a prescriptive list of
“must-dos”, setting out a broad list of things that must be
mentioned (disclosed) in the contract of sale or lease.
This includes the familiar facts mentioned above regarding a
vehicle’s history of use, but also, for example, if the vehicle has
sustained damage caused by flooding or by fire, and also if
two or more adjacent body panels have been replaced.
Failing to properly disclose any of the MVDA mandated
disclosure items can not only result in the customer having
the right to cancel the purchase or lease agreement, but jail
time of up to two years, or a fine of up to $50,000 for an
individual, or $250,000 for a dealership. While these are the
upward limits of potential penalties, OMVIC has said that in
2015 their two most common reasons for discipline were
non-compliant advertising and non-disclosure in contracts of
sale or lease.
Conscientious dealers and salespeople should remember that
proper disclosures are required even if the “as-is” statement
is signed, or if the vehicle is being sold without a safety or an
e-certificate. Therefore, while the truth in advertising
requirements of the MVDA may be easy enough to navigate
independently, the disclosure requirements are a bit trickier.
During discussions with my client, I thought about how it
might seem harmless to avoid mentioning the VW emissions
issue entirely. Indeed, the MVDA’s list of Must-Disclose items
does not mention anything specific about a global scandal
over an alleged company-wide fraud involving regulators and
emission tests. Likewise, it doesn’t specifically require the
disclosure of a currently unknown fix that will likely result in a
mechanical alteration of the vehicle in question, possibly
affecting its performance or fuel economy.
In summary, ensuring your Dealership’s contract of sale or
lease document is up to date and reflective of the
requirements of the MVDA is something that demands special
attention and review on a regular basis.
However, the last item of the MVDA’s list of disclosure
requirements is a broad catch-all that sometimes creates
unforeseen disclosure obligations. Subsection 42(25) of the
General Regulation under the Act requires Dealers to
disclose: “any other fact about the vehicle that, if disclosed,
could reasonably be expected to influence the decision of a
I often work with Dealerships who intend to make full
disclosure, but make inadequate or incomplete disclosure
because their staff are not adequately trained, are using old
documents or simply the wrong documents. OD
It is also important that your salespeople and management
understand the various forms used by your Dealership (such
as the many great forms available from the UCDA), and when
to use each.
photosbypierce.com
130 Industry St., Unit 36, North York, ON M6M 5G3
e [email protected]
www.photosbypierce.com
32
ONTARIO DEALER
the old car detective
1930 Model A Ford
driven 100,000 miles since 1999!
By Bill Sherk
I
n May 1927, Henry Ford ended production of his Model
T and retooled for his new Model A, which hit the
showrooms in December of that year. Modern-looking
and with a 3-speed floor shift behind a more powerful
flathead four, the Model A sold well during its four years
from ’28 to ’31.
Norm Grant of Trenton, Ontario, belongs to the Model A
Owners of Canada
Inc., and has
probably put more
miles on his Model
A than anyone else
in the club. The fun
began in 1999 when
he purchased a
1930 Model A Ford
Tudor, a dependable
fun car to drive to
work (60 miles a
day) and something
he could work on
himself:
record. On June 10, 2004, we departed Toronto City Hall
at 11 pm. We replaced a burnt exhaust valve in Manitoba
and reached Vancouver City Hall at 2 pm on June 14,
exactly 87 hours after leaving Toronto. By the end of 2004,
I passed the 50,000 mile mark.
“In 2007 we drove our Model A with three other A’s to
the Yukon. I rebuilt the motor before the tour. On June 9,
we sent the four
Model A’s to Calgary
by train, then flew to
Calgary. On July 27,
we arrived in Dawson
City, Yukon.
“The next day we
drove two of the
Model A’s (including
mine) up the
Dempster Highway
to the Arctic Circle.
Five hundred miles of
gravel roads but we
made it back in 20
hours in the oldest
cars to cross the
Arctic Circle in
Canada.
“I installed signal
lights and halogen
headlights for safety.
I learned how to
Norm Grant and wife at Arctic Circle with their 1930 Model A Ford.
shift gears (without
“By the end of 2007, I
synchromesh) and in
had over 70,000 miles on the car. The year 2008 got off to
1999 I drove 10,268 miles. The next year, the motor was
a bad start with an engine rear main bearing going but we
rebuilt, and after only 60 miles, I broke a new connecting
were soon back on the road. The car ran great all year and
rod and lost some driving time. With the new motor, I
by November I had passed the 80,000 mile mark.
drove 9,609 miles in 2001. In 2002 I added another 8,476
miles and I passed the 25,000 mile mark.
“In 2012, the rear main bearing went again and the motor
was out for the rest of the year. Early in 2013 the motor
“In 1932, a Model A was driven from Toronto to
Vancouver in 96.25 hours. Our 24-year-old son James and I
continued on page 38
decided to duplicate the trip and see if we could break the
ONTARIO DEALER
33
cars, cash & the culture of credit
>> continued from page 30
says that response time and
efficiency, both in the credit
adjudication but also in the funding
process, are extremely important
to their dealer base.
“For us, it’s one of the main points
that dealer feedback has given us:
that being responsive and efficient
in our credit decisions is one of the
biggest factors why we either get a
deal or we don’t – even above rate
and other items.”
And for Gower, keeping pace with
technology is a pivotal factor in their
business model. “Investment in
technology is certainly a key point. We
have had a number of recent software
changes, with the primary focus of
increasing dealer experience when
they’re dealing with credit or with our
funding process,” he says.
In today’s buying cycles, CTL’s O’Brien
says, speed is key. Firms want to keep
the customer in the store, and move
them through the process as quickly
as possible. “You want an
underwriting team and a funding team
on our side that only asks questions
once,” he says. “We try to make sure
that when we talk to the dealer, we
give them all of the information we
need so they don’t have to come back
and forth and sort of avoid any of
those processes.”
O’Brien says the intent is to streamline
communication, and simply recognize
what is going on at all times. “Let’s
help them get this thing done today
and now, as opposed to sending the
customer home,” he says. “As soon as
the customer goes home, they
introduce a level of risk to both the
dealer’s sale and us from a finance
contract.”
For CTL, speed is an investment.
From a people and process
perspective, says O’Brien, they likely
employ more people and more
systems and processes to allow them
to give that dealer the advantage.
“We have really modeled this business
to be able to provide that level of
34
ONTARIO DEALER
service to the dealers, which is I think
appreciated and it is allowing us to
grow.”
What Sets A Firm Apart
Times have changed. And technology,
says Carfinco’s Gower, has been a
crucial differentiator. For years, he
says, the market was very limited, and
Carfinco had deep programs, such as
their GO plan. “We really knew what
our place in the market was. We were
that D-space lender. There was
nobody else out there doing it, and
then the market got kind of cloudy,”
he says. “There were a lot of
competitors that came into the space,
and it made it a little more difficult to
determine exactly where everybody
was or what your niche was.”
Everyone, he says, was trying to
change their programs to compete in
the marketplace, and as a result he
believes a lot of lenders kind of lost
their identity.
“I think we worked hard over the last
year and a half to regain that and
figure out where we sit in that
marketplace,” says Gower. “The
changes we made recently with our
near-prime programs, some of our
best-in-class advances and aftermarket allowances, our efficiencies in
our funding and credit departments,
as well as our top-notch service levels
are really what’s setting us apart.”
Gower says it is the product changes
in their programs and efficiencies and
service levels that have enabled them
to reach a top-three or top-four
lender position.
Key strategies include offering
interest rates as low as 8.99%. “That
range continues to go up to 29.9%,
but we have opened up our interestrate spectrum down to 8.99,” says
Graf. “That allows us to give a full
spectrum in the non-prime and
near-prime market. As well, we’ve
just recently offered terms up to 84
months.”
For CTL’s O’Brien, knowledge and
depth in this business has played vital
roles. “We really understand what we
are buying and so it is like we are
going to be here for the long term,”
he says. “We are very consistent in
our pricing and our policies. Then, the
speed is huge.
“Over time, they will get to know
exactly,” says O’Brien. “They can look
at a customer profile and pretty
reliably know what CTL is going to say
about it. We will do it really quickly as
well. “
The use of good, strong technology
and processes on the credit side, he
says, has allowed us to really grow
national at a pace. “From outside it
would look like quite quickly, but from
our side it has actually been very
orderly because we have got the
systems and processes to really handle
and process large amounts of
applications.”
Outlook For The Rest of 2016
Graf states that becoming a member
of Santander’s group of companies has
provided Carfinco with a partner with
a very high level of knowledge in the
auto finance industry. “I think Carfinco
is looking forward to benefiting from
having access to that knowledge and
transferring it to our customers and
dealerships that we deal with in
Canada,” he says. “We’re looking
forward to that as a positive in 2016
and going forward.”
Also exciting for the firm, says Graf, is
the establishment of a cascade
...continued on page 38
INDUSTRY NEWS
Pets Allowed, If They Are Service Animals
The following article is reprinted
with permission from OMVIC. For
more news and information please
visit www.omvic.on.ca
Service Animals. Specifically
trained to open and close doors,
retrieve items, bark for help and
activate an alert system.
• Psychiatric Service Animals. These
animals are trained to assist those
who suffer from social anxiety,
with intellectual disabilities, or
post-traumatic stress. We’re all accustomed to this
“rule” but, did you know that in
Ontario all organizations that
provide goods and services to the
public are legally required to allow
people with disabilities to be
accompanied by a service animal?
Recently, a car dealer in Ontario
generated negative media
attention for denying a person
with their service animal access to
browse RVs due to their “No Pet”
policy. At the time, the dealer was
unaware of the rules concerning
service animals under the Accessibility
for Ontarians with Disabilities Act, 2005.
What Is A Service Animal?
A service animal is used by individuals
with disabilities. Organizations in
Ontario that provide goods and
services to the public are required to
permit a person with a service animal
into all areas of business available to
the public.
Examples of how Service Animals are
used:
• Autism Assistance Service
Animals. Provides calming relief in
high anxiety situations and helps
reduce stress that is often
experienced in public places.
• Diabetic Alert Service Animals.
Assist those with Type 1 Diabetes
with hypoglycemic unawareness.
Trained to detect and send alerts
in situations where blood sugar
levels are low.
• Physical Disability Assistance
How To Recognize A Service Animal?
Service animals often wear a vest,
harness, saddle bag(s) or a sign to
indicate they are working. If it is not
apparent the animal is working (or in
training), the owner or handler should
have an identification card from
the Ministry of the Attorney
General or a letter from a
physician. This card will also
determine if the animal is a service
animal in training.
Remember, service animals are not
considered “pets.” They are animals
tasked with a job -- to assist a person
with a disability, and they are entitled
to enter any place of business under
the Accessibility for Ontarians with
Disabilities Act, 2005 ... even
when buying a car ... or an RV. Please contact:
Justin M. Jakubiak
416-864-7605
[email protected]
to discuss how our lawyers
can help your dealership today
We regularly assist Ontario dealerships with:
•
•
•
•
•
•
Advertising
• OMVIC registration, licensing
Commercial Leasing
and compliance
Employment Law
• Proposals to Refuse and
Licence Appeal Tribunal Matters
Proposals to Revoke
Litigation
• Provincial Offence Act charges
Mechanic’s and Storage Liens
www.foglers.com
ONTARIO DEALER
35
An Accounting
Team Focused
On Dealerships
... Taylor Leibow
by Lori Straus
I
n this issue, we interviewed Ban to
learn more about the firm itself and
what it can offer car dealers, both
franchisees and independents.
In the November 2015
issue, we interviewed
Robert Ban, one of two
advisors on Taylor
Leibow Accountants and
Advisors’ dealership
team. Ban offered
financial tips for dealers.
Taylor Leibow has been offering
specialized services to dealerships for
25 years. Its auto dealership accounting
team includes two advisors, Ban and
Erik Banders, and a team of 12-15 staff.
Ban says this setup can save dealers
time.
“When it’s time for year-end compliance work, dealers are getting staff
who have knowledge of the industry
so they don’t have to explain it to new
people each year,” Ban explains.
Dealerships are unique, Ban says,
because they are generally several
businesses in one: new car sales, preowned car sales, service, parts, and the
business office. “It’s not just a
manufacturer, for example, that
continuously makes one product.
There are five businesses and you get
to learn how each one of those helps
out the other division or department,”
Ban explains.
36
ONTARIO DEALER
Ban says his team can also help dealers
increase their profitability. “There’s
different requirements or margins or
different expectations of profitability in
each one of the divisions,” he says.
“Again, because we do as many as we
do, we have an expectation of what
those should be and we can leverage
that from one dealership to the next.”
That can include analyzing profit
margin on vehicle sales, digging into the
profitability of each department, and
finding more tax savings.
The auto dealership team coordinates
with other teams in the firm where
necessary, such as discussing tax issues
with the tax team. However, they’ll
also work with a dealer’s outside
consultants. “Sometimes we’ll team up
with those consultants and say, okay,
let’s look at this specific area. In our
service department, we’re not getting
the margin that we should be. Why
aren’t we?” For example, they might
suggest investing in needed training,
which can increase profitability.
Dealers may be familiar with the
concept of Twenty Groups, whereby
individual businesses belong to a group
of a maximum of twenty dealers to
learn about best practices, compare
their finances with other dealers, and
also get new ideas for managing their
dealership. Taylor Leibow offers a
similar service. While their clients do
not assemble into a formal group, the
firm will let clients know where they
stand in comparison to similar
businesses.
“On a no-names basis, we can sit
down with our clients and let them
know what we’re seeing in our group
of similar clients and say, ‘you should
be more profitable in this area,’” Ban
says. Then we look at how we can get
dealers profitable in that area or
highlight some of the issues that are
restraining their profitability. The group
will also let dealers know how
independents measure against other
independents.
the most comprehensive numbers, and
then they’ll compare them to other
figures. “We’ll look at a specific brand,
we’ll compare it to our group of clients
that have that brand, and then we’ll sit
down with them and say, ‘Look, you
can probably improve here. The
average is such and such.’” Then they
dig in deeper with the dealer to see
where the dealership’s numbers are
below average, average, or above
average. The year-end period is also
when they typically ask for the
comparison data from the dealer’s
Twenty Group. “We try to get some
concrete evidence as to what our
expectations should be,” Ban says.
If a dealership belongs to a Twenty
Group, then the accountants will ask
for financial comparison data and work
with the client to see where
improvements can be made.
It’s not uncommon to change
accounting firms during the lifespan of
a business, and dealerships may change
accountants for a variety of reasons.
Perhaps the bank suggests it, perhaps
the dealership has outgrown its
current accountant, or perhaps the
dealership is looking for more services
under one roof. Whatever it is, Ban
says his team’s approach is to first
listen to the reasons for moving.
Tax time is when Ban and his team see
“We try to hammer down the reasons
why they’re not happy by honing in on
the top three or five things that are
causing them to be unhappy and see if
we can help them with those areas.”
Taylor Leibow also helps with business
planning. They can advise on the
acquisition or divestiture of a current
business, or how to transition to a
third party or a partner the dealer
already has. In addition, dealerships are
often family businesses, and the firm
can help out here, too.
“Not all the family members will work
in the business,” Ban explains. “They
look to us for advice as to how to
make sure that we transition it
properly to the next generation that
wants to be in the business and how
to deal with that next generation that
doesn’t want to be in the business.”
Taylor Leibow offers a unique blend of
expertise for dealers: “As a specialist
industry, what we can do is we
leverage our knowledge from one
dealer to another,” says Ban. “No one
client is the same. Everybody has
different issues, different challenges,
different opportunities.” OD
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ONTARIO DEALER
37
cars, cash & the culture of credit
the old car detective
>> continued from page 34
>> continued from page 33
agreement with Bank of Montreal. Developing that
program is now a central objective in the coming months.
“Bank of Montreal provides financing really in that prime
and super-prime market, whereas now Carfinco can offer
a full spectrum in the non-prime. So we’re certainly looking
at benefiting the dealer base by adding efficiency and ease
of use and access to the financing programs for our dealer
partners,” he says. “Particularly continuing to grow and
service the Ontario dealers, specifically.”
For the balance of 2016 and beyond, the focus at CTL
remains firmly on process efficiency, while appreciating
and considering the national opportunity that is available.
“Just taking advantage of the whole footprint,” says
O’Brien, who points to CTL’s embrace of technology as its
springboard to the national scene. “We are probably faster
now than what we were when we were little. Then, that is
really just the evolution of a business.
“What we are using now, systems-wise, from the front
end/back end, is fairly cutting edge as far as lenders and
Canada as a whole. If you are a longstanding player, it is
much harder to move those systems out. We have really
been able to build on a new platform, which has allowed
us to be pretty slick.”
That said, the CTL approach moving forward will remain an
organic growth formula, he says, without messing with
risk. “We only buy what we understand and we only price
it as we think it should be priced,” says O’Brien. “We grow
through more stores and we’ve got obviously a value
proposition that gets them to send us the deals.” OD
member’s corner
http://www.ctvnews.ca/w5/eleven-out-of-20-cardealerships-fail-this-year-s-w5-apa-survey-1.2849750
“We have a strange situation in five Canadian provinces
where an ad placed by a car dealer is supposed to be all-in
pricing. The same vehicle advertised by a car manufacturer
doesn’t have to be all in,” said Iny. The federal Competition Bureau is an independent law
enforcement agency that is responsible for the
administration and enforcement of the Competition Act,
which contains general prohibitions against making false or
misleading representations to the public.
ONTARIO DEALER
was back in but quickly developed a rear main bearing oil
leak. A local machine shop installed a rubber seal and
stopped the leak.
“In November 2014, I passed the 100,000 mile mark. It
was a long journey and driving the car was only part of the
fun. The people I have met on the 100,000 mile journey
have made it very special. I wonder what the next 100,000
miles will bring.”
And when Norm reaches the 200,000 mile mark, I hope
we can feature his Model A Ford again – and how often he
needed a new set of tires! OD
>> continued from page 9
Well, in the short term at least, don’t expect much to
change:
38
Norm and Model A at home.
Note gas cap in front of windshield.
Matthew Boswell is the Senior Deputy Commissioner for
Cartels and Deceptive Marketing Practices with the
Competition Bureau. When asked if the Bureau is looking
into advertisements that can’t be enforced at the provincial
level, Boswell said he was unable to discuss the specifics of
what cases they do or don’t have ongoing.
“But we have looked at the auto industry and obviously
any issues that come to our attention with respect to false
or misleading advertising, to the extent we can on our
resources, we will follow up,” said Boswell. OD
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ONTARIO DEALER
39
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