Updating
Transcription
Updating
the FRONT ROW The official publication of the Washington State Independent Auto Dealers Association April/May 2016 HACKERS Targeting Dealerships, Firm Warns Updating Computer Systems or Risk Catastrophic Loss New Licensing & Vehicle Systems Means Better Dealer Services PLUS 7 Employee Mistakes Costing Your Dealership Millions 2 | THE FRONT ROW | WSIADA.COM Apr/May 2016 the FRONT ROW The magazine of the WASHINGTON STATE INDEPENDENT AUTO DEALERS ASSOCIATION WSIADA.COM 707 Auburn Way South Auburn, WA 98002 T: 253-735-0267 | F: 253-804-0844 E: [email protected] CONTENTS A P R I L/MAY 2016 J.T. Curry, Board President Curry Enterprises, Inc, dba Motors Northwest [email protected] Ken Williamson, Board Vice President/ Chapter President - Tri Cities John’s Auto Mart, LLC [email protected] Emil Scarsella, Board Treasurer Town & Country Auto Sales [email protected] David Randall, Board Secretary Randall’s Auto Sales, Inc. [email protected] Mo Aliabadi South Tacoma Auto Sales, Inc. [email protected] AJ Hamedian, Chapter President - North Sound Excellent Choice Auto Sales, LLC [email protected] Rachel Frankel, Chapter President - Vancouver Top Auto Brokers, LLC | [email protected] Frank Tamez, Chapter President - Yakima Auto Max USA | [email protected] Becky Doolin, Chapter President, South Sound Sunset Auto Wholesale | [email protected] Dan Arrotta, Chapter President, Spokane Arrotta’s Auto Max and RV | [email protected] WSIADA STAFF Todd C. Elliott, Executive Director Becki Waskey, Member Services Director Colette Eilers, Member Services Associate Monica Taylor, Member Services Associate Ashlie Seipert, Member Services Associate Michael McGaughy, Member Services Associate Dana White, Member Services Associate PRODUCTION EDITOR Professional Mojo [email protected] Copyright 2016 2 | Relying on Partnerships 4|It’s Your Magazine 6 | Updating Computer Systems 8 | New Licensing and Vehicle Systems Means Better Dealer Services 10 | Hackers Targeting Dealerships, Firm Warns 12 | Save the Dates: 2016 WSIADA Education Fairs 14 | Take Stock of Your Dealership’s Transparency 16 | Know your Competition 18 | 7 Employee Mistakes Costing Your Dealership Millions 19 | Is This the Red-Headed Stepchild of Your Dealership? 20|Auction Listing 21 | Service Provider Directory 22 | WSIADA Membership Application 23 | Read and Respond THE FRONT ROW | WSIADA.COM Apr/May 2016 | 1 u MESSAGE FROM THE PRESIDENT Relying on Partnerships BY J.T. CURRY, MOTORS NORTHWEST Partnerships, each of you rely on them in your professional and personal lives. Same applies to WSIADA. We rely on them to maintain the quality and integrity of programs, for ideas and for financial support. We have partnerships with dealers, other Associations, Sponsors (Associate Members) and Washington State Agencies in Olympia. Some of our partnerships are longstanding ones, some are relatively new and under development. Todd mentioned our newly created Advisory Board in his column. That is just one of the formal structures we have put in place to leverage the power of partnerships. In this issue, you see an article from Lewis Dennie at the Department of Licensing. The Attorney General will be represented at our Education Fair and in several chapter meetings. The Department of Revenue has been a regular contribution to our Chapter program. I think you get the drift. In future editions of the Front Row Magazine we have the desire to create a regular space where some of our partners can contribute content to this publication. All of this is work in progress. I guess it will always be work in progress, because, like any relationship, they get better as you invest more time and energy in them. Here is where you, our dealer partners, come in. Think of this as a “calling all partners” initiative. Let us know who you are working with to improve the value of your business. If they have helped you, we would look forward to including them in the broader context of the Association, so they can help others. We are not looking for trade secrets here, I won’t share mine…if I have any, and I would not expect you to share yours. But we can improve the lot in life of our trusted partners if we can provide them with a better leads base, even if it as simple as getting them to become an Associate Member and listing them in the Service Provider Directory. Todd has this wild vision of every independent auto dealer in the state belonging to WSIADA…all 1600 of you! Why not have the same vision of every business that is essential to our individual and collective success. Think of that Independent Dealer Ecosystem. We are all interdependent entities dependent on the same set of agencies, suppliers and other partners to improve our lot in life. The Board is a bunch of dealers volunteering to make the Association, and in turn the industry stronger. Participate in Association meetings and events, send us your trusted partners. Remember, no trade secrets! J.T. WSIADA EVENTS CALENDAR MAY 6 10:00AM - 3:30PM, Title Workshop South Sound MAY 9 7:30AM - 9:30AM, Chapter Meeting Yakima MAY 9 11:00AM - 4:30PM, Title Workshop Yakima MAY 10 11:00AM - 4:30PM, Title Workshop Tri Cities MAY 10 7:00PM - 9:00PM, Chapter Meeting Tri Cities MAY 11 11:00AM - 4:30PM, Title Workshop Spokane JUNE 3 10:00AM - 3:30PM, Title Workshop South Sound JUNE 8 12:00PM - 2:00PM, Chapter Meeting North Sound JULY 1 10:00AM - 3:30PM, Title Workshop South Sound JULY 7 10:00AM - 3:30PM, Title Workshop Spokane JULY 19 ALL DAY, Eastern Ed Fair Spokane JULY 29 10:00AM - 3:30PM, Title Workshop South Sound AUGUST 18 ALL DAY, Western Ed Fair Tacoma 2 | THE FRONT ROW | WSIADA.COM Apr/May 2016 CHRIS BRADLEY DAVID BLAKE “In an ever evolving and highly competitive used car environment, what sets you apart is how you treat your consumer. DAA Seattle gets this right by recognizing that their greatest asset is their customer.” “At DAA Seattle, we’re committed to a culture that is enriched by the contributions of our partners. We recognize that our partnerships are our greatest achievement and we are truly invested in our customers’ success.” Used Car Director Titus-Will Automotive Group Olympia, WA General Manager DAA Seattle Auburn, WA “This Is My Auction.” INDEPENDENT. CONNECTED. COMMITTED. THE FRONT ROW | WSIADA.COM Apr/May 2016 | 3 PO Box 19190 | Spokane, WA 99219 | McConkeyAuctions.com u EXECUTIVE DIRECTOR’S MESSAGE It’s Your Magazine BY TODD C. ELLIOTT, WSIADA EXECUTIVE DIRECTOR ADVERTISER INDEX 7 ADESA Seattle 21 AUL 12 Credit Acceptance Thank you for the positive feedback on the relaunch of the Front Row magazine. This is your magazine, so I welcome feedback on content, features and columns. ilar sessions in Tri-Cities, Yakima and Spokane. NOTE: Everyone is invited to a unique North/South Sound Chapter meeting event hosted at Manheim, Seattle on June 8. If you are buying at Manheim that day, stay for the meeting. Marc Worthy, Assistant Attorney General will be our guest presenter. Don’t miss it! IFC LOBEL Financial In my last column, I spent some time outlining our chapter structure. To highlight the regional similarities and differences, we are looking at ways to personalize and differentiate the chapter experience. Advisory Board Our Luxury Edition sponsors held our inaugural Advisory Board Meeting (hosted by Manheim Seattle) in April. Stay tuned for some big initiatives in support of our Independent Auto Dealer Ecosystem. 24 Rekdal Hopkins Howard In this Month’s Edition The general theme of this edition revolves around computer systems. Important contributions in this regard come from Lewis Dennie at the Department of Licensing and one of our associate members, Martyn Olliver at Skywerks. We also include our regular features: service provider directory, calendar of events, auction schedules and read and respond. Pictures, Columns, Content Our first couple issues in the new format have included content contributions from a variety of sources. The best articles and best sources continue to be articles contributed by our own dealers, associate members and Olympia partners. Raymond Arroyo scours the world over for content for his EWTN television program. We are not scouring the world, but we need help from you. Let us know if you have pictures, colorful anecdotes or ideas for columns and other content. New Auction Discount Cards We are getting good feedback on the new card format. Given their value, we went to some extra expense to have them delivered by FedEx to the dealer principal at each of our members. Since we issued the cards, a couple of other auctions have expressed interest. While we will not be able to get additional auctions included in the cards until the 2017 cycle, we are researching ways include these auctions in our Discount Card Program. Watch for an announcement in the Front Row or a separate mailing. Chapter update We completed successful Vancouver and North Sound Chapter meetings. A new twist to these meetings included a Title Workshop. Check the calendar for sim4 | THE FRONT ROW | WSIADA.COM Apr/May 2016 Education Fairs We will start to bang the drum more loudly for registration at either of the upcoming Education Fairs. • • July 19 – We are co-hosting the event with Credit Acceptance and DAA Northwest. Paul Webb keynotes with another stimulating session. If you plan to participate in the DAA Rock N Roll sale, arrive a day early and get your 5 hours of continuing ed. News flash: DAA has announced the band for this year’s concert: Chicago! August 18 – LeMay, America’s Car Museum, Tacoma. Thursday instead 11 Dealer Socket 17 LeMay America’s Car Museum IBC Manheim 3 DAA Northwest/Seattle 12 Nationwide Northwest LLC 5 NextGear Capital BC Olympic Dealer Marketing 15 Shepard & Shepard Insurance 9Skywerks TARGET YOUR ADVERTISING DOLLARS TO ADVERTISE WITH WSIADA and receive a copy of the media kit for THE FRONT ROW magazine, call (253) 735-0276. of Saturday this year. Paul Webb keynotes this one, too. Marc Worthy joins us again plus other featured presenters. Continuing Education - Read and Respond Starting with this edition, you only need to complete two quizzes (this issue and Feb/ March issue) to earn 2.5 hours of continue education credit. If you already used last month’s quiz for 2016 CE credit, you can use this issue and next to accumulate CE credit toward your next license cycle. Ashlie, or anyone else on staff would be happy to step you through the CE process. HAPPY MOTORING! Sincerely, Work With LOCAL REPRESENTATIVES That Know Your Business NextGear Capital’s local representatives are the best trained in the industry. Their comprehensive experience and consultative approach make them partners who are truly dedicated to your dealership’s success. Visit nextgearcapital.com or call 855.372.2329 and get the best-in-class support your dealership needs to be successful! THE FRONT ROW | WSIADA.COM Apr/May 2016 | 5 u TECHNOLOGY UPDATING Computer Systems BY MARTYN OLLIVER, CHIEF TECHNICAL OFFICER OF SKYWERKS Every four to six years you are faced with updating hardware. Quite often, new hardware comes with a new operating system (O/S). Over the past 35 years I have seen a few O/S’s from CPM, then DOS to Microsoft’s latest O/S, Windows 10. The best time to update your equipment and O/S is before your current system breaks. Unfortunately there are dealerships that do not perform regular backups, not only to the Dealer Management System (DMS) software but other products like Quick Books and the Microsoft office suite. I have seen many 100% catastrophic losses. When you finally pull the trigger and update your current computer with a new model, pick wisely. Here are several items you want to put on your check list and a few tips on selecting your hardware. 1 2 Contact your DMS provider. It does not matter if your DMS is Web Based (Cloud) or local based. DMS companies are a good source of information and in most cases can help or recommend certain machine models, storage needs and compatible O/S. If you manage a multi-user environment (More than 1 PC) I recommend you use a local private service company. Stay away from the big box stores. They generally do not have 6 | THE FRONT ROW | WSIADA.COM Apr/May 2016 onsite installation crews nor keep dealer hours. Remember independent dealerships can operate for long hours from 6:30 AM (Service Departmant) to Sales 9:00 PM (Sales). Dealerships alos operate 7 days a-week including most holidays. Pick a company that is on-call 24/7, 365 days per year. You might pay a little extra, but when was the last time you heard of an outage during “normal” business hours!? 3 Avoid those $300.00 computers. You know the old saying, “ If you pay peanuts you get monkeys.” These machines are less expensive for several reasons, smaller less powerful processors, minimal RAM (memory), small storage devices, cheap shoddy keyboard / mouse packages and lower resolution monitors. They also come pre-loaded with a large number of trial programs that you will never need and constantly have “pop-up or nags” to remind you to try their products. 4 Avoid all in-one machines, where the monitor, CPU are all one device. Although these types of PC can save space, if the monitor portion fails you are faced with replacing the whole machine where as normal configuration would only cost a new monitor. I could rant and rave on for chapters, but I will save you from that. Support your local community, pay an extra few bucks and have your System built and serviced locally. I have included a quick build list. This build will support most DMS companies regardless if they are web-based or local based. You will get a nice clean installation without all those pop-ups. 1. I5 or I7 Intel Processor 2. 8 gig Ram Minimum 3. 1 x 500 g Internal SSD Primary Drive (SSD = Solid State Drive. Very Fast) 4. 1 x 500 g Internal Conventional Drive (For Backup) No Raid 5. 1 x High resolution graphics card with 2 outputs for multiple monitors. 6. 2 or just 1 Hi-res monitors (Min 1680 x 1050) 7. Plenty of internal cooling fans (Heat is the primary reason for PC Failures) Windows 10 operating system looks to be a solid product, far better than its predecessor 8.0 or 8.1. Happy computing, Martyn n _______________________________ Martyn Olliver is Chief Technical Officer of Skywerks. Skywerks is an Associate Member of the WSIDA and Martyn is an active participant in the Association’s Advisory Board. Search simplified. Find cars on ADESA.com All Makes All Models Auction Channel Year Distance To Year ZIP Code SEARCH Log in. See what’s changed. THE FRONT ROW | WSIADA.COM Apr/May 2016 | 7 © 2016 ADESA, INC. u TECHNOLOGY New Licensing and Vehicle Systems Means Better Dealer Services BY LEWIS DENNIE, ADMINISTRATOR WASHINGTON STATE DEPARTMENT OF LICENSING TRANSPORTATION SERVICES The State of Washington’s Department of Licensing (DOL) and Department of Revenue (DOR) both have old computer systems that are costly to maintain. For this reason, DOL and DOR have elected to replace their current business systems. DOR’s Business Licensing Service (BLS) will replace its system in June 2016 with the first installment of their new Automated Tax and Licensing Administration System (ATLAS), and licensees will be able to access it using a new eServices application. DOL’s new system, known as DRIVES, will roll out its first installment in December 2016. Both systems will optimize business operations by streamlining workflow and providing up-to-date information, better reporting, and advanced security. BUSINESS LICENSING SERVICE DOR is collaborating with FAST Enterprises (FAST) to replace their current systems with a browser-based, highly-configurable solution that operates on industry-standard technology. Based out of Colorado, FAST has implemented its nationally recognized tax and licensing solution, GenTax, over 30 times for various local, state and federal governments, including in Alabama, Idaho, New Mexico, Georgia and Louisiana. The first roll-out of DRIVES will take place in December 2016 and impact the vehicle licensing processes. DRIVES will simplify vehicle dealer staff’s ability to issue, revoke and reprint permits electronically. Changes and enhancements will include the Dealer Temporary Permits (E-Permits), as well as off-site permits. We anticipate that the new and improved E-Permitting system will be a simpler process for dealership staff and save time. DRIVES will also provide DOL staff with the ability to review automated reports. Starting in June 2016, the ATLAS eServices application will be used by all Washington businesses, including vehicle dealers. For additional information about other DOR services, please refer to the DOR website at: http://dor.wa.gov/content/home/. The second installment of DRIVES will affect driver licenses. There will be more information about DRIVES coming soon. Please refer to the DOL website for additional information about DRIVES at: http://www.dol.wa.gov/ DOR’s ATLAS eServices application will provide Washington State auto dealers the ability to complete their initial business license applications and license renewals online for the first time ever. The new system will decrease licensing time for applicants and licensees and increase accuracy, which improves customer service. DEALER SERVICES DOL has also contracted with FAST to modernize and improve the way DOL does business by moving to a higher level of automation and integration. The DRIVES system will automate many manual processes and cumbersome work-arounds. For example, ATLAS eServices system will feed your licensing data into DRIVES for our licensing staff to review and process electronically. These improvements will result in improved system reliability, less down time, and the ability to make system enhancements faster - all which will result in better customer service. Also, please feel free to sign up for email updates about DRIVES at DOL’s ListServ: If you sell cars, trucks, RV’s, ORV’s, motorcycles, or any type of trailer use the following: http://listserv.wa.gov/cgi-bin/ wa?A0=DEALERS-SNOWMOBILES-ORVS-MISC The new DRIVES system at DOL will automate and integrate many current processes and systems, which will also result in improved customer service. 8 | THE FRONT ROW | WSIADA.COM Apr/May 2016 If you are a tow truck operator, wrecker, scrap processor, hulk hauler or transporter use the following: http://listserv.wa.gov/ cgi-bin/wa?A0=RTTO-TRANS-WRECKER-SCRAP-HULK n THE FRONT ROW | WSIADA.COM Apr/May 2016 | 9 Hackers Targeting Dealerships, Firm Warns REPRINTED COURTESY OF F&I SHOWROOM The biggest threat to a dealership, according to Helion Automotive Technologies, is its employees. And according to the firm, hackers are targeting dealerships and their accounting and F&I departments. These email attacks are targeted and are designed to look as if it were sent from within the organization... Helion claims that international crime organizations are using targeted email scams that are designed to trick employees into performing actions that will result in their dealerships becoming vulnerable to an attack. ...Employees should be trained on cyber warfare tactics, he said, and all software patches should be regularly updated. “The increase in the number of organized attacks in the last year is astounding, and auto dealers need to be on alert,” said Erik Nachbahr, president of Helion. “In addition to the volume of attacks, the level of sophistication and research involved is frightening.” Hackers who break through dealership networks have the ability to gain access to dealership login credentials, dealership and customer bank account and routing 10 | THE FRONT ROW | WSIADA.COM Apr/May 2016 numbers, and other private customer information, according to the company. Helion provided an example of an actual incident: A virus was downloaded in an email attachment onto the F&I Manager's computer. The virus tracked every website visited and every keystroke. Hackers were able to use the information to login into credit bureau sites and extract credit re- ports for more than 200 customers before they were caught. This incident ultimately cost the dealer more than $150,000. According to Helion, security software and firewalls can’t stop an attack like this because the attack originates from an employee email. These email attacks are targeted and are designed to look as if it were sent from within the organization. These attacks are called spear phishing attacks and to prevent them, Nachbahr recommends that dealerships verbally verify all requests for wire transfers. He also recommends dealerships have a cyber-liability insurance policy in place. Employees should be trained on cyber warfare tactics, he said, and all software patches should be regularly updated. Helion Automotive Technologies is an information technology (IT) provider for dealerships. n N R U T S R A R C E T D S U S E AY S FA CRM D N MS A D TED D A 0 R 4 AN INTEG U L LY ET’S F K C SO ALER LS D: DE E TO O V I Y ARR TOR S N A E H V T IN NDEN AND DEPE ITES, N S I B F E ,W EO DMS UTUR RM, THE F C D E R AT INTEG WITH DealerSocket’s industry-leading suite of tools made specifically for Independent/BHPH dealers can help move your inventory faster, increasing profits by more than $261 per vehicle. Schedule a demo today. ID.DEALERSOCKET.COM/WSIADA 888.319.4950 Save the Dates EAST JULY 19 In conjunction with DAA Northwest’s 21st Annual Rock & Roll Sale 5 WEST AUGUST d ing E tinu Con its Each d e r C 18 2016 WSIADA EDUCATION FAIRS Call 253.735.0267 or Email staff@wsiada.com NORTHWEST LLC Point-of-Sale Lending Specialists • No credit scoring • No mileage or year requirements • No payment recourse • Quick electronic funding • Work directly with buyer R • Newly-licensed dealers accepted Call Michael Farmer (480) 370-5052 or visit www.NationwideLoans.com States Serviced: Washington Oregon Idaho Sub-prime since 1954 12 | THE FRONT ROW | WSIADA.COM Apr/May 2016 THE FRONT ROW | WSIADA.COM Apr/May 2016 | 13 Take Stock of Your Dealership’s Transparency BY JOHN STEPHENS, SENIOR VICE PRESIDENT, DEALER SERVICES, EFG COMPANIES It’s time to provide more transparency in the auto-buying process. Recently the Federal Trade Commission announced a planned study on the auto buying and financing experience. Since 2011, the organization has brought more than 25 cases challenging illegal practices in the area of dealership business. It is likely taking steps to look even closer into the industry due to increased Consumer Financial Protection Bureau activities. While the FTC is in the exploratory phase of the study, it is important to note it does have jurisdiction over automotive retail, unlike the CFPB. And it’s time to provide more transparency into the auto buying process. The FTC wants to find out how complicated the automotive-financing process can be at the dealership level. The organization is soliciting public comments and feedback from consumers’ actual experience purchasing or financing a car. What can you do in light of the increased scrutiny? You can start by assessing your dealership’s transparency and asking yourself a few key questions: How competitive is financing and aftermarket pricing at your dealership? Today, consumers can easily research prices to negotiate the best deal. But when it comes to financing, VSCs and other aftermarket 14 | THE FRONT ROW | WSIADA.COM Apr/May 2016 products, most consumers don’t know what they qualify for or if they are competitively priced. But the tide is shifting. Consumers and entities such as the CFPB are stepping in. They are demanding transparency in every industry and are much savvier when making purchasing decisions on both high-end and lower-end items. As you look to increase transparency, consider an easy step toward that end: make more information available online. Provide an online credit application and make aftermarket information accessible on the web. Be up front and allow consumers to educate themselves about your offerings when they are doing research to purchase a car. You should also work with your product provider to understand the consumer benefits of the products you offer. Compare the benefits with the retail price and question the value to consumers based on the price. Are they getting a good deal? Is there a good balance between dealer profit and consumer value? How big a priority is customer satisfaction for your sales and F&I teams? Take a look at your performance metrics and your CSI score, customer reviews and chargebacks to measure customer satisfaction and ensure they are aligned. For example, high F&I product penetration should reflect F&I managers putting customer needs first by taking time to learn about personal driving habits to tailor presentations and increase customer satisfaction. Remind your teams that the customer experience is crucial to a successful dealership. Ask yourself if you would be comfortable sending your friends and family through the sales and finance process at your dealership. Do you have compliance procedures in place and are they being followed? One way to ensure procedures are being upheld at your dealership is to implement recurring, random audits to check that your team is complying with local, state and federal laws. You won’t know unless you audit. Another suggestion is to put your finance managers through the Association of Finance and Industry Professionals certification. This process ensures your team knows and understands regulations at the state, federal and local level, and empowers them to take responsibility for your dealership’s compliance. Dealers who take steps toward transparency will be better positioned to tie profitability increases to compliance initiatives as scrutiny from the FTC and CPFB continues. In addition, those dealers will cultivate longterm relationships with customers that will generate increased sales and future growth. n _______________________________ John Stephens is senior vice president of Dealer Services at EFG Companies: 972-445-8910 and [email protected] DEALER INSURANCE EXCLUSIVE MARKETS oac) 00. ( 2 $ T A G RTIN TA BONDS S & d r a p e Sh COMPETITIVE RATES 1st ed ition d r a p e h S -0488 6 9 3 5 85 Shopping for Dealership Insurance? Request a Complimentary copy of Insuring Your Dealership Send Your Name, Dealership Name, and Address To: [email protected] Shepard & Shepard Insurance “We wrote the book on dealer Insurance!” 855-396-0488 KNOW YOUR COMPETITION! What Independents are Doing to Retain Customers BY DIGITAL DEALER There is a constant stream of advice from industry experts concerning customer loyalty and retention. While most of the advice is on point, a large piece is typically missing in the bigger picture. In order to increase market share, businesses must be aware of what their competition is doing. Turning a blind eye to pricing and marketing tactics of the dealership down the road can easily cost sales or service business. Savvy dealers check out what their competition is doing. But, these mystery shops or research data is usually limited to their franchised competitors, not independent repair facilities, which is a mistake. A recent roundtable discussion published by Loyalty360 included key executives of some large independent repair franchises. It provides interesting insight into the mindsets and strategies they are using to build customer loyalty and keep customers coming back. The roundtable included Robert Falconi, CEO and John Wiegand, SVP of Operations with Precision Tune Auto Care; along with Tom Tracy, SVP of Marketing for Monro Muffler Brake & Service; Ralph Yarusso, SVP of Operations and Business Development for Grease Monkey; and Ryan Rose, Director of Automotive Strategy for Clutch. In this roundtable, several questions were posed to the group including: What is your brand’s biggest strength with customer experience? Tracy indicated that they focus on thoroughness in their inspections in order to prevent further issues down the road. Yarusso stated that it was 16 | THE FRONT ROW | WSIADA.COM Apr/May 2016 the consumer’s desire for quick service done right. Falconi recognized the bad reputation that repair shops have gained and stressed that ethics is their most important value proposition. While Rose indicated that using customer data to analyze consumer behavior is key to effective marketing. What’s the most significant customer challenge your brand faces? The group’s answers to this question revolved around providing a consistent customer experience across all of their facilities. Staffing the stores with the right people who understand the importance of providing an excellent customer experience is challenging for Precision. Monro focuses on being clear with their customers on what they should expect, then delivering on those promises. While Grease Monkey strives for chain-wide consistency in experience. How is technology impacting your brand’s customer experience? These groups are integrating and utilizing technology across the board to enhance their customer’s experience, including the use of tablets by advisors, digital menu boards and mobile friendly websites with appointment setting abilities. They recognize that consumers have access to more information and conduct research as to the best place to take their vehicle. So, they work to ensure that their information is easily accessible and helps convince consumers to choose them. What role does data play in your marketing strategy? These independents recognize that data is an incredibly effective tool when used to communicate with customers in relevant and personalized ways. Wiegand shared the importance of using data to lure back customers who haven’t come in for service in some time. While Rose shared the importance of integrating data from many sources, including POS systems, vehicle databases, and even social accounts. It is a sad fact that in the eye of the consumer, these independent service departments still have the edge in their ability to provide a complete service experience. The 2015 annual survey of Consumer Reports subscribers found that independents outscored dealership service for overall satisfaction, price, quality, courteousness of the staff, and work being completed when promised. However, most independents lack the ability to perform major service repairs, or recall work. That being said, it’s very easy to lose sight of just how important quick service type ROs are. These all provide these independents with the opportunity to interact with and touch a customer. Every service performed at an independent versus a dealership is a lost opportunity (and revenue) for a dealership. So, take note of the strategies that independents are using to attract and retain customers and consider implementing similar strategies to help improve the customer experience at your dealership. Otherwise, you may find your customers visiting less frequently and miss out on a great deal of revenue and countless opportunities. n INTERNET MARKETING t EXPERIENCE YOUR AUTOBIOGRAPHY COMPLIMENTARY DEALER CROSS-PROMOTIONAL OPPORTUNITIES • Display vehicles on Anderson Plaza at ACM — Great visibility from I-5, I-705 & Tacoma Dome • Offer Ride & Drives around Dome District & Haub Family Field • Purchase ACM Group Admission Tickets for event promotion • ACM develops event promotional email for dealership RESERVE TODAY Contact the Private Event & Sales Coordinator at [email protected] 2702 East D Street Tacoma, WA 98421 | 253.779.8490 | americascarmuseum.org THE FRONT ROW | WSIADA.COM Apr/May 2016 | 17 u DEALER INSIGHT 7 Employee Mistakes Costing Your Dealership Millions BY DIGITAL DEALER Recently an auto dealership experienced an all-too-common security breach. An employee in the accounting department received an email from someone who he thought was the dealer asking him to initiate a $30,000 transfer from the dealership’s bank account to another bank account. The accounting employee complied with the request and it was discovered later that the email was a scam. Unfortunately, there was no way to retrieve the funds. This dealership has a state-of-the-art firewall and security software, but today’s clever hackers are finding ways to get through even the toughest defenses. The most common method for gaining access to a dealership’s network and data is to trick or ‘scam’ employees. That’s why it’s so important to have a corporate security policy in place and to train your staff, so they don’t make these common employee mistakes: 1) Not verifying email addresses. Any time an employee receives a request to transfer money, check the sender’s email address and be sure that it matches the one on file. If the request is above $1,000, you may want to require verbal confirmation over the phone. These steps would have prevented the transfer just mentioned. 2) Click on an email attachment from an unknown source. Attachments can contain malware. In one instance, a dealership employee downloaded malicious code that allowed a hacker access to online credit apps, social security and credit card numbers from over 200 customers before discovery. This ultimately cost the dealership more than $150,000. 18 | THE FRONT ROW | WSIADA.COM Apr/May 2016 3) Click on website links within emails. Known as typosquatting, this approach involves sending links to bogus websites that steal login ID and password information. In one instance, an accountant received an email notice from the dealership’s bank. The accountant clicked on a link in the email and was taken to what he thought was the bank’s website, where he logged in. Result: A $450,000 wire transfer was initiated from the dealership’s bank; however, this dealer was lucky because the bank caught the error before the money was transferred. 4) Bringing Their Own Devices. Your dealership should have a policy that prevents employees from copying customer records onto USB drives and other devices. Your employees’ intent may not be malicious; perhaps they want to work from home and they need contact information. Nevertheless, having your customers’ data on an unsecured residential computer is a big no-no. 5) Believing that phone representative is who they say they are. What if you got a phone call from a Microsoft representative who told you they’re working with your IT company or employee (naming them correctly), and that you need to go through some troubleshooting steps? Would you believe them? Unfortunately, some employees fall for this scam and proceed to give away information that allows the network to be hacked. If you receive such a call, ask the rep for their number and tell them you’ll call them back once you check with your IT staff. 6) Password violations. Employees should create passwords with a combination of letters, numbers and symbols, and they should change passwords every 90 days. Never share or give login ID or password information to anyone. 7) Visit personal websites while at work. Your corporate security policy should disallow employees to visit social media sites, online shopping or gaming sites at work. This is not about productivity or privacy; it’s about your network security. The consequences of a security breach can be hugely expensive. Stealing money from a bank account is only one part of it. Once hackers gain access to your network they may be able to breach your database and steal your customer records, including social security, credit card and bank account numbers. One of the biggest expenses dealers incur from such a breach is the cost to contact all customers and then manage and monitor their credit to ensure they are not adversely affected. Additional consequences may include investigations, audits, lawsuits and FTC action for non-compliance with the Gramm-Leach-Bliley (GLB) Act. Violations can add up to hundreds of thousands of dollars per incident. According to the Ponemon Institute, the average cost per stolen record is approximately $200. If your dealership has 100,000 customer records that means you could be on the hook for $2 million. Firewalls and security software are the first line of defense against hackers who want to steal your data. Your employees are the second line of defense, so be sure they are trained in the latest cyber warfare tactics! n Is This the Red-Headed Stepchild of Your Dealership? BY DIGITAL DEALER We all know that feeling when you walk into an auto dealership that’s on top of its game. The interior is gleaming. The exterior is impeccable. The service department is clean and humming. The sales staff is professional, organized, and hitting their goals. Even the coffeemaker is state of the art! But I know a secret. In many dealerships, in the back rooms and behind the walls, lurks a red-headed stepchild. An afterthought. Often overlooked, it only gets attention when it causes a problem. That red-headed stepchild is your information technology (IT) strategy. Let’s face it. You’re probably not devoting as much time to it as your Daily DOC, checking the numbers daily, weekly and monthly to ensure you’re on track. You’re probably not showing it off like those fancy software programs you invested in to help you achieve your sales and service goals. I understand the red-headed stepchild can be complicated. You know how important it is, but you’re just not sure what to do with it! Still, that doesn’t mean it’s okay to ignore it. Signs that you are ignoring your IT strategy include: • When employees complain about their slow computers, you send your IT guy to Best Buy to purchase ten new computers, and hope that solves the problem. • When customers complain about the Wi-Fi connectivity in your lounge, you send your IT guy to Best Buy to purchase a new router (dealerships require enterprise-grade routers, not residential routers) • Your phone system or network occasionally goes down, or your Internet provider has an occasional outage. Doesn’t everyone’s? • You believe that your current firewall and security software will protect you from hackers, so there’s no need to have a corporate security policy. The good news is creating an IT strategy isn’t terribly difficult. You just have to know the right questions to ask, such as: • What is the lifecycle of our current IT equipment? For example, a network switch lasts eight years, PCs and servers typically last five years and routers last seven years. However, equipment may need to be replaced sooner if there are business reasons to do so. • How much does it cost to maintain and replace the equipment? Every time you purchase new equipment, allocate a budget for its future maintenance and replacement. Budgeting in advance can help guard against big, unexpected expenses. • What are the business reasons to replace IT equipment? As dealerships rely more on cloud-hosted software services, as new technology in vehicles and mobile tablets require more bandwidth in the service department, your IT infrastructure needs to be upgraded to handle the huge increases in data. Every time you consider a new software or technology, ask the vendor what the bandwidth and other IT requirements are. Factor the cost of IT upgrades into the cost of the new technology. • Which pieces of equipment are under warranty and when do those warranties expire? In case something happens to the equipment, is it more Continued on next page THE FRONT ROW | WSIADA.COM Apr/May 2016 | 19 u AUCTION LISTING Adesa | adesa.com/seattle Tuesday: Consignment 9:30AM Alternate Tuesday: Specialty 8:30AM Thursday Night: InOp Sale 4:45PM Brashers - Portland brashersportland.com Thursday: Consult website Copart | copart.com Times vary: Consult website DAA - Seattle | daanw.com Friday: Dealer and Fleet/Lease 9:30AM Alternate Friday: Heavy Metal* 9:00AM (Lane 8) *Mechanically-challenged/cosmetically damaged/non-running inventory DAA - Northwest | daanw.com Thursday: Fleet/Lease 9:00AM Wednesday: Promotional 1:00PM, as scheduled Thursday: Promotional 9:00AM, as scheduled Thursday: MotorSports 12:00PM, as scheduled (Lane 8) Thursday: RV 11:00AM, as scheduled (Lane 8) Alternate Thursday: Heavy Metal 8:00AM - as scheduled (Lane 8) Note: MotorSports, RV & Heavy Metal auction dates can be found at daanw.com Ehli Auto Auctions | ehliauctions.com Last weekend of every month. Kaman | kamanauctions.com Thursday: Noon Manheim - Seattle manheim.com/locations/SSAA/events Monday: OVE Event Sales online Alternate Tuesdays: Closed Ford Sale 10:00AM Tuesday: Cross Border Mobile 1:00PM Wednesday: General Sale 9:00AM Alternate Thursdays: Night Sale Red Lights 7:00PM Friday: TBD Mobile Sale, Eastern WA Manheim - Portland manheim.com/locations/PAA/events Tuesday: Open Sale: 9:00AM Continued from previous page cost-effective to purchase an extended warranty or to replace the equipment? • What are the current and future projected costs of licensing for all your software programs? Are there ways to reduce these costs, such as re-negotiating with vendors? Are you still paying licensing fees for users that have left your company? • What new technologies coming down the pipeline should you be aware of? Advances in wireless devices, collaboration tools, teleconferencing and other technologies could soon make email and other existing technologies a thing of the past. Are you planning to experiment with any of these new tools in the near future? Most are designed to speed up decision-making and increase customer satisfaction, two important priorities for many dealers. • What is the best way to secure my dealership’s data, including sensitive customer information such as credit card and social security numbers? Believe it or not, the biggest threat to your customer data is probably your employees. Scammers try to trick your employees into downloading malware, viruses or to click on websites that can steal your information. Unfortunately these schemes have resulted in many instances of employees inadvertently granting hackers access to networks, bypassing the very firewalls and security software meant to keep them out. When this happens, consequences are expensive. Knowing the answers to these questions will help you craft a strategy to ensure your IT infrastructure can always support your business goals and keep your data safe. Creating a spreadsheet that includes a list of IT inventory, lifecycle and replacement costs will help you budget and save money in the long run. Pretending your IT strategy doesn’t exist won’t make it go away, so stop ignoring that red-headed stepchild! A proactive approach is far more cost-efficient than a reactive approach. n SERVICE PROVIDER DIRECTORY Accounting Services Randall W Faber, CPA, PS (425) 533-0711 rwfabercpa.com Rekdal Hopkins Howard (425) 658-1400 rh2cpas.com Please see our ad on page 24. Auctions Adesa Seattle (253) 735-1600 adesa.com/Seattle Please see our ad on page 7. ADESA Portland (503) 492-9200 brashersportland.com Copart (253) 847-8300 copart.com DAA Northwest (509) 244-4500 daanw.com Please see our ad on page 3. DAA Seattle (253) 737-2200 daaseattle.com Please see our ad on page 3. WSIADA service providers are best in class. We invite you to explore their services and please mention that you saw their listing in The Front Row magazine. Commercial Insurance Hecht & Hecht Insurance (800) 609-0979 hectins.com Shepard & Shepard Business Solutions (855) 396-0488 shepquote.com Please see our ad on page 175 NW Dealer Services (360) 200-5287 walkerinsuranceagency.net Customer Relationship Management Systems DealerSocket (866) 813-1429 dealersocket.com Please see our ad on page 11. ProMax Unlimited (360) 789-7486 promaxunlimited.com (425) 922-3560 nwdfs.com NW Dealer Services (360) 200-5287 walkerinsuranceagency.net Financial Indemnity Group, Inc. (206) 713-7178 [email protected] Western Fidelity Insured Services, Inc. (206) 240-2575 wfisinc.com (253) 333-0300 afcdealer.com NextGear Capital (425) 640-5111 kamanauctions.com Skywerks Manheim Portland (206) 999-6699 skywerks.com Please see our ad on page 9. Manheim Seattle Finance and Insurance (503) 286-3000 manheim.com (206) 762-1600 manheim.com Please see our ad on the inside back cover. AUL Corp (800) 826-3207 aulcorp.com Please see our ad on page 20. (866) 701-4700 ext. 823 gravitypayments.com AutoZone (866) 727-5317 [email protected] (855) 372-2329 nexgearcapital.com Please see our ad on page 5. In-Vehicle Security OnStar Photography Pixel Cars (310) 621-8055 pixelcarsstudios.com Sales Training Paul Webb Training (623) 271-1865 onstar.com (949) 632-3734 PaulWebbTraining.com Davies Pearson, P.C. (253) 620-1500 dpearson.com Gravity Payments Parts & Service (509) 703-6558 fpxus.com Legal Services Merchant Services LeMay Car Museum (253) 779-8490 lemaymuseum.org Please see our ad on page 17. AFC Kaman Auctions Nationwide (800) 622-7605 NationwideLoans.com Please see our ad on page 12. Museum Floor Plan Companies (888) 963-5369 frazer.com [email protected] Lobel Financial Corp. (253) 839-2600 lobelfinancial.com Please see our ad on the inside front cover. (503) 238-6464 unitedfinance.com (206) 290-3993 riesmanagement.com Floor Plan Xpress (253) 279-3230 creditacceptance.com Please see our ad on page 12. United Finance Ries Management Ehli Auctions Frazer Computing, Inc. Credit Acceptance NW Dealer Financial Services Dealer Management Systems (253) 572-0990 ehliauctions.com Lending DPC Corp (206) 696-2264 dpccorp.net Surveillance/ Security Pro-Vigil (210) 858-1105 pro-vigil.com THE FRONT ROW | WSIADA.COM Apr/May 2016 | 21 Membership Enrollment YES! It is important to be to be recognized as a professional! Enclosed are my annual dues to ensure that my business has all the advantages WSIADA/NIADA provides to put me at the forefront of my profession. By completing this form, I am consenting to and giving WSIADA/NIADA, its affiliates and subsidiaries, my permission to (until I give written notice to discontinue) contact me and provide information to me at the mailing and e-mailing addresses, telephone and fax numbers I have provided. I certify that (I am/we are) eligible for membership in WSIADA. Member Name: Business Name: Dealer #: Address: City: State: Phone Zip: Cell Phone: County: Fax: E-Mail: Website: Enrolled by: Todd Becki Ashlie Colette Monica Other Employees I would like to include within my membership Full Name: Position: Cell: Email: Full Name: Position: Cell: Email: Full Name: Position: Cell: Email: MEMBERSHIP CATEGORIES: $450 – Dealer Member: is limited to any sole proprietorship, partnership or corporation which is engaged in buying and selling motor vehicles as a principal part of its business; holds a vehicle dealer’s license issued by the Washington State Department of Licensing. Business Name: Dealer #: Business Name: Dealer #: Business Name: Dealer #: PAYMENT OPTIONS: Dues: $ Charge Card for Membership Dues Check made payable to WSIADA enclosed. Returned checks will be subject to a $25 service fee. Please charge my (circle one): VISA MASTERCARD Credit Card Information: 16 Digit Card #: Type of Credit Card: Visa Dealer’s Signature: AMEX EXP: DISCOVER Master Card AMEX CVC#: (Card Holder’s Signature if different) Discover Date: 707 Auburn Way South, Auburn, WA 98002 Email: staff@wsiada.com Call or Text: (253)735-0267 Fax:(253)804-0844 READ AND RESPOND | April/May 2016 Front Row The purpose of this Read and Respond quiz is to verify one has read the content of this issue of Front Row. All of the answers for the questions provided are included in the content of the issue. WSIADA’s Read and Respond quizzes may be counted toward state required continuing education. A passing grade will be granted for scores of 80% or higher. $50 payment is required for non-members prior to the Washington State Department of Licensing being notified of completed continuing education. Please be advised that the information contained in WSIADA’s Front Row is, to the best of our knowledge, current and correct. However, we caution readers not to use the information provided to them as final authority. Its purpose is to be a guide. Any legal advice should be regarded as general information. It is strongly recommended that one contact an attorney for counsel regarding specific circumstances. Some articles may express opinions and/or suggestions for best practices. Likewise, the appearance of advertisers or their identification as members of WSIADA, does not constitute an endorsement of the products or services featured. Dealership Name: _______________________________________ Dealer #: _______________ Date: _________________ Check: q I read and understand the disclaimer above. Check those that apply: q $50 payment is enclosed. q I already paid. q It’s included in my membership. Quiz Taker’s Name: ______________________________________ Signature: _ ___________________________________ Email: ________________________________________________ Position: ____________________________________ Feedback and Comments: _________________________________________________________________________________________________ _________________________________________________________________________________________________ CIRCLE THE CORRECT ANSWER. 1. According to John Stephen’s article, one way to ensure procedures are being upheld at your dealership is to: a. Have monthly meetings with Sales and/or Finance managers. b. Implement recurring, random audits to check that your team is complying with local, state and federal laws. c. Have an in house compliance manager responsible for training new employees and staying on top of legislative changes. 2. In the article “Know your Competition! What Independents Are Doing to Retail Customers,” Robert Falconi stressed that the most important value proposition is: a.Price; b. Quality Service; c.Ethics; d. Online Presence; e. All of the above. 3. It is suggested that dealers use data to lure back customers who haven’t come in for service in some time. Some sources that data can be integrated from are: a. Social Accounts; b. POS Systems ; c. Vehicle Databases; d. All of the above. 4. The first installment of the Washington State Department of Licensing’s new business system, DRIVES, is scheduled to roll out: a. August, 2016; b. October, 2016; c. December, 2016; d. February 2017 5. ATLAS eServices will feed licensing data into DRIVES for DOL’s licensing staff to review and process electronically. These improvements will result in which of the following: a. Improved system reliability; b. Less down time; c. The ability to make system enhancements faster; d. Better customer service; e. All of the above. 6. What are the registration fees (through August 1st, 2016) for WSIADA’s Education Fairs? a. $200 for non-members and $50 for members; b. $150 for non-members and $25 for members; c. $125 for non-members and $25 for members; d. $100 for non-members and $50 for members; 7. Martyn Olliver suggests that if you are able to find a $300 computer, a. Snatch it up. Good deals are hard to find. b. “If you pay peanuts, you get monkeys.” c. Purchase the computer and request an upgrade from a reliable IT person. d. Purchase it, but first research compatibility with your DMS. 8. Martyn Olliver’s stance on “all inone machines,” where the monitor & CPU are all one device, is: a. They are a great option because they are space savers; b. First research compatibility with your DMS and accounting system before purchasing one; c. Avoid all in one machines; d. Consult with your IT person regarding server compatibility before purchasing one. Continued on next page THE FRONT ROW | WSIADA.COM Apr/May 2016 | 23 u READ AND RESPOND | APR/MAY 2016 Continued from previous page 9. Every time you consider a new software or technology, you should: a. Not make a move until your IT person has consulted you on compatibility; b. Make sure that you are researching the most current release of that product to ensure that you are getting the newest and best technology; c. Ask the vendor what the bandwidth and other IT requirements are; 10. According to the article “Is This the Red-Headed Stepchild of Your Dealership?” what is the biggest threat to your customer data? a. Old and out dated systems; b. Not having off-site data back up; c.Employees; 11. To find out how complicated the automotive-financing process can be, the FTC is: a. Looking at case law to assess industry patters; b. Interviewing auto dealers all over the nation to get their input; 24 | THE FRONT ROW | WSIADA.COM Apr/May 2016 c. Soliciting public comments and feedback from consumers’ actual experience purchasing or financing a car. d. All of the above. 12. Who is the new WSIADA South Sound Chapter President? a. Mac Ruddell; b. Dan Arrotta; c. Becky Doolin; d.J.T.Curry 13. In the article “Seven Employee Mistakes Costing Dealership Millions,” it is suggested that dealers have what in place to avoid costly employee mistakes? a. A corporate security policy and staff training; b. Employee contracts making the employee liable for the mistake; c. Allow employees to use their own personal devices whenever possible. 14. According to Ponemon Institute, the average cost per stolen customer record is approximately: a.$20 b.$200 c.$2,000 d. $2 Million 15. Approximately how many independent auto dealers hold licenses in the state of WA? a.750 b.1000 c.1600 d.2200 16. Who is Marc Worthy? a. Head of the Washington State Patrol b. Director, Department of Licensing c. Assistant Attorney General, State of WA d. Retired forward from the Los Angeles Lakers 17. Why would a dealer attend the Education Fair at LeMay in Tacoma or The Red Lion in Spokane? a. Support WSIADA. b. Acquire 5 Continuing Education Credits. c. Become a better Independent Auto Dealer. d. All of the above. n WE’RE MOVING TO WEDNESDAY’S BEGINNING MAY 4TH - REDUCED SELL FEES - FRESH INVENTORY - AVAILABLE ON SIMULCAST - DINNER FROM 4:00-5:00 - EXCLUSIVE MONTHLY PROMOTIONS 400+ UNITS BRAND NEW UP TO 4 LANES 5PM TO 7PM FOR 2016 MANHEIM SEATTLE WEDNESDAY NIGHT SALE DEALER AND COMMERCIAL CONSIGNMENT THE FRONT ROW | WSIADA.COM Apr/May 2016 | 25 WASHINGTON STATE INDEPENDENT AUTO DEALERS ASSOCIATION WSIADA.com 707 Auburn Way South Auburn, WA 98002 EDUCATION FAIRS EARN CE CREDIT EDUCATION FAIR - EAST F&I Industry Professionals est.1987 650 Dealerships Nationwide Largest Anti-Theft Hardware Provider in U.S. Premier independent full-service provider of F&I products, training and dealer participation programs. www.swds.net | 888.930.5277 July 19 | All Day Earn 5 Continuing Education Credits Red Lion - Inn at the Park, Spokane, WA FEATURED GUEST: Paul Webb, CEO – I.T.S., Inc. / Paul Webb Training / WebbVT EDUCATION FAIR - WEST August 18 | All Day Earn 5 Continuing Education Credits LeMay, America’s Car Museum, Tacoma, WA FEATURED GUESTS: Paul Webb, CEO – I.T.S., Inc. / Paul Webb Training / WebbVT, and Marc Worthy, Assistant Attorney General, State of Washington CALL OR EMAIL TO REGISTER (253) 735-0267 or staff@wsiada. com