Dealer Confessions (part 1) automotive

what's up youtube welcome to automotive life and this is dealer confessions this video series is all about me answering all the good honest ugly bad brutal truth of being a car dealer now i've taken a lot of your questions from instagram so if you haven't followed us already make sure you go to automotive.life and follow us and go ahead and message me there if you have any questions also if you can message me down below in the comment section i personally answer every single one of your questions also if you can please hit the subscribe button and like this video this definitely helps us with the youtube algorithm to reach more people like you guys to share some automotive knowledge and help grow our channel which we truly appreciate it so without more any more shameless plugging let's get into the video okay the first question is from jess from houston can you rent out a dealer plate this is a hundred percent no if anybody's doing it right now please stop it's technically illegal and you're a hundred percent liable for whatever happens with your dealer plate so if you're a dealer right now and you have one of your friends driving your car or one of his cars with your dealer plate if he crashes into anybody if he hits a bus load full of nuns if he gets coked out with a bunch of strippers and crashes into a building you are on the hook for it now i don't know if you guys remember i won't say the dealer's name but it's a friend of mine here in las vegas about six months ago it was on tmz there was a yellow lamborghini um huracan that was flipped over on the strip that was with one of my friends dealer plates this guy took this car from somebody that wasn't making their payments anymore so it wasn't even his car they put a dealer plate on it so he can look like a big shot he drove it around las vegas he got drunk crashed into the caesars wall caesar sued him the people that he hit suit him and then the bank that actually owned the lamborghini sued my friend he's still in litigation six months later so you do not want to be a part of that it's not worth the headache please do not do that okay the next question is from rig in california is it hard to get a dealer's license it's kind of a trick question it's not really that hard to get a dealer's license but it is extremely hard to run a dealership and to set it up correctly so if you followed one of my videos you can see i talked about how to get a dealer's license and everything else it doesn't seem that bad but once you start setting everything else up it is kind of overwhelming so i really recommend people go ahead and actually work for a small independent dealership for about a year or two work for a franchise store get the the kind of flow of the dealership underneath your belt get that experience before you even try to attempt this because once you get your license it's very very quick to lose a lot of money very fast and that's probably i'd say the biggest thing that puts a lot of dealers out of business is just the fact that they don't know all these little things that come up later down the road and bite them in the ass so um you know you could take i have one of my classes if you want to take one of the classes or like i said go ahead and try to work for a small independent dealer or franchise store kind of work your way up from there okay the next question is from russ from virginia what is the craziest trade-in that we've ever gotten now without doing a massive long video because i've got so many hilarious things that people have traded in through the years i can literally make an hour long video just of that so i'm going to tell you two guy or two just to keep the series going so the first one is going to be a vehicle the second one is going to be non-vehicle so we had a guy call us up we had a uh a dodge challenger that we got from hertz really good deal had a little bit of front end damage i pretty much stole it from the hertz auction put it back up on there and headed up for sale i think we headed up for like 27 grand but i think we're into it like maybe 18 000 the guy was like well i have an unusual trade-in he's like are you interested and i was like sure what do you have he's like well i have a bell helicopter and i've never seen you know what i don't even know what a bell helicopter was so at that time i was like okay well can you send me some pictures and whatever information you got and basically what he told me was is a friend of his owed him some money and so he flew this thing into his backyard and took it as collateral because his friend was needed the money for something and the guy never came back and never paid him off so now this guy's got this helicopter sitting in his backyard so you know the way he talked about it made it sound like it was a long time so i called my friend that owns a helicopter rental company here in town and i'm like what is a bell helicopter you know is it worth anything is it a big dollar value and he says they're just a basic helicopter they're nothing really fancy he he doesn't really deal with them so he said that he has a flying school that buys a lot of those here in town he goes we'll send me his information just close the deal and let me know whatever i get it for and we'll see if we could sell it so i asked him for pricing i looked online i saw like kits bill kits for like 20 grand i didn't know what that was so i said okay whatever let's just go ahead and make the deal so i called the guy up and i was like look if you bring me um ten thousand dollars and the helicopter i'll go ahead and take it so the guy was like okay no problem he's like it's it's done calls me up an hour later i can't get it out of my backyard i don't know how to move it so i had to call my friend and say how do i do this he's like you have to take the blades off fold them back do it this way everything has to be done a certain way because it's a safety thing keep track of each bolt put it where it is take pictures bags blah blah blah so i send my guys down there we literally take the blades off this helicopter put him on side wrap him up lift this thing onto a flatbed drag it out of his backyard get it back to the dealership i told him since we had to do a little extra work he's got to bring an extra like 3 500 down instead of the 10. he brings me the 35 or the 13 500 gives me the thing gives you the paperwork he has with it takes his car takes off figured okay good massive deal so i'm thinking in my head well worst case scenario if i can't sell this thing for at least 10 grand i'll have this amazing looking thing i could sit on the side of my building as advertisement you know so i'm already thinking about tearing it apart and putting electric motors so the helicopter thing will spin put lights on and everything else so my friend introduced me to the gentleman that had the helicopter rental place here in vegas came down looked at it and he's like oh this is a great helicopter he's like this is a bell something something something he goes if the blades are good he goes the blades are 20 grand and i'm like the blades are 20 000 he's like yeah he goes the blades are 20 thousand dollars he goes everything is scheduled by hours and time wise so we don't know how much this thing could be worth it could be worth 50 could be worth 80. he goes it just depends on what the equipment is and everything else so the guy came back looked at everything and he's like you know what he goes it's actually in really good shape he goes but it hasn't been serviced in over a year and i was like okay i was like so what do you think it's worth you know what are you willing to offer me and he's like well you know it's usually worth about 70 grand but since we got to service it and there's other stuff i'd like to find out about it he goes i'd like to offer you 50 000 for it i literally rolled out of my chair i literally thought i was getting ready for like a 10 000 offer maybe a 5 000 offer at this point i was already thinking about putting lights on it and sticking in front of my dealership as soon as he told me that i literally jumped out of the chair and i was like you know what i really don't want to get rid of it but you can have it congratulations you guys got yourself a new helicopter so once they fixed it all up they actually took us out and flew us around in it which is very cool but i had no idea so that was probably one of the craziest vehicle ones now the second part of the trade-in story is i am in the city of las vegas so we have a lot of entertainment workers that work here and what i mean by that are basically strippers and hookers so we had alexis up for sale and we had a dancer from a local club come in and she really wanted it and i told her okay um you know you need x amount of dollars down because of your credit and your job time because she couldn't prove her income so she needed five thousand dollars down so she had about thirty five hundred dollars and she's like okay well can i get it with 3 500 i was like if you leave it i'll keep it for you for two weeks but you need to still come up with the rest of the money so anyways back and forth talking for about you know 20 30 minutes you know and she starts asking me like all these really weird questions you know are you single what do you do for fun what do you do blah blah blah and i'm sitting there like okay i know where she's going with this so i just kind of let her ramble on and see where what was going to happen and she basically told me she's like well you know what are some things you like what's something that turns you on and i kind of laughed and i was like you know what what really turns me on it really gets me excited and she's like what and i was like money pay me and so pretty much after that she got upset that i wouldn't take free lap dances instead of a down payment for a vehicle but that's kind of some of the crazy stuff that we get for trade-ins but like i said i literally can do a whole hour video on uh trade-ins but which we're going to say for the rest of the series because i got way more ones or way more crazier ones too so next thing we're going to talk about is let's see let's get to the next question okay the next uh question is from chan from utah what is the dumbest slash stupidest car deal that you've ever done okay so in full transparency i have done of quite a few dumb car deals any dealer tells you something different he's full of so this was right around 2008 2009 when the economy pretty much tanked a lot of people were losing their houses they were leaving vegas it was a really crazy time but we got a call from this woman she was on her way to florida she needed a vehicle to get there her husband left her it's just her and her two kids she needs to get back there she's looking for something good and affordable so at that time i had a 2008 nissan altima it was a v6 leather interior was a nice car i think i had it for sale for about 12 grand and i told her that i could do like 13-5 out the door she says okay that sounds good she's like do you take trade-ins and i was like yes i do i was like what do you have she's like i have a classic car i was like oh what is it so she sent me pictures it was a 1965 shelby gt350 so i told her she could send me the vin number and some pictures of where the vin plate was and everything else and she sent me the one underneath the hood because she didn't want to crawl under the firewall underneath the car which was fine and sure enough it was a real shelby gt350 i gave the number to my friend he checked it everything checked out so you know i was really excited i'm like okay man we're gonna give you this nissan altima and we'll just trade you straight up across you know she started talking and she's like you know what i think the mustang's worth more um you know i my ex-husband loved this car you know blah blah blah and i was like well you know is the title in your name is it his name and she's like no it's in the old owner's name we just never registered it so it's like okay cool i was like well how about if i throw in three thousand dollars extra just to sweeten the deal she's like okay that's fine so i'm like thinking great i got me an extremely rare car you know like a sixty thousand dollar car for you know fifteen thousand dollars you know my mustang friend that i sent the information to to verify that it was a real shelby was already calling me telling me he's got people that are lined up now this particular mustang um was believed to be in a few photo shoots for some of the marketing advertisement for uh ford during this time so this mustang was lost for quite some time so they believe that this particular mustang was that one so you know the morning she was getting ready to drive to florida we we dropped off the car we bought the three thousand dollars and she's like you know what i changed my mind i'm just gonna write you a check for the car i i think i'm just gonna sell the uh the mustang and so at this point i'm like chomping at the bit i'm like i'm never gonna get a chance to buy one of these cars i'm like what is it going to take for me to to get you you know to give me the car and she's like well ten thousand dollars i'm like well ma'am the the nissan altima is worth thirteen thousand plus the three thousand dollars i'm giving you that's sixteen thousand dollars total she's like no no i want ten thousand dollars in the car so at this point i was scratching my head and i'm like well should i do it you know should i take my time go through it research and do some more stuff but i was just i was extremely excited i was kind of just not really thinking straight i was a little a lot younger than i was now so i was like you know what let's just go ahead let's just do it so i told my guy bring her the car showed up with ten thousand dollars gave her the 10 grand we got the car we towed it back to the shop beautiful the car was extremely clean you know we checked the van everything matched up but the downfall was as we started going through the vehicle a lot of the things that made a shelby cobra r cobra r this thing didn't have it it didn't have certain um bolt holes it didn't have certain uh pieces that were missing anyways to make a long story short they basically took a 65 tub and welded on the front end of this other vehicle obviously was probably totaled on a track and so she made two cars at a one so we're like okay well you know what at least it's still worth 20 grand let me just go ahead and i'll fall for the title um you know because of the main body of the vin that's the most of the car so we wanted to file for the rec correct title we run the paperwork car reported stolen so cops came down picked up the vehicle that's even after i spent a few thousand dollars fixing stuff up getting some of the paint work done getting the c3 done so make a long story short i probably lost about 20 000 because i was too excited and too quick to make a move on a classic car that was one of my dream cars when i should have just took the time did the research and properly actually check out the vehicle okay the next question is from ted from nevada what is the fastest you've ever driven um the fastest i've ever driven is 168 miles an hour and it was on my 2015 yamaha r1 but one of my goals for this year is to reach 200 miles per hour um before 2021 so we'll see how that goes there's a few racetracks i'll be visiting later this year so i'm hoping i can make that one happen next question is from mike in dallas excuse me nick in dallas what is your favorite car to do buy here pay here pretty much i don't really have a favorite car but there's a few if you were to ask me as far as a brand goes my favorite buy here pay here would probably be hyundai's because they're so cheap and the maintenance is pretty much it's that's even probably cheaper than the cars itself they don't break down a lot they're good solid vehicles you can get a much much newer car than you can for like a civic for the exact same price and when you do buy your payer your whole goal is to get something that's dependable so as long as your vehicles are on the road your clients are still making those payments therefore you're making more money on it so to ensure my portfolio i would definitely if i could only pick one brand i guess i would pick hyundai if i had to pick one car it would probably be a hyundai sonata or a older chevy tahoe 05 and below those are my favorite suvs of all time they just don't die and they hold their value next question is from clark in seattle if you were to go back in time and tell yourself something what would you tell yourself um well if i could go back in the time i would tell myself basically to don't even mess with banks work with some hedge funds and some other portfolios and do buy here pay here when you do buy here pay here you are the bank you make the decisions you're able to roll the deal you you basically control your own destiny when i first started i was kind of cutting edge because i built my dealership around the banks and i preached this if you watched some of my other videos or if you've seen me speak before in other places i always talk about build your dealership around the bank's programs not what you want but what the banks actually buy well now in 20 and 2020 these banks ain't buying they don't want to buy any cars they want to give you insane fees they want to charge you all kinds of money for different things it's not as good as what it used to be so if i could go back in time and work on my buy here pay here i would be self-sufficient right now i wouldn't even have to do anything i could literally just sit back and collect payments and not have to worry about anything so if i was going to say anything that would definitely be it um good question great question by the way clark thank you so much for that one um the next one is from jerome and milwaukee what is your opinion on floor plans okay so this one is one of my favorite topics so floor plans is definitely a double-edged sword it could be a blessing and also a curse and what i mean by that is floor plans are like lines of credit that what us dealers use and rental car companies and everything else to buy more vehicles so we can have more inventory to hopefully get you to come buy a car from us so they're a great thing because they give you the opportunity to get the cars but they love to get you stuck it's almost like a payday loan store they're just the curtailments just keep adding up the fees keep adding up and they are literally the devil so my honest opinion is you need to get one even if you don't need it just so you can build your credit but i would never go above 20 almost like a credit card because once you get into that pitfall and you're paying all these fees and all these money all this money they will literally bleed you dry i remember when at our peak we had probably a little over like a million and a half and flooring between next gear and afc and we were purchasing cars you know between ten and twenty thousand dollars well each car that you see on somebody's lot imagine having a each one costing you 500 to a thousand dollars a month so if you got 100 cars excuse me you know 100 cars or even 50 cars and each one's 500 to a thousand dollars you know that could be anywhere from 25 grand to 50 000 that's a lot of money and the worst part of it is is only maybe about 65 to 70 percent of that is actually going towards principal the rest is your fees and your interest and that's even if you have excellent credit so if you can afford not to start off with the floor plan i would strongly recommend it i would get one just so you're building uh the relationship because floor plans are really funny most credit card companies once you get a credit card and you start using it they want to give you lower rates and give you a bigger thing so you can basically get yourself more in the debt so they can take care of you and basically make more interest off of you floor plans if you use too much they try to shrink your line or they just try to charge you more fees so if you use your line a lot and you're not really doing a lot of your own cash cars and you go for an advance let's say six months down the road they're not going to give it to you they're going to be like well mr smith you know you're you're running 80 of your credit line and you're always late on your payments and everything else now we're not going to give you the extension we're actually going to lower your line and we're going to charge you more fees oh you don't want to do that you don't want to pay it okay well fine we're just going to take your line off you've got 30 days to write us a check for whatever 600 000 it's on your line pay us now or go pound sand and the other thing that's kind of bad about flooring lines is especially like right now next gear here in vegas just got burned for about another two million dollars from these two other dealers so once the floor lines start getting screwed they start tightening up just like the banks so now these dealers that are used to having like a 500 000 line or a million dollar line they're all going to start getting cut back and eventually they're going to wean everybody down to the bare minimums and if you need if you need a million dollars to survive to float your inventory and they only cut it by or they cut it by half you're pretty much squeezing these people out of business and that's what they do so like i said floor plans a great thing but also a very very bad thing so get one don't use it if you can stay away from it you'll be much better i'd rather see you guys with 10 cars on your lot than 80 and be in debt alrighty next question is from two texts if i said it wrong i'm sorry but it's just the number two and then t-e-x what if you live in a small town how would you do your dealership okay so small towns it's very unique big cities we have traffic we have lots of flow different types of people you can scale your business model very very easily when you live in a small town it's a little bit different so i need more information so if you're in a small town but let's say your town is run like let's say you have a lumber mill in your small town and it employs about 80 percent of the people in your town then i would strongly recommend you do bank financing and do more affordable cars and start out small because if for some reason that mill were to ever shut down you know you could still finance other people but if you did buy here pay here and the mill shut down you would lose 80 percent of your income from day one and you'd pretty much be screwed or these other people hopefully they'll find other jobs and that's the other thing when a big when a big city loses a plant it hurts a little bit but there's more jobs around it to kind of make something going but when you live in a small town and that one big factory closes it's devastating for the local economy so you need to find out in your market what is working and what is there now if you already see two three small dealers watch what they're doing maybe ask to work for them for the weekend just to kind of get some information from them see if they actually sell cars see if they do anything a lot of these dealers they're just there because there's always a need for a small dealership people need cars that's just the way the world works so you opening up believe it or not won't be hurting anybody there's more than enough pie to go around but if you talk to these guys and these guys are not selling cars and they're talking about how there's no jobs there's nobody there their their portfolio is awful and they're getting ready to get out of the business then you probably shouldn't open up in that town now there's nothing wrong with living in a small town but i say usually when you start your business i would recommend you go to a bigger city to get a more bigger sample size of sales and everything else so if there's a bigger city maybe an hour down the road that's maybe got instead of like if you live in a town with ten thousand maybe a town that has a hundred thousand that's big enough where you can at least kind of get the ropes and kind of see how things are going and then if it goes well then i recommend you making a small satellite store in your local town because small towns are usually gonna have low rent they're gonna have low overhead you can get employees for really cheap because there's not a whole lot of jobs there so you can get one or two good people so now you have your big store in the big city that's making you constant money and then you have your satellite store where you live so this way you're growing your market who knows maybe things may go well maybe you can build it up into something really really good it just depends on your market so even if you're in a small town don't be afraid to take a chance and get out there and try something okay the next question is actually really really good um this is from david uh from orange county how do you sell cars in 2020 during the pandemic in a very bad economy well david that is the million dollar question right now i get more calls about that than anything else i've seen dealers that normally sell 50 to 100 cars slash it down to about 10 to 30 cars even personally our numbers that we're doing here in vegas are not that great we're doing about 25 to 35 of what we're normally doing now we're pretty fortunate and pretty blessed because the stuff i'm going to tell you right now is what's helping us so the only way to get through this really down economy in this bad time and to reach people during this pandemic is marketing now i'm gonna say this until i'm blue in the face if you don't believe in marketing you are a fool if you're if ninety percent of your budget is not in marketing you're literally doing everything wrong what i mean by marketing is actual real marketing if i don't believe in billboards but in your town if you got one it's better than not having a billboard if you guys want to pay four thousand dollars for a magazine where they print it once a week and they put your cards in there hell that's better than doing anything but i don't recommend that one the easiest way to target people is one thing everybody has it in their phone or in their hand 24 7 is their phone i do facebook and instagram marketing non-stop we spend an absurd amount of money on marketing because we know it reaches people we see the messages we count them when you're getting fifteen hundred to three thousand dollar messages every month that gives your salesman plenty of opportunity to close some of these people that you normally wouldn't reach that are not out driving around that are not out shopping for vehicles you need to be in their face so right now if you don't have a facebook or any type of social media presence you need to start right now you need to grab your camera you need to walk around your cars and you'll see some of my videos i'll post a few of them here i may even pause it and pay a few little snippets i do all kinds of crazy stuff and it's not that hard you literally get your phone you get your sales guy hey bob tell me about this car this is a great family car it's a 2018 whatever chrysler 300 blah blah blah blah deal of the century great put that on there put it on facebook put 20 behind it boost it let it pop up there let it start getting some more people in there there's money out there you just got to drive it in so after you post that video of you walking around your car talking about it you need to make that put it on instagram put five dollars a day behind that one post these ads it's really not that hard and don't pay for all these people's weird classes on how to do all this marketing if you sign up for facebook ads they're actually a link right there that's called facebook academy you can literally take it and you can take all the classes to see what you're doing but it's very simplistic it's very easy to do and you need to be original do something funny so once you get started anything is better than nothing just start putting out those ads but once you start getting good start thinking of something funny something creative because you want to build your brand i've seen so many dealers that blend in with everybody else because they're that one little dealer in a line of 70 other dealers and there's nothing distinguishing between that amb auto sales anc auto sales a and d auto sales like nothing you guys are all selling the same same cars to the same banks so if you're not working on branding yourself if you want it to be you if you want to hire a model if you want to get a animated character and make fun of this thing and make that your spokesperson go for it you need to do that you need to find some way to be relevant in this time because right now there's a lot of people that can be going out of business because they're maxed out on their flooring lines all the banks are not lending and pretty soon the piper's going to come calling and they're going to take all these cars and if you're not marketing and you're not out there ahead of everybody else you're gonna be one of those people that's gonna basically go away with the wayside so like i said if you ask me my professional opinion as of right now if you're not spending at least five grand a month in social media marketing you're a full so and that's just the minimum if you're a bigger store and you can afford 15 20 30 000 do it i guarantee you'll see results it's what we do it works great and then you can actually track real life people and once you get better with your marketing you can assess more of how you want to do marketing start working on your ads to target specific people to bring your ad revenue costs down and then your conversion rates a lot higher but it all starts with posting that one ad like i said take your phone take your sales guy have him talk about whatever car take that put it on facebook 20 bucks behind it for the day and just let it ride and just watch how many people contact you once you get your first few messages you're going to be calling me up like lucky you were right this is great i had no no leads this week and just this week i put 20 in one ad and i got five leads i'm like it's a miracle it's marketing so you know if if you're in a weird area right now and it's really bad don't worry about it it's gonna get tough it's tough for everybody right now but just start working on your marketing that is pretty much the crucial thing and there's nothing wrong with old school door knocking a lot of people are lazy when i see a hustler salesman like there's this guy that works at the chevy dealership this guy's a stud every sunday he goes to walmart and i see him because sometimes i go shopping there he's handing cards out he's putting cards in the cars this guy's been doing this for probably about three four years but he gets people steady you know the old salesman there was no social media they had to go out and hey what's your name bob hi bob my name's whatever you know here's my card if you need a new chevy call me they're looking like i don't need a new car but guess what three months from now when their car blows up maybe they got your card maybe they don't but if bob left a good enough impression and kept knocking on people's doors he's gonna get people i watched him pull people off of bus stops in front of walmart which is pretty funny so you know don't be afraid don't be lazy marketing is the key here's another really good question this one is from george from salt lake if being a dealer is so much fun why did you sell your dealership like i said this one's going to be kind of brutally honest and i'm going to be straight to the point i was burnt out i love the industry i love what i do i've been in the car industry my whole life now very few people go from high school till they're you know mid 30s doing the exact same job and all my friends i am the only person i know that's been doing the same thing since high school most people have switched careers several times they've been in and out of college trade schools and there's nothing wrong with that we're all trying to find our way in this world so you know as i started doing this dealership thing you know i loved it and i flourished at it and it was great and i enjoyed it and i was always like what else can we do let's do rental cars let's do the shop but these last two years really put a damper on things with the banks they got extremely strict they got you know they took all the fun out of being a dealer when i got when i was used to it it was easy i mean we could push deals through we could talk to the bankers make a deal happen now you're talking to computers we don't even get to talk to anybody the most of the bankers have all been fired everything's automated now you got to put your numbers in the matrix and pray to god you get an answer so it's almost like sticking a coin in a slot machine you could come up a winner it could get somebody approved or the machine can come back and say we don't like this person and kick it out where before we can be like oh hey you know what mr smith does have bad credit but look he just got a new job he's working hard he's paying his bills you know we should give him another shot the human side is gone that's it so when it took that element out of it that was one of the things i really enjoyed so it made it a lot tougher to sell cars now did it make it impossible to sell cars no we're still doing it right now but i was spending about four times the amount of time being there at the dealership so i've been working pretty much seven days a week since i was 18 and i'm not talking like typical you know douchey people like i work sunrise to sundown no i literally worked seven days a week all the time and i am burnt out so you know as of the last year and a half i started this youtube channel for fun i i spent more time trying to show my friends what to do so they didn't burn their dealerships and this all kind of came around as i was teaching this other dealership about how to set up their stuff the owner asked me if i wanted to sell my dealership to him if i wanted to do some consulting for him and i thought about it i was like you know maybe it's the time maybe it's the best time for my move so i enjoy doing this you know i really do so i'm actually going to be doing coaching in atlanta this week and you know i never would have been able to do this unless i actually would have made that step and sold my dealership you know do i regret it sometimes but i know that you know i can always get back into it that's the best thing the things you're going to learn on this channel even if you don't get a dealership or even if you do get a dealership these tips and tricks and some of the stuff i'm going to show you guys you can make money whether you're flipping cars in your house getting a dealership or even going full franchise all these concepts work the same but once you have the knowledge you know the path to which way to go so you could always do it down the future so you know like i said i i do love the industry i'm never probably going to get out of it but i want to step back from being a owner operator and being stuck there 24 hours a day i want to travel a little bit i want to help out some other people i want to see where this youtube thing is going because you know in the last few weeks i've gotten tons of messages about going doing outside consulting about doing some videos um there's some tv stuff i'm working on i can't really say nothing right now but um there's some big companies that wanted to do some uh uh really big like promotions as far as talking about cars teaching about cars actually doing hands-on stuff where we're actually gonna teach people how to physically work on cars which was pretty cool so you know this is some of the stuff if i was a dealer i couldn't do this you know like i gotten calls from uh motor trend back in the day to sponsor a show i mean to host a show i couldn't do it because i was stuck here they're like hey we're gonna have a car show in vegas we don't have anybody would you like to come you know you'd be on the camera for like four hours blah blah blah it was a huge event it was a major thing but it was tax season and i was right there and this is when everybody had their money i was buying cars and i was writing papers and i couldn't leave my dealership and i missed that opportunity you know and this was about four years ago so i could have started i could have been at where i'm at now four years ago and who knows where i've been as far as followers and subscribers and everything else so you know i think this is the right thing for me i love it i enjoy it i love helping you guys which is really cool so another shameless plea if you do like this information please hit the like button hit the subscribe button and comment down below like i said i'll answer all your questions and that's pretty much the honest truth but uh thank you very much for the question it's a great question next question is from tony from new jersey excuse me tom from new jersey do you ever get fake money and how do you tell okay in this business get ready for it you're going to get burned with a lot of fake dollar bills once you get good you can actually feel the texture of the bills you can see if they're fake or real but in the meantime get a marker and get a bell scanner it'll save you a lot of headache i think it's more prevalent here in vegas because there's so many scams and there's so many people trying to rip off the casinos that's why we see so much of the fake money but just be very very careful get like i said a marker pins like three dollars online um the bill the bill checkers are literally like 25 bucks it's a uv light they show you how to do it and then once you get good you can actually feel the actual texture of the paper um here's another good question um this one is from it's actually anonymous so they got it underneath there so the name is actual anonymous is what what it's listed under do you morally have any issues selling used cars great question so i'll be honest with you if you sell crappy cars you are a piece of now there are cars out there where we don't have a crystal ball that you never know what's going to happen but you try to help people as much as you can but without financially destroying yourself so all of our cars i actually we service them we go through them just to make sure they're okay i make my sales guys take them home i make my mechanics take them home we drive around a little bit because here in las vegas we have to smog them so we have to drive them 30-40 miles to smog them and usually within that time period we see if there's anything wrong and then with every car i sell i give them a 30 day warranty so if anything happens that's not their fault we cover it so i strongly recommend when you start out try to do this now if the motor blows up i know it's going to be hard for you to come up with the money for the motor or transmission or bigger expenses but try to do your best to work with the people a lot of times you know when we first started we said we would pay 50 of all parts and labor you know which in all reality you could charge people 100 in labor and you could charge them 50 bucks what what your mechanic charges you but at least you're giving them some sort of option and you're taking care of them never blow off a customer i'm going to tell you that right now you do not want a 2.2 rating on google you know we were so excited that we had a 4.9 rating for the longest time because we kept calling our customers my car is having an issue my car is overheating my tires are flat my my master mechanic said this car is a piece of you're gonna get that that's just part of the business but as long as you are up front and you tell them like when we sign paperwork i actually tell people hey you're buying this car as is this is how it is where it is anything else if you have any issues come talk to me and i'll help you not saying i'm going to fix everything underneath the sun but i'll try to help you as best i can and you're buying a used car if you want a brand new car you can go right over there ford will sell you a brand new ford fusion for fifty thousand dollars but you're buying a ten thousand dollar car from us or a five thousand dollar car whatever you're selling you know make customers expectations real and then if it is a piece of car don't sell it to them you don't need the headache i know you need the money but let's just take the loss let's send it to the auction hopefully we'll get a better car next time and start building that especially if you're going to be doing buy your payer the crappier the cars you put out the worse your portfolio is so one of the other things we do is we go out and we buy paper from other buy here pay here dealers and that's the one concept that slips a lot of these guys minds they buy the cars from the auction they wash them and when they sell them they sell them for top dollar at 29 interest they don't fix and then when the customers comes in and they're like my car is acting up this has issues blah blah they don't fix anything they don't care because they want the car to repo so they can get it back instead of letting that customer make those payments to get yourself settled to build your portfolio so don't be those dealers if it's a bad car let it go if it's got issues and you know it don't sell it now if it does happen try to help him out but don't put yourself in the poor house because like i said things happen unfortunately i have to tell some people no it's gonna suck but if you do it quickly it's like that tear off the band-aid thing if you talk to him man the man and you say look this i'm not gonna fix this you're bitching about a radio but your radio is leaking i'll fix your radiator but your radio i don't care about you know try to do as much as you can to help them out and as long as you put a line in the sand most people will stay on the right side but if you're kind of weak and you ignore them and you don't answer their calls what do they do they get angry and then they start picking out everything that's wrong with the car so when they finally get mad or they turn you to the dmv they're going to have a list of like 70 things that they're going to want you to actually fix so like i said don't sell the junky cars do the best you can and morally i don't feel bad i sleep at night i walk around the streets of vegas i don't have to worry about getting shot in my back or stabbed because i sold a bunch of crappy cars so try to stay above that don't be that typical dealer you don't want to be that sleazy scumbag a lot of that stuff has gone away especially because a lot of states implemented a lot of rules like us i can't sell a car with a check engine light you know i know some states you can but but here you can't but try to stay away from that and like i said you'll see the dividends in your reputation and the return customer base next question is from felix in la why do banks charge recourse good question so pretty much what happened in the last few years is so much bad subprime paper has been floating around so what i mean by sub prime paper is basically everybody with bad credit most people you talk to will have one two sometimes three repos now which is insane and this is the majority of the united states not the minority the majority of the united states have at least one repo now because of the economy the pandemic all this stuff so recourse is basically you're on the hook for you know one month two months however months you actually set up with the bank the bank determines it so now what the banks are doing is if they don't like the fee you know like they don't want to charge you too much because they don't scare you away so instead of charging you a 3 000 fee to buy a 10 000 deal they're gonna charge you one thousand dollars but they're gonna make you sign a three month recourse what that means that you are married to this customer for three months you have to make sure that that customer makes all three monthly payments because if they don't and that bank wrote you a check for ten thousand dollars and they miss the second payment they're gonna come knock on your door they're gonna ask you we need our check for ten thousand dollars and they're gonna sit there and they're gonna wait for you to write out your check for ten thousand dollars you gotta give it to them and sometimes they're nice they bring you the car you have to pay the repo fee sometimes they don't give a they're like you know what it's your car you go get it and so now you're out ten thousand dollars you're out the vehicle because you have no idea where it's at and now you got to go track it down and see what's going on so recourse is a bad thing if you ask me i don't do more than one payment i'd rather i'd rather take a 1500 fee than get a 800 fee with a two-month recourse because it's just not worth the risk you know because they could crash it they could total it they could just disappear with it i've seen it a million times but uh to answer your question felix that's the reason why they actually do this is because they're leveraging their bet they want to make sure that you know if they don't scare you away with the bank fee they want to kind of grab you and make you hold onto your paper and this it's all numbers at the end of the year they can skate out of you know 10 million dollars in negative paper if they make the dealers buy it back but the thing is is a lot of dealers are getting in trouble right now because the banks are coming back now and they're like oh well you have 10 deals to buy back i need to check for 120 000 and the dealers don't have it because sales are really bad and then now even more uh people are going to be breaking recourse they're going to be late on their payments more buybacks more buybacks and it's just going to snowball into this ugly nightmare so like i said never do more than one banks do it just as a way to to try to fool you to try to trick you they'll give you a low fee but hold time behind they won't show you they're like oh yeah by the way i got this three-month recourse that we're hiding from you it's in the fine print very small in your deal's approval but go ahead and sign for this low fee and we're going to tack on this so be very careful if you're a finance manager watch for that they're all sneaking in now they're all changing their documents but that's pretty much it but that's why banks do recourse it's just a way for them to try to protect themselves against bad debt and bad paper okay the next message is from tesla from oklahoma i'm just going to kind of paraphrase it but basically she's asking dealerships have a lot of moving parts how do you keep track of everything i currently work at a dealership now and they're constantly losing cars losing customers losing money um great question um it is extremely hard i'll be honest with you when i first started i thought i was mr do it all yourself type of thing and you know my ego was pretty big and i was just like i'm just gonna bang it out and be organized i have my phone with my lists if i show you guys on my list it'd probably blow your mind but one thing i'll tell you right now in the very beginning you need somebody to help you with it doesn't have to be a business partner it could be something as simple as a secretary or a friend or maybe your top sales guy somebody to help bounce ideas off of some of the people that take some of the brunt and leg work away from you because you're going to see you're going to be running about 100 miles per minute from buying the cars to doing the financing to doing the paperwork to making sure the payments are done to keeping track of the invoice keeping recon down to training your people to doing the marketing i mean you literally have to wear about 30 hats as a owner operator so i strongly recommend in the beginning getting at least one person to help you start this journey with because when i did it i literally did everything myself and that's why i think one of the reasons why i burnt myself out and i work seven days a week because i was so paranoid because you know when you use your money it's scary like you could lose a lot of money very quickly so it's very hard to give that trust to somebody else and put your money in somebody else's hands but unfortunately this is the way that businesses is once you get bigger you're gonna have a finance manager you're gonna have a sales manager they're gonna be making calls on your behalf they're gonna be pushing deals through that you know that you they need to push through sometimes you may not agree with it but they're doing it because they either want to make more money they want to make the business money and it's just you can't control it don't be a control nazi start learning how to delegate now biggest thing i think when i see people when they're very small mom and pops is not knowing when to delegate because when you first start out it's not that big deal you got four or five cars you're selling cars yourself you're the salesman finance manager whatever else but all of a sudden you you get into this massive growth where maybe your next month you hit 45 cars now you're one person and they don't know when to hire more people because they're just like well no i'll just keep it myself and i'll do it myself because i'm so used to doing it myself don't you're going to make costly mistakes i've signed a few contracts not even like wrong like one of my sales guys forgot to initial a contract my fault i did not check it i got a 10 000 fine for the dmv because they classify that as a fraudulent contract and there's there's people out there that will try to get free cars from you and making you rush to the paperwork to do this type of stuff don't do it you will lose money i've had sales guys where they forgot to mark down pick payments so the whole time i thought that the money was all received they forgot to make a notation in the account saying that the pick payment was made they thought i knew i thought they got it next thing you know you're missing thousands of dollars just gone through you need to keep track your inventory your cars um you know you need to watch your employees because some unfortunately some employees will steal from you it's just part of the business but you know these are some of the things that you can avoid if you get a second set of eyes and you have somebody else watching out for your interests so don't be stubborn get somebody that you can like i said start training today even if you don't have a lot of money to give them it's nice to have somebody else because the one thing you don't want to have happen and what happened to me is i never took vacations and i actually was in a car accident i was only out for like two days but for those two days i controlled everything i was the funnel i was the reason why my business was stopping so my sales guys were trying to do their best to still sell cars but i gave them the calls i knew what i was into the cars i knew what was the go what was the no and i really screwed my business because i took everything out of their hands now i gave them the power to make some decisions i train proper people i got really good managers to put in place to make calls that i trust so if i'm not there i trust their judgment so i would say that's probably the biggest thing to make sure you don't lose money and all the things fall through the cracks but great question nonetheless okay guys thank you guys so much for watching the whole video once again if you haven't subscribed please do again last time i'm gonna bug you hit the notification bell definitely give it a thumbs up if you feel like you've learned something um if you want to message me put it down in the comments i will reply to every single one also make sure to follow us on instagram automotive.life on this weekend from september 28th to october 6th i will be in atlanta georgia so if you're in that area go ahead reach out to me on instagram or youtube come say hi i'll be out there training a few dealers and doing some stuff there and i'm hoping i'm going to try to get on the show vin wiki if you haven't seen it before it's a great show ed if you're watching i love your show i'm going to send you a message right after i finish this video but thank you guys so much for watching and we'll see you next time you

Channel: Automotive Life

Views: 94,704

Rating: 4.9814692 out of 5

Keywords: automotive, cars, dealer, dealership, dealership business, news, automotive life, flipping cars, flipping cars for profit, flipping cars from auction, car auction, confessions, the truth, vehicle virgins, vinwiki, car sales, car salesman, car sales training, car salesman tips, car sales closing techniques, dealer license, how to get a dealer's license, starting a dealership, passive income

Id: hDzG0xew-Qo

Length: 48min 53sec (2933 seconds)

Published: Fri Sep 25 2020