“You can go back over all the different economic downturns and challenges that we’ve had, yet auto dealers always find a way to survive and come out smelling like roses right because of the innovators the entrepreneurs.” -Jeremy Beck
Beck is an automotive executive with 25 years of industry experience. His resume includes roles with rural, small-town dealerships with BHPH operations to working with some of the largest automotive dealer groups in the country. Beck also spent 10 years working for F&I providers in streamlining their dealer support, training and development, process and procedures, and go-to-market strategy. Most recently, he was the Vice President of Sales and Field Operations for one of the largest F&I product providers servicing the independent dealer community.
Since joining NIADA, he’s worked to develop and implement a strategy for Dealer Education, 20 Groups, Research, and Industry Insights and Events.
Independent dealers are the backbone of our industry, says Beck. They drive volume, growth, and innovation, and adapt to ever-changing landscapes better than any other part of our industry. I’m excited to join the executive team at NIADA and help provide our members an association that is dedicated to their future. NIADA’s mission of Meet, Learn, Profit, and Grow are aspects to which I have dedicated my entire career.
NIADA Link:
News Kate Winslet CAN hold her breath for 7 minutes
Used Car Price Index
Australian quarantine
Toyota Emissions Goals
00:00 Introduction
05:18 Glitter?
14:03 Preparing for Carvana
25:50 Jeremy Beck
55:10 Next Five Years
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Full Transcript Below:
Herb Anderson: What’s up? Welcome to another episode of the Dealer Talk podcast. This is your host, Herb Anderson. Thank you so much for tuning into that episode to season eight. Very exciting to check in with our co-host, Miss Charity Ann Farmer. What’s up, Charity Ann?
Charity Ann: What’s up? How are you?
Herb Anderson: It is January 14, 2023. Let’s talk about new year’s resolutions. It’s always a fun topic to talk about in January.
Charity Ann: Do you make new year’s resolutions?
Herb Anderson: No, I make it all-the-time resolutions. I don’t get that concept like you’ve got to wait till the new year to put things in motion. Like, do that ship now, today, whatever you’re trying to resolve. Yeah.
Charity Ann: Resolve? Is resolve the base word?
Herb Anderson: Resolve.
Charity Ann: I’m curious.
Herb Anderson: You understand.
Charity Ann: Resolute: admirably purposeful, determined, and unwavering. It is resolute.
Charity Ann: I don’t, although, um, a couple of years ago, I decided that I would use it as a way to map out my year, and little things that I wanted to accomplish are goals that I would like to try to achieve in a year, and that’s been kind of fun. So, I’ll be like, okay, quarter one, I want to do this; quarter two, I want to do this; and then on these months, I want to do these things. I haven’t done that this year though.
Herb Anderson: So, what happens in Q2 when you look back, and none of the stuff is done? Then you give up, and you are like, well, I’ll just wait till next year, now start.
Charity Ann: Well, yeah, but that’s why I also haven’t. I’m not the kind of person who’s like; I want to do this, and then doesn’t do it. If you’re going to commit to doing something for yourself, don’t lie to yourself. If you’re lying to yourself, that’s the worst kind of lie possible.
Herb Anderson: Yeah, I have a better one. Instead of resolutions, make decisions. It’s better, right?
Charity Ann: Well, I don’t call it resolutions.
Herb Anderson: Just decide what it is that you want to make the decision, and once the decision is made, then you’re going it’s going to happen because you decided that it would be. So, I don’t know if you’ve seen, there was a clip that I saw the other day, Kate Winslet, an interview she’s been interviewed it seems it’s by a little girl, or you know, and she’s like, oh, I’m nervous my first time Kate Winslet like starts pep talking he’s like this is going to be a great interview you want to know why because we decided that it’s going to be a great interview made the decision it’s going to be awesome you can ask me anything you want and I was like, dude that’s such a great example like I’m good for her man no pass.
Charity Ann: Do you know Kate Winslet can hold her breath for like seven minutes or something? I’m going to look it up.
Herb Anderson: I don’t know about that; I mean, she did. She was on the Titanic, though.
Charity Ann: We’ll watch; I’m going to watch that one all year long. I’ll be like, ‘Herb’s decided he’s not drinking soda for the entire year.’
Herb Anderson: And no coffee.
Charity Ann: Yeah, coffee, that one’s rough.
Herb Anderson: Easy. Piece of cake.
Charity Ann: Yeah, okay.
Herb Anderson: So, what do you got?
Charity Ann: Uh, yeah, can we talk about something that has nothing to do with the automotive industry, but I think it just brought me an incredible level of conspiratorial joy yesterday? Did you know that there is a shortage of glitter in the world?
Herb Anderson: I did not know that.
Charity Ann: There are only two companies in the world, major companies that all of the glitter for the whole world, and when they were interviewed about why there was a shortage, the head of one of the companies said that she couldn’t tell us that there was one industry taking all of the glitters and they couldn’t tell us which industry, but we would never guess who it was.
Herb Anderson: It was the automotive industry.
Charity Ann: Now this massive come conspiracy about who it is, and nobody can figure, and they call it to glitter gate.
Herb Anderson: It’s hilarious. That’s fun. You know to tie that back into the automotive industry, I do think that there are major flaws in vehicle designs.
Charity Ann: Okay, keep going.
Herb Anderson: Like they’re not thinking about their number one consumer, women, right? Like, it should come with a hook, for example, so you can put your purse on there.
Charity Ann: Oh, yeah, that would be great to have a hook on some of them.
Herb Anderson: But like it obviously be and you should be able to put multiple persons on, and that’s just one. You should. It should have like something that pops up that holds like your lipstick and your chapstick and stuff like that, you know.
Charity Ann: Chapstick? You said chopsticks.
Herb Anderson: Yeah, I mean, that’s the Venezuelan in me. Um, you know women have these ponytails, and then they have the headrest there, so they have to move their heads like this. Like, it should have like a little opening there so they can put their head in there and that, you know. Like, there’s all kinds of stuff that they’re not thinking about. Like can you imagine if a car maker comes up with that stuff? Like, that ship would sell like hotcakes.
Charity Ann: Hm, well, what they need is that they need to start hiring designers and engineers that are building and designing these are men.
Herb Anderson: I don’t know, we don’t know that. I don’t. I’m not going to say that they are all men. Maybe there’s a bunch of women designers out there who knows; you know what I’m saying.
Charity Ann: What would the role be, the job role?
Herb Anderson: I don’t know, car design or something like that, okay.
Charity Ann: Among the nearly twenty-eight thousand members of f thousand members of the society of automotive engineers, only fifteen hundred are women. 5%
Herb Anderson:
I’m just saying there is a miss
Charity Ann:
I totally agree with you, though, but I love how you associated glitter with women.
Herb Anderson:
Well, I mean
Charity Ann:
Although glitter is used in automotive paint.
Herb Anderson:
That’s why I’m saying it’s probably going to the automotive industry.
Charity Ann:
Yeah, but it’s an industry that nobody knows would guess.
Herb Anderson:
Exactly, you wouldn’t think that it’s going to the automotive industry, but it is.
Charity Ann:
Here’s my theory: I think it’s currency. I think it’s in our money that would make sense because of course nobody wants them to know that they use that when they’re making money because that would be like part of um.
Herb Anderson:
Of the recipe part of the bill recipe
Charity Ann:
Well, threats of people, what are they, so you can’t. I’m drawing a blank with the word counterfeit money. I don’t know. That’s my theory, or there isn’t a shortage, and they’re just saying there’s a shortage to make us talk about it.
Herb Anderson:
Just to mess with you just so you buy more glitter.
Herb Anderson:
That’s funny, uh
Herb Anderson:
You do know that this is an automotive podcast, right?
Charity Ann:
I specifically asked if I could talk about something not automotive.
Herb Anderson:
Well, I’m gonna bring it back right as a good host.
Charity Ann:
Okay.
Herb Anderson:
I have a prediction. It is January 14, 2023. I predict that within three weeks from this date, Carvana will file for bankruptcy. That’s my prediction. And insane, you know, I don’t know. We’ll see when this episode ends, but if my prediction is accurate, well, it depends when this hits, but I’m going to say what I think you should be doing just in case it comes out before this the time is up. Number one, if you have aged inventory, get rid of it immediately get rid of that stuff if you have to take a loss, take the lost now. If you have over sixty days’ supply, try to break bring that down to thirty or less right and then be ready to go out to the market and buy. Do not get caught with inventory right before that happens because you will obviously lose a bunch of money there. Also, get ready to advertise to Carvana buyers. Figure out what the strategy is in your market if there a lot of title issues or, you know, stuff like that. I know that there’s not a lot that could be done, but you could be. I don’t if beacon is the right word, but you could be something out there that customers could go to to find answers and solutions that will build value for you and create loyalty towards your specific dealership service. Have service campaign for Carvana customers. Um, talk about hey, if you bought a car at Carvana and you know the car was dirty or what, or you had any issues bring it here. We’ll pay top dollar for your vehicle or try to trade you into another stuff like that. Be ready to take advantage of that stuff because you’re going to have a bunch of customers potentially where just depends in your area that went that experience, and this is the perfect time for you to capture those consumers back, and if this hits after the three-week prediction and it’s too late then no hit me up and let’s See what we could do together to, um, get you in the right direction.
Charity Ann: And if it’s not three weeks from now?
Herb Anderson: What do you mean if it’s not three weeks?
Charity Ann: What if it’s longer than three weeks?
Herb Anderson: I’m wrong.
Charity Ann: Then you’ll just…
Herb Anderson: Then I’m wrong, and I’ll eat my words, but just saying, what do you think? Do you disagree? Do you agree? What are your thoughts?
Charity Ann: I mean, I don’t want Carvana to go under, so… because that would be bad.
Herb Anderson: It’s not bad, yeah, I mean, I’m not wishing for it either, but you know, like just, I can’t really say specifics, but I just know based on certain conversations that I’ve had and certain things that I’ve been paying attention to, I think it’s inevitable. Yeah, I mean, and you know, I just want to put the word out there to see if it reaches anybody, and it could prevent them from, you know, in some heat, but you know, I could be wrong too like maybe they won’t. They seem to, I mean, their stock has gone up in the past month or so; I think it went up four points, so you know, they still have… But the problem is like if you’re if you read the numbers.
Charity Ann: At four points, didn’t they drop like a hundred percent?
Herb Anderson: It’s still down 98%.
Charity Ann: Woohoo!
Herb Anderson: Well, I mean, hey, listen, and when you know, you can’t fall off the floor, dude. What’s the other thing? Oh, yeah, the issue that’s alarming, that just screams bankruptcy, is there seven billion dollars in debt and being able to make their payments on that stuff, and so you can only hold that off for so long, and if you don’t have injection of cash, you got to start selling off assets, which they’re already doing, when you have to start cutting personnel, which they already had another round of lay-offs, and I mean, you can only hold out for so long, so, um, no, but it’s a prediction. Maybe I’m wrong, and you know, this is just what’s that called when you say stuff in your um conspiracy theory?
Charity Ann: Doomsday? Conspiracy theory? A conspiracy theory is a little different.
Herb Anderson: Yeah, well, whatever. It’s a prediction. Putting myself out there, and we’ll see. If I am right, the writer makes sure to do real about this, so you can now say three weeks ago, bla bla bla, and if I’m wrong, to oppose to say three weeks ago, Herb said this wrong, that’d be funny, um.
Charity Ann: Okay.
Herb Anderson: Anyway, what else you got going on?
Charity Ann: Nothing. Do you want to do automotive news?
Herb Anderson: Is that a question?
Charity Ann: Mmhmm.
Charity Ann: Are we doing automotive news this season because we kind of didn’t last episode?
Herb Anderson: No, I think we should just, this is different, right? We’re changing things up, so…
Charity Ann: Okay, I have an interesting thing That I learned a couple of weeks ago that I thought was really fascinating. Did you know that there is a backlog of vehicles at the ports in Australia? Because the two, it says three of the Australia’s top five car brands hit new quarantine delays. So that will last fifteen to twenty-two weeks the quarantines because of a seed that is hazardous to the fragile eco-system of Australia. Then there was the article was about how the OEM’s and the manufacturers have the ability to prevent this if they just store the made vehicles in safer locations, but they don’t, and then they stick them on these ships, and then they bring all of these things that would destroy the eco-system in Australia and so then you have to quarantine them and then clean the freaking ships down before that they can even let them into Australia.
Herb Anderson:
Why though?
Charity Ann:
Because of the things that they bring with them, like this seed that would annihilate the plants in Australia or there was a bug that got into one of the ships that they can’t have in Australia. I thought that was interesting.
Herb Anderson:
That is interesting.
Charity Ann:
Because, like I know, during Covid, Australia locked down hard, and I mean, if you’re just this massive island, you really have to be careful of what you’re getting in and out.
Herb Anderson:
I figured it out! That was awesome.
Charity Ann:
And literally, sometimes don’t know if you hear anything I say, but.
Herb Anderson:
No, I did.
Herb Anderson:
Yeah, love it. I love it. Love it. Love it.
Charity Ann:
Oh.
Herb Anderson:
Let’s see what else we.
Charity Ann:
Yes.
Herb Anderson:
Got here. What else?
Charity Ann:
Working with you, there’s never a dull moment. Yeah.
Herb Anderson:
Very cool. How we’re doing it, season eight.
Charity Ann:
Okay.
Herb Anderson:
And they got some good tunes in the thing.
Charity Ann:
Hm.
Herb Anderson:
Right on.
Charity Ann:
Anything else?
Herb Anderson:
No, I really enjoy that. I was pretty good anyway. So, Australia seats. So, what’s the impact? Are we going to have inventory more inventory shortage us potentially?
Charity Ann:
Well, Australia is suffering. Apparently, fifteen to twenty-two weeks is how long it takes them to move those cars out of quarantine.
Herb Anderson:
Wow, that’s terrible.
Charity Ann:
It’s like Toyota and Mazda and Ford and Mitsubishi.
Herb Anderson:
Yeah, well.
Charity Ann:
I thought that was interesting.
Herb Anderson:
Yeah, that’s a good one. What about the test a thing up to twenty percent discounts? It’s very there is no way that any other manufacturer can keep up with Elon’s ability to just kind of shift and move. He just doesn’t have the red tape and bureaucracy just to announce it like that, you know?
Charity Ann:
Well, did you read more about it after I sent that to you?
Herb Anderson:
Yeah, of course.
Charity Ann:
It drops the test lesson to the tax credit.
Herb Anderson:
Yeah, well, I don’t know if you’ll see spikes. That’s I know that’s what he intends to do, but there’s just a lot of Elon hate right now, and so see, I was talking to somebody the other day that was said he was on a guy with an Uber driver here in Vegas and um you know he was asking him like hey how I was Ubering how you know he had to Tesla obviously and he was like dude it’s horrible to be an Uber driver right now people get in the car, and it’s a Tesla in just talk and smack, and now they think that they want to project out onto us the drivers it’s like really really bad, and I was like, ah man.
Charity Ann:
I was wondering about that.
Herb Anderson:
That’s unfortunate.
Charity Ann:
Said I was wondering about that. I wonder if part of the reason that Tesla has lost their value is just because of the Elon hate.
Herb Anderson:
Well, yeah, I mean, if consumers don’t buy it and I think that that there’s more alternatives, gas prices have gone down, demand has stalled because of interest rate n there’s all kinds of reasons that that’s that that’s on not to mention that there’s competition coming out, particularly this year that’s significantly less expensive so and if Toyota figures out this hydrogen thing then I don’t know man might go away altogether so we shall see very interesting times though sure.
Charity Ann:
Um, that was another one that I read was Toyota making a statement about, um, converting to accelerate the global move towards sustainable vehicles. Toyota is suggesting simply replacing the inner workings of vehicles already on the roads with cleaner technology.
Herb Anderson:
I mean, the cool thing is that there’s technology and there’s forward momentum on this deal, so it’s only going to be good long term once we get over this rocky part and figure out what the next tech is who is going to invest on what in which direction we’re going to go in so it’s all positive stuff, but you know it’s just interesting to be in the midst of it all and I like that you know what happened during my lifetime that we are going to see such a big change in the space, so I’m super excited.
Charity Ann:
I think that that’s one of the things that’s exciting about being in our generation, though, is that we’ve got to see all of these incredibly cool things. I was on the talking with my best friend last night, and we were just talking about memories from twenty years ago, and I was like, I think I had a cell phone back then, and it was weird to remember at there were times when I didn’t have a cell phone.
Herb Anderson:
Yeah, so our generation and our maybe our parent’s generations depending on your parent’s age, um, we’re the last ones, right so we knew what it was with technology, and then we know what it is with technology, and we’ve adopted we’ve been able to adapt to both but moving forward it’s just everybody like my kids your kids they all grown up you know the internet and social media and all this stuff, so it’s going to be interesting to see that economy right of that generation and what that’s going to look like um.
Charity Ann:
What kind of what they’re going to create
Herb Anderson:
That’s what I mean so
Herb Anderson:
Um, season eight season, sorry, I’m confused. Season eight, episode two where all about NIADA during this season, so we’re very excited, and we have our second guest Jeremy Beck is, joining us. He’s waiting for us in the lobby just get him in here get this thing rolling.
Herb Anderson:
Mm, should we do a drum roll here, drum roll there? It is. What’s up, Jeremy
Jeremy Beck:
That’s great. Your sound effects are going to be better than my visit on the show.
Herb Anderson:
We’re figuring it out, man, we’re figuring it out all right, so we kick things off here with an intro, so tell us about you.
Jeremy Beck:
What so? I’m Jeremy Beck. I am the vice president of dealer development and industry insights for NIADA. I am a life long car guy so I’ve been in the car business for twenty five years started this will tell you not that I’m trying to age myself or anything but I actually got into the car business by responding to a newspaper ad for car sales person so that tells you how long ago it was you know close to twenty five years ago and worked my way up been on the franchise side ben on the independent side by her pay here for a little while and then moved over to the you know what we call the provider the vender side worked for a very large well known financial bank on the f and I side and then most recently on the f and I side for really large f and I provider as VP of Sales Ops before I came over to NIADA and so I’ve been I guess in a for I was counting the days I’m not counting that I told Melanie the other day I’m gonna stop counting the days I’m just going to refer to how many months I’ve been here so just over four months um and super excited about all the things that we’ve got going on you know here at the association that’s me in a nutshell.
Herb Anderson:
Very cool now. We’re super excited to have you on here. We’re excited to actually do this season where we’re just going to be focusing on all things on the independent side of it and obviously partners with an idea, so I think this is going to be really good. There’s one thing that I wanted to kick things off with, and that was a certification we talked to Melanie on our last one, and she brought that up, and I’ve just really just got my wheel spinning. I’ve been thinking about it a lot in the impact that that’s going to have. Can you tell us a little bit more about that
Jeremy Beck:
Yeah, so one of the things that I actually started working with NIADA two years ago seems a long time ago. Two years ago, NIADA approached several of the f and videos that were really big in the independent space and said hey, we have a desire to really come to the market with a true CPO program for independent dealers to compete or at least low independent dealer is really the opportunity to compete with the franchise stores we all know franchise stores have really kind of had a lock on the CPO on the certified pre owned you know industry for quite some time for various different reasons manufactures spent billions of dollars building these great programs and their phenomenal programs the independent side really hasn’t had anything like that for a really really long time they dabbled here and there some of the providers will come out with you know their version of a CPO program but to be a real certified pre owned program it’s got to be you know backed by a big name it’s got to have a true quality it’s got to be true quality coverage and it’s got to provide value and confidence to the consumer and it can’t be at additional charge to the consumer because that’s what that’s the definition of a limited warranty of a certified pre owned vehicle so we’ve worked with some of the biggest f and I providers in independent space over the last couple of years happened to be one of them before I came over to the association to really build a robust program we’ve partnered with Carketa to do digital inspections and to be able to increase the level of transparency for a consumer when they’re searching for that vehicle they can see everything that was done to that vehicle they can see the inspection that it went through before they ever walk on the lot um and really have an opportunity to look at the vehicle look at the carfax look at the history there’s some stringent criteria as it relates to the way that the vehicle you know must operate how many accidents the vehicle can have on carfax to really be able to drive confidents to the consumer so we came out on January 3rd was our launch date with four f and I providers those four f and I providers being Pro Guard, GWC Warranty, AUL, and then Southwest Dealer Services um and really developed this holistic program this limited warranty program that comes in various different terms based on what the dealer wants to offer and then allows the consumer to be able to win searching for the vehicle see that it’s a certified peon vehicle see the inspection that was done see the repairs that were done and really be able to build confidence in that overall buying experience so it’s been a long time coming it is a phenomenal program and the again the intent is to build confidence into the consumer through the buying process which you know the manufacturers have been able to do and so we’re really just bringing that mind set over to the independent world I tell him all that that’s dealers all the time the c p o program is designed to allow you to compete against the manufacturers and give you a leg up on your independent competition that isn’t offering a true certified pro in program
Herb Anderson:
So that’s interesting. How we are like as a consumer is what I’m most interested in. So I’m a consumer. Let’s say I go maybe on AutoTrader or even the independent dealers’ website. Who is it going to be certified by NIADA, a financial institution, and how is that going to be promoted or marketed
Jeremy Beck:
So it’s backed by an idea it is an NIADA certified pre owned program so there’s a shield there’s a there’s a branding campaign that’s going and you can certainly go on to our website go into our social media but all of them are are backed and will show the sort of the NIADA CPO or certified brand image that we’ve created and there’s an entire branding campaign that’s going to go out over know the coming months to really be able to start to build confidence in that brand and to get people to understand you know who is an I d a and the brand behind it but really ultimately what they’re going to be able to do when they go in and they search online as you mentioned you know they’re going to be able to really be able to see that the vehicle is certified and then be able to see what does that certification mean what with it what work was done on it what type of rigorous inspection point system that it have to go through they’re actually going to e able to see all the work that the that the dealer did through the Carketa system and be able to see that on all of the dealers listings and so we did that with the with the mind set that we have to build confidence in the consumer on their couch right in order to get them to be able to come in and say yeah I actually want to see this vehicle we got to start with building confidence on their couch.
Charity Ann:
I love that the whole that you can see what was done to the vehicle from your couch, like from my experience in the franchise side of things, there’s as much as we talk about giving customers an experience that they can have on their couch it always comes back to well get them into the building and especially with like CPO’s, yeah we’ve got all of the stuff that we did to the vehicle, but well you’re going give it to you in paper format when you buy the vehicle, and then you can see everything that he’s done, but this sounds like it’s way more transparent and
Jeremy Beck:
far more
Charity Ann:
That’s a total value add, I think
Herb Anderson:
Yeah, but the reason behind that is also there’s, you know, always talking about this on the website experience for most dealership is riddle with FOMO, right we put all these different things on there. We don’t want to miss the lead. We don’t want to miss a single thing that we clutter it to the point where it’s just the customer gets there and they’re overwhelmed with so much that they don’t they’re not looking at the comments. They’re not looking at the things that they should. They’re just lookin price and photos right, and they just want to get out of there.
Jeremy Beck:
Yep and and nine times out of ten those prices in those photos you used to tell my franchise dealers all the time and I tell our independent dealers if you don’t have some type of value slide in that photo current sale that tells consumers why to buy from you then how are you setting yourself apart if you think that everybody is going to be reading this long description that you put in you know you know look how many of us are reading that I don’t get past the first sentence I’m severe ADD I’m a god there’s no way I’m going straight to the photos but if the second photo on this I carousel or the photo carousel is why buy for me or the inspection certificate or what they get from it or what was done to it and there’s a there’s a link for them to be able to you know be to see the detailed Information and now you’ve got my attention right and you’re absolutely right I mean look I come from the told you how long I’ve been in the car business you know our version of internet leads was you know us you clicked on it you submitted the lead and then my first response was yeah we got the car what time can you be here? That was I didn’t want to negotiate with you I didn’t want to give you the price over the phone I didn’t want to give you the price over the internet I wanted your warm butt in my seat right and and consume s are on to that and they’ve been on to it for a while and so really being able to provide some level of transparency or as much as we can in the buying practice has been a massive focal point the associations in developing this program it’s available now so you can go on to our website NIADA.com you can click on the certified pre own portion of it you can submit information to us you can us so again I mentioned we have those four administrators right now if you don’t know who you want to sign up with and we’ll help you find the right one geographically within your region to be able to sign up with and then you know the administrators will reach out to you they’ll walk through the program for you they’ll touch base with you they’ll get you to sign all the legal documents and everything like that and then you’re up and running.
Charity Ann:
Ah, so it’s only been live since the third have you seen a lot of movement from dealers?
Jeremy Beck:
Yeah, surprisingly, we have. I mean, my email inboxes, if I need any more emails, my email box has been blown up with all of those forms fills as we call them right though lead generation form fields, and we’ve seen a lot of interest our phones have been busy at the association saying hey I heard about this want to know more and so we’re getting as much information out there as we possibly can, and we’re working on getting some testimonial vehicles are some testimonial videos from dealers that are enrolling.
Herb Anderson:
okay
Jeremy Beck:
In the program, so a lot is coming, but we’ve seen a ton of interest so far, and you know you know the good news about us is we’re nimble enough, and we selected the right partners, I believe, with this program for us to then be able take feedback and constantly improve upon it we can move really really quickly so if we see something that’s not working with the program as we envisioned it right now we can change it we can take the feedback and we can change ally quickly as long as it doesn’t impact you know the overall mindset of us wanting to drive confidence and transparency in with the consumer.
Herb Anderson:
So that’s good, man. Charity Ann, let’s make sure to put some information on that in the notes. I really like this. I want to get this information now. I’m excited for it mentioned to Melanie in the last call that when I was with cox, Kelly Blue Book was trying to put a certification program together, and they were going to launch that. I remember during my time there, and it was a lot of back and forth, and we had some pilots in certain areas and stuff, but for some reason, they decided to pull the I did, and I always thought that that was a big miss.
Jeremy Beck:
I was with a company that worked with kelly blue book, trying to develop that back in the day. So, I remember that.
Herb Anderson:
So I’m very excited for you guys for this move. I think it’s the right move and look at the end of the day it tells the consumer that you’re getting, you know, a better-quality unit, right that’s good, that’s a good thing if we have that standard set the consumer is the one that benefits from that, so that’s amazing.
Jeremy Beck:
You’re absolute you’re absolutely correct let me just add this just real quick because you know I think one of the challenges that the independent side has had for so long is that you know look the manufacture and as I mentioned billions of dollars building the mind set with consumers that a certified vehicle is better than a non certified vehicle and it should be the challenge that we had on the independent side as we had no way to demonstrate that we had no way to really be able to differentiate that and then we started using you know the word certified has been used and really kind of miss use so many different ways and around our industry that that you almost start to diminish the value of the word certified and the value that the consumer has and that’s why the transparency of what was the inspection what was done to the vehicle all of that became so valuable to us with Carketa because we needed cuss where’s to be able to see that to get past the mindset of oh yeah we have certified what’s that mean right I mean and really build the value back in the word certified so I think I think it’s going to take off we see it already starting to take off but ultimately it’s about building up the confidence the transparency and ultimately the reputation of industry with consumers.
Herb Anderson:
Yeah, for sure, okay, so kind of moving along here not to completely get away from the subject, but I wanted to talk to you also about the the what you guys were seeing in the industry as a whole. I mean
before you got on, I was talking to Charity Ann, and I have a prediction that Carvana is going to file for bankruptcy here within the next three weeks my prediction I’m fairly confident maybe I’m wrong, but we’ll see anyway, let’s say that it does happen well how do you see that impacting the industry you know the independence side also is gonna there’s going to be some effects there I’m sure
Jeremy Beck:
yeah I think I think it will be interesting to see how all that plays out obviously we’ve been watching the Carvana saga for many for better part of a year and a half to two years and I think from an association standpoint obvious we don’t take a stance on we don’t want to see any dealer or any group go out of business or or go through financial hardship but I think what this does as it tells a couple of different things specifically on the independent side but really as an industry as a whole covid and in the pandemic and the supply shortage and all of those different things for everything that it has one negatively to our industry behind lowered volume you know forced us to do things that the consumers really have been asking us to do for a while which is become more digital more transparent those are all positive things really that have really allowed us to to re-innovate look one thing I know about this this industry you can go back over all the different economic down turns and challenges that we’ve had as an industry the auto industry finds a way to survive and to come out smelling like roses right because of the innovators the entrepreneurs and all of those different things what we’ve learned I think through the Carvana experience and others that have tried similar approach is and what we’ve learned through various different communications feedback from consumers is yes consumers want a digital experience but they still that in person experience as well they still want that human capital right you cannot replace human capital with digital capital and I think that a lot of retailer’s tried to remove the human capital element from the experience and tried to remove the human interaction and it’s backfired on a lot of us and I think it’s backfired on the industry in general the challenge we now have is to not try to flit back the way that we were right where where we were we were we swing the entire pendulum back over in customers want to come into our store and when our auto respondors are back to the old yeah I’ve got at what time can you be here that’s not what we need to do what we need to do is find a happy medium right um and you know there’s some interesting statistics that you know part of my responsibility is to kind of analyze the industry and work with our partners and really understand what’s happening and one of the interesting statistics that that I’ve seen trending up over really the last twelve to eighteen months is number of physical dealerships visited so you and you all probably know for years and years and years the number of physical dealerships visited was somewhere around the two to three range right and then it started dipping quite significantly as we went into you know to covid and all that other stuff well what we’re seeing now is starting to trend back up the number of physical dealerships that consumers are visiting is trending back up which which think it’s a great thing because it forces us back into value selling it forces us back into the customer experience as you know I heard somebody tell me the other day you know look if you know anything about chick full right chick file have a lock on the chicken sandwich someone could argue they do some could argue they don’t we’re not going to get into that debate right they have a great chicken sandwich the product has got to be good the quality is got to be good but why do you pass three other chicken stores whose chicken are just just as probably adequate to go to chick file and it’s because of the experience the customer experience they are programmed they are trained to be able to really go in there and I was talking to you know to to several of our partners the other day you know and they were actually the ones that you kind of brought this up to me and it made lot of sense that ultimately I think what we’re going to learn from the carbonic experience and what we’re going to learn from covid and from the supply chain and all those different things is that we’ve got to up our we’ve got up our customer experience because customers still want to talk to us customers still want to come into our stores customers still want to be able to interact with us but what we also have to is on and insure is that we don’t flip the pendulum to the complete opposite and say that the digital experience isn’t important because it is both are
Herb Anderson:
Here’s the thing, and I like where we’re going with this because I just had this debate with somebody.
I’m not going to name any names here on LinkedIn the other day, and they were talking about, well, and you know, the customer they want to buy the car on line, and stuff, and I’m like, dude, where is the proof if that was going to happen it would have happened during covid I’m talking well it went from one percent to ten per cent no dude it would have gone from one percent to fifty percent or sixty percent we would have woken up literally the next day, and that’s how business was being done, and that did not happen so you can’t sit there and tell me that that’s what the consumer wants because their behavior doesn’t predict that doesn’t it doesn’t say that.
Jeremy Beck:
It’s not only their behavior. They’re telling us that that’s not what they want. They are physically
Charity Ann:
right
Jeremy Beck:
Telling us the words are coming out of their mouth. That is not what I want. I want to go into the store; I want to have that experience. I want to test drive the vehicle; I want to maybe they don’t want to play the games. They don’t want the back and forth.
Herb Anderson:
They don’t want to be there for hours
Jeremy Beck:
Right, that’s exactly right. They don’t want to be for two, three four hours, but they still want to go in and test drive. They still want to have a positive experience. They do not want to do everything digitally. If they did look if they did you would have been able to buy a car on your apple iphone five years ago because the technology look. I’m confident that we’ve got enough ingenuity in the text space in the united states between google and a apple and Facebook and meta and all those other they would have figured stuff out a long time ago. It’s not that we can’t figure it out is that there is no market for it, the consumers don’t want it.
Herb Anderson:
exactly
Charity Ann:
And I think that if it’s trending up that people are going to more and more dealers, that just shows also
we’ve had a chokehold on the way that we do business in the automat of space as dealerships
they haven’t really had a choice other than to play the game by the way that we wanted them to play the game and now things are shifting, and they’re like balls in our court watch. And that huge
Jeremy Beck:
That’s I think that’s a phenomenal point Charity Ann I think that you know that’s the biggest point that I try to make to people when I talked to him as you know look we turned a deaf ear to this for a blind eye to many for many many many many years the consumers have been asking and begging for this for some level of transparency from some oh of of you know look there’s a reason the manufacturers put time spent in the fan I box or in the f and I office on their on their manufacture surveys there’s a reason you know that that they asked those questions consumers have been telling us this for for years and that’s why I say covid and all the pandemic and and the supply shortage did really a lot of good for our industry yes it did a lot of but it also did a lot good for our industry because it forced us to come at least some way the challenge now becomes two prong that number one we don’t go too far which believe some of the retailers have have um and then number two that we don’t try to swing the pendulum back the other way and say nope customers don’t want that digital experience because that’s not what they’re saying.
Herb Anderson:
It’s a happy medium. I think the ideal experience is that the customer goes online they, get all the information they, do their fourteen-plus hours of research they own in on the car that they want, and once they do that, they start the process online, and then they get to the dealership, and they’re there for an hour they get them in their car they get there whatever they’re going to do for finance, and they’re out of there that’s he that’s ultimately what who should be striving for not trying to get
Jeremy Beck:
agree wholeheartedly
Herb Anderson:
Yeah, not to get a car to a consumer that they never see, and because I don’t ah, that’s not there’s a big gap there between what the customer wants and what we’re trying to force down the customer’s throat too.
Jeremy Beck:
And I think that that gap still exists today, and I, you know, look, I think we need to we need to pay attention to what our buyers are telling us and what our consumers are telling us, and we need to read leaves right and understand that you know look we’ve got some changes we’ve got to make in this industry, but we don’t have to go so far in the name of progress right in the of digital evolution, and you know that customers want to do everything online because they don’t
Herb Anderson:
Agreed, Jeremy thanks, man, for doing this. We really appreciate it. This has been really nice appreciate.
Jeremy Beck:
yeah
Herb Anderson:
your insight there is one question that we ask everybody that comes on the show but before we do that I do want ask something and I wanted to ask this on the last show but you know was it was our first you know getting back in the grove is there anything that you can say that that that the franchise dealers could benefit from the independence or vice versa and you obviously haven’t had both experience I just want to try to bridge the gap between the two spaces yeah I think that’s a that’s a really good question you know
I was joking with somebody the other day that you know I’ve had franchise experience I’ve had vendor experience I’ve had independent experience and now I have association experience and I don’t know if I’m trying to round myself out or not but it’s been it certainly has been the differences and the dichotomy between all of them are really kind of different but the I think to answer your question of what could we do what could franchise dealers learn from independence and what could independent dealers learn from franchise
I think it’s really it goes on on two premises one is the franchise dealers could learn to be as nimble as independent dealers are in their ability to change and to evolve with the market and to be able to understand it and be willing accept that change you know usually when you’re in a big franchise where you’ve got you know you sixty seventy thousand dollar rent factors and you’ve got you know you’ve got a huge overhead expense you’re a you’re scared to change right you’re scared to try new things you’re scared to evolve because if something goes wrong you’ve got a big nut over there you’ve got to really be able to crack and that could affect the ability to do so really kind of learning from the independent dealers ability to be able to pivot ability to be able to evolve and to be nimble and to change fast
I think would be I think would certainly benefit the franchise world on the flip side independent dealers can learn from the sure that franchise dealers have right because independent dealers are smaller operations they don’t have the big overhead expense and so on the flip side of being able to be nimble they have structure they have less formality around their processes around their overall operational structure whereas you have you know a ton of that in the franchise world and so think that independent dealers could really learn from embracing more structure and more processes from the franchise world in the franchise world could learn you know to be a little bit more nimble o evolve with the market from the from the independent world
Herb Anderson:
Very cool, man. Thank you for that. I really appreciate it, and with that, the question we ask everybody that comes in the show is where do you see the automotive industry headed in the next five years in why
Jeremy Beck:
oh that’s a that’s a really good question so here’s what. I think we’re going to have to understand the impact of eve’s in the in the automotive world. I do not believe I am not an e v u h person who believes that eves are going to take over the world and take over the frank the space. In the next you know fifteen twenty years there’s a lot of work really that has to happen even outside of the industry right in order for vs to have. The impact that everybody says they’re going to have look our electrical grid can’t handle all of the all these vehicles. You know being plugged in and charging overnight or whatever so there’s a lot of work that has to be done. So but I think we are going to have to do as we are going to have to figure out where do eves play in the space and how do we adapt as an industry s service departments as service facilities.
You know as charging facilities how do we really embrace a level of ev come v compatibility and merge it with our traditional retail experience. Because I think there I believe that there is a massive space for eves and there’s going to continue to be a massive space. I don’t see that it’s going to take probably more than you know twenty twenty five percent of the industry. I think right now it’s about you know thirteen percent if I looked at the last numbers you know for twenty twenty-two um. So I think number one we’re gonna have to figure out EV’s and we’re gonna to figure out. How they play were to figure out the longevity the viability of the long term and the batteries and charge all that other thing. The other thing that I think that we’re going to have to understand that we’re going to have to really focus on in the next five years is the evolution of the auto industry.
The digit tat tat the digital ation of our processes that does not mean what that I’m contradicting what I said earlier and trying to make everything a digital experience but we we do to go to the I mean why do we need to continue to print law contracts on you know this really long you know piece of paper with five press hard five copies you know what the dot matrix printers and all of that other stuff I mean we still do that you walk into the majority of the the boxes in these dealerships and we still got these big you know active printers that you know or that looked like they were you know from back in the future when it was generated right but when that movie was created think we’re going to have to figure out because perceptions with consumers are real right and so until we can really get away from you know this mound of paper work and not and not digital consumers are going to continue to have
I think a negative connotation so I think we’re going to I think somebody’s going to finally figure that out and we’re going to go more digital in the f space in the paper work space and I think we’re going to find a happy medium with a media with eve’s in the space and I think I tend to believe that you’re going to continue to see number of dealer ships go up visited go up but I think you’re goin also going to see customers satisfaction really start to go up and not be I think erroneously inflated because you know we have a way of of making numbers tell us what we wanted to tell us as opposed to what the consumer has actually I guess so I don’t know if that really completely answers your question but I think that those are three things that I think we’re going to be able to finally solve really in the next five years
Herb Anderson:
Right on, well there you have it, everybody Jeremy Beck, let’s give him another hand here, you know, yeah, thanks again, man, for doing this. We really appreciate it.
Herb Anderson:
Yeah, that’s all the time that we have for today, and as usual, we’ll talk later.
