In this issue: Ryan Winkelmann – Michael W. Dunagan: Dealer Questions About Sales Tax on GPS Units and Air-Time Fees – Can Great Recession Lessons Help Dealers in 2022? – Watching Your Profit & Loss Statement Isn’t Good for Your Dealership – 6 Key Areas You Might Be Wasting Your Local Marketing Spend
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TexasDealercontents Volume XXII / Issue 9 / September 2022 Notice to all members concerning services and products: TIADA was established in 1944 to develop professional standards of service and conduct for the independent auto industry. Opinions expressed herein are not necessarily those of the TIADA management, the Board of Directors or the member ship. Likewise, the appearance of advertisers or their indemnifications of TIADA does not constitute endorsement of the products or services featured. Editor: Stephen Pallas Magazine Ad Sales: Patty Huber, 512-310-9795 TIADA Board of Directors PRESIDENT Ryan Winkelmann/BJ’s Autohaus 5005 Telephone Road Houston, TX 77087 PRESIDENT ELECT Eddie Hale/Neighborhood Autos PO Box Decatur1719TX76234 CHAIRMAN OF THE BOARD Mark Jones/MCMC Corporate 264 Burleson,ExchangeTX76028 SECRETARY Vicki Davis/A-OK Auto Sales 23980 FM 1314 Porter, TX 77365 TREASURER Greg Phea/Austin Rising Fast 8024 IH 35 North Austin TX 78753 VICE PRESIDENT, WEST TEXAS (REGION 1) Brad Kalivoda/Fiesta Motors 2599 74th Street Lubbock, TX 79423 VICE PRESIDENT, FORT WORTH (REGION 2) Greg Reine/Auto Liquidators 39670 LBJ Freeway Dallas TX 75237 VICE PRESIDENT, DALLAS (REGION 3) Chad Lancaster/Chacon Autos 11800 E. Northwest Hwy Dallas TX 75218 VICE PRESIDENT, HOUSTON (REGION 4) Russell Moore/Top Notch Used Cars 900 East Davis Conroe, TX 77301 VICE PRESIDENT, CENTRAL TEXAS (REGION 5) Robert Blankenship/Texas Auto Center 6809 Suite B S IH35 Austin, TX 78744 VICE PRESIDENT, SOUTH TEXAS (REGION 6) Armando Villarreal/McAllen Auto Sales, LLC 4215 S. 23rd St McAllen, TX 78503 VICE PRESIDENT AT LARGE Lowell Rogers/11th Street Motors 1355 N 11th St, Beaumont, TX 77702 VICE PRESIDENT AT LARGE Cesar Stark/S&S Motors 7699 Alameda Ave. El Paso, TX 77915 TIADA EXECUTIVE DIRECTOR Jeff 9951MartinAnderson Mill Rd., Suite 101 Austin, TX 78750 Office Hours M-F 8:30am – 4:30pm 512.244.6060 • Fax 512.244.6218 jeff.martin@txiada.org Did You Know? The 2022 TIADA Conference and Expo was the largest in association history, with 320 dealers in attendance! 4 Officers’ Message by Greg Phea, TIADA Treasurer 8 Board of Directors Meeting Minutes 12 2022 TIADA Conference & Expo Wrap-Up by TIADA Staff 14 2022 TIADA Awards Wrap-Up by TIADA Staff 17 Legal Corner: Dealer Questions About Sales Tax on GPS Units and Air-Time Fees by Michael W. Dunagan 18 Upcoming Events 20 TIADA Auction Directory 22 TIADA Membership Application 24 On The Cover: TIADA Welcomes 2023 President Ryan Winkelmann by TIADA Staff 27 Auto Dealer Bond Claim Process in Texas: Everything You Need to Know by Eric Weisbrot 31 Can Great Recession Lessons Help Dealers in 2022? by David Meyer 35 Watching Your Profit & Loss Statement Isn’t Good for Your Dealership by Harlene Doane 39 6 Key Areas You Might Be Wasting Your Local Marketing Spend by Jamil Zabaneh 42 House of Delegates Meeting Minutes 43 Local Chapters 43 New Members 45 Behind the Wheel by Jeff Martin
uly 27th marked my wife’s and my 30th anniversary. It was so significant and joyous to be embraced by friends, family, staff, and even customers. Remarkably, this social event led to a boost in sales and reengagement with my business’ social media. It was even a wonderful opportunity to get new online reviews from those customers. The expe rience was so remarkable, that I began thinking about the power of connection and how I could use those strong feelings to bolster my business evenPeoplemore.gravitate towards celebration and posi tivity. My team and I celebrate every single deal with a miniature party: music plays, and all staff cheer and thank our customers. Celebration is my favorite part of our process. We might do deals all day, every day, but for most customers, a vehicle purchase is a big deal, done only a few times in a life time. We want them to feel embraced. My company is always orienting messaging and digital communica tions around providing a family-like environment and positive experience. However, there is always room for improvement.OnethingI have resolved to do since the TIADA Conference’s Dealer Education Sessions is to bring It is more crucial than ever to continue to connect with previous customers in meaningful ways.
messageofficers’ by Greg Phea Austin Rising Fast (Austin) TIADA TREASURER
customers’ stories and experiences online. No one is a stranger to the unique challenges the last two years have brought to the car business. Physical restrictions brought sales online and being able to conduct remote transactions represented a strong draw to many shop pers. So why not bring customers joy and celebration online as well? It is more crucial than ever to continue to connect with previous customers in meaningful ways. I truly value relationships, and whenever I find my self looking at the sales and find them lacking, I always revisit the foundation: loyal, repeat business.
On Making Connections Through Celebration and Positivity
J
4 Texas Dealer September 2022
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Dealer Academy This has been one of the most challenging years in the Buy Here, Pay Here industry. Dealers are finding that every collection opportunity needs to be capitalized on and that’s where this seminar can help. Collect The Cash, Not The Car is designed to help you and your collection teams maximize your collection opportunities. Through this 1-day course you can expect to learn: • How to maximize the collectability of every customer • Effective skip tracing methods and tools • How to overcome the common and not so common objectionscustomer • Effective collectionphonetechniques Collect the Cash, Not the Car Presenter Brent Carmichael, Executive Moderator,Conference20Groups.NCMAssociates,Inc. Time 9:00am - 4:00pm Cost $249 Members, Each Additional $199 (must be from same dealership) $498 Non-members Monday, October 3, 2022 Dallas, Texas Hilton Garden Inn Dallas Market Center | Dallas, TX 75207 214.634.8200 We have put together a very strong course outline that includes a wide array of role playing, classroom learning and interactive activities that will allow your collection team to soak up the information and come back to your dealership ready to collect the cash and not the car. To register visit Txiada.org or by phone at 512.244.6060 Sponsors Texas Dealer September 20226
President Mark Jones called the meeting to order at 9:02 a.m.
Executive Director’s Report
President’s Report
Secretary
Jeff Martin, Earl Cooke, Teresa Orkun
Eddie Hale presented the minutes from the last meeting. A motion was made to accept the minutes.
compiled by Texas Dealer staff Board Members in Attendance:
Mark Jones presented the President’s Report. He thanked the board for the past year.
Treasurer’s Report
Jeff Martin presented the Executive Director’s Report, including a discussion of the FTC Safeguards Course and conferences attended (NIADA, Ignite, Tax Assessor Collectors).
A–PASSEDmotion was made to pay off the mortgage of the association’s office space.
Robert Beck, Mark Jones, Ryan Winkelmann, Eddie Hale, Vicki Davis, Cesar Stark, Chad Lancaster, Greg Reine, Russell Moore, Robert Blankenship, Armando Villarreal, Brad Kalivoda, Greg Phea
July 24, 2022 | Kalahari Resorts, Round Rock, TX Save the Date Save the Date July 23-25 JW Marriott Hill Country Resort San Antonio, TX 2 Conference23&Expo 8 Texas Dealer September 2022
Moved by Ryan Winkelmann, seconded by Greg –PASSEDReine.
Vicki Davis presented the Treasurer’s Report. A motion was made to accept the report.
Minutes of Last Meeting
board of directors meeting minutes
New Business
A motion was made to accept the 2023 proposed Movedbudget. by Eddie Hale and seconded by Greg Reine.
Moved by Eddie Hale, seconded by Russell Moore. APASSEDmotion was made to adjourn the meeting. Moved by Vicki Davis, seconded by Robert Mark–PASSEDBlankenship.Jonesadjourned the meeting at 11:15 a.m. Respectfully submitted, Eddie Hale, Secretary A complete copy of any reports referenced in this document and more detailed notes from the meeting are on file at the TIADA office and available upon request.
TIADA Staff in Attendance:
Moved by Russell Moore, seconded by Armando –PASSEDVillarreal.
NATIONALCORPORATEPARTNER GOLD NATIONALCORPORATEPARTNER GOLD PROUD MEMBER OF
Thank you to all those who have contributed to INDEPAC in 2022! A Li of Our C t b ors r July Please ll out the form on the next page to help our e orts at the Capitol! *Monthly Donor T C t b i s in 2022 $78,500 Alderson, Sam Allen, EdenBarragan,ScottCesarBeck,RobertBrown,MarkCarlson,MikeChaney,Greg*Chapman,KyleCochran,KipCockerell,ClintCooke,EarlDavis,VickiDobbins,AllenDonnelly,Chris*Downey,Mikeeld,Robert*Endsley,JenniferFox,AndyGoodman,Jason*Gregory,Tommy*Greig,StevenJ.Hagler,Keith*Hanson,April* Hobson, James Hudson, Richard Hudson, Robert Ireland, Alden Johnson, James Keate, Kyle Klein, Daniel Labaj, Lancaster,KantonChadLathrop,PhillipLevine,StephenMaroney,RickMartin,JeMartinez,MarioMiddaugh,TomMoore,Russell*Munoz,JoseMurphy,BillParedez,SonnyPhea,GregRhodes,BrentRose,JayRuckel,Matt Sabillon, Christina Sabillon, Juan M. Sabra, Smith,Smith,Simonsen,Siddiqui,Scott,RamziPaulIrfanSilva,DavidNelsenJerryandDeDeSmith,JesseRussellandLindaStark,CesarStazzone,RichStoll,KevinSumrall,CalTrevino,Miguel(Mike)Turan,JonValdez,SergioVillarreal,ArmandoWilson,ErikWinkelmann,Ryan*Zak,Gregory*Zak,Michael Top Ten Donors Blankenship, Robert and Erika Davis, Gregory,BradJasonHale,EddieIngram,Blake Jones, Mark* Kaya, Simmons,Rogers,Reine,SelcukGregLowellTyler* Texas Dealer September 202210
Yes, I would like to he lp with TIADA’s grassroots effort! Please list me as a sustaining donor. I would like to support my industry by making a monthly credit card donation of $______________ Add me to the KEY-PERSON list! I know (Name of Legislator)asa Acquaintance Personal Friend Professional Contact I would like to attend political fundraisers in my area I would like to support my industry by pledging a one-time donation of ___$1,000 ___$500 ___$250 ___$100 Other $_____ ____ Personal Check Payable to INDEPAC _____ Personal Credit Card CName__ompany ___ Home Address_ Email ** Personal Check or Personal Credit Card only. Corporate contributions are prohibited by state law. Contributions are not tax deductible as charitable contributions for federal income tax pu rposes. ** Charge my Credit Card V MC D AM Exp: / CVV: Name on Card: Card Billing Address (if different): Or donate online at www.txiada.org >> Resources >> Advocacy >> Political Action Committee c/o TIADA 9951 Anderson Mill Rd Suite 101, Austin Texas 78750 PHONE 512.244.6060 FAX 512.244.6218 EMAIL accounting@txiada.org Referred by: September 2022 Texas Dealer 11
The variety of these discussions covered many important top ics within the industry, including BHPH operations, dealership management, special finance and retail, technology, marketing,
12 Texas Dealer September 2022
IADA members traveled to Round Rock in July to at tend the 2022 Conference & Expo. It was the largest, and one of the most successful and memorable events, in the association’s history, with 320 dealers in attendance. Many of these dealers were first-time attendees, who enjoyed several hours of educational breakout sessions presented by leaders within the industry. The revamped dealer-driven roundtables were also a huge success, with several dealers com menting how much they enjoyed discussing issues affecting dealerships of similar size and scope.
feature by TIADA Staff 2022 TIADA Conference & Expo Wrap-Up
T
and compliance. Dealers also attended an enter taining opening keynote address by dealer Chad Randash and master magician Armando Lucero. On Tuesday, FTC Senior Attorney Tom Carter gave an important keynote address to help deal ers stay compliant with the FTC Safeguards Rule and Used Car Rule, followed by an insightful question-and-answer session from the audi ence and an association update from TIADA Executive Director Jeff Martin. These presentations, sessions, and events were highlighted by an atmosphere of excitement and camaraderie, as dealers face some serious chal lenges in inventory and other areas. Attendees were enthusiastic to participate in the largestever TIADA Conference. In addition to the educational sessions and roundtable discussions, dealers attended a jampacked expo hall, which featured over 100 vendors.
13September 2022 Texas Dealer
Don’t forget to mark your calendars for July 23–25, 2023. We will be heading to the JW Marriott Hill Country Resort in San Antonio, and we can’t wait to see you all again!
Greg Reine, owner of Auto Liquidators, was named the 2022 Texas Quality Dealer Award. It is the most prestigious award the association gives each year, and the award committee bases its selection on the individu al’s character, association participation, political involve ment, and business acumen.
14 Texas Dealer September 2022
Carol Alvarado was awarded the
Earlier, the first award winner was Breanna Simmons, who was given the Marvin Norwood Scholarship for her promise as a student and leader in the community.
2022 TIADA Awards Wrap-Up by TIADA Staff feature organization’s Independent Award, which recognizes individuals outside of the industry who work to sup port independent automobile dealers. Senator Alvarado has worked hard to move legislation to prevent cata lytic converter theft and has attended numerous local HIADA chapter meetings.
Scott Allen, who presented the award, also announced that TIADA was able to award additional scholarships to every one of their applicants this year, thanks to a gener ous donation from Steve and Susan Babinksy’s Triple J FamilyTexasFoundation.StateSenator
Next, outgoing TIADA President Mark Jones pre sented Sergeant Darren Schlosser with the Presidential Award. Sergeant Schlosser leads the Vehicle Fraud Unit in the Auto Theft Division of the Houston Police Department and has brought a set of standards and practices to help the industry efficiently combat fraud. He also regularly attends the TIADA Conference.
Blake Ingram then announced the first-ever TIADA Lifetime Achievement Award, which was given to Michael Dunagan for his decades-long service to the industry and to the association. And former TIADA President (and current NIADA President) Scott Allen has become the newest member of the TIADA Hall of Fame for his ongoing representation, leadership, and advocacy for Texas dealers at the Capitol in Austin. Congratulations to all this year’s winners!
T IADA announced the winners of several awards at the final event during the 2022 Conference & Expo, which took place from July 24–26 at the Kalahari Resort in Round Rock. The awards banquet is always one of the event’s major highlights, and several members of the community were honored for their work over the past year.
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CMYCYMYCMYMCK EPI-TIADAhalf SEP2022.pdf 1 8/8/22 9:35 AM Texas Dealer September 202216
by Michael W. Dunagan TIADA COUNSEL
Answer: There is an exemp tion for an “accessory” that a dealer would purchase to install on a vehicle that is resold. The theory behind the accessory exemption is that the sales price of the object to which the accessory is installed (in this case a motor vehicle) will be enhanced by the product which results in sales tax being recovered at the ultimate retail sale (in this remove units from cars he takes back and from paid-off units, the units would be considered to be nontaxable accessories. Can I rely on the auditor’s statement to that dealer?
Dealer Question: If I buy a book or DVD on-line from a com pany that is located out-of-state, case, motor vehicle sales tax on the vehicle).Theaccessory exemption doesn’t apply to GPS devices, the comptrol ler’s office says, because they are pri marily purchased and installed for the use and benefit of the dealer (or other lien holder), not the consumer.
Dealer
legal DealercornerQuestions
About Sales Tax on GPS Units and Air-Time Fees
Answer: The official opinion of the Comptroller’s office is that GPS devices are taxable regardless of whether they remain the property of the dealer, and regardless of whether or not they are removed. The decision of an auditor in the field is probably not binding on the Comptroller’s of fice. We can expect future audits to consistently take the official position.
Even if the device stays with the ve hicle, and is available for the buyer to use after repayment is complete, the initial purchase and installation were primarily for the dealer to locate the vehicle for repossession purposes.
September 2022 Texas Dealer 17
Answer: The Comptroller’s office, in audits of deal ers, and in discussions with TIADA, has taken the posi tion that GPS units, purchased by dealers for installation on vehicles sold as a way of tracking collateral, are taxable purchases by the dealer. The taxable amount includes ship ping and handling charges billed by the seller. Additionally, the Comptroller’s office has taken the position that air-time charges billed to the dealer are taxable service charges. As to the purchase of the device itself, the Comptroller says the item is taxable as “tangible personal property.” All tangible personal property purchased for use in Texas is sub ject to sales tax unless specifically exempted. The state’s tax office has taken the position that there is no exemption that applies to GPS devices purchased by dealers for the primary purpose of locating collateral.
Dealer Question: If I buy a part to install on a vehicle that I in tend to resell, I don’t have to pay sales tax on the part when I purchase it. Can’t I argue that the GPS unit is like an accessory that I purchase for in stallation on a vehicle that will be in cluded in the motor vehicle sales tax?
Dealer Question: A dealer down the street from me who uses GPS devices was recently audited by the Comptroller’s office. He was told by the auditor that since he didn’t
The official opinion of the propertyregardlessdevicesofficeComptroller’sisthatGPSaretaxableofwhethertheyremaintheofthedealer,andregardlessofwhetherornottheyareremoved.
Question: One GPS vendor is telling me that sales tax on GPS devices and air time charges are not subject to state sales tax and thus tax would not be included on my in voices. I’ve been told by another vendor that I have to pay sales tax on GPS devices, even though I buy them from out-of-state and install them as accessories on the vehicles I sell. The sec ond vendor includes sales tax on its invoices. What gives?
EventsUpcoming TIADA DEALER ACADEMY Online registration available. www.txiada.org October 2022 3 Collect the Cash Not the Car Hilton Garden Inn Dallas Market Center 2325 N. Stemmons Freeway Dallas, TX 75207 December 2022 12 Keeping Your Dealership Legal & Compliant Sheraton Houston Brookhollow Hotel 3000 North Loop West Houston, TX 77092 OTHER TIADA EVENTS October 2022 24 Board of Directors Meeting Austin, TX February 2023 6-7 Board of Directors Meeting and TIADA Day at the Capitol Austin, TX April 2023 23 Board of Directors Meeting Austin, TX July 2023 23 Board of Directors Meeting Followed by TIADA Conference and Expo San Antonio, TX
I usually don’t pay sales tax. Why do I have to pay sales tax on a GPS device that I purchase from an outof-state company that doesn’t have an office in Texas?
Answer: According to the Comptroller’s office, you do techni cally owe sales tax on the books and DVDs and many on-line retailers are not collecting and remitting sales tax on purchases sent to Texas residents.
Dealers, however, are subject to audits on motor vehicle sales taxes, and inquiry can easily be made by an auditor of taxable purchases.
By the way, whether or not a seller has sufficient contacts or “nexus” to require collecting and remitting sales tax is totally separate from the issue of whether the purchase of a product from a seller is taxable to the buyer. That is, even if an out-of-state seller has no contacts with Texas at all, the “use” tax is owed by the purchaser on taxable items.
There is a provision of the Texas Tax Code that says there is an equivalent “use tax” owed by the purchaser on items purchased out-of-state but brought into Texas to be used. As a practical matter, Comptroller per sonnel are not going to audit every household for taxable purchases.
Answer: The dealer can pay sales taxes that are owed but aren’t collected by the seller by adding the amount of tax owed to his or her Texas Limited Sales Tax report (not to be confused with the Motor Vehicle Sales Tax re port on deferred sales taxes) and re mitting the appropriate taxes directly to the Comptroller’s office. This same procedure has been recommended for paying sales taxes on repossession fees when repossession agents refuse to add sales tax to their charges. By the way, unlike motor vehicle sales tax, which is uniform throughout the state, the limited sales tax rate varies from location to location as there are optional types and amounts of taxes local governmental units can add to the state’s portion of the sales tax. Dealers need to determine what that rate is (usually in the range of 8.258.75 per cent) at their locations.
Texas Dealer September 202218
Dealer Question : Why do I have to pay sales taxes on air-time fees that I am charged by my vendor for access to satellite tracking infor mation and for activation of shutoff devices?
A separate but related issue on the question of sales tax on outof-state purchases has to do with when a seller in another state must sign up to collect Texas sales tax on purchases made by Texas residents. This question has been the subject of much litigation. The general answer is a seller must collect Texas sales tax if the seller has “nexus” to the state. That is, does the seller have sufficient contacts with the state to give the state jurisdiction over the selling en tity? According to the Comptroller’s office, almost any type of contact with the state is sufficient. For instance, having an office, a ware house, or employees in Texas creates “nexus.” But what is not commonly known is that just having a sales rep (even an independent agent) calling on customers in Texas, or appear ing at a convention or trade show in Texas are sufficient contacts.
Answer: The Comptroller’s office takes the position that such charges are taxable as “security services” and/ or “telecommunication services” which are taxable under the Texas Tax Code. The Tax Code lists certain ser vices that are subject to sales tax even though they don’t involve the pur chase of tangible personal property.
Dealer Question: I have been audited in the past, but noth ing was said about owing sales taxes
Dealer Question: My GPS vendor refuses to collect sales taxes or even put sales tax on my invoic es. How can I pay sales tax to avoid being assessed penalties and interest if I’m audited by the Comptroller?
Answer: The Comptroller’s Office has always taken the position that its failure to raise an issue in an audit can’t be relied upon to excuse non-payment of a tax due assessed in a subsequent audit.
Also, in the federal Consumer Finance Protection Bureau (CFPB) opinion in the Herbies case (see the May, 2016 issue of Texas Dealer for a more complete discussion of the case), the placement of a charge for GPS devices on retail installment contracts was found to be one of the violations.
Answer: Until further clarifica tion is received from the Comptroller, the administrative process, or, ulti mately, the courts and the legislature, the best practices procedure is for the dealer to either pay sales tax as invoiced from the GPS vendor, or, if sales tax does not appear on the invoice, to pay the tax directly to the Comptroller using the Limited Sales Tax report discussed above. Dealers may wish to consult sales-tax special ists for further guidance.
Answer: The Office of Consumer Credit Commissioner (OCCC) has taken the position that charges for GPS devices are not au thorized charges that can be passed through. And like the Comptroller’s Office, OCCC cites the fact that GPS devices are primarily for the benefit of the creditor, not the con sumer. When such charges have been found on contracts (usually during routine investigations or audits) of licensees, the dealers have been required to refund or credit the charges.
Dealer Question: What does TIADA recommend for dealers who purchase and use GPS devices?
on the GPS devices I had bought.
6/22 September 2022 Texas Dealer 19
Can’t I rely on the absence of be ing assessed for the taxes in a prior audit to establish that the purchases are not taxable to me?
Dealer Question: Can I pass through a charge for GPS devices to a vehicle finance customer on a motor vehicle retail installment contract?
First, such charges may be violations under state law (as is the case in Texas). Additionally, the CFPB found that the charges were in fact finance charges as defined in federal Truth in Lending (TIL). But since they were not added to the disclosed finance charges, and were not included in the annual percentage rates, TIL violations had occurred.
Michael W. Dunagan is an attorney in Dallas, Texas who has represented the Texas Independent Automobile Dealers Association for over 45 years. He has writ ten a number of books and hundreds of articles for trade journals and law reviews. His clientele includes dealers, banks, finance companies, auto auctions and credit unions.
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GM: Adriana Serrano Friday, 9:30 a.m. $AVE : up to $200 Sell Fee MANHEIM HOUSTON www.manheim.com 14450 West Road, Houston, TX 77041 281.924.5833, Fax 281.890.7953
GM: Edgar Chavez
MANHEIM EL PASO www.manheim.com 485 Coates Drive, El Paso, TX 79932 915.833.9333, Fax 915.581.9645 GM: JD Thursday,Guerrero10:00a.m. $AVE : $100 IAAHarlingen/McAllenMCALLEN* www.iaai.com 900 N. Hutto Road, Donna, TX 78537 956.464.8393, Fax 956.464.8510 GM: Ydalia Sandoval Tuesday, 9:00 a.m. $AVE : up to $200 Sell Fee BIG VALLEY AUTO AUCTION** www.bigvalleyaa.com 4315 N. Hutto Road, Donna, TX 78537 956.461.9000, Fax 956.461.9005 GM: Lisa Thursday,Franz9:30 a.m. $AVE : $200 ADESAHoustonHOUSTON www.adesa.com 4526 N. Sam Houston, Houston, TX 77086 281.580.1800, Fax 281.580.8030 GM: Brian Wednesday,Wetzel9:00 a.m. $AVE : $200 AMERICA’S AA HOUSTON www.americasautoauction.com 1826 Almeda Genoa Rd., Houston, TX 77047 281.819.3600, Fax 281.819.3601 GM: Ben Thursday,Nash2:00 p.m. $AVE : $200 AMERICA’S AA NORTH HOUSTON www.americasautoauction.com 1440 FM 3083, Conroe, TX 77301 936.441.2882, Fax 936.788.2842 GM: Buddy Cheney Tuesday, 1:00 p.m. $AVE : $200 AUTONATION AUTO AUCTION - HOUSTON www.autonationautoauction.com 608 W. Mitchell Road, Houston, TX 77037 822.905.2622, Fax 281.506.3866 GM: Juan Gallo Friday, 9:30 a.m. $AVE : $200 HOUSTON AUTO AUCTION www.houstonautoauction.com 2000 Cavalcade, Houston, TX 77009 713.644.5566, Fax 713.644.0889 President/GM: Tim Bowers Wednesday, 11:00 a.m. $AVE : $200 IAA HOUSTON* www.iaai.com 2535 West. Mt. Houston, Houston, TX 77038 281.847.4700, Fax 281.847.4799 GM: Alvin Wednesday,Banks9:00 a.m. $AVE : up to $200 Sell Fee IAA HOUSTON NORTH* www.iaai.com 16602 East Hardy Rd., Houston-North, TX 77032 281.443.1300, Fax 281.443.4433 GM: Aracelia Palacios Thursday, 9:00 a.m. $AVE : up to $200 Sell Fee IAA HOUSTON SOUTH* www.iaai.com 2839 E. FM 1462, Rosharon, TX 77583 281.369.1010, Fax 833.595.8398
GM: Brian Walker Tuesday, 9:00 a.m. / Thursday 6:30 p.m. $AVE : $100 MANHEIM TEXAS HOBBY www.manheim.com 8215 Kopman Road, Houston, TX 77061 713.649.8233, Fax 713.640.6330 GM: Darren Slack Thursday, 9:00 a.m. $AVE : $100 ALLIANCELongviewAUTO AUCTION LONGVIEW www.allianceautoauction.com 6000 East Loop 281, Longview, TX 75602 903.212.2955, Fax 903.212.2556
$AVE : up to $200 Sell Fee TEXAS LONE STAR AUTO AUCTION** www.lsaalubbock.com 2706 E. Slaton Road., Lubbock, TX 79404 Wednesday,GM:806.745.6606DaleMartin9:30 a.m $AVE : $75/Quarterly LUFKINLufkin DEALERS AUTO AUCTION www.lufkindealers.com 2109 N. John Reddit Dr., Lufkin, TX 75904 936.632.4299, Fax 936.632.4218 GM: Wayne Cook Thursday, 6:00 p.m. $AVE : $200 Midland Odessa IAA PERMIAN BASIN* www.iaai.com 701 W. 81st Street, Odessa, TX 79764 432.550.7277, Fax 432.366.8725 Thursday, 11:00 a.m. $AVE : up to $200 Sell Fee ACVONLINEAUCTIONS** www.acvauctions.com 800.553.4070 $AVE : $250 E-DEALERDIRECT** www.e-dealerdirect.com chris@edealerdirect.com $AVE : Up to $500/month San ADESAAntonioSANANTONIO www.adesa.com 200 S. Callaghan Rd., San Antonio, TX 78227 210.434.4999, Fax 210.431.0645 GM: Clifton Sprenger Thursday, 10:00 a.m. $AVE : $200 IAA SAN ANTONIO* www.iaai.com 11275 S. Zarzamora, San Antonio, TX 78224 210.628.6770, Fax 210.628.6778 GM: Paula Booker Monday, 9:00 a.m. $AVE : up to $200 Sell Fee MANHEIM SAN ANTONIO** www.manheim.com 2042 Ackerman Road San Antonio, TX 78219 210.661.4200, Fax 210.662.3113 GM: Mike Wednesday,Browning9:00a.m. $AVE : $100 SAN ANTONIO AUTO AUCTION** www.sanantonioautoauction.com 13510 Toepperwein Rd. San Antonio, TX 78233 GM:210.298.5477Brandon Walston Tuesday, 10:00 a.m. / Thursday, 1:30 p.m. $AVE : $200 GREATERTyler TYLER AUTO AUCTION www.greatertyleraa.com 11654 Hwy 64W, Tyler, TX 75704 903.597.2800, Fax 903.597.3848 GM: Wayne Cook Tuesday, 5:00 p.m. $AVE : $200 ALLIANCEWaco AUTO AUCTION WACO www.allianceautoauction.com 15735 I-35 Frontage Road Elm Mott, TX Friday,GM:254.829.0123,76640Fax254.829.1298ChristinaThomas10:00a.m. $AVE : $200 September 2022 Texas Dealer 21
$AVE : up to $200 Sell Fee IAALubbockLUBBOCK* www.iaai.com 5311 N. CR 2000, Lubbock, TX 79415 806.747.5458, Fax 806.747.5472 GM: Chris Foster
Longview,
GM: Chris Barille Friday, 10:00 a.m. $AVE : $200 IAA LONGVIEW* www.iaai.com 5577 Highway 80 East, TX 903.553.0210 Thursday, 9:00 a.m. Tuesday, 9:00 a.m.
PLEASE INDICATE PAYMENT METHOD: Check or Money Order payable to TIADA Check # __________ CreditCard Card Number: :edoC.ceS ____________:etaDnoitaripxE Monthly Payments - $41.58 per month Via Credit Card (Please enter card information above) Via Bank Draft)eciffoetatstcatnoc-deriuqertnemeergA Mail or Fax Application To: TIADA Membership Services, 9951 Anderson Mill Rd., Suite 101, Austin, TX 78750 FAX 512.244.6218 www.txiada.org 512.244.6060 Dues are not deductible as charitable contributions for income tax purposes but may be deductible as miscellaneous itemized deductions, subject to IRS restrictions. It is estimated that 20 percent of your dues dollars is used for lobbying activities and is therefore not deductible. Business Name: ____________________________________________ Select one: Dealer MemberAssociate Member Contact City:Address:Person: Zip:State: :ytnuoC :enohPlleC :enohPeciffO Fax: Become a TIADA Member MembershipDues: texas independent automobile dealers TIADAassociationtexasindependentautomobiledealersassociation (*Membership is thru 12/31/2022. Dues include NIADA and local chapter membership where applicable.) Email: Dealer P Number: Who referred you to TIADA? Mailing Address (if different from above): City: State: Zip: $499* Renewing Member $250* New Member Texas Dealer September 202222
. .. . . .. .. . .. . . .... . ...... .. .. . .. ... . . .. .. . . . ... ... . ..... . . . . . . . . . . . . .. .. . . ...... .. ... .. .. . ... . . . . ... . . . ... . . . .. ... .. .. .. ... .. . ... . . ... .. .. .... .. . .. ....... ... .. . .. .. . . ... . . .... ... ... .... ... .. . ... . ... . .. . ... . . . . . .. ... ... . ....... . .. . .. .. .... . ..... ... .. . .. . . . ... . . . . . . ... . . . .... . .. . . .. . .. . .. .. .. . .... . . . . ... . .. ... ....... . . . . . .. . .. .. . . . .. . .. .. .... ... . . .. . . . . .. .. . ... .. . ..... . . . .. . .... . .. .. .. ... . . ... .. ... . . .. ... ... . . . ..... .. . .. . .... . .. .. . . . .. .. ... .. . . . ... ...... .. . .. .. . .. . .. ... .... .... . . . .. . ... .. ... . . .. . .. .. .. . .... ... ...... . . ... ... ... . . . .. . . . .. . .. .... . . .. ..... .... .. . . ..... . .. .. . . •40 Years Serving Texas Dealers • 4.9 Star Avg. Customer Rating • Independently Owned W h y C h o o s e U s ? M U L L E N I N S U R A N C E . C O M V i s i t U s O n li n e f o r C u s t o m i z e d S o lu t i o n s & H e lp f u l I n s i g h t s W h y C h o o s e U s ? M U L L E N I N S U R A N C E . C O M V i s i t U s O n li n e f o r C u s t o m i z e d S o lu t i o n s & H e lp f u l I n s i g h t s
President Ryan
on the cover by TIADA Staff
TIADA Welcomes
Winkelmann
Texas Dealer September 202224
2023 President Ryan Winkelmann is a secondgeneration dealer who started in the independent automo bile industry while he was still in high school. His family has a long heritage in the association, with his mother, Janette Winkelmann serving as TIADA president back in 1997. But Ryan is much more than a product of his family’s suc cess. As a partner in BJ’s Autohaus in Houston, he helped manage the dealership for his first 20 years, and then purchased the family business ten years ago, making this his 30th year in the industry.
Ryan andLegacy:Winkelmann’sPast,Present,Future Ryan will be the first to admit that he has lived firmly in the shadow of his parents for much of his time in the business. His mother dedi cated over 20 years to the indepen dent automobile industry and was the first-ever female president of TIADA. His father, Bill, served as president of the Houston IADA, and coached Ryan through nearly every department of the company during those same 20 years. “I’ve had a tremendous amount
“I want to show people the true internal benefits of what TIADA does for their business. We have enormous potential as a leader in the association industry, and we look forward to attracting as many good, healthy, and strong dealers as possible.”
T IADA
2023
“I’ve spoken with many dealers who have taken this time as an op portunity to retain and hire quality employees with a drive to work,” he said. “We see the return of a willingness to work. We also see vehicle prices starting to stabilize and becoming more realistic from the dealer side, which hope fully means an end to the crushing inventory shortages we have seen this past year.”
Ryan has been actively involved in his local chapter of TIADA for a long time. It is ingrained in him as an integral part of his business. As one of the more active participants in the local Houston Chapter, Ryan became the first person to be elect ed for two terms of the local chap ter. He also served on the Houston Automotive Board for eight years. “It was recommended and hon estly mandatory that I get involved in our local and state associations from the time I was in sales,” said Ryan. On the Future of TIADA During Ryan’s tenure as President of TIADA, he plans to focus his ef forts on growing membership and member engagement and on pay ing close attention to the upcoming Texas legislative session that begins in January 2023.
On a more direct level, Ryan expressed a desire to grow the association.“Iwantto show people the true internal benefits of what TIADA does for their busi ness,” he said. “We have enormous potential as a leader in the association industry, and we look forward to at tracting as many good, healthy, and strong dealers as possible.”
byConferencePresidentspeechfather.asdealersaidnooverheadoperationrunningcompany.representativesreliableofthe“Ipridemyselfonadebt-freewithlittleandalmostemployeeturnover,”Ryan.HeisasdedicatedaandemployerheisahusbandandHeopenedhisasincomingatthe2022andExpocelebratingananniversary
of love, support, and encourage ment, not only from my parents, who built an extremely success ful life and business in the auto industry but also many of you in this room,” Ryan said at the Awards Banquet.ButRyan has become an incred ibly successful dealer in his own right. BJ’s Autohaus currently employs six staff members and historically sells between 250-350 cars annually. As a dealer, Ryan empha sizes customer loyalty and retention; as an employer, he ensures his staff members are efficient and with his wife. His speech ended with a chorus of “Happy Birthday” for his 5-year-old daughter Mia.
TIADA’s new five-year strategic plan begins in 2022, and Ryan will oversee various initiatives at the outset of this plan to expand mem bership and engagement, increase non-dues revenue from a growing number of quality programs and services, and enhance the associa tion’s communications strategy.
“I see the penetration that we could have with licensed dealers across the state,” he said. “We want them to know what our current members already understand: that we offer some of the best educa tion and services for Texas dealers and that we are committed to doing even better in the years ahead.”
“I’ll work hard to deliver the best results possible for whatever challenges present themselves during that time.
“As your incoming President next year, I want you to know that I’m excited about serving our associa tion,” Ryan said. “I’ll work hard to deliver the best results possible for whatever challenges present them selves during that time. Some of my initial goals are to continue respon sible growth in our membership and education, and to have one of the most productive legislative ses sionsThepossible.”legislative session almost invariably includes bills that the association needs to address to pro tect the interests of the independent automobile dealer in Texas. Ryan anticipates there will be some sur prises along the way, but that the association is ready to tackle any bill that may negatively impact the industry in the short and long term.
In addition to what promises to be a busy legislative session for TIADA, dealers have been facing inventory shortages and staffing issues for sev eral months. Ryan is optimistic that these issues will be somewhat easier to manage in the coming year.
September 2022 Texas Dealer 25
“If you happen to see my daugh ter running around the resort, her birthday falls during the conference every year,” said Ryan. “She thinks this entire event is all for her.”
Some of my initial goals are to continue responsible growth in our membership and education, and to have one of the most productive legislative sessions possible.”
A u t o De a l e r S o l u t i o n s
Claim Process in Texas: You
Surety
I
Need to Know
by Eric Weisbrot Chief Marketing Officer, JW Bonds Dealer Claims
Everything to Know About Texas Auto
AutofeatureDealerBond
Everything
September 2022 Texas Dealer 27
ndependent automobile dealers in Texas must pur chase an auto dealer bond to obtain their license and operate their business. While you may not have dealt with claims against your bond, you should under stand how it works if you ever have a claim against you.
The government requires surety bonds to protect consumers and other third parties from financial harm caused when dealers violate licensing laws.
When you purchased your surety bond, you had to sign an indemnity agreement with the surety company. By indemnifying the surety company, you agree to re imburse the surety company for any amount it pays on your behalf. If you fail to reimburse your surety for a bond claim judgment, the surety company can pursue legal action in court to recover what it paid and any le gal costs it might incur.
Bond
In Texas, a bond claim can be made for only the fol lowingFailingreasons:toprovide a title to a customer who purchas es a Failingvehicle.topay for vehicles/issuing bad checks to pay for Beforevehicles.aperson can file a bond claim, they must first file a legal action in court against a dealer. They must prove that they suffered financial harm because the
Surety bonds are legal agreements involving the fol lowing three parties: Principal – The auto dealer seeking the bond. Obligee – The governmental agency requiring the bond. Surety – The bonding company issuing the bond as a guarantee of the principal’s legal compliance.
What is a Surety Bond?
Impact of Bond Claims
For more info, visit Txiada.org /TiadaCPOprogram or call 512.244.6060 . Maximize Your Sales Potential with the TIADA CPO Program. Participating in the certified pre-owned program means your dealership and the CPO vehicles you offer are held to a higher standard. 28 Texas Dealer September 2022
It is a good idea for you to retain an attorney if a claimant files a legal action against your bond in court to avoid a judgment against your bond. No matter what else you do, you must comply with the provisions of your bond and your indemnity agreement when a judgment is issued. If your surety contacts you and allows you to pay a claim, it’s best to pay it instead of forcing your surety to file a legal action against you. Failure to pay a valid bond claim can result in higher costs for the claim and any future bond you might need to purchase. If you lose your license, it means the forced closure of your business.
2 Payment and Indemnification
Once the surety pays the bond judgment, the surety company will request you to reimburse them. Suppose you don’t timely repay the surety. In that case, the surety company will likely seek reimbursement from you through the court and any legal fees it expends to recover compensation from you under your indemnity agreement.
Because of the potential repercussions of a surety bond claim on your business, it should be clear that you should do everything possible to avoid potential claims. To prevent valid claims, you should do all the following things:Retain documents about each transaction as required by your state. Have systems and processes in place to guarantee you promptly provide titles and report sales. Strive for accurate accounting and financial manage ment to ensure all vehicles are properly paid for.
dealer either issued a bad check to pay for motor vehi cles or failed to provide a valid title for a motor vehicle. A claimant can include attorney fees in the claim if the dealer is found liable.
Filing the Judgment With the Surety After a judgment is won, the person can then contact the surety company to make a claim up to the face value of the bond. In instances where the amount exceeds $50,000, the person making the claim can seek other legal remedies for the amount exceeding $50,000.
In some situations, a valid auto dealer bond claim could result in the revocation of your dealer license. However, even if your license is not revoked, a bond claim can affect your ability to renew your bond or se cure a new one, which will remain on your record.
1
A poor bonding history can also impact your ability to obtain surety bonds in the future. Since your bond is not permanent and must be renewed regularly, you might be forced to shop for a company willing to issue a bond to you. Any bond for which you are deemed eli gible will likely be at higher premium rates because of the increased risk you pose to the surety company.
How to Avoid Bond Claims
Eric Weisbrot is the Chief Marketing Officer of JW Surety Bonds. With years of experience in the surety industry, he is also a contributing author to the surety bond blog. www.jwsuretybonds.com
Bond claims come with a substantial financial obliga tion for you. You will have to repay the surety up to the full amount of your bond. If you fail to pay the surety for the entire amount it paid to the claimant, the surety company can file a legal action in court to enforce your indemnity agreement. This could result in a court order forcing you to repay the surety company for what it paid and any legal costs incurred by filing the legal action against you. If your license is revoked, you will no longer be able to operate your dealership legally. You might also face prosecution in criminal court if the claim involves crim inal allegations.
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President, Advantage Automotive Analytics
feature financing models work had difficulty finding the inven tory they needed, at the right price.
Dealers can take a page from dealer response to the economic challenges of the Great Recession. Then, deal ers asked for: A higher down payment
Trillions spent to bolster the economy spurring Anotherinflation $1.4 trillion to be spent for U.S. Theseinfrastructurechallenges have made it difficult for subprime and BHPH finance companies to find the inventory they need at the cost they need to make their models work. The economics of the BHPH and subprime business models are the same now as they were back in 2009. Consumers have trouble securing a large down pay ments, have a maximum weekly or bi-weekly payment that they can afford, and require regular attention from collectors to help keep them on track to make timely payments.Today,record-high used vehicle values, near doubledigit inflation, rising costs of floorplanning or lines of credit, and higher wages for employees are putting pres sure on the BHPH business model in ways that have never been experienced to this degree.
In a move to save several major U.S. auto manufactur ers from bankruptcy, lawmakers passed CARS giving consumers up to $4,500 toward the purchase of a brand new vehicle for their old “running” vehicle. The older vehicle could not be re-sold. The program was designed to spur new car sales, and, importantly to the Obama Administration get older, higher polluting vehicles off the road and replace them with cleaner, more energy-efficient vehicles, as evi denced by the rules governing the law. Qualifying ve hicles had to have fuel efficiency of 18 mpg or less, and consumers had to purchase a new vehicle that had an average efficiency of at least 22 mpg. More than 750,000 vehicles, many of which would have been traded in, wholesaled, and sold by BHPH and subprime dealers, were removed from the U.S. auto fleet. The program did have its desired effect in prompt ing new car sales, but had many unforeseen and unde sirable consequences for used car sales. Effects on the used car industry were immediate and long-lasting. Wholesale prices of older vehicles not eli gible for the Cash for Clunkers program jumped from $2,000 at the time, to $4,000 to $5,000. BHPH dealers who relied on these vehicles to make their in-house by David Meyer
What’s Happening Now?
Lengthened the loan term, and Intensified their collections efforts and secured their collateral as quickly as possible in the event of a Thosedefault.efforts are being made now, but they can only be taken so far. Adding too many months to a finance contract results in greater default rates. Consumers, challenged by higher food and fuel prices, have only so much they can put down on a new car.
S igned into law in June 2009, the $3 billion Car Allowance Rebate System (CARS) law, commonly called “Cash for Clunkers,” by President Barack Obama, had many long-lasting effects on the automo tive retail industry. The similarities — and differences — between 2009 and what automotive retailers face in 2022 can give dealers insights into risk mitigation and avoiding financial losses.
Today, BHPH dealers and subprime finance compa nies face similar inventory shortages and high values for very different reasons including: Chip shortages in the new car industry Pent-up consumer demand as a result of the Global DirectPandemicgovernment stimulus payments to consumers
The Great Recession and Cash for Clunkers
A global economic crisis resulting from a meltdown in mortgage-backed securities market resulted in home prices plummeting and borrower defaults. Huge fi nancial losses spread to every corner of the globe. That caused the 2007 mortgage crisis, the 2008 financial crisis, and the Great Recession. It was the worst reces sion since the Great Depression. That’s a very simplified version of a series of serious and complicated financial mistakes by financial institutions, legislators, government regulators, and consumers.
Can Great Recession Lessons Help Dealers in 2022?
31September 2022 Texas Dealer
Protecting Your Assets
Economic Outlook
32 Texas Dealer September 2022
This is likely to occur again should the economy take a significant downturn, as banks, investment corporations, and economists have begun predicting. How it will play out, exactly, in terms of consumer demand and creditworthiness is dif ficult to predict, but a downturn is more likely to occur than not.
Good News? Economic contractions and re cessions have boded well for the subprime and BHPH markets in the past. Prime consumers who take a credit hit, become subprime customers. Subprime customers who take a credit hit become BHPH customers. In each case, finance companies typically get better qual ity customers that are more accus tomed to paying bills on time and maintaining their vehicles.
Thirteen years ago political and economic pundits suggested it could take 20 years for the U.S. economy to recover from the Great Recession. Fortunately, while the effects were devasting and business-ending for thousands of dealers and many other small businesses, within just several years there were green shoots ev erywhere. Technology made huge improvements for consumers and businesses, making products and services less costly and far more beneficial.Economic challenges in the U.S. economy today are numerous, and in many cases have little precedent. Thirteen years ago, there was al most nothing the mortgage and banking crises could be compared to in the past, except the Great Depression. We survived those ex treme challenges, and we’ll survive these.
Twenty years ago the collateral protection industry was relatively PM
young. Many thousands of BHPH and subprime finance compa nies were using GPS tracking and payment reminder devices. Discussions in dealers Twenty Groups weighed the pro and cons of adding $150-$250 to the cash in deal for every unit they sold. Many dealers opted not to use GPS track ing and payment reminders. Today, GPS tracking units cost less and generate valuable data analytics. They are generally con sidered the cost of doing business. Most subprime finance companies and BHPH dealer chains require GPS and/or payment notification devices. Being able to avoid the tremendous losses from having just one vehicle abandoned or im pounded makes financial sense for the entire finance portfolio. Having information instantly sent to mo bile devices for vehicles exiting or entering geofenced areas, device tampering, real-time vehicle loca tion, all assists finance profession als in loss and risk mitigation.
CMYCYMYCMYMCK 2021 TLSAA Lubbock_TIADA ad.pdf 1 2/28/21 4:11
TIADA designed and implemented some important on-demand courses to give dealers quality educational programs they can access throughout the year. These programs are essential for dealers to stay compliant. They offer flexibility, so you can complete them according to your schedule. These courses are designed for any dealers with questions related to various regulations that affect their businesses.
The
TIADA counsel Michael Dunagan answers repossession related questions for both the dealer starting out and those dealers who want a refresher. Dunagan goes through the basics of self-help repossession, repossession when a client has filed bankruptcy, and using the courts to regain collateral through sequestration. The course also covers all the repossession letters and includes a downloadable deck of slides to follow along with the course. 98 two 1-hour You Need to Know Txiada.org/on-demand at 512.244.6060 or email if you need assistance.
To register visit
for
Repossessionvideos 101: What
In
Want to avoid having your title transfer paperwork rejected at the tax office? This online course is designed to walk you through the title transfer process and is best suited for people new to transferring titles or those who want to brush up on the basics. This course has been reviewed for accuracy by the Tax Assessor-Collectors Association of Texas. 48 the course Basics of Transferring Titles this two-part video course
us
On-Demand Offerings Texas Independent Automobile Dealers Association
$
Call us
$
for
Featured Courses
YES! I would like to serve on TIADA Committees Check the committee(s) you wish to join. All Dealer Members are welcome to participate. We need your input! Please complete form and return to info@txiada.org or fax to 512.244.6218. Committee members will be appointed at the October 2022 board meeting Standing Committees: Awards Committee Budget and Finance Committee Legislative Committee Political Action Committee (INDEPAC) Bylaws Committee Ad hoc Committees: Ad hoc committees will be appointed by the president to focus on specific issues and given a specific timeframe. Issues may include but are not limited to: education, conference, compliance, member services, membership recruitment, website, magazine and surveys. Committee members will be notified prior to a committee being appointed to determine interest. Name ___________________________________________________________ Dealership_______________________________________________________ Title Email ___________________________________________________________ Phone________________________ Mobile____________________________ Texas Dealer September 202234
so their current dealership doesn’t have the necessary structure. What might work with 10-20 cars a month in sales, doesn’t always work well as the business grows. With growth comes the need for stronger processes.
When I begin discussing processes with dealers, we usually start with some dealership basics. Questions like “How many vehicles do you retail?” Then I move quickly to questions like, “Can you tell me the last time your ledger was reconciled to your floor plan?” “Why is your sales tax payable account so large?” Dealers often have no answers to these questions. They believe the ledger inventory is correct because they are good at ensuring the inventory feeds are correct online. However, your ledger inventory is only accurate if you can identify every unit in the ledger by the stock num ber with the actual cost of your vehicle plus all expenses for repairs, transportation, gas, etc. I’ve lost track of the number of times the value provided to me has been misstated.Thedisconnect is that the dealer is focused on the profit and loss and I’m asking questions about the balance sheet.
feature
Isn’t Good
Watching
35September 2022 Texas Dealer
Weaccounting.oftenfindindependent dealers who have never worked in a new car store with a high level of structure, by Harlene DealerStrongDoane Your Profit & Loss Statement for Your Dealership
I work with many dealerships, both franchise and independents, on accounting-related projects. Some of the projects are Dealership Management System (DMS) conversions and some are fill-in work when a controller leaves or passes away. Some of the projects are what we consider to be clean-up projects. Clean-up projects are when a dealer has had a lousy controller/ office manager or a theft issue, or sometimes when the dealership has had so much growth that they have outgrown their current processes and need an outside perspective.Clean-up projects come in all sizes and levels of com plexity. For example, a dealership has a DMS system but hasn’t reconciled their bank statement in the system in 8 years — those are complex. Another example is a deal ership attempting to run accounting on Quickbooks and other products. Those are usually messy and complex because Quickbooks isn’t designed for proper automo tive
Watching your profit and loss statement without watch ing your balance sheet is a formula for a disaster. The first reason is that someone can hide a lot of sins on the balance sheet which can wipe out your profits. The second reason is that profits don’t equate to cash flow, but that’s a different topic for another day. So let’s look at a few ways to wipe out your earnings by cleaning up your balance sheet. If you fail to reconcile your finance inventory to your general ledger inventory, you will wipe out profits. Most dealers are shocked by how many units and dollars are not posted properly here. I’ve never had a dealership with additional profits when cleaning up their inventory files. Instead, it’s always additional costs sitting in inven tory on units long since sold. Cleaning it all up means reducing your profits. Another spot is the failure to review prepaid expense ac counts. Oftentimes, items are recorded to expense in future months but then are forgotten. They become a big adjust ment at the worst possible time and reduce your income. Then there are down payments and receivables that don’t get cleared properly because no one is focused on collecting your money. By the time the spotlight is on it, your ability to collect has diminished immensely, so they become write-offs that reduce your net profits. Next we have the bank statement issues. When the bank statement is not properly reconciled daily, the number 6/22 of entries that are not made or made backwards can add up to substantial dollars over an extended period. Recently we had a client take a $190,000 hit for years’ worth of expenses that were being taken from the bank account but not recorded in the ledger. Here’s one most dealers wouldn’t even think twice about. Tag & title fees are on the balance sheet’s liabil ity side, and there is always a credit there, right? You should be able to reconcile that account at any point in time to match the exact tags not processed yet. In many stores, we find stock numbers with debit balances. This is caused by the dealership paying additional fees to title vehicles, but it’s not posted correctly to the ledger. Those fees must be written off, adding to your expenses again reducing your net profits.
36 Texas Dealer September 2022
If a dealer only cares about the profit and loss statement and never pays attention to the balance sheet, they can’t be sure their net profits are real. Additionally, they are setting themselves up for embezzlement or other theft is sues. A dishonest employee can hide a lot on the balance sheet and not get caught for a long time. Dealers should require their accounting staff to justify the balance sheet account balances every month. Then review the informa tion for accuracy because only when we know the bal ance sheet is accurate can we truly believe the profit and loss statement and keep your profits in your pocket.
Ensure your staff knows how to protect consumer information Eto nsure your staff knows how to protect consumer information to comply with the FTC requirements, avoid inadvertent exposure cof omply with the FTC requirements, avoid inadvertent exposure of your customer's information, government enforcement yactions, our customer's information, government enforcement actions, lawsuits, and bad lpress. awsuits, and bad press. Brought to you by TIADA. Powered by the Dealer BEducation rought to you by TIADA. Powered by the Dealer Education Portal. Portal. Visit Visit dealereducationportal.com dealereducationportal.com Or scan the QR Code for info and Oregistration r scan the QR Code for info and registration S a f e g u a r d Ss a f e g u a r d s C o m p l i a n c e C o u r s Ce o m p l i a n c e C o u r s e Volume purchase discounts available for purchase of 10+ courses The course is flexible and on-demand to fit your busy schedule All users earn a certificate upon completion Sample policies and agreements are included at no additional charge Keep Your Dealership Compliant with Kthe eep Your Dealership Compliant with the FTC's Safeguards FRequirements TC's Safeguards Requirements O n l y $ 7 5 f o r t h e Q u a l i f i e d I n d i v i d u a l O n l y $ 4 9 E a c h f o r A l l O t h e r E m p l o y e e s V o l u m e D i s c o u n t s a t $ 4 0 f o r A n y C o u r s e
6 Key
You
1 By Targeting A Broad Audience Local marketing works well when the efforts are aimed at a hyper-specific audience segment.
For these small businesses, marketing spend is limited, and every penny needs to count. But unfortunately, many businesses waste their local marketing spend. According to a report by Proxima, between 40-60% of digital mar keting spend is being used ineffectively.
Unfortunately, too often, businesses looking to market in a local area pick campaign strategies that are too broad, wasting a large amount of money on an audience that will never convert to a sale. Today’s consumer is not interested in seeing irrelevant ads. Digital tools have made it possible for brands to understand their customers on a deeper level. By using L ocal marketing campaigns are critical to long-term growth and continued profits for those running a small business. These campaigns allow companies to target key local audience segments, promoting ongo ing growth and customer retention. This is particularly important for those operating a business in the service sector where customers are searching for where to do business on a hyper-local level.
feature
reinvest that money into an improved marketing strategy. If your small business is not seeing the results you should from your local marketing tactics, take a deep dive into the following six areas where you might be wasting your local marketing spend.
Small businesses cannot afford to lose half of their budget to wasted spend, making it imperative for these companies to look for where the waste is happening and by Jamil President,ZabanehJ&LMarketing Areas Might Be Wasting Your Local Marketing Spend
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Depending on your goals, you can determine which of these audience segments to include down to a granular level when creating a campaign.
Truthfully, numerous factors could cause your cam paign to perform poorly. It can take time, but it is well worth the effort to dig deep and determine the root cause of the issue before spending more money.
For a dealership, this is particularly important. If someone is right out of high school and a potential firsttime buyer, and your inventory is made up primarily of family style vehicles like minivans or large sedans, tar geting them with ads is a waste of money.
If you don’t run your marketing in-house, request an audit from the agency you work with and ask about where every penny is being spent.
A great place to begin is via Google Ads (though you can apply this same strategy to other digital channels such as Facebook or Instagram).
4 By Settling For Surface Level Reports
For Display campaigns, you can combine your data with two other segments referred to as affinity and intent. Your data will allow you to target people who previously inter acted with your business specifically. Affinity segments will reach groups of people based on their lifestyle, buying hab its, and long-term interests. Intent segments allow you to focus on people actively researching products or services.
This leads many businesses to simply dump more mon ey into poorly performing channels hoping that they will be able to outpace the competition in spending.
data, you can ensure that your marketing reaches a par ticular audience.
What to Do About It
2 By Sticking To The Same Strategy
If you are concerned that your local marketing efforts are wasted on the wrong audience, use digital marketing to spend your money on the right audience segments.
When running an ad via Google, you can target a par ticular audience segment based on the type of campaign you are running.
By Dumping Money Into Poorly Performing Channels
It’s time to do an audit. How are you tracking the return on your marketing dollar? If you don’t have a method to do so, set one up. You need to be able to mea sure your conversion rates and determine what tactics might now be outdated and are hemorrhaging money.
This is a common issue for small businesses that have been in operation for a long time. The company has handled marketing one way for decades, and there are no plans to change.
For example, if you are seeing a poor return on your Google Display Ads, it might not be because you aren’t spending enough; it could be because your ad copy is hard to read or your call to action button isn’t working. Maybe your display ads are sending customers to a bro ken webpage or one that is difficult to understand, caus ing customers to drop off before converting.
Many small businesses have learned the impor tance of pulling reports on their marketing campaigns. Rather than walking blindly into each new quarter, they actually take the time to see what tactics have per formed well in the past and which ones aren’t providing a high enough return.
And, when running a video campaign via Google, you can also add life events and other detailed demograph ics to your audience segments. This allows you to target customers based on milestones, such as graduating from college or becoming a parent, and by groups of people of people with shared common traits.
Over time, as you begin to see which segments convert at the highest rate, you can double down your efforts on these segments and reduce spend on segments that don’t lead to profitable conversions.
What to Do About It
For many small businesses, it can be concern ing when marketing channels are not performing as expected. If you planned to earn 20 new customers a month via a specific channel, and, instead, it seems that you are losing more customers to your competition than gaining new ones, a natural reaction is to think that your budget might not be high enough to compete.
What to Do About It When was the last time you did an audit of your mar keting tactics? Have you relied on the same strategy for
Before spending another cent on a poorly perform ing channel, take a deep dive into the analytics around the campaigns you are running. In many cases, you can actually lower your spend while increasing your reach simply by improving how your campaign operates.
However, marketing strategies should not be stagnant. What worked ten years ago does not work the same way today. Further, what worked one year ago, or even a month ago might not be the ideal strategy. Digital has created a fast-paced world where marketing strategies must continually be tweaked, and businesses must adapt to changing consumer demand.
40 Texas Dealer September 2022
3
years, perhaps even decades? If so, there is a good chance you are wasting a large amount of the money you spend on these marketing strategies.
Unfortunately, this strategy rarely works. It is usually not money that is the culprit behind a poorly performing marketing channel. Dumping more money into the situa tion simply results in more money lost.
6
By Ignoring Your Customer Reviews
solely on the shoulders of your ad copy. When you pay to surface an ad to a customer with a weak or non-existent call to action, you run the risk of wasting a lot of money. If a customer glances at your ad and they don’t know within sec onds what they are supposed to do next, you are most likely throwing money down the drain. People have short attention spans, and when they see an ad, they don’t want to have to guess what to do next. What to Do About It Sit down and go through each ad you are running. Ask yourself: What is the call to action? How is a customer supposed to take this action? If you can’t answer these ques tions within seconds, you need to rework your ad copy. Keep in mind, as well, that it can be ben eficial to get a second set of eyes on your ads, particularly if you helped write them. Often, what seems obvious to someone on the inside of a business is confusing or unintelligible to someone on the outside.Additionally, beyond your own analysis, a good indication that your call to action isn’t effective is when your ads are receiving a high number of views with an incred ibly low goal completion rate.
HHH HH
Perhaps you are running perfect marketing campaigns. You’ve honed in on the key audi ence segments that best represent your ideal customer, and you’re get ting your business’ name out there and in front of the right people. But then something unimaginable happens — custom ers who were poised to convert suddenly drop off. Behind the scenes, unbeknownst to you, a customer who was ready to call up your business to schedule a service saw a litany of negative online re views. Glancing at the complaints surfaced by Google, they also no ticed a trend from your business — radioWhensilence.youdon’t pay attention to the reviews your business is getting and you are absent from the conver sation, you can waste a lot of money paying to show customers your poorly managed reputation. What to Do About It Put into place a strategy for managing your online reputation. Your company must know which customers are leaving you reviews and for you to actively manage this. This means responding to new reviews as they come in. It means actively seeking out positive reviews from satisfied customers. And it means monitoring your reputation to ensure that you aren’t marketing your business during a slump in your business’ perceived credibility.
By Using A Weak Call To Action In some cases, the failure of your marketing campaign rests
41September 2022 Texas Dealer
However, when looking at these reports, too often, business owners are handed surface-level informa tion from marketing teams. These reports might show basic metrics, such as click-through rates or the number of new visitors to a website. Perhaps there has been an uptick in both of these numbers, leaving business owners to walk away satis fied. Unfortunately, surface-level re porting doesn’t tell the whole story, which can lead to spending money on tactics that look good but aren’t actually resulting in profits for the business. What to Do About It Next time you look over your company’s marketing reports, whether they are provided in-house, from an agency, or you pull them yourself, make sure you look at in formation beyond the surface level. For example, if your company saw a large uptick in new website visitors, what happened next? Did any of those visitors go on to schedule an appointment with your dealership? If not, why? An uptick in website visitors can be a good sign of a well-run campaign, but it can also be a sign of wasted spend. Funneling a large number of new visitors to your website will do you little to no good if those weren’t the right target audience. Unfortunately, many marketing companies rely on surface-level reporting to paint a pretty picture. Don’t settle for the basics. Dig deeper and find out what is actu ally earning you measurable, prof itable results.
5
Vice President Region
Robert
Vice
Russell
With no contested races, Chairman Robert Beck asked for a motion directing the Secretary to submit a single ballot for the following candidates: Chairman of the Board: Mark Jones; President: Ryan Winkelmann; President-Elect: Eddie Hale; Secretary: Vicki Davis; Greg Phea; President 1: Brad Kalivoda; President 2: Greg Reine; 3: Chad Lancaster; 4: Moore; 5: Blankenship; 6: Villarreal; President at Large: Lowell Rogers; Vice President at Large: Cesar Stark.
Vice President Region
Vice President Region
Respectfully submitted, Eddie Hale, Secretary A complete copy of any reports referenced in this document and more detailed notes from the meeting are on file at the TIADA office and available upon request.
Treasurer:
Armando
compiled by Texas Dealer staff
Region
Motion to dispense made by Greg Zak, seconded by Keith Hagler – PASSED
Bylaws Committee Motion to accept bylaws amendments as presented made by Brad Kalivoda, seconded by Cesar Stark – Passed. Motion to adjourn made by Blake Ingram, seconded by George Karlen – PASSED. Meeting adjourned at 12:45 p.m.
July 24, 2022 | Kalahari Resorts, Round Rock, TX 42 Texas Dealer September 2022
Vice
At its meeting on Sunday, July 24, 2022, TIADA took the following actions: President Mark Jones called the meeting to order at 12:00 p.m. Elections
house of delegates meeting minutes
Region
Vice
Vice President Region
2023 Officer
43 DEALER MEMBERS 7-11 Auto Group LLC Santiago Rodriguez ........ 711 W. Hildebrand Ave., San Antonio, TX 78212 Auto Plaza Mike Hannon 1660 N Beltline Rd, Irving, TX 75061 Automex Auto Sales Juan Rodriguez 115 N Zapata HWY, Laredo, TX 78043 AutoVida Steve Jordan ................................. 2812 Thomas Ave, Dallas, TX 75204 Brazil Imports LLC Hector Enriquez 11230 Montana, El Paso, TX 79936 Cash for Cars BHPH Hassanain Aljanabi 2541 South IH-35 Suite 200-329, Round Rock, TX 78664 Cherry Cars Ron Cantrell P.O. Box 590, Whitesboro, TX 76273 DP Auto Sales Ltd DBA Byrider - Lubbock Lucy Alvarez 1211 19th St, Lubbock, TX 79401 EADO Automotive Zaiful Kazi ............................ 6432 Gulf Fwy, Houston, TX 77023 Engler’s Auto Brokers Jaime Engler 4004 San Pedro Ave., San Antonio, TX 78212 evrdrive Brian Singh 211 Highland Cross Dr, Houston, TX 77073 Fully Loaded Cars & Trucks Luz Cruz .. 14525 State Highway 249, Suite B, Houston, TX 77086 FYC Auto Abel Sanchez 4501 S. County Rd West, Odessa, TX 79766 HiJolly Gohar Jaffery 129 Oram St., Arlington, TX 76010 I Drive-DFW John Le Unes 2729 Lipscomb St, Fort Worth, TX 76110 ION Car Sales Steve Richardson 3401 W Marshall Ave, Longview, TX 75604 Kayalar Motors Selcuk Kaya ............................ 16230 FM 529, Houston, TX 77095 Krissy Auto LLC Krystal Franklin 6301 E Lancaster Ave, Fort Worth, TX 76112 Lone Star Auto Brokers, LLC Adam Jones 7445 US 287 HWY, Arlington, TX 76001 Lufkin Auto Center Manuel Escalera ........................ 210 FM 706, Lufkin, TX 75904 Lux Auto Centre Manny Abdulhadi 10903 Shady Trail, Ste 115, Dallas, TX 75220 Off Lease Only LLC Marissa Kaliman 1200 S. Congress Ave., Palm Springs, FL 33406 Preowned Cars of SA, LLC Alex Munoz 3438 SW Military Dr, San Antonio, TX 78211 RJB Auto Sales George Vasquez 5413 Viking Drive, Houston, TX 77092 Rockin’ H Motors Phillip Holt ....................... 300 E Sam Rayburn, Bonham, TX 75418 Saga Autos Gabriel Mendoza 11585 South US Hwy 181, San Antonio, TX 78223 Si Auto Inc. Martin Gutierrez 911 W. Mayfield Rd, Arlington, TX 76015 Superior Motor Company Michael Stanley ........... 3924 Texoma Pkwy, Sherman, TX 75090 Triple B Motors Raul Ernesto Fong 917 East TX 495, San Juan, TX 78589 Webb’s Motor World Robby Webb 10010 South Padre Island Dr, Corpus Christi, TX 78418 ASSOCIATE MEMBERS Glo3D Inc. Sean Toussi 2323 Yonge St., Unit 503, Toronto, ON M4P 2C9 North American Auto Care Carlton Lancaster 6864 Cape Cod Dr, Grand Prairie, TX 75054 Visitor Chat Dana Abramson ..................... 88 Elm St, Suite 304, Rochester, NY 14604 Please Welcome Our Newest TIADA Members CORPUS CHRISTI G.R. Moore The Car Shack (dates announced at www.txiada.org) EL PASO Cesar Stark S & S MeetingMotors–3rd Friday (Monthly) FORT WORTH Jerry Smith H J Smith Automobiles (dates announced at www.txiada.org) HOUSTON April CoastHansontoCoast Motors Meeting – 2nd Tuesday (Monthly) SAN ANTONIO Jose IrvingEnglerMotors Corp (dates announced at www.txiada.org) Local Chapters September 2022 Texas Dealer
Goal Number Five
by MartinJeff TIADA DIRECTOREXECUTIVE behind the wheel
Social engagement rates and impressions: The engagement rate is the number of engagements di vided by Engagementsimpressions.areinteractions with an update: reac tions, comments, shares, and clicks. Impressions are how many people see a given update on their feed.
B y Year-End FY’23 Audit website content and analytics to optimize the user experience and functionality on desktop and mobile devices; implement any new best practices Evaluateavailable.website user flowchart and traffic patterns; increase access to popular landing pages. Create a sponsored content program for social media Basedchannels.on KPI analysis, increase successful content types and frequency on social media. Add a testimonials page to the website.
Analyze social media performance to evaluate key per formance indicators for all campaigns. Create various content for social media channels to promote brand awareness, increase program atten dance, and establish relationships between members.
STRATEGIC PLAN: By Year-End FY’22 Audit website content and analytics to optimize user experience and functionality on desktop and mobile devices. Develop benchmarks for average pageviews, LinkedIn followers, Facebook likes, YouTube subscribers, and engagement rate. Enhance our content strategy to include industry insights and organizational stories on the blog.
T his is the last in our series of articles focusing on the association’s five-year strategic plan. This month, we are thinking about the ways we plan to enhance TIADA’s digital marketing and communica tions strategy. We plan to do everything we can to make sure our members’ experience, in terms of the ways it engages the association, is efficient and modernized. It is essential for us to provide our members with timely updates and communications, and so we are working diligently to increase our efforts in digital marketing and communications by improving the website and engaging with members by providing high-quality con tent on social media. These are the central focus of goal number five in our five-year strategic plan.
Goal #5 — Enhance digital marketing and communication strategy, resulting in an 18% increase in organic users at txiada.org and a 10% increase in total social media followers and page likes annually while maintaining a social media engagement rate at or above 5%.
We plan to do everything we can to make sure our members’ experience, in terms of the ways it engages the association, is efficient and modernized.
Evaluate how social media campaigns are driving increased website traffic and program attendance.
45September 2022 Texas Dealer
By Year-End FY’24 Audit website content and analytics to optimize the user experience and functionality on desktop and mobile devices; implement any new best prac tices Createavailable.a“store” on the web site where members can purchase the educational pro grams, forms, resources, and Evaluatemerchandise.SEO best practices, en suring our continued use of tar geted keywords for all content. Update website URLs to make the website easier to find.
Seekavailable.professional development opportunities to implement the latest best digital marketing and communications practices. Hire a third party to evaluate our digital marketing and com munication strategy.
By Year-End FY’26 Audit website content and analytics to optimize the user experience and functionality on desktop and mobile devices; implement any new best prac tices Implementavailable.new strategic digital marketing and communication opportunities for website con tent and social media. Explore new avenues of communication: software, programs, and social media Basedchannels.on the third-party evalu ation, determine the next steps for improving the website and social media channels. own company.
Finance more customers and sell more cars. Be your
captive finance
877. 592 .4672 | agoradata.com © 2022, Agora Data, Inc All rights reserved Texas Dealer September 202246
By Year-End FY’25 Audit website content and analytics to optimize the user experience and functionality on desktop and mobile; imple ment any new best practices
Assured Vehicle Protec on, Inc., 6300 Glenwood St., Ste 200, Mission, KS 66202 www.avpadmin.com © Assured Vehicle Protec on, Inc.. 2021
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