On today’s show, we’re pleased to welcome back James Boening, General Manager at Ourisman Lexus Rockville in Washington, D.C.
[Previously aired 11/6/19]
VIDEO TRANSCRIPT:
Jim F.: Hi, everyone, I’m Jim Fitzpatrick. Thanks so much for joining me on another edition of CBT News. Today, I’m so excited to have with us via Zoom, Mr. James Boening. You’ve seen him here on CBT before. He is the general manager of Ourisman Lexus in Rockville, Maryland. Welcome back to CBT News.
James B.: Well, thanks. I really appreciate it. Looking forward to this.
Jim F.: Sure, as you know, it’s been my passion, and I’m going to be talking a lot more about it in 2020, and that is how do we get good people into the industry? What has to happen in order for that to take place? To be able to literally go to colleges like every other major retailer out there or every other company out there that says, “We’re going to hit college campuses. We’re going to offer an opportunity to young people to get into the industry, learn the industry, grow in the industry, stay with dealer groups for 4, 5, 10, 15 years.”
Jim F.: I want to talk a little bit about what has to happen inside of car dealerships and our mindset that’s got to change in order for that to happen.
James B.: Yeah, so really broad questions there. I’ll dive into some of the things.
Jim F.: You think? Take any one of them.
James B.: I think there’s some hybrid situations that I think you have to look at. What I mean by that is with how this industry is moving forward with technology and these kinds of things. I think that we’re very fortunate in having some luxury stores and then you’ve also got some import stores and some domestic stores.
James B.: I think each OEM, each brand has to be set up even maybe a little different, not totally different, but a little different. I’ll maybe get into that, but some of the things that we are doing different that are completely polarizing to the industry, and we started doing it about 30 days ago.
James B.: We have gone to, which is everybody’s going to be like, “What are you talking about?” We went to a four day work week.
Jim F.: Four day work week, okay. That’s innovative, I like that.
James B.: It doesn’t matter if you’re a sales manager, it doesn’t matter if you’re a GSM, it doesn’t matter if you’re a salesperson, an FNI manager, it doesn’t matter. I mean, everyone is on a four day work week. I will tell you, to give three days full days off a week in this industry, it’s unheard of.
Jim F.: Right.
James B.: Everyone’s like, “Okay, how did you pull that off?” It’s very interesting. I found some weird dynamics. How I was able to do it is I found out I actually have more people here during a longer period of time than trying to break everybody up over an amount of time.
James B.: It was very interesting, so the coverage is actually more, and I have more time off for my team. We don’t go, “Okay, it’s the last week of the month. Guess what? I need everyone here bell to bell.” We don’t do that either. We don’t do any of the old traditional things.
James B.: I mean, as a matter of fact, I’ve tried to break every single old mold possible. Even with pay plans where even my managers and my salespeople, I’m super transparent. We’re like, “Okay, we’re going to pay everybody on every last red cent. Hold back, FNI, packs, docs, hidden packs, hidden docs.”
Jim F.: Wow, you’re the man of the hour right now, four day work weeks and you’re paying them on everything. I love it.
James B.: Paying them on everything. What I’ve found is when you do that, you’ve got a sales team, you’ve got a management team trying to figure out how to maximize a deal for the store, instead of for a department or for a pay plan. When everybody’s trying to figure out how to maximize the deal, and it doesn’t matter where the money’s coming from, what I’ve found is we’re all making more money.
Jim F.: Right, that’s great.
James B.: Everyone.
Jim F.: That’s great.
James B.: It’s really refreshing. I will tell you, it’s really awesome. The team has embraced it. Everybody was a little worried about it. I do way unorthodox pay plans, super unorthodox.
Jim F.: Hey, if it drives performance, that’s the name of the game. If you can get a better quality candidate that’s going to come in and apply for that job and work for you and value that job and not be looking around all the time, because you’re wearing them out on a 65 hour work week and their pay is all over the map because of the way the commission structure is, then it’s a winning formula, right?
James B.: Yes, yes.
Jim F.: It really is.
James B.: Yeah, it’s about a 45 hour work week, and the only singular day that we ask every single person in the building to work bell to bell, no matter what … If your four day work week and then your next day was the last day of the month, we work everyone bell to bell on the very last day of the month and everybody gets that.
James B.: Here’s what we do. If you do that, we give you a different day off, so that you’re still only working the four days a week.
Jim F.: Wow.
James B.: We find a way to give you that additional day either in that week or the next following week, so you could have four days off the next week. We are not going, “Okay, well except on the last day of the month, you’re going to have to work more.” I will tell you, super refreshing.
James B.: It’s a totally different dynamic. Now here’s what everyone’s going to say. It won’t work, because if you don’t create pay plans that drive behavior, whereas what the dealer’s looking for, let’s say in finance, or if you’re looking for volume in new cars, if you don’t put a pay plan together that drives what the dealer wants, not what the team benefits from, you’re never going to achieve the goals you’re trying to get to.
Jim F.: Right.
James B.: I completely disagree.
Jim F.: Yeah.
James B.: I think culture drives behavior, not pay plans.
Jim F.: Right, so let me talk to you about paid time off. That seems to be still a hot topic with salespeople. They could be at a dealership for a year or two years and they say, “Hey, I want to take a summer vacation.” “Ooh, summer vacation, what do you mean a vacation? You’re talking about like you’re going to leave for a week and then if your job is available, we’ll give it back to you at the end of a week?”
James B.: Right.
Jim F.: Usually, you don’t see salespeople going on a week or two weeks vacation every year, although they might’ve been at the dealership for four or five years. The other thing is when you ask the salesperson, you’ve been at the dealership for four years, you’ve been making $60,000, $70,000 a year.
Jim F.: When you go on vacation, how much do you get paid? Is it paid time off? Do you get a thousand bucks a week or whatever? No, I’m on vacation and I’m a salesperson. I don’t make anything, okay? Well that’s not really a paid vacation, okay?
James B.: Right.
Jim F.: That just means you’ve got to work harder the two weeks prior or the two weeks after your vacation. I think we got to take a look at that as well.
James B.: Yeah, I mean, not to dive too much into what we do, but we basically do two weeks paid vacation after the first year.
Jim F.: What’s the pay based on? Is it an average of what the salesperson made?
James B.: Yeah, it’s an average.
Jim F.: Okay, fair enough.
James B.: Yeah, so whatever you made for that annual, we divided it out for those seven days and you get paid.
Jim F.: Fair enough, that’s great.
James B.: We have some serious tenure, and they have a month.
Jim F.: What are some of the things that do keep you up at night, if any? If you had to pick two or three things that you say, “This is a concern of mine,” whether it be internally, externally, market-wise, whatever, what’s lurking around the corner from your perspective that you feel that either the industry or your dealership really needs to focus on?
James B.: I don’t want to sound that I don’t worry about things, but I think I look at things differently. I look at, and I really do. I look at all these things that are changing the industry as amazing opportunities. That’s how I look at things.
James B.: I really don’t lay in bed and worry about this industry, I don’t. I mean, it sounds probable, however, but I see the mobility, I see the subscription business. I see there’s definitely margin compression. I see that people want a different experience, but I’m excited about it.
Jim F.: Yeah, it sounds like you see it and you’re also able to take action on it, right? Versus seeing it and feeling like a victim to go, “Oh, what are we going to do about this?” You see those things, those challenges as opportunities and then you’re able to pivot accordingly, which that’s the key is to be able to pivot, which is what you’re doing.
James B.: Yeah, I think that’s a good word to use. I’ve never in my whole life ever felt like a victim. Maybe I even was at times, I’ve just never had that mindset.
Jim F.: Right.
James B.: I look at this as I see an industry, and for all the people that are listening, I’ve said it a lot of times, that are stuck. For me I’m like, that’s an opportunity for me because I’m not stuck. Matter of fact, I’m forging forward. We’re getting ready to do a subscription business here, and it’s not going to be your traditional subscription business actually.
Jim F.: Do you do anything traditional? You’re like not traditional, throwing that out? We’re doing our own thing.
James B.: I mean subscription just started, so we’re going to put a twist on subscription.
Jim F.: That’s great.
James B.: I don’t know, I’m just super excited about it. I really don’t wait. I mean, the things that I think that everybody should be looking at that I’m not concerned about, but you should be looking at are mobility, subscription, digital to where people can buy a car online.
James B.: Pickup and delivery in your service department, so people don’t want to come here anymore.
Jim F.: Right.
James B.: That’s okay.
Jim F.: Yeah.
James B.: I’m like those are things that definitely probably keep a lot of dealers up.
Jim F.: Yeah.
James B.: Those are the things you should be worried about if you’re not embracing it.
Jim F.: James Boening, the most positive man in the retail automotive industry and General Manager of Ourisman Lexus. I want to thank you so much for joining us on CBT News. It is always fun talking to you and keep up the great work man.
Jim F.: The stuff that you talked about today with me, four day work weeks and compensation and that’s thinking outside the box. Keep it up, we love that stuff. I’d love to do a followup with you and see how things are going.
James B.: Yeah, and definitely we’d love to do a follow up when we get the store open, so you can see it in action.
Jim F.: Absolutely.
James B.: It’s going to be different.
Jim F.: We’ll come up and shoot a show right from the showroom if you’ll allow us.
James B.: Okay.
Jim F.: That’d be great.
James B.: Yeah, that would be awesome, because it’ll be really, really different I think than what you’ve ever seen.
Jim F.: I would love it. I’d love it. Plus, I love DC, so great.
James B.: Okay.
Jim F.: All right, thanks so much.
CBT Automotive Network, the number one most-watched network in retail automotive. This has been a JBF Business Media production.
