Tag Archive | "Agent Profile"

An Interview with John Peterson

John Peterson, president, The Oak Group, believes the years have been kind to F&I as a whole. He joined the company in 1977, and the rising level of professionalism is something he is very proud of for the industry. “The caliber of F&I professional today is higher than it’s ever been,” he noted. “It has matured into a professional office and become a very important part of the whole dealership.”

And it’s not just the F&I office that has seen that rise, he said, but providers and agents have also risen to the challenge. Competition, he noted, has forced everyone in the industry to get better at what they do.

That doesn’t mean, however, that there aren’t bumps in the road. Neither he nor the providers can promise that there will never be problems with a product, but, he said, they can promise both dealers and consumers that when problems do crop up they will be solved quickly. That’s what sets today’s F&I professional apart. “F&I is there to minimize problems, and solve them as quickly and amicably as possible when they occur, because you can’t promise no problems.”

Finding a Niche
Training, Peterson said, is one of the key factors that The Oak Group uses to set itself apart. “Training is one of the most important things we do,” he noted. “Anybody can drop brochures off at a dealership; we don’t consider getting someone supplies of ultimate importance. Teaching them ways to use those supplies, how to sell them, how to handle claims, how to be a good finance manager, those are important. We are very proud of our training skills.”

In addition to training, the company offers a range of products, from service contracts to GAP to appearance protection, but Peterson noted that one of the largest categories is a certified preowned/lifetime warranty program for both new and used vehicles. For that, the dealer certifies the vehicle with an inspection, and then The Oak Group administers the rest of the program for them, including claims, accounting, and everything in between.

As to which products they offer to clients, that he noted, is often left up to the dealers. The Oak Group uses a consultative approach, he said, going in and talking to the dealer to get a feel for what their specific needs are before deciding on a product package. “We go in and talk to them first,” he said. “We really don’t have any special knowledge of what a dealer will need until we talk to them. I feel that gives us an advantage over other people. We have a very strong product lineup, so once we hear their needs and wants, we can figure out what will fit those needs and wants best. We are very dealer driven.”

Getting into that product mix, however, can be challenging for a provider. “Providers are always asking to work with us, and we respect them for that,” Peterson noted. “But we can only offer so many products. If something new came up, we’ll look at it to see if it’s worthwhile and something customers should have.”

And that has happened often over the years. When he first started with The Oak Group, there was only one product – credit insurance. Service contracts and GAP followed a few years later, and today that mix has expanded even further. He noted that The Oak Group tries to keep its product mix current, so F&I managers will have the products customers are looking to buy right now filling out their menus. He sees it as keeping the value proposition for F&I at a high level.

Looking Ahead
So what does Peterson believe is the future of F&I? Overall, he noted, there will be a continued push toward even greater professionalism and, he hopes, more of a recognition from consumers as to the value of the F&I office. To do this, he sees the need for continued training across the board, for not just products, but also for bringing in the younger generation and educating them on how to properly connect with and sell to dealers, as agents, or to consumers, as F&I managers.

“F&I is a very important office, the heart of the front end of a dealership, and we have to keep striving to make it more professional,” Peterson said. “Giving confidence in that office is a very important part of the equation. It is the business office in the dealership; that’s where transactions are finalized, and that’s extremely important. It’s the last person the customer meets with before meeting their car, and from what it came from 30 years ago to what it is today, it’s a world of difference.”

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An Interview with Bill Kelly

Bill Kelly, partner, Automotive Development Group (ADG) has been in automotive business his entire life. His father was in the industry, and he always knew he wanted to follow that path as well. He started out selling cars and working in the finance department, but then moved to the F&I provider side of the business, and from there made the leap to agent.

He has been with ADG as a partner since 2004. Joel Kansanback started ADG a few years earlier, and Kelly was attracted to the smaller, more nimble model he was building. “One of the things that attracted me going to the smaller agency is working with the dealers and being in the dealerships,” he said. “This industry is such a fast paced, changing environment. You need to be in the dealerships to know what they need, to provide them the right programs; the relationships you build in the street are so valuable. I really liked that ADG provided flexibility to bring different programs to my clients.”

That flexibility is a core mission for ADG, and hasn’t changed since Kansanback first founded the company. They aim to provide outstanding F&I results, with top-notch products and training. And both the products they offer and the training they provide are equally important.

On the training side, every one of the eight agents who work under Kelly and Kansanback have training backgrounds. Kelly noted that they even hired a director of training, Tony Troussov, last year, with the agents reporting directly to him. “We wanted an emphasis on training,” Kelly noted. Troussov even spoke at NADA in Orlando earlier this year, and Kelly said they got some interesting feedback. “Some of those things [Troussov is teaching] are cutting edge; he’s talking about changing the F&I office as we know it today. That comes with a lot of resistance. But I feel you have to be willing and ready to evolve.”

The other major part of the puzzle is the products and providers ADG works with. Kelly noted that they have a few ways of finding new products for their lineup. First, he and Kansanback walk the floor at NADA every year. “We really get a feel and a sense of what’s out there,” he said. “Will it help our dealers maintain the high level we have for them, or is it a product that could go into a store where we need something different? Every year, we find something we can bring back to all or one of our clients. And we don’t necessarily just pick product we see at NADA; we see the type of program, and then go out and find out everyone who is doing it, and research those companies and find the one that fits out needs.”

It’s a long process, he noted, since they do a great deal of research up front. But, he also said, when they do choose a provider, they stick with them long term. “We don’t just switch [the products or providers] when the next best whatever comes along, because we did our research.”

In addition to NADA, Kelly noted that ADG researches and finds new product lines because their dealers ask for a specific type of program to fill a need. They also read trade publications to see what’s being advertised, and what dealers, agents and providers are talking about. And they attend other industry events as well, where Kelly said he enjoys talking to agents in other regions, to find out what’s working for them and why, to see if it might make sense in his region as well.

For the future, Kelly sees ADG growing, but in a controlled way. He believes focusing on having good people on the street in core marketplaces is a long-term strategy for success. “All of our agents can train and do income development in the store,” he noted. “Those are our core principles, and we need to stick to that. We need to make sure we’re doing what the clients need, not what ADG needs.”

One way he sees growing is to acquire other small agencies. He is targeting firms with, perhaps, a principal looking to retire, and who wants someone solid to take care of their block of business. “We haven’t purchased any to date,” Kelly said, “but we’ve come close.”

At the end of the day, however, Kelly admitted that everything comes down to the numbers, and he holds not only the company, but also his individual agents accountable for their success. “You can talk about training, all the things that we do, but it comes down to this: success is based on numbers. If you aren’t moving the needle, it’s all talk. We set goals every six months and work with employees to achieve them. We stretch goals to challenge them to grow within their current base and find new clients — just like we have to perform for our dealers, they have to perform for ADG. It comes down to hitting your numbers, and the numbers don’t lie.”

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An Interview with Patrick Donahue

A year and a half ago, Patrick Donahue, owner, Agents Management Group (AMG), had a very different job — he was president of several companies within The Warranty Group, a company he had been with since its beginning as Pat Ryan and Associates in the 1970s. He was there as that company grew and spun off in several different directions, but his passion was and remains the profit center that Pat Ryan helped to create – the Finance and Insurance department.

Today, he has gone on a slightly different path. He was looking to remain in F&I, but he wanted to approach it in a new way, with a new challenge. So he formed Agents Management Group, a holding company with the express purpose and finding and acquiring top agencies, and helping them grow. His first acquisition was David Gavin & Associates (DG&A), a 25-year-old firm with, Donahue noted, sustainable volume and long-term relationships he felt he could leverage and build on. He believes he can take his years of experience and translate that into the agency model.

“The process of growing from a modest regional player to a vast multinational company provided endless opportunity,” Donahue said. “The industry exposure, skill requirements and constant challenges provided invaluable preparation for the velocity of today’s F&I landscape. As president of several Warranty Group companies, managing through change and accountability for results became core disciplines. These techniques apply equally to any size organization in every phase of growth.”

Through DG&A — which is just the first of what Donahue hopes will be many agencies operating under the AMG banner — he sells a comprehensive line of products. These include service contracts, GAP, pre-paid maintenance and reinsurance services.

“Products are evaluated and selected based on how well they complement our core business,” said Donahue, “how they can enhance the performance of our clients profit center and how they provide a defensive barrier to prevent competitive influences from invading ‘shelf space.’”

When it comes to adding products, he noted that there are always new things hitting the market, on a daily basis at times. He, and his agents, review every product, looking for the pros and cons, and do their research to know not only how it would impact their dealer clients, but what kind of value it would bring to the end consumer as well. “A competitive marketplace and savvy consumer reactions quickly sort the winners from the losers,” he noted. “Product offerings that are attractive only for the revenue they generate are rarely viable or credible long enough to become an industry standard.”

But his strategy goes beyond simply choosing what he believes are the best products. While that is a big part of the equation to success, he notes it’s not the only factor. The difference between a great agency and a poor one, he pointed out, is rarely just a product or service issue. “Strategically, we remain focused on anchor accounts that have the size and reputation we can leverage,” he said. “We focus on elements of our value proposition that are unique, and methodically expand deeper product relationships in accounts while mining referrals and testimonials to capture new market share. We remain disciplined on both sides of our balance sheet, and do not attempt to make our year from a single product, client or market windfall. We manage our resources conservatively; invest in technology, training and opportunities that sustain margins and fiscal health.”

Training is Key
As for training, he has found that technology plays a very real part in how that segment of the agency business has evolved. It makes training more accessible, with a winder range of skills and topics available to agents and dealers to draw from. “Agents are fortunate to have many training options through product and service providers,” Donahue noted. “Course schedules are published and topics cover the range of general industry and agent-specific material. There are industry-sponsored events with a variety of seminars to select from throughout the year. The use of Web-based training, remote site and classroom choices allow the selection of topics and timing for training convenient and efficient.”

He looks for a specific list of topics when it comes to the training opportunities:
1. Compliance updates and changes;
2. Product knowledge;
3. Sales and marketing strategies;
4. Best practice benchmarks; and
5. Agency specific “value propositions” (training done in-house)

At the end of the day, Donahue believes it is that combination of experience, talent, product and training that can grow an agency. Knowing what you do well and then continuing to improve on it; making certain the value proposition is both unique and clear; and then delivering measurable results are the secret to success in this and any other business. “Having a ‘vision’ is a great start,” he said. “Having a solid business plan, forecast and budget including the resources to execute are essential.”

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An Interview with Steve Pearl

The Oak Group was founded in 1975, and Steve Pearl, its president, joined in 1985. The original mission of the company was to improve dealer profits through consulting and quality products, and Pearl says that’s still the company’s primary goal today. What began as a consulting firm has grown to an organization that administers products on a national scale, with a mix of both a direct sales force and independent agent network.

Pearl himself brings that mix of skills and talents to the company, with a career that extends beyond the automotive industry. At one time he was a market maker at the Chicago Board Options Exchange (CBOE), and his first accounting job was in the audit and tax department of Price Waterhouse Coopers. “Our industry is a combination of sales, risk control and accountability,” Pearl said. “The sales strength comes from my auto background, risk control comes from my time spent as a member of the CBOE and accountability comes from my background as a CPA with Prices Waterhouse Coopers. In life’s journey we are all a sum of our experiences, both our failures and our successes. I really can’t point to any one defining moment but I have had plenty of both success and failure.”

Pearl says he strives to be the kind of leader he wants his people to emulate. He works, he noted, seven days a week, since as a business owner, there is no such thing as a day off — clients, suppliers and employees are always counting on him. “I try to lead from the front by living up to the ideals that we expect from all in the company,” he noted. “If there is bad news to deliver, you do it yourself. Never be afraid of a challenge.”

Finding Success
Part of Oak Group’s longevity comes from always being willing to look into new products. “Product ideas are brought to our attention through our clients’ requests for new products, supplier solicitation and our own imagination,” Pearl said. “We then have the products vetted for salability, profitability for the client and then safety and stability of the suppliers. The client and end consumer establish the ultimate success of any product.”

He went on to say that most of The Oak Groups’s best ideas and new product additions come from client requests. “If someone wants a product and coverage and we can find a profitable way to satisfy their need, we will do it.” He attributes the company’s long-term growth as a testament to that philosophy, of always putting the clients first. “Growth is certainly influenced by the cyclical nature of the auto, financial and insurance industries. To grow at a faster rate than these industries requires imagination in product development and delivery, as well as continued excellence in performance of client profit improvement.”

His recipe for success isn’t difficult, he noted, it just requires being willing to stick with it. “The hardest part of starting in our industry is staying power. Because so much of the industry is based on relationship and stability, the client needs to know that you are going to be there for them. So many people start and give up when success could be right around the corner. Our experience is that it could take a year to become established. Obviously you also have to have talent to assist the client obtain the goal of increased profitability, and the ego to withstand the constant rejection until a base of business is built. So staying power is both financial and emotional. The rewards are great though in both areas. Clients properly serviced do not leave. The Oak Group has clients that have been with us from 1975, and the vast majority have been with us for decades.

“Never leave someone hanging,” he continued. “If someone asks for something, be it a product or a favor, get back to them promptly, even if it isn’t the answer they want to hear. When I am asked ‘what should I tell the client’ when there is a problem, I always reply ‘when in doubt tell the truth. If you try and make something up it doesn’t work.’ When trading options on the CBOE you had to live by your word. We would trade millions of dollars of contracts on your word, no written contracts. Lie once and you were done, no one would trade with you. One of the primary rules we have in our company is that everyone knows it’s okay to make a mistake, but it isn’t okay to hide it. We want to know about everyone’s mistakes so we can help train, but, just as important, so we can install internal controls so it will not happen again.”

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Staying Ahead of the Pack

Bruce Sievert, partner of Cornerstone Automotive Programs Inc., and president Centurion Automotive & Powersports Inc. has a long history in this industry, although it wasn’t his first career. He spent 22 years in the banking business before joining Mark Brown, Sievert’s current partner at Cornerstone, at SouthWest Dealer Services. He was with SouthWest for six years before he and Brown decided to form Cornerstone.

“I love the people in the business, the competitiveness and the chance to succeed in a results driven industry,” Sievert noted.

From Cornerstone, Centurion was founded as an offshoot in 2008. “The original mission was to provide a partnership in cross selling opportunities for Cornerstone and Centurion,” he said. “Not much has changed since then.”

A Product-Driven Business
Centurion offers a wide range of products, from service contracts and GAP coverage, to paint & fabric, tire & wheel, and key replacement. Sievert noted that, ultimately, products are chosen to be part of the Centurion package because they meet both dealer and consumer expectations and needs. And he is always looking for new opportunities. “We are constantly keeping an open mind to vendors reaching out to us and what dealers are using and requesting,” he noted.

Part of that strategy has been for the company to try and choose products that meet the needs of a changing marketplace, and get them out there faster than the competition. “We also want to be on the point of the spear when it comes to new products and be the first in our market place to offer them,” he said. “In the past we have taken advantage of changing laws — such as hands free calling in California — and offered Bluetooth to dealers, service contract follow-up programs and customizable maintenance programs, and some ‘front end’ products that can enhance a dealer’s sales success, such as QR code driven technology.”

In addition to choosing the latest, and greatest, products to offer dealers, Sievert noted that a big part of the strategy is also to use income development strategies to build new business. “We will continue to march down this two-pronged sales process in the future,” he said.

So how does he then measure the success of any given product? One way is by the traditional method of volume, Sievert noted, although he also went on to point out that you have to keep an eye on the amount of time spent servicing those products, as well as the end user feedback, to get a full picture.

Agents and dealers are also evaluated for success rates, looking at benchmarks such as the number of accounts and referrals for agents, and the willingness of a dealership to refer the company, as well as the bottom line numbers.

When it comes to giving both agents and dealers the tools they need for success, Sievert stressed that training is important. “We offer in dealership training on sales, products and presentations” he explained. “We will also do remote training sessions annually, and we are currently in the process of providing an online training resource for our clients that will be available 24/7/365.”

Looking to the Future
When it comes to building and maintaining a successful business, Sievert noted that there are several key components. “Persistence, education on current trends and products, and an ability to built relationships on trust and performance. And did I mention persistence? Since this business is very relationship oriented you must be able to gain a dealers trust by being the most educated agent and have a willingness to work as hard as any of their employees. Persistence is critical as it may take months and even years to close or get deeper in an account,” Sievert said.

He went on to note that anyone interested in becoming an agent should find a few mentors who have been successful to start, and be prepared to use some of that persistence he mentioned. “Be prepared for the long haul as success isn’t built overnight.”

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An Interview with Randy Crisorio

For this month’s Agent Profile, I traveled to Clearwater, Fla., to sit down with Randy Crisorio, president and CEO of United Development Systems Inc. (UDS).

Crisorio founded UDS more than 30 years ago, and he has found success on two fronts: as a provider of F&I and aftermarket products as well as first-class F&I training and development. In fact, UDS and its team of trainers, led by Gerry Gould, has been ranked among the best in the business by Auto Dealer Monthly for eight straight years.

I wanted to know whether UDS’s focus on training was present from the start; Crisorio assured me that it was. And as you’ll see in the video, his advice to agents hinges on the value they bring as trainers and consultants.

“What the dealer expects is, in my opinion, en masse, a high degree of competency, a high level of professionalism in advancing the staff of the dealership,” Crisorio said. “… So if they’ve got a competent F&I partnership with an agency, with an F&I company, I think that’s exactly what they would be looking for.”

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