Sales Models and Staffing Strategies with Jim Colon

Paul J Daly: 0:02

You're listening to the asoto Con Sessions by Effectv live from ASOTU CON 2024. Welcome to ASOTU CON conversation sponsored by our friends at Effectv this is their third year doing the show, and I am here with the one and only Jim Colon, co owner of Toyota of Marysville. Jim, welcome to the program.

‍Jim Colon: 0:21

I'm excited to be here. Excited.

Paul J Daly: 0:25

So you come all the way from the west coast to be here. I did. Tell us a little bit about your background in the industry. And then I want to get into what you're doing at your store and why it's so different than what we see in a lot of other places.

Jim Colon: 0:37

Okay, well, my background is probably a little bit different. I spent a few years working for Toyota Motor North America, I had the opportunity to lead the sales divisions for both the Lexus and the Toyota divisions during my career. So been calling on dealers for a lot of years. And then Toyota said, Hey, listen, we think we're going to move to Texas, my response was, you will move without me. So at that point in time, the accent for me, was able to identify an opportunity just outside of the Seattle area, went up and built a new Toyota store we opened in July of 2018. And it's six years later, can you believe that?

Paul J Daly: 1:28

Man? I remember when it was like three years. And yeah, you went into the store with a very specifically different approach to employment and sales model. And it you know, open point, right, you had to build from the ground up, we build it from ground, which takes some time. Tell me about your approach to your sales model? Well,

Jim Colon: 1:51

I, you know, when when open points are relatively rare. So there's a lot of data on an open point in terms of what is needed in that particular marketplace. So a new Toyota store, just outside of Seattle, we're about 40 miles north of downtown Seattle, but in sort of a fast growing kind of suburban community, if you will. All the data was saying that we were researching was saying customers did not want to negotiate. I mean, that was the obvious data we don't want to negotiate. So we started to really kind of dig into that and kind of try to study that model, went and visited a number of stores. Avondale Toyota, down in Phoenix crown, Toyota, in the LA area. We went and visited the shump stores in Denver, Colorado. What an eye opener when we saw what they were doing. We made the decision, we're going to open the store, negotiation free, we're all in. And we started like that from day one.

Paul J Daly: 2:59

So you opened it like that. So what did you What was the biggest pushback you got? And I don't know if it was from people from the community from the OEM, from fellow dealers, when you got pushback to that sales model. What was it? We

Jim Colon: 3:14

really didn't? Oh, well, first of all, we ignored the pushback, because we thought we were doing the right thing. And we were right, doing the right thing from the customer perspective. So this really was going to be a customer driven decision or a customer centric decision. This was the right thing. So we ignored all the naysayers. Oh, you can't do that. Everybody's just gonna, you know, put a price out there, you'll be the shopping store and everybody will beat you by $100. Well, that's not really how that turned out. And if you look at the performance of negotiation free stores, at Toyota across the country, Avondale, Toyota and down in Phoenix is in the top 10 buy in stores in the country. In our specific region, in the Portland region, there are seven, Washington, Oregon, Montana and Idaho. So within that four state region, we have seven negotiation free stores. So 10%, the 10% number you use. 10% of the stores in the Portland region, are negotiation free Wilsonville Toyota, outside of Oregon, one of the top five volume stores in the region, Beaverton Toyota, in Seattle to negotiation three stores two out of Seattle and us, which is Marysville Toyota.

Paul J Daly: 4:37

So to run a store on that type of model. People have an expectation when they come in both on the sales side I also think it changes people's perspective on the service side as well. It does. I don't hear a lot of conversation about the service side have a single point of contact or single price dealership. How would you say the service experience needs to be different In a store like that, well,

Jim Colon: 5:01

I think the service, I don't think we're paying as much attention to that service process. When when customers are coming into the store. We're trying to give it sort of an approach of going to the dentist office, if you will you go to the dentists, they know you're coming in, they've confirmed your appointment, you get there. And then the dentist has a plan for you. Right? He looks at you know, does the X ray. Here's your plan, Jim. Now, we're probably not gonna do this all out today. But over time, here's what you're gonna do. And so rather than make it painful for customers, when they come into your dealership, they know, here's the plan for your car. We're probably not gonna do it all today. But we could do it over time. And it makes it less sort of a part, additional sells environment for service. Tell

Paul J Daly: 5:56

me about your approach to staffing because explain your situation. Um, there aren't many stores in the country I've ever heard of that. Or maybe you are the only one that hits these percentages. But you've started out this way you've stayed committed to it, and the results show that it's working. So why don't you give us the flyover?

Jim Colon: 6:12

The one thing that we didn't count on in terms of staffing the dealership with a negotiation free sales model was how many women were going to show up? absolutely shocked us.

Paul J Daly: 6:30

Show it to buyers show up to work show up to work.

Jim Colon: 6:33

So you take all of the nonsense the out of the heavy negotiation. Women don't want to do that. Don't want to do it ain't going to do it. Don't think you're gonna go out and hire women in a traditional model named showing up. But they showed up at our doorstep. And we were like, Okay, now Now, what are we doing here? And so we had to invite people into the dealership. We have 80 employees at Marysville Toyota, over 60% are female. That's everything. Technicians, female technician started showing up.

Paul J Daly: 7:15

What and there was no special effort there, you know,

Jim Colon: 7:18

special effort. It was just we changed the culture. And when the culture changed, people began to get comfortable. And were welcome to our dealership. And we were just really we still you know, today are trying to make sure that we understand that and, and we embrace the culture that we have, and try to support people where they are in our environment. Let's

Paul J Daly: 7:46

try to shake up a little bit of thinking because Are you single point of contact,

Jim Colon: 7:51

single point of contact? Okay.

Paul J Daly: 7:52

I think there are a lot of dealers who are kind of circling the concept of either fixed price, like one price selling or single point of contact, usually they can go together really well. Yeah, right. What would you say to those people who are like that would never work at my store. And then there's this next layer into the Senator that are like paying attention to it, considering whether or not it would work. What would you say to the people who are in consideration right now?

Jim Colon: 8:19

Well, I would tell everybody to go do their own research. I mean, you gotta go see some other stores and take a lecture you're

Paul J Daly: 8:25

saying researches, go go like, go and feel the culture, right? Watch it happen.

Jim Colon: 8:31

In the world of Toyota, where I came from, they used to call that Genji gimbal Tzu in Jagan, Bucha, who is go and see? So you gotta go see for yourself. What it is how it works for us, and I'm going to go back to the fact that we have so many women that work for us, I cannot imagine running a business where you eliminate half of the talent pool. How does that make sense? You eliminate half of the talent pool, and then you expect that your business is going to grow. You're going to have all the talent, all the knowledge, all the enthusiasm, it doesn't make sense to us. So we are very excited that we welcome people into the business. The challenge is people say, Well, if you're delivering a great customer experience, that over ways, so much of the back and forth on price, it really does. And we're able to measure all of the data points in terms of pricing, I mean, between a traditional store, Toyota provides us with the comparison data. So between a traditional store and my store, maybe there's by bottle, a difference probably about maybe 100, maybe $200, maybe$300 Depending on the model between on the front end gross. So Then what are we talking about? We're really only talking about the back end. And that's really the challenge. And that's what scares law dealers. But there is a major difference between what you pay in traditional store and what I pay. Salary bonus. There's a big gap chargebacks look a whole lot different. And I think you got to look at the entire picture. That's what our dealer has to investigate.

Paul J Daly: 10:30

How about throwing retention in there? Oh,

Jim Colon: 10:32

retention is absolutely amazing. When you look at retention Toyota, the Toyota folks know we Toyota measures retention by tle, RTL is off the can off the charts. So we don't have to worry about tle and grinding trying to meet Toyota standards. I think that's very important. And then we use another met metric, the that TPS performance guide, where we try to look and measure loyalty, our scores typically run in the 50% to 80%, minus 100, top 100. And that 50% 80% is kind of considered world class. Yeah, I don't know about you, but I kind of take world

Unknown: 11:20

class experience. You and Perry bear my business partner, Pierre Watson,

Paul J Daly: 11:27

you are always thinking of something over the horizon. So what are the things like a lot of people would look at your store and be like, okay, very progressive model, a progressive employment plan that's out there. But what things there are also a lot of dealers who are doing those things? What do you what are you Imperio? Kind of like cooking up over the horizon? Where do you see your opportunity for growth and improvement and maybe like shaking it up a little bit more?

Jim Colon: 11:50

I'm suggesting to all the traditional dealer models don't change stay the same. Even do nothing? I

Paul J Daly: 11:58

don't know. But what things in their store? Are you? Do you have any employment practices? Do you have any sales or marketing techniques or anything that you're kind of like, let's try this this year,

Jim Colon: 12:09

I think we want to do more focused on brand. Because of the fact that we are we partnered with the shump organization, and we've licensed one person, one price, and one hour. So we're going to try to take that one person one price one hour. And when we first did that, we launched the one hour probably about about a year and a half ago, I was absolutely scared to death, but the one hours by the time we agree on all the paperwork, we can get the paperwork done in an hour. Haven't had one. Hardly any bad. And I don't think we've had a bad survey of that. Somebody has said you didn't get it done in an hour. Once you can make the commitment. We get your done in an hour.

Unknown: 12:58

There you go. parting words. Well, let me ask you this. Do you host people at your store before? We do? Absolutely. Okay, so there you go. If you had an idea that you might want to explore this a little more. Bottom right here. Right, Jim is the guy I have to come visit us. We also visited your visit. Jim, thank you so much for being gracious with your time and your wisdom. Okay, thank you. Thank you for listening to this a so to concession by effectv if you want more content like this, you can check out our other podcasts we have a daily show called The automotive troublemaker Monday through Friday. Here on podcasts also live streamed on YouTube, and LinkedIn and Facebook. We also have a long form podcast called Auto Collabs Auto Collabs. And if you just want to go a little deeper into this community, you should sign up for our regular email we put our heart and soul into it. You can get it for free by going to a sotu.com. We'll see you next time.

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