During the previous issues, we discussed why you need a Business Development Center, how to decide who will call customers - salespeople or trained telemarketers, and how to find the right BDC manager. In this issue, we'll discuss pay plans for the department.
Before you can consider hiring a BDC manager, you need to determine what you can afford to pay that manager and the salespeople, The following are a few different options. If you would like these spreadsheets to use for your situation, please e-mail to Sjerome@dealeronline.com.
Option #1 - Simple Pay Plan for Salespeople
· Vehicles sold from CRD - 5% additional commission. It's easy to monitor. Just have the BDC manager initial the "Contacts to Call" sheet and include a copy in the deal. This method also tracks BDC sales and enables you to monitor your success of the department.
· Plus .5% of parts and service business they generate. Run a report from your Closed Repair orders and give the salespeople a bonus check based on their volume. This encourages them to call customers for service appointments and "tie" the customer to the dealership.
The next two pay plans are a little more complicated, but can provide better results of what you are looking for - customer labor sales, parts sales, etc. It uses a point system that translates into dollars. Since it is difficult to determine by the previous pay plan if the salesperson is responsible for creating labor and parts sales this plan monitors it. It also rewards salespeople for reporting to the BDC center.
During our next issue we will explore the next step to Using Technology to Retain Customers - determining if you can afford the department.
During the previous issues, we discussed why you need a Business Development Center, how to decide who will call customers - salespeople or trained telemarketers, how to find the right BDC or CRC Manager, and pay plans for the department. Now the big question is; Can You Afford a CRC Department?
The following analysis (also included on the pay plan spreadsheet) is a proforma on what a CRC can do. In a medium-sized store with just 5 or 6 salespeople doing the calling, you could sell 60 or more vehicles from the CRC center. Remember that these are not "cold calls" - but calls to customers that you know. Your salespeople know what vehicle they own, when they last had it serviced and often the customer's birthday, hobbies, and driving habits.
Although this shows a cost of about $8,000 a month - it generates over $80,000 in gross profit. Remember - this $8,000 isn't an outside expense - it is a salary for the new manager and increased commissions for your salespeople. This new manager might not just benefit your BDC or CRC department, but other departments as well. In many of the dealerships we work with the CRC manager helps manage the inventory, website, other PC's in the dealership and Internet leads. In addition, when you enable your salespeople to make more money - you retain them longer. This reduces your training costs and employee benefit costs.
During our next issue we will explore the next step to "Using Technology to Retain Customers - how to plan your contact strategy.