Move cars off the lot faster than you can drive them
You may think you’ve hired the right dealership manager to lead your sales team, but if you set measurable goals, you’ll know for certain.
Hiring a new sales manager for your auto dealership isn’t a process to take lightly. The individual you choose will run your entire sales department — not just managing and training the sales team, but controlling the inventory, providing accurate analytics and forecasting, and intervening during negotiations or disputes. You can hire a huge amount of talented salespeople, but if you don’t have the right, experienced leader to guide them, things can fall apart very quickly.
Once you have found that “perfect” dealership manager, however, there is still more work that needs to be done on your end to ensure your hire is indeed the right person for the job.
How can you be sure? By establishing key performance indicators (KPIs). KPIs are quantifiable measures that a company can use to gauge its performance — or a specific employee’s performance — over time. When determining KPIs for a dealership manager (and you’re not sure if you’re on the right track), the best thing to remember is to keep them S.M.A.R.T.
• Specific – Don’t be too broad with goals; they should be very clear and defined.
• Measurable – Focus on things that can be quantified, not just assumed.
• Achievable – Does the sales manager have everything they need to achieve this goal? Or are you asking them to do something without the necessary resources?
• Realistic – It’s fun to reach for the stars, but think of goals that are actually reasonable.
• Timely – Every KPI should have a pre-determined time frame. Whether it is a week, month, quarter, or year, it needs to make sense in the allotted time given.
Getting started can be the hardest part, so if you’ve just hired a dealership manager and you want to evaluate and track their performance, here are a few KPIs you can use and tweak as appropriate.
Measuring the effectiveness of your new dealership manager in the sales department
Determining an appropriate time frame in which to measure these KPIs may be different than normal since you are evaluating a new employee. You have to remember that it takes time to settle in at any new job, and there is always a learning curve, no matter how talented the employee is. A general rule of thumb with new hires is to give them a 90-day trial or introductory period. This gives them enough time to get up to speed and begin making a difference in your dealership’s bottom line.
With the 90-day period in mind, here are some KPIs you could use to evaluate a dealership manager’s performance during this time (be sure to fill in your own exact, realistic numbers that match up with numbers your dealership typically sees.)
1. Number of vehicles sold
2. Number of ups
3. Number of test drives
4. Number of internet sales leads
5. Number of internet sales leads closed
6. Percentage of employee turnover within the department
7. Amount of positive reviews posted online
8. Ratio of positive to negative reviews posted online
9. Positive feedback from more than half of the sales team
10. Number of outgoing follow-up phone calls
11. Percentage increase in sales
12. Percentage increase in gross profits13. Full coverage on the showroom floor at least X percent of the time
14. Organizing and leading X number of sales team meetings every month
15. Leading the launch of X number of new programs
Depending on the exact responsibilities of your dealership manager, you may want to add or remove some of these KPIS, but one thing is for sure: when you set goals and measure them properly — for all employees — you gain more insight into whether or not you’re making the right hiring decisions for your auto dealership.