Decision brief overview and applications

Decision-Brief

The problem that is sought to be solved here is the rapid departure of sales staff from Tucci Toyota, a car dealer in Atlanta, Georgia. A new plan for development of suitable sales representatives is presented here.

Selling cars is no longer an act of salesmanship by those present at the shop and many think that buying a car is important enough for them to make a study of the deal that they are getting. Let us look at the experience of another dealer for Toyota -- Carson Toyota. Those dealers have five pages on the Internet about the satisfied purchasers and their comments. In all those comments there is the mention of the satisfaction that they had in dealing with individuals in the shop. Some of the purchasers had traveled some three hours and by using all types of transport to reach the shop -- Metrolink, light rail, the Red Line, and Green Line. (Happy Customer Recommendations)

Naturally they were very tired when they reached the shop and the best feelings that they got is that the salesperson concerned gave the buyer a lift from the station, a cold soda and ensured their convenience before even talking about the deal. This is the essence of salesmanship, of knowing when to talk and about what to talk. A salesman succeeds in making a sale as that is the measure of the capability of the salesman. There is not much point in haggling with a potential buyer as it ends up only irritating him -- the buyer knows what he wants and when the dealer keeps changing his price, it makes him feel that the salesperson is trying to cheat him. As one buyer from that organization mentioned "For me the purchase of a new car is second in financial stress only to the purchase of a home." (Happy Customer Recommendations) Thus the purchase of a car for a buyer is an expensive exercise and he would like to do his best to ensure that his money has been utilized the best.

In the case of Tucci Toyota, the salesmen were not trained and not experienced and this made them indifferent to the feelings of the customers. They also had a short period of stay within the organization and did not learn even by experience. Car buyers go through a lot of dealers before buying a car. Some of the people gave their experiences in buying cars as having gone through a dozen or 8 or nine dealers before deciding to buy the car from a particular dealer. As already mentioned it is an expensive purchase for the buyer, and he would like to ensure that he got the best value for his money. Sometimes, even for a particular brand, he would go through a number of dealers to ensure that he is getting the best possible deal. (Happy Customer Recommendations)

Experienced salesmen would have the patience and would continue repeating the same amount of clauses and prices. It is not similar to an immediate purchase like the case of retail products about which people may tend to buy and forget. The buyers would tend to appreciate as to when they are told regarding the same price by all the individuals concerned in the same organization. This would grant them more faith and confidence in the organization and its underlying principles. Thus even the organization would have to have fixed prices and that need to be repeated by each and every salesman in the organization. Otherwise, the chances are that the buyer is likely to hear the rate of different prices and would tend to feel that the organization is trying to flee him away. On top of that price differences would tend to evolve from additional charges when the buyer is actually trying to buy the car and to drive away. This would also make him have the feeling that he is being cheated upon by the organization. Thus it is very important that the question of prices is to be dealt with properly by the agency in a cautious manner. (DiPonzio-Ricci Group)

When the organization would develop a selling practice that is being appreciated by the customers, the dealer may even get purchases of its cars from the buyers who are at a long distance away as they are dependent on by the buyers. Since it is a purchase involving a higher value item, there has to be an amount of trust and mutual confidence between the buyer and the sellers concerned. The entire practice however, cannot be learnt in one day, and by being a good friend of the owner of the organization does not add to any difference. All the salesmen have to be properly trained to cater to the needs of the customers. This need not be done by the agency itself, as there are now many organizations in this field that are being devoted to the sole purpose of providing training. Irrespective of the manner in which it is done, and without taking into consideration the person who has been employed, it is important that a certain amount of training need to be provided. (DiPonzio-Ricci Group)

There are many organizations that spend their valuable providing time and effort in training to other individuals to be good salesmen in dealing with the customers. It is hence not enough to just think of only recruiting good salesmen for performing the job, but they have to be trained well. And for this purpose, they need to be, compared to other salesmen, and need to be measured up about their capacities and capabilities in various difficult situations, upgraded in terms of the remuneration being offered when they perform well in a difficult situation, and motivated and encouraged to be at their best all the time. The job of the manager in such a situation would be to do all this and also have control over the salesmen and also retain them as other organizations would like to pick them up from your staff.

However, this has not been done well and the salesmen are leaving their jobs continuously. The salesmen are not dedicated to perform their jobs, or in their services to the dealership or even capable and efficient salesmen. This has to be corrected and worked upon. The total evaluation of the situation has to take into account the following questions -- the total efficiency levels of the sales manager, the real capability and efficiency levels of the sales staff as they may not be selling the required amount even if they tend to be more capable, the strategy for sales that has been decided and taken up may not be the best strategy employed for that particular locality, the sales targets that have been fixed may not be realistic and workable, the manner of comparison in relation to other units may not be correct and relevant, the competency of the sales manager concerned and the competency levels of the entire group. (DiPonzio-Ricci Group)

There are different organizations who are involved in developing these capacities for many organizations, or even individual experts who are ready to help in this regard. It may be required that help is required from one of them for the organization to develop and reach its potential. The entire business of sales is competitive and a direct competition between different agencies. If one salesman or agency is not able to sell to a particular buyer, then the buyer will move to another agency or salesman, but the sale will certainly take place.

III. Demographics

There are good chances for success in sales of automobiles anywhere in United States, and Toyota has a good market in Atlanta, Georgia. Thus there are no fundamental problems with the market, and the problem is only with not being able to sell. Let us now look at the present position of car sales in United States.

a) Facts about the problem

The first point to be discussed about the problem is the market situation in Atlanta, Georgia about Toyota vehicles. Regarding this we note that there are nine dealers for Toyota in general Atlanta area. The names of the dealers are Toyota South, Team Toyota, Hank Aaron Toyota, Sandy Springs Toyota, World Toyota, Stone Mountain Toyota, Toyota of Roswell, Atlanta Toyota Inc. And Toyota Mall of Georgia. All these dealers are within 40 miles of Atlanta and are thus clearly in competition with each other. (Toyota Car Dealers in Atlanta) All these dealerships are in competition with each other as also in competition with Tucci Toyota. Thus it is clear that Atlanta is a good market for Toyota and it is not due to the problems with Toyota that the dealership is having difficulties.

The other question that may be raised is that the market is having some difficulties in the current year, and that is the reason why Tucci Toyota is having difficulties. The sales of automobiles have been increasing rapidly during the last few months and according to information available, the automobile manufacturers have sold a total of 1.8 million cars and light trucks in July and this is an increase of 16% from the previous. This is a high record of growth and considering the fact, that there are nine dealers in Atlanta, there should not be any great difficulties for them to get the additional sales required, and it is clear that increases in sales are not taking place at Tucci Toyota. (Paul, 2005)

The same problem does not exist with other dealers and this is made clear by the statements given by two banks to magazines. Atlanta-based Sun Trust banks is the fourth largest among the lenders for automobile purchase in the country, and during July, the loan volume has increased by 30% and this sort of increase had not taken place in the last one and a half years. Another bank based in Alpharetta called Net Bank has also said that it has financed $49.7 million during June and that is growth over the previous years' figures by 28% during one year. (Paul, 2005) Thus it is clear that the problem is not due to any difficulties with the industry or customers, but the problem is with getting buyers. The performance of this dealer is mainly with the inability of his salesmen to get enough sales in a booming market.

b) Assumptions about the problem

The picture of Tucci Toyota that is taken here is like that of any other dealership which is trying to sell their cars and other vehicles of the same category. We have assumed that it does not have any particular relation in line with Toyota or any other concerns that would enable it to have special favorable considerations of any type. The organization is expected to be receiving the same amount and range of commissions that any other car dealer for Toyota in Atlanta is likeable to be receiving. The staff that are employed in the arena of Tucci Toyota are also working there based on the relationship of pure salary concerns and they are not getting any due benefits as a result of their being part of the investors group in the organization or are being related to investors in the organization. These assumptions are important in the background as only then can the proprietor or manager of the organization concerned can have full freedom in relation to appointing the staff based on their performance levels only and that there are no other particular considerations.

c) Limitations

The reasons for the failings of individuals may be due to many reasons and it is not with a view to judging the individual that we decide his competency. We are not all-knowing individuals, and what we are judging is only whether the individual fulfilled his responsibilities in his job. These problems exist with all employees, and may be due to various difficulties.

1) Time

What is meant by time here is that the individuals concerned may not have had enough time necessary to improve upon and learn. One can thus witness that the turnover was at a very high levels, and part of the time was that he or she would have required for learning about the product and competing products. Further apart from the beauty of the concerned product itself, one need to have information that all motor cars contain more than 10,000 parts and they are also the components that keep it running continuously. It is known to all the drivers of cars that certain types of brands are stronger in some functions of the ride, in comparison to others whereas others are better in certain other aspects. These aspects may be with regard to the quality of ride in terms of being smooth or rough, the turning being made easy, the running of the car being steady or not, etc. And these functions result due to the quality of certain parts of the car, and whereas the quality concerned may be obvious to a person who is driving or using the car, the reason for it may not be known. Ultimately, we are thus accustomed to be in a position to accepting an advice from a person whom we believe to have superior knowledge regarding the product, and the salesman has the responsibility to sell this product based on the belief that he can make an attempt to create about his superior knowledge to the customer. Lastly, for this purpose, he requires the need for handling cars for sometime, and if he does not stay stick around long enough to acquire that knowledge then he will fail in his job as a salesman also.

From the side of the customer, there are delays in taking decisions and one person has mentioned about his purchase from a Toyota dealer "We researched the consumers' guides, scoured the auto web sites and picked the Toyota Avalon as our car of preference." (Happy Customer Recommendations) It is certain that this entire process took time and the concerned salesman also has sot be patient so that he can close the sale at the end. This is a concept of time that must be had by a dealer salesman. Otherwise he can never close deals, and often enough the deals made for him are by the same customers. Earlier it was a customer buying a car every year, but even today a good customer buys a car once every two or three years, but once he likes a salesman, the customer is likely to go back to the same person.

2) Money

The next important point in relation to the success or failure of any salesman is mainly due to his livelihood. In several of the cases, we can find that the earnings of a salesman would tend to depend on the quantity or number of cars that he can sell, as that shows the proof of his capability to sell the cars and his value of return to the company. Thus one can note that individuals from very low stratum of the society can make their life a success as salesmen by selling cars. At the same time, in today's world, getting a successful sale depends on a several other matters as well. One of the other dealers of Toyota in the area, about whom we have already discussed, Team Toyota has only three salesmen. (New Inventory) Yet one should note that there is a lot of support given to these salesmen by means of a direct inventory of 89 cars which are being in stock. Thus one can see clearly that the dealership has invested a considerable amount of money in making the dealership a relevant success. However one is not certain that these sorts of efforts were being made at Tucci. That will certainly make a difference in the entire matter.

3) Manpower

This has to do about the staff that the organization had. Yet, today the problem is not with regard to the number of employees that the organization possesses at hand. It can be seen clearly from the previous paragraph that a potential customer made his searches on the Internet, and that is how most customers make their searches in a situation when they are on the look out for buying a new car. All the salesmen have is their own email identities and they are first being contacted by potential customers by way of the Internet. What they need to do is to send them a suitable price and other relevant details about the product and then the potential customer will have the opportunity to make comparisons between different dealers and finally arrive at his choice. This does not however make the role of the salesman less important s since he still has to convince the customer about purchasing the car.

The satisfaction that the customer wants can be sent even on the email. Let us look at another customer and what he had to say: "Next I e-mailed some dealers with what I was looking for, and I received a response from Dianne Whitmire at Carson Toyota. She said if we can't find it, we'll have Toyota build it for you (!) NOBODY at any other dealer ever even mentioned that was an option! Needless to say I recommend Dianne Whitmire and Mike Chase highly! I received my Tacoma EXACTLY as I spec's it out, I've had it a more than a week now and love it!" (Happy Customer Recommendations) Ultimately the job of a salesman is to satisfy the customer and that can be done on the Internet as much as it can be done in person.

4) Facilities

This is really a difficult question to provide an answer, and this problem is likely to come up when the car would come back for service after a certain period that the owner has run about it. Whether this adds to make any difference in sale at the outset, one however does not really know. Very few people would be looking at the level of facilities when buying the car from the dealer for the very first time, but on his second purchase, he may knock out a dealer if he feels that the dealer does not have the facilities. Since this was a new outfit, this question should not have been so important.

5) Equipment

I feel that the meaning of equipment here is almost the same as facilities and both should have a similar effect on customers. Toyota vehicles are not known to give much trouble during the first drives and this should not be known to customers to make a difference in relation to their purchase intentions.

IV. General Discussion

The question is now to decide what actions should be taken to improve the low sales and retention of salesmen at Tucci.

1) Purpose

The purpose is quite clear -- get Tucci to sell more cars and ensure that their salesmen stay there longer. It is possible that the organization may not be in a position to sell more cars as sales tend to depend on a lot of factors which are not related to the realm of the salesmen, but our main concentration, however will be on salesmen.

2) Elements of the plan

The first point to be realized is that any automobile agency would spend tens to hundreds of thousands of dollars for the sole purpose of bringing in customers to the showroom to purchase their products. These people come to the showroom after doing all the study about the product and the agency concerned, yet when the salesmen do not pay the necessary attention to them, and the customers tend to go away to some other better agency, then the total money spent on promotion is lost. Often the customer has already decided on the type of car he wants to buy, the color that it must be, and also with regard to the facilities it must have, and so on. It is a question of servicing that demand and meeting that demand and getting the commission.

But when a failure takes place, it would hurt the dealership very badly. The important point which is to be considered for the sales personnel is to treat that all types of customers or who would tend to be potential customers are very important for the organization. What is required here is in relation to more enthusiasm and interest in the customers and their requirements and to satisfy them. Today this is true not only in the showroom, but their approach also on the Internet where they will be getting several enquiries from clients. This will result in greater sales and profits for the organization. (DiPonzio-Ricci Group) The task is not impossible, but it requires more committed effort.

The question then comes as to how this can be achieved successfully. Since the organization is supposed to be almost near the beginning of its run, the best method will be to engage a suitable consultant who can guide on all these issues. Ralph is experienced in the art of selling cars, but it is now clear that he is not so good when it comes to training others to develop the capacity of selling cars. If he was good in training up others, then there would not have been such a situation where are many difficulties in dealing with the staff. Even the new organization which has been hired for training the salesmen may be asked to take part in the developmental efforts of these salesmen from the day they join the company and give an assurance that they will perform well in their roles as salesmen. Otherwise they may be left to deal with a situation which is subject to some pre-decided penalties.

The training should be provided in such a manner that all the visitors to the showroom will be treated on par as potential buyers of a car on the same day. The greatest effort in terms of training should be to learn to sell cars to the potential customers who would walk in to their showrooms. This gives the dealership a chance to have a hold over a large amount of customers to whom they would not have sold cars otherwise. Customers who come after doing their research over the internet and through other channels are much more likely to buy the car from the dealership anyway. At the same time, there is a high profit with regard to these sales as they also end up lessening the inventory costs that has to be held, and this is very effective in adding to the profit levels of the company. The importance of "recruiting, hiring, training, measuring, upgrading, controlling and motivating sale personnel are very important for any car agency." (DiPonzio-Ricci Group) After testing out the capacities and efficiency levels of the newly engaged trainer, they may then be engaged on long contracts if they are found suitable for the task.