The Buy Here Pay Here & Lease Here Pay Here Business and BHPH & LHPH Dealership Management Software

It's all to do with the training: you can do a lot if you're properly trained.

Buy Here – Pay Here operators across the country have been debating over the last few years whether to embrace the latest innovations in technology or to stick with the traditional way of operating their businesses. It has been almost 15 years since the first payment protection devices hit the market. Since then, new technologies that can be adapted to BHPH seem to appear almost weekly. There is GPS, auto dialing, SMS text messaging, geo fencing, integrated credit card and ACH payment processing, and online payments on the collections side and websites, Internet inventory posting, web based applications and lead generation, and prospect scoring on the sales side.

There is currently a post running on AutoDealerPeople.com titled, “What Vehicle are on Your Do Not Buy List?". We all know that one of the most important questions in the purchase of any one vehicle for inventory is, will it “run the note?”  Every dealer also knows that some vehicles experience more issues than others. Do you keep a Do Not Buy List for your BHPH dealership? If you don’t, you should!

Part 2 - Collections Promotions

As I said in the first part of this series here, properly designed promotions are more fun than advertising. Promotions should involve your employees, your customers, friends, family, neighbors, etc. All promotions should be done in a festive atmosphere. Plan the promotions so that as many customers as possible are included. Try to avoid promotions that have just one winner. It is very difficult to get people excited about one grand prize. People are more likely to participate if they think their chance of winning is better. Use promotions to set your dealership apart from your competition. Promotions are an important factor in helping you retain existing customers by making their experience with your dealership a pleasant one and reminding them why they chose to do business with you in the first place.  Make sure you take plenty of pictures and post them at your dealership, on your Facebook page and on your website to show customers who chose not to participate all the fun they missed.

I ran across an interesting article last week in Business Insider. It was about a survey released in December of last year concerning financial services done by the Federal Deposit Insurance Corporation (FDIC). The survey found that roughly 1 in every 12 US households, or some 17 million adult Americans, are “unbanked”. That means they lack a current checking or savings account.

Collections are the most exciting activity at a Dealer Controlled Financing dealership. If your employees have properly worked the other processes at your dealership, then collections can be easy. The dealership can maintain a larger portfolio without increasing personnel expense.

Do you want to improve your sales, increase collections and protect your dealership by enhancing compliance? Of course you do. The key to doing all of the above is being consistent.

Sales

I often begin our Collections training class by asking the students what the most important collection tool is at their dealerships. I get answers ranging from the telephone to the tow truck but I have never had a student give me the right answer.

Collections during the upcoming holiday season always become just a little tougher. We know our Buy Here – Pay Here customers live paycheck to paycheck and, during this time of the year, there are more demands on those paychecks than ever. The cost of holiday meals at Thanksgiving and Christmas or Hanukkah plus Christmas presents and even preparations for New Year require extra money when our customers have very little extra money to spend. Too often, BHPH customer use money budgeted for their car payment to cover these expenses.

Charging late fees is a practice some Buy Here – Pay Here dealers choose to do but an approximately equal number consider to be a bad practice. Those who charge fees when their customers pay late typically look at it as another source of revenue. Those who believe that it is a poor practice will, more often than not, site one or more of the following reasons.