As a consultant, when I evaluate a dealership’s Sales Department, the first thing I look for is a Traffic Log. Only a small percentage of dealerships keep an accurate Traffic Log. In most cases, they believe a Traffic Log consists only of customers who “got serious.” And that is why they think they have such a high closing ratio.
No one really knows what the national average is for a closing ratio because there isn’t accurate data. Some estimate 20%. But without an accurate Traffic Log, no one can be sure.
To establish an accurate figure, the president of one OEM came up with an idea. In 25 leading cities around the U.S. he hired a temporary employee. This person was to stand on the showroom floor and do nothing but keep an accurate account of how many customers walked in. Each just stood over on the side of the showroom floor and counted customers coming in.
At the end of the month they were able to figure out what the closing ratio was with a fair degree of accuracy. Just take how many units those dealers sold and divide it by the number of people that came in.
After 30 days, guess what the national closing ratio was in these 25 cities? 30%? 20%? 10%? Well, it was 4%! Surprisingly, at the end of the second month, this closing ratio more than doubled. So he hired all new temporaries for the third month. Guess what happened? It went back down to 4%.
Why was the second month so much higher than the first and third? What had changed?
It wasn’t really an improvement. It was the salespeople who were working over the temps, telling them who was a “customer” and who wasn’t. They would say, “Not him. He’s not a real customer. He’s just looking.”
The salespeople were getting to the temps. The same way they try to get to you. And the only way a sales manager can combat this is with an accurate Traffic Log.
I learned the discipline of a Traffic Log and how valuable it could be from a particularly tough general manager. He would walk in just before noon and ask me, “Why isn’t there anything in your Traffic Log? You started your day at 9 o’clock. Is it asking too much of a sales manager to get some traffic into this place before noon?”
Oh how I hated him. I couldn’t stand him! But he was right! A Traffic Log lets you see patterns. It shows the busy times and slow times. In this case, mornings were never that good. So as the sales manager, it was my responsibility to notice that and get something going in the morning. I started getting with my salespeople and helping them get some appointments.
I also learned the value of accountability when this same general manager would come in and say, “Who is this customer Carol (a salesperson) talked to?”
“I’m not sure.”
“Is it asking too much of a manager to know. Or do you have so many customers coming into this place that you can’t meet each one. Or at least find out what happened in each case?”
What do you suppose I did? I got together with Carol and the rest of the sales force and said, “From now on, don’t let a customer leave the store without letting me know. Whether we sell them or not, I want to speak with everyone.” From then on, I did speak the majority of our floor traffic. And I wrote the results on the Traffic Log.
With my newfound discipline and accountability, my behavior was beginning to change. So was my income--and both for the better!
Your Traffic Log is the very essence of your Sales Department. If you want to know what’s going on, you have to know how many people came in and how far the salesperson got in each case.
When you sit down with each salesperson in the morning, at the beginning of their day, what should you go over? Yesterday’s Traffic Log. Discuss (a) How they spent their day, (b) The customers they saw and what happened with each one, and (c) How they will follow-up.
This doesn’t mean you have to be a tough guy. You can be a counselor, be empathetic, be on their side, be motivational. But do it. You cannot afford to overlook a single customer. Not for any reason.
Next Time: Daily Sales Appointments
Author, speaker and educator, Gart Sutton has been retained by every major powersport manufacturer/distributor. He is a frequent keynote speaker for national motorcycle conventions and state Motorcycle Dealer Association events. Visit www.gartsutton.com.