It's time for a check up - Monitor your financial health
Published Apr. 2017
April is Financial Literacy Month, and GM Financial is proud to support this initiative in a number of ways. You may have heard of KeysSM by GM Financial, our new program to help spread financial literacy throughout our communities. This month, we're ramping up our efforts and heading to Capitol Hill in Washington, D.C. as one of the premiere sponsors of “Hill Day” with a focus on teaching and empowering adults to learn the how, what and why about personal finances.
But you may be thinking, "What does this have to do with me? Business owners are pros at handling money." While that may be true sometimes, it isn't always the case. Most dealerships fit under the title of "small business," or reach even further into the semi-small to midsize category. But dealerships are complicated, running like mini-businesses within one larger "corporation" so-to-speak. This complicates things when it comes to ensuring your business is financially healthy.
It's time to take the books back
Spring has sprung, which means we're well into the new year. Did you set aside time to look back on 2016 and create a business plan for 2017? If not, now is the time! Get your books back in order and remain hands-on in every aspect of your business for greater success.
Budget: A business plan should include an extensive budget focusing on equipment and building costs, the cost of leases and sales, salaries for your employees, and any necessary marketing. Each department in the dealership should have its own plan, because the "equipment" for a service department will be vastly different than what's needed for F&I.
Inventory: Which cars sold the best last year? And what do the industry trends look like for the most popular cars this year? It's important to focus on your inventory - plan out which vehicles you'll need to stock up on, how many, and when. Track these trends throughout the year to set your business up well for the future.
Cash flow and accounting: These ideas may seem like no-brainers, but when it comes to the numbers, who is behind the function? Is it you? Have you hired financial managers, or maybe even a CFO? Do you need to? Maybe leveraging some technology is all you need. If your dealership is on the smaller side, look into new tools such as cash flow management or accounting apps and software. If your dealership is large, consider hiring a professional. Unorganized finances can become red flags quickly, especially if you're looking to seek assistance from a lender.
Employees: What's the best kept secret behind a successful business? Employees. Their time and attitude become your money. Invest in the best. It may cost you more upfront because of higher salaries, but the experienced, confident, happy and knowledgeable employee will earn you more by making your customers' decisions smoother. Customers who have positive experiences at your dealership are more likely to become loyal to your business.
This April, set some time aside to learn about the financial health of your business. There are no quick fixes, but taking even a few measures can create a lot of difference. In the end, it'll be money in your pocket, and you'll have satisfied employees and returning customers.