Wake up, Buy Here, Pay Here people. It's a beautiful day. Go grab yourself another cup of Joe and say hello to Jim and Michelle Rhodes on the Buy Here, Pay Here morning show. Take it away, you two. Music oh my goodness hey hey happy uh wednesday yeah wednesday in advance we're recording this on a tuesday evening yeah just the night before we're gonna be headed to the airport travel day tomorrow so just put a little streamer on there to let you know we're pre-recorded so if you send in your comments and we don't respond you'll know why Well, we'll have to respond after the podcast when we catch it on social media. Yep. So just had the opportunity to hop in the studio and record for our Wednesday in advance. Just had a lot of fun stuff to talk about coming off of the V-Ape meeting. We hosted V-Ape meeting tonight. And it just reminds me, Michelle, how much I just really love what I do. Yeah. I you're so dang good at it too. I hope so. I just think I came away from the meeting. We had a smaller group, had some of our dealers couldn't make it tonight. We had a smaller group. We had one dealer who's well-established and pretty good sized portfolio was there really kind of to, to learn, but also happy to step in and mentor the dealers that are in the one hundred to five hundred account range. And that was something when, when, Jim came up after he was done with the meeting and he was telling me about that. And I said, that is a very unique thing in the industry that is not really, it's kind of the only place that I know of where you can go and have a dealer that is in a very different paradigm in a business come and be a part of the meeting and be able to offer some wisdom in what, yeah. And offer their phone number from a different group and said, Jim, make sure, you know, this dealer has my phone number, have them reach out to me because they were talking about some really important stuff around capital, which is really kind of the reason that I wanted to go the direction I did with the title and the conversation today is like, you know, I just today's conversation in that group was amazing. um sort of an amplification of the things that I see in my work across the work that we do and working with data obviously in v-aid and working with dealer clients and working with lenders and sort of these dealers growing so let me kind of give you a microcosm one of the conversations was Our business is doing well. We've grown it a lot with our own cash. We don't have much retail business, so we're building on our buy here, pay here from our own cash, really. And we have places we could go to get cash versus maybe traditional line of credit. And so they were talking through that, and they were able to ask somebody who's been there, done that, who's built a business partially on debt, partially on their own assets and so there was some really great advice and it just kind of as we talked through it it just illustrates sort of that void that exists and I was just struck through the whole conversation throughout the night I was able to share with them that you know we're gonna speaking I'm gonna be on the stage at an idea where we'll be talking about success tools that are aimed at a lot of these things that were touched on tonight in this group oh fantastic So because all the work is really, our industry has this unique problem of having You've got cash flow to think about, capital constraints, capital demands of growing a portfolio. So there's cash flow. And then there's profit. And we talked about the fact that profit has been a bigger part of the conversation. Normally, we can almost take profit for granted in the buy here, pay here space. But we're finding that lenders are really pressing their dealers at the point of renewal. to demonstrate their profitability and so on. And so this is part of what, you know, just you realize that the challenges that this industry faces are not new. We have new technology and new solutions coming into the space. And I just see it as a really wonderful opportunity time and opportunity for us to bring together many of those resources to solve some of these problems in this kind of fragmented space. Right. Yeah. So you, you know, you, as the title it's from limitations to launch pads. Yeah. I, I, I wasn't there at, at the meeting. And so was, was that, it having someone there that has gone to the other side of this, that really added that this is a launch pad or. Yeah, they, they added sort of a, a path, right. And they didn't say it was a quick fix, but they said, this is how you could build your way into keep in mind. There's multiple conversations kind of layered on top of one another and In just this one dialogue between younger dealer versus more established dealer. And so part of that was around ways to create wealth, ways to create leverage, and kind of the pace. And also talking about exit. We have a dealer in that group who has a health scare. And it's a serious one. It's at least got them thinking very seriously about their own mortality. And I'm quite sure it has them thinking about- Oh my gosh, how many dealers if we like, yeah. Right. Yeah, we- I talked to them about the fact that you and I talk about enterprise value all the time. And I said, there's enterprise, there's actual- like liquid market value of your business if you were to sell it. But then in addition to that, there's what is the sustainability of your business? If something were to happen to a dealer who was not able to continue to perform and function in the role in the same way, then what would that mean to the business? Could the business... you know could it persist could it stay as a going concern and produce income for loved ones and for the family so there's all these kind of layers to what we do and things to think about and I just think it it just again tonight's conversation just sort of highlighted the problems that exist in our industry and and sort of the the thing that I see that white ways in a position to do is to take on some of this stuff, ask the questions of the providers and bring some of these solutions together to, because I think the job for buy here, pay here dealers is just more difficult than it has to be. Right. It's a hard, it's a hard thing. The dealer who's well-established acknowledge that. Yeah. It's a hard, it's a hard business. And yeah, There are places where you can go wrong and this and that. There's places you can explode. You can fiery burn out. Yeah, it can go sideways. And so there can be some things that go badly. But I think I really bring a really positive outlook to the thing to say, I think that when we get cooperation from the providers you know the people in the industry who have the resources who have the means and the tools to be able to bring to the problem just bring their toolbox and let's let's open the toolbox and let's get busy solving some of these pieces I'll give you one one example we talked about in the meeting tonight that, you know, these dealers come up to this renewal and with their capital provider lender, you know, whatever kind of traditional revolving line of credit or whatever they might have. And, and, One of the conversations that you've heard through the podcast alone is like LTV. What is LTV? Loan to value. It's like, what is the loan? What is your loan amount? Or what is your amount of finance relative to the value of the collateral? And in their case, they're talking about the book value of the car. Like if it had to be sold, right? At least I'm saying according to the book. It's like if you and I went shopping for a used car and we chose Kelley Blue Book or whatever book we would find a reference to say what's the car really worth. So the lender obviously is more interested in that. The dealer might book the car in for five thousand as a repo, but the lender wants to know what's it really worth. Is it really worth thirty five hundred? Is it really worth sixty five hundred? What's the book say? We don't have that information. I don't have it in VA. Most of the dealers in their DMS don't have that information. Yet with lenders, they're trying to grow to a place where they can get to capital, and it's not a number that they're tracking currently. And it's one of the most important things. Right. Yeah. So it's like, wow. I just told the group, I said, we don't, we don't have that. I don't have that in VA because you guys as dealers don't typically have it in your DMS. So you're really just talking about an integration, but it's like the lender expects to have it. We really ought to know what it looks like, you know, in our own portfolios. And we simply don't have it from the DMS. And, and. Ninety-nine percent of the cases. I'm not exaggerating. Like, I just don't think, I don't see. LTV being the car being booked at the time of contract, time of origination. And if so, it's showing up somewhere else in a different system. It's not, it's not in there where we manage all the stuff. Yeah. Right. And so this is just, it's, it's an opportunity. It's like when you and I do these SWOT analysis and whatever you put down as a weakness is usually really an opportunity, right? And so this is the way I'm thinking about all these things that I see in our industry. Like there are, There are challenges and there are limitations and there are frustrations. The good news is many of us see the disconnect and we are rallying the people who have the means to solve these problems and we're working on it. So just, you know, and I would say that those folks who step forward in the, whether it's technology or whatever these solutions are going to look like, they're going to see life get easier. They're going to see a path from B to C to D and right on up the way. Still, it goes into this whole thing that this enterprise value is a conversation that we've been having in a public way for years now. And so many of the capital providers and dealers and it was like, there is no such thing in buy here, pay here. that it's just a, it's a liquidation sale and that's it. And we, and, and it's funny because when we first started having these conversations with those that are like, you can't do it, you can't do it, can't, you can't do it. We'd say, if these certain things were part of the industry and we're, you know, just not major standardizations, but some things that just, and it's, and this isn't really a standardization, but it's also, but it's, It's along those same lines of dealers looking at things the same way and being able to say, my portfolio right now, the LTV or whatever, regardless of whether or not they have a capital provider, but having that information, that is really incredibly valuable. Yeah. And, you know, one of the things you and I, we have been beating the drum that it doesn't have to be, you know, a liquidation. It doesn't have to be a liquidation. I mean, it's like anything. There has to be a buyer for it. But how do we make it attractive for a buyer? So you and I could do a whole separate conversation on that. And we have done right around. Oh, yeah. But I think this kind of touches on the piece about you can create that value. And I think it just becomes sobering when you've got a dealer who's the primary principal who realizes there's nobody else in the building who can really do the job that they currently do. And now they have the sobering news that they're being called in for an emergency operation. mri kind of thing and so this dealer is like reeling and thinking what yeah because you know it's what's that going to mean to me and my business and I've spent my career you know building this thing and and what else you know is so I'm just saying these are things that You know, if you owned a franchise group, you know, multiple franchise, that wouldn't be you'd have a market for those kind of things. Right. You'd have a place to go. But I think this is this is both an opportunity and, you know, it's a challenge in our space. And I just think we dig into it. Yeah. Anyone out there listening that would like to watch, we did a half-day event on enterprise value and had an hour-long conversation about capital, an hour-long conversation. Accounting, cash flow, yeah. Yeah, I mean, it was a great event. And you can find that on bhphinstitute.com. And that's our platform for online education. Yeah, that was so rich. I mean, so many of the top experts from the industry were part of that day. And it's still a hundred percent relevant. Yeah, true. Absolutely. Yeah, that's right. Yeah. That's, that's kind of evergreen stuff. It really is. We did in that event. So, yeah, I think it's, it's, it's, it's important for dealers to recognize there, there are solutions here, right? There, there are ways to, to get there. I think what we ask dealers to do all the time and tonight's conversation was a really good example of how we, you know, we, we stopped for a minute talking about cash and deal and all the stuff that dealers spend their days talking about. So let's, let's talk about wealth creation. Let's talk about how do we get from here to there and, Yeah. Then that's something that's another drum. It's not just the enterprise value, but it's like, what do you really want out of life? That's the bigger question you should ask yourself. And I know with dealers that we have had as clients over the years, that when we would go in and sit down with them, we'd do a discovery of two and a half days. and you know talk to the team and talk to them and and one of the assignments that the dealers have is go sit down with your wife do so do it by yourself and also or your significant other and really have a frank conversation about what a perfect life would look like yeah um and nine times out of ten, the wife, I'd really like to see you home more often. Yeah. I'd really like to see you be able to participate in some of the things. You know, the kids are growing and you're not, you've been so, because a lot of dealers, they get on that hamster wheel. Sure. But, you know, taking that time to just really ask yourself some of those super important questions because, you know, we get so tunnel visioned And the day-to-day and the keeping our heads above water and all of that. But until you have a vision of where you're going, you can't create a roadmap to that. You're just kind of zigzagging around. And it's really, really, that's, I think, one of the big things when you bring in uh a dealer that has been been around for a while and you know that has been thinking about different things and just like the kind of conversations and v-eight though I just I I was thinking to myself I I don't know if if everyone listening really understands the the ecosystem okay So White Hat Way Incorporated is the parent company of all the things that we've created. Podcasts, the Institute, you know, all of the things. V-Aid is one of those things in White Hat Way Incorporated. And V-Aid is something that Jim launched a year ago. And, um, it's just, it's almost a year and a half ago and it's, and it's, it's in that, that, that one of the things that dealers are able to do, if they can't make their group, then there are opportunities to go to a different group and still have a conversation. And so this, you know, the opportunity for, for that dealer to be able to come and sit with the others, that doesn't happen anywhere else that I can think of. Yeah, that's true. I think that is part of what's happening. And I think the, the data part that, you know, we do in VA, we, and look, another part of the conversation tonight with same dealers, like, There was the thing about, you know, if some of these numbers aren't right, then it makes you lose confidence in the whole thing, which is a very valid point. You know, I feel that same way as a data person. We don't want data that's not going to be accurate. We don't think people should bother to show up and give their time of an evening, you know, to meet with other dealers and talk around data that's not accurate. accurate. If it's not valid, then it serves no one really. And so we're very committed to making sure that those things line up and dealers can have valid conversations. And then there's also just this piece about, there was the wealth building conversation that included things around real estate. And there's just, it's all of it is really, when you back up to what you said about why Atway and this VAT being just one solution, an example was the one of the dealer who was asking about was considering, you know, getting a mortgage on their home or whatever to, to get the next round of capital. How should I take the next step? And I just was able to say to them, look, you know, you and I could have a really great conversation with your local lender right now, just based on your VA data history alone. Like you've got enough months of history, strong month over month to be able to tell a story and, about what your business does. Yeah. On a single sheet of paper, we can show them how it functions. And so I think this is just part of the value. Yeah. It's part of the value of what happens, but you just got to start, you got to have comparable stuff and you got to have, you know, you got to string it all together so that you can tell the story. And it's, you know, it's, it's kind of funny because, um, when, before V eight was created that we're coaching and, um, So many people said you can't scale coaching. Well, that's what VA does. Well, it's group coaching. I don't think of it so much as coaching. We certainly do some coaching, especially in our newcomer group. But the whole idea is like that coaching thing. So how many times have you either been included in a conversation with capital providers that are banks or have prepared coaching? here's the print offs of all of the data that we've been stringing together over the course of the last whatever. And, and that, you know, you now are in a position because you've been tracking a lot of these things with the dealers and the groups that, that they, it's like, if you need it, we can get the stuff. And I'm sure I can get permission to pull the quotes from what was said tonight. But the one dealer who's well established, he said, I went to my lender with a very well-prepared plan, probably more sophisticated than they're used to seeing. And it was based on their own cash flows, their history of cash flows, their projections, and they're very much on plan from what they deliver to the bank. So it's just a way to connect the dots. And I was able to share with what we've heard from others about how You know, data is going to be really important. We talk about data is key. And yeah, you've got the artificial intelligence piece coming on. And so how we utilize data is going to be a connection to capital, which is going to be a connection to growth, which is going to be wealth building, which is going to be creating a sustainable business that has enterprise value. All those things can be achieved. you just got to kind of, you got to start here, get to a place where your numbers are comparable and you can make sense of them, adjust them where needed and, uh, and be able to kind of, to build accordingly. But I would just say that, you know, for tonight, I just came away from it, just feeling really fortunate to be in a position to be able to just encourage those conversations between dealers and let's get past the thing about, you can go on Facebook and talk about cash and deal and, In these meetings, I really, I'm going to be nudging them. And sometimes it's going to turn into a little harder nudge because you've seen me do that with clients. It's like, sometimes we have to kind of press to a place. Let's get past this conversation about day to day and let's talk about what can be achieved. in your business and in your life. Yeah. Right. When you just can kind of back up and see it for what it is and, and where it fits in the grand scheme of what's to be accomplished. And I would just say, everything seems to be moving in our favor in the industry. And some of us are going to just help to make sure it happens faster. Yeah. That's fantastic. All right. Fantastic. We should wrap up then. Is that it? Yeah, that's it. All right. Well, we are again, pre-recorded. We will be, when y'all listen to this, we'll be in the air somewhere. Yeah, in flight. Thank you so much for joining us today. We really appreciate your support. And again, if you're interested in learning more about enterprise value, go to bhphinstitute.com and there is in there the all-day live stream. All of the sessions are in there. And also, if you are interested in joining a VH group, Reach out. We would love to have a conversation with you about that. Let's introduce you to these dealers. And if you're going to be at NIADA's conference, we will see you there and we can talk all things. That's right. Data, White Hat Way, VA, all the things. All right, everybody. Have a great day. Thanks again so much.
