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. Hello, friends. Welcome back to the Buy Here, Pay Here morning show. We're in some time zones today. It's the Buy Here, Pay Here afternoon show. Coffee's always called for just about every time of the day, I guess. So, you know, grab yourself a cup of Joe. I did learn, though, side note squirrel here we go um from an influencer i know right an influencer that i listen to who comes from italy and he talks about coffee and he's like an espresso any time of the day is a good okay it's great so you can continue to drink coffee throughout the day okay at least based on what the you know i was high class europeans before i heard from your your fancy influencer so Well, he just said no cappuccino after eleven o'clock. No more cappuccino. So that means your pumpkin latte spice and all of that after eleven o'clock. They're saying no coffee with any cream. Okay. I'm sorry. I can't. I'm just saying what, you know. Anyway. Yeah. So. We're in a little different time slot. Today was unusual. We're just back from a little getaway and back in studio. You might be able to hear my voice. I'm a little bit under the weather. Yeah. That's what happens when you travel. Yeah. And it's funny how the leaving the power cord behind for the laptop accidentally is like it kind of. messed up my schedule because yeah you could go use a different device and yes everything's on the cloud but it just kind of messed up my thursday that aren't we grateful for like overnight and same day delivery from amazon yeah got us back in the in the groove but anyway just a little bit uh discombobulated that'll be our friday word of the day but we're we're uh we're live at uh uh, eleven mountain one eastern today and happy to be reconnected. So got some important stuff to talk about for folks who missed our, our pre-recorded Wednesday that we were wrapping up in our Airbnb rental in New England and took a moment to kind of share with folks what the experience was like just kind of practicing what we preach and stepping off the the hamster wheel of life and getting a little quiet time and reflecting and, and getting re-centered. It was the word I like to use. And so, uh, so focused. Yeah. Getting refocused and kind of recalibrated. It's all part of the same thing. It's like, but it helped to get a little clarity. And now I come back, uh, enthused and ready to resume the work that is uh podcasting and and helping dealers find the information they need to be more successful dealer performance groups all the things yeah yeah um not dealer performance groups i mean they're peer groups is that dealer peer groups oh yeah that's an old that's an old thing that's gone uh anyway uh so we're just uh Here to talk about today, the happenings with Tricolor. That was one of the things that's back in the news. And we talked about it probably, what was that, six or eight weeks ago. And now there's more information. Yeah, because I think it was September. It was in September when everything kind of broke. Okay. And so we were just, you know, watching that because... There's a reason why this is highly interesting to probably every dealer out there. Most dealers that we talk to, their goal in business is to build, build, build, build, build, grow, grow, build, build, and create a lot of dealers that we talk to. It's like building their empire. Yeah. building their you know it's yeah their legacy and um and it's just it because they've been they were a company that many have used as a symbol of what success looks like yes certainly in terms of sheer size Yeah. Well, and, and just, just the idea that like when, when the people from Tricolor would come to a event that it's just, they were, that was a star kind of quality because it's like, look what you've done. Tell me everything you've done. And I want to be able to do the same and that kind of thing. Yeah. It's naturally for people to point to those folks as a model. And, and, you know, I've used the example and unless we're going to get to the tricolor stuff, like there's there, what we're going to focus on today is, you know, what can we know? So let me back up and share with people what we did in order to prepare for today's conversation. Yeah. Um, you know, assign chat GPT with the thing of going out and sweep all the public records and bring back whatever is new from the last, um, in terms of, you know, any kind of announcements, news and, And so it referenced some articles from Bloomberg and Reuters. So now this stuff is hitting the national news wire, largely because... Not just automotive publications, but this is like heavy hitting business publications are... Because there were public filings, there were bankruptcy filings. So Tricolor stepped into a chapter seven. And so there's all these, they call it affiliated filings, like... there's not surprising with an enterprise that big, you have tricolor holdings, you have tricolor, all you have these different entities, right. That are kind of all related or five or six, something like that. Different entities that are part of this. Yeah. So for today it was really about, you know, we asked chat GPT, go find the stuff. What's the latest information. It brought back some, some, and we're not going to, you know, go through the actual articles, but you can certainly go do your own search and find all the stuff out there. That is the latest news on, on tricolor. And I think the, when this kind of stuff happens, it's an opportunity for us to pause and focus on what is knowable. And as I shared with you this morning, it's like one of the things that happens in my work as a coach and as an analyst, I meet dealers who are really bent on building a massive enterprise i mean they build cash flow modeling it's part of what i'm helping them do sometimes and they set their sights really high and i just find that too often they're they're so fixated on that growth strategy that they're they're not accepting very well the the words of caution that I'm trying to offer because I've said, you've heard me say it over the years since we first got together. Cause I've been saying it for many years. It's like when I meet dealers that are sort of, um, what I call thoroughbreds, like they're dealers who are this, this dealer that is this type a individual, go, go, go. We're going to build, build, build, we're going to build a massive enterprise. And I find that they, they're just not as, um, willing to hear the cautionary kind of examples that I think are appropriate. And I think this is an example of, You know, you don't find very many operations in our segment that are larger than Tricolor was. Okay. And you look at that and you think that's the model of success. You use your point. They're the panelists at the conferences and you go in there and you don't get to know that the X's and Y's behind their business. You just know I got a thirty thousand account portfolio. And how people are just waiting for a nugget. Yeah. And it's like writing things down. It's like because they are they. They sometimes we make our models of success something that's, you know, really big. And it's just you just don't know. You really don't know. So and so that's that's been true for me for a long time. And the other thing that I have said, and it continues to be true, and I believe it'll it'll still be true, folks, if we just pay attention that. You go to these conferences, I'm really thinking back to conferences from years ago. I would go to these conferences and you would see a panel of dealers who are the most successful dealers in the building or whatever, and they have them up there to showcase their prowess or whatever. And often those folks are still at the comfort, they're mentioned in the panel that they're shopping for capital. They're just still looking for more money to grow, grow, grow. Like you would hope they would be cash positive and that they would be there to help fund other dealers. They're making so much money. that they would be there to share money, not to find money. That says an awful lot about the industry and about people's approach to the business too. Because I see other dealers that want to keep their local business This is where they diversify a lot. So they have their dealership, which starts to fund, helping them diversify. And so they can grow their dealership, but they, in the process, they're able to catch capital in other ways too. Right. So why don't we dig into this part first about what is known? And let's talk about the tricolor situation. And I like this. Known versus narrated. Because one of the reasons why we talked about this is because we saw a bit that was being talked about in social media. And, you know, there's a lot of it's like, well, here's the what we know. And then there's a lot of narrative about, you know, the why and the and just speculation. So and so there is a difference between known and narrated. And you can listen to someone who, you know, even us, it's like we'd say, go out and do your own research and don't take what it is that are some of this is perspective. And some of this is fact. Yeah, and some of it can be wrapped in some emotion, right? And so that clouds the whole thing. And so I think this is why we would have taken the same approach in September, and now we're back to do the same. It's like, let's stick to what we know, and let's make sure that dealers who would hear this, and maybe lenders too, who would hear this and think about what can we know from this situation that is – going to help us in our own business. So when I hear, you know, the thing about, um, you know, there's, there's a lot of speculation. There's people talking about, you know, what, what's going on there. And I think, I don't, I don't know that we can know, but I think it's important for us to focus on the, the, the typical, um, kind of framework of what happens when you have this situation. In fact, I'm just going to pause, Michelle. I'm going to grab this because I think it makes sense to read that. I'm going to go and read that monologue that we had prepared because it wrote something. So let me just pause and read that because I think it'll kind of frame the rest of our conversation. You can take that off the screen. Well, I think this gives kind of a relevant perspective of When it says, you know, there's a certain rhythm to the news cycle in our industry. Something big happens, a company collapses, layoffs ripple through LinkedIn or Facebook, and within hours, the feeds fill with hot takes and half-truths. The tricolor story is the latest spark in that familiar pattern. But today, we're not here to speculate. We're here to separate what's knowable from what's just noise. When a business that size falters, it's rarely one decision or one scandal. Mm-hmm. More often, it's the slow decay of fundamentals, leverage, outrunning liquidity, operating costs creeping past cash flow, and leadership believing the mission will somehow outrun the math. Okay, so that's an important one. That's beautiful. Yeah. And then we've seen it before. And if we're being honest, there are many dealers who will hear this broadcast today who are feeling shades of this in their own operation. Yeah. So this is important, and this is why we need to take time and really talk it through. And let's make sure we focus on what can be known and let's not guess at what took these folks under it to try color. But so in this episode, we're going to slow things down. We'll talk about what's verifiable, what's pattern based, and most importantly, what lessons every dealer and lender can draw before the next headline hits. Because facts matter and the timing matters. And in this business, clarity is a valuable form of survival. So I think clarity, transparency is important. And especially as we kind of step into this thing about. You know, when you think about some of the breakdowns and this thing starts to talk about the dangers of kind of mission blindness. OK, so, you know, there's and there's some ego wrapped up in this. Right. When we have because because to step away from the mission sometimes means. Accepting that we were wrong, announcing that we could be wrong. We're shifting the mission that says that we we had some flaws in our calculations and that, you know, it's this hard thing for some folks to acknowledge. Jeff, Jeff Owens, we're actually talking. You came up in our conversation, Jeff. as this morning, as we were, as we were talking about this, we saw your post also. So the mission, Jeff, the mission will outrun the math. Love that line. Cause it really is. It's pretty powerful. Yeah, it is. So it's like, you know, it's, it's, we get married to this. And so what we're really talking about here, just to get more specific is, is when we think about and this we see this more where dealers are leveraged right they've got a bank in the picture maybe it's private investors and so that starts to play stress on the business it takes money from it's you know we're paying for capital in some form or fashion private public whatever it's like we're We're paying for the use of the money and often their administrative costs, what have you. But it's like now because of that additional layer of pressure in the operation, the financial pressures that go with that meeting covenants on a line of credit, you know, making sure that the assets are performing well. then, you know, I had a chance to talk to a dealer this morning before we went live and we talked through some of this and I just said, you know, in my observation, and this is, you can take a lot of this to business in general, but certainly buy here, pay here. In our buy here, pay here segment, When I look at a thing like Tricolor, don't know any of the numbers, don't know what their cash flows were, don't know anything about their portfolio performance. But when I see something like that, my suspicion becomes, or my first thought is, That you question whether the portfolio performance, and what I mean by that is you could look at the rate of cash flows, you could look at the charge-offs, and especially when there's leverage, and there was definitely leverage in this case, multiple banks and lots of securitization involved. So when the portfolio starts to falter, wheels start to wobble, charge-offs get a little high, then the question becomes, how does that – will the business still support itself as the portfolio starts to perform at a lower rate because now we're feeling pressure against the borrowing base and and as this dealer pointed out this morning in the conversation is like one of the things that doesn't get talked about enough and we have no indication no no information about the tricolor correlation here but just in in general what can happen is people start to do goofy things with They may change their policy or practices around valuation of repos, which is a dangerous situation to start putting a little higher value on a repo because, you know, Jeff always chimes in. Jeff's a big proponent of collateral recovery rate. He's talked about it on social media, and it's important. We've started to look at collateral recovery rate as both a with repos and without repos because you just can look at how well is the portfolio performing just in money that we're putting in the bank, payments that we're collecting. And then when you're not collecting, you're collecting repos, you know, you may have charge offs and repos. And so you've got the repo values coming back in. And so obviously that's a number that dealers typically can manipulate a little bit where they set the value of the repos. And so I think just like when we talked about this in September, my mind is still on, if you're a dealer hearing our voice and you're in a situation where you're bumping up against your borrowing base, and you're finding that you have a lot of pressure and you may need to make some adjustments like to ACVs or whatever to make the math all work, then I would say, first of all, reach out to me. I mean, call me and let's talk because maybe I'll offer some solutions. But what you're going to hear me say is, We can't keep hiding the stuff, whatever we're doing in terms of, because in this example, there was references and this is not factual, but we've seen many cases across years where people start doing funny things with titles. Well, and they did, there were some things that were brought out from the articles about multiple loans on the same car. Okay. So let's clarify though. It's not like, it's not like car titles typically in a situation like what a tricolor or a large bank deal would be that you're really talking about UCC filings where- they have so that means they have a a blanket sort of filing across all the assets of the business repo could be real estate it's probably receivables probably inventory Oh, okay. So these were like assets backing money then, but the same assets were likely used in multiple places. But UCC filings are common. Like if I'm a lender offering you a line of credit, even though I'm not a floor plan lender, it's common for me to do a UCC filing that's going to protect me to cover, to extend to the other assets. Mm-hmm. So what you're saying is that, and I didn't read the article, but I just know I've seen it in my career. We've heard of examples. And while I wasn't there in any part of it, I've seen it happen where dealers did get themselves in legal trouble. You're starting to cross out of something that's civil and into, you know, some fraudulent. Now you're talking about, you know, something that is criminal. And so we're not, we don't know what happened in the case of, uh, of tricolor. And so we're not suggesting that that's what happened here. But when that's referenced, it's most likely UCC filings where multiple parties, they cross over and they have security interests and there was talk about multiple lenders and that gets messy. But we're simply saying that if we find ourselves in a situation where the business is not supporting its debt in particular, or supporting itself, but certainly its debt, then let's be transparent. And that is something that we bump up against frequently. And this is some of the stuff you've been talking about in V-Eight. It's like, is what you're bringing in covering your debt? And you've been slicing and dicing the numbers in different ways to show... That's true. different ways to look at it and from like different perspectives. And so, you know, the, the key is, is like from multiple, because there's always going to be more than one perspective, but from multiple perspective of looking at the numbers, finding the place where it's a sweet spot. And it's like, okay, we're, we're going to be safe here. Yeah. And that comes up a lot about sweet spot. And, and, um, and I, I tell people, I wish I had enough data to tell you exactly what the sweet spot is. We see different things work for different people. And I think, you know, business approach. But it's because there's so many different business models. Yeah. And I think to your point about what we started to do as an analyst, this is the, both as a coach and analyst for me, what we started doing our V eight environment is we've started to, um, show inside we do roll forwards and so in some of that we've started to apply a stress test like and so what i do is i'll take the same leverage ratios and apply it to all the dealers in a group yeah that way everybody can see the same thing we can see which ones are currently at your current rate of cash flow you know, this dealer's better able to support debt at these terms. Yeah. Then, you know, dealer one is in better position than dealer three, as an example. So it's just math. It's just we're showing them the math and saying, here's the hard math around what's going on in your business based on the last six months of history. And so this is sometimes good news, sometimes bad news. But I want to add something. I want to say when we talk about being transparent, I want a dealer who's finding themselves in trouble. They're in a pinch. So I'm changing that. Transparency. Yeah. Transparency is a lifeline. It's not a liability. But I would say in addition to being transparent, if I'm coaching a dealer, I'm going to be saying, let's be wisely transparent. Let's be proactively and wisely transparent. What I mean by that is if we're in a pinch, Let's go to the lender, the parties that are also affected by these struggles, and let's make sure we put the cards on the table and those cards are accompanied by a plan. Uh-huh. Right? So that when we come forward and we say this is where we're at, And we don't want to do anything that's not transparent. And we don't want to cause a problem. We don't want to violate covenants. We want to get through this together. Here's our plan for how we resolve that. And now this is where we find out if the lender that we're working with is in a position to play a long game. This is the white hat way piece. Like you can be a white hat borrower and you can be a white hat lender. It's like, are we both playing a long game here? Are we prepared to ride out a storm together? This is where we find out. we have a plan. This is where we kind of find out where we're at. But I think if I'm a dealer and I show up and I'm transparent and I have a plan for how to get through the, you know, to clean up the muddy stuff and get past it, then, uh, then I would hope that would be met by some good faith from the, you know, the lender in this case. And so that's where we would find out, but I would just say transparency first, first of all, we have to admit to ourselves we're, we're in trouble here. We got some stuff going on and it's gotten difficult and we have to be able to admit to ourselves. So I think this is what, you know, we're trying to really suggest about transparency as a lifeline is be, be open about what's going on. You know, human, the human side of this, it is really hard for, for especially leaders that aren't, well, it's hard for humans to admit that they made a mistake and, um, or that it's not working out the way that we thought it was going to work out. Um, and, and so, you know, we've seen multiple high profile examples of that whole thing. We, you know, that, that, uh, um, that Jeff mentioned the mission running out of the math. It's like, it's like paying attention to the straight line things, right. And being really open and honest about those things, the math, where are you at? Because, you know, part of this transparency thing that you're talking about here is there is apparently a lawsuit from the employees. Yeah, yeah. That's part of this whole thing. Yeah, it's a class action. It's a class action lawsuit from the employees. Yeah. Which means they're in line with all the other creditors here. Yeah. Yeah. And so, so you, you know, it's, it's, I, I look in when you go into a micro and say, cause you know, the business, let's say the business is the macro and there's micro and you've got relationships and, or whatever. And, and when you aren't transparent with all of those that are affected by the decisions you're making or, you know, the, the course that you have, where you're at with the math, all of that is that you are putting the rest of the team in a place, the rest of the, those that are involved or that are part of the thing in a place where they have no voice and no power. And, and, and, and just, I mean, really to feel they're very disadvantaged and, Because sometimes I, you know, and I think like you go down to the micro of like a marriage, if, if there's not a transparency around, this is the mission, these are the things this. And so being able to have that conversation, you know, you might be able to get a really great idea or different perspectives or whatever, but we hold on to the things that we wrap ourselves, wrap shame around and we, we hold them tight and we hold them close and, And, and it's like, I'm a big boy. I can get out of this. I, you know, and, and I see this, I've not just in business, but I see this in, in a lot of different things. And, and the intention is well, the intention is, is there's not an intention to be deceiving. There's not an intention to take advantage of, but when you're not transparent and, All of those that were not part of the decision or understanding what it is that's happening feel deceived. And they feel like they have no power. That the power was completely taken away from them. Now, one of the things that as we were looking at this is around the transparency. When you let even in your employees know early that The phrase that it uses, because when silence sets in, partners start assuming the worst. Partners, yeah. And that's employees too, because your employees are your partners. So when silence sets in... everyone's going to going to assume the worst because that is part of human nature because you know we we live in a world today where it's just like screw or be screwed yeah and um and that's not a white hat way it's a tricky one it's a tricky one it's a tricky one because i know that you know if i'm a dealer and i've got a management team the fear is you're gonna you're gonna divulge to the management team maybe some stuff that you've been holding to yourself for a time and And you're going to start to lose some of those people. They're going to say, this is sinking ship. I'm out of here. And you're on your own. That's the risk if you don't present it well. And if you don't have enough relationship equities, we talk about with these folks. So I think, you know, you'd like to think that if I'm going to take a plan to a lender in this, whether it's a partner or a lender or whoever it's going to be, that I would have the buy-in from the team on whatever this plan is that we're putting together. I would like to hope that that would be put together. But I think the main thing I'm really suggesting is when I say being transparent, I'm saying, let's not hide some stuff in the shadows. We find ourselves feeling that pressure. And I will also add that it's been my observation just working around human beings for a long time is, they may not come into a situation like this. And, and, you know, again, not talking about the tricolor, we don't know those people and know what happened over there, but in, in a business, sometimes what can happen is people start feeling the pressures around this business is tanking. It's getting, I'm getting in trouble, you know, if I'm, and so people tend to protect those, their, their loved ones, they're going to protect themselves and their family. And so they may tend to start to, um, take some actions that they wouldn't under normal circumstances. But when it comes down to the bank versus their family and their loved ones, it's not surprising to me that humans are going to err on the side of protecting their loved ones. And I'm simply saying, what if it's possible to do both? Right. And we can create a plan that can, you know, be transparent about it. Go, go solve this. Because I think the idea of putting blinders on and say, I'm a power through. And we talk about, you know, sometimes people say, all I got to do is work more. I just got to sit at work in fifty hours. I got to work sixty hours a week and this will get solved. And I would simply say that's generally not the answer. So I would say if you find yourselves in that situation as dealers or whatever. And then if it's not us, find somebody else who can help you navigate a situation like that. Because if you're really prepared to play a long game and this is the right business for you and you enjoy what you do and you really expect to ride out this kind of downturn. Because I think I just kind of quickly read Jeff Owing's point about, and I'd love to just also extend the invitation to him here. I'd love to have him come back and talk to us about he basically posited in his comments that he believes car buyers in a subprime segment are still out there buying. He basically says the same thing that we basically said, is that in times of economic change, stock market shift, you know, whatever, it's been my observation that the subprime buyer is still the subprime buyer and they still need wheels and they're still out there buying. And so in that way, our industry is less affected. However, we're seeing in recent years that this industry, this segment is feeling impact. Jeff talked about, you know, sales were slow. Why? Does that mean they're buying somewhere else? I mean, they're not buying. Does it mean they're uncomfortable? I mean, if they're not buying, how are they getting to work? Because when their last car broke down, I think that I'm paraphrasing what I was hearing from Jeff. We'll have him come tell for himself. But that's the part that I would say, if that's true and the customer is still buying, then we should still have opportunity. And then if they're faltering because of other financial pressures, the customers, then our portfolio can start to suffer. And now the question is, if the customer is suffering, then does that mean that we're going to suffer and potentially fail as a result of that? So these are all questions that need to be asked and answered. And we're working through them and we're asking dealers. And listen, I don't profess to have all the answers. I just know that we feel like we have enough experience to at least know what questions to ask. Yeah. You know, and where to go to find the answers and where to find the information and try to bring this to dealers and help them make better decisions. I would say on this kind of thing about this is where the what the coachable can learn here. One of the first things we have to be is just coachable. And I'm not talking about for me. And part of being coachable, too, is that transparency factor, because if you're looking for help, you have to be coachable. just radically transparent with all of the things and be with yourself and with your team and with your coach or your advisor. Because I mean, it's, it's kind of, I think about like the, the, you watch in television and there's like a law show or whatever. And you know, and the lawyer is like, is there anything you're not telling me? And then the person is like, no, I'm telling you everything. And then something comes out in court and it's like, why didn't you tell me that? Well, cause of shame. Yeah. And, and it's like, if that you can't help what you don't know. Yeah. And that's on the coachability side of this, I would say, um, first of all it goes back to the ego thing we have to be prepared to take off the blinders and the commitment to a business model that may be flawed i've said that michelle about my own business when i look back at my own dealership experience i think when we told that story on the podcast three years ago, two years ago, I probably used that expression. Like when I looked back at my own business model as a dealer, I thought I can see flaws in that now that I, for whatever reason, I was blind to it at the time. But it's like the same thing here is we're asking people to be coachable in this situation. And it's not about, it's not about Jim in this case. It's not about Jim's approach versus dealer X's approach. It's about if your dealer X in this example, uh, and you go to find help and you find somebody who is capable of putting together all the puzzle pieces, lay all the puzzle pieces out and let's, let's build a plan from that. But if you're hiding puzzle pieces. Yeah. Yeah. Or, or when you say, no, these pieces have to go together like this. Yeah. And it's like, do they? I mean, it's like you, you, you have to be willing to let go of your, you know, it's like maybe the wrong strategy. It may be the wrong business plan. Yeah. And being transparent and, like like being willing to make what shifts that need to be made yeah and you know there's there's lots of different perspectives and so there there's with with struggles that dealers or the dealerships might be going through there's a lot of different perspectives right and you know there's not when people say sweet spot or it's like what is the it's it it's it really varies. It's kind of like, it depends on what kind of approach you want to take or what kind of, I think that's the part that's always hard to, you know, you can, you can say sweet spot in terms of ACB or whatever, but it's hard for, to know what people's there. There's also financial consideration, like how much capital they bring or have access to can be a limiting factor, but, but either way, it's like whatever the approach is going to be, then we want to find the approach that's right for that person and their strategy. Right. And so that can, can make sense. So, Yeah. I think this is all part of, you know, all I would really say is that if, if dealers are, um, Dealers who have been flying by the seat of their pants have been able to get by for a long time. Now we're in an environment where that's going to be a lot less likely to work out well. And I would say the dealers of tomorrow, the dealers of twenty twenty seven, if we jump out two years, the dealers that are active and hopefully growing in twenty twenty seven are going to be those dealers who are. sitting on the front row at the conferences, they're out there learning and getting educated and making sure they stay on top of the latest thing, what they're learning, what they learn. And then they are able to, I would say we got to get more sophisticated in terms of our analysis and our awareness, like just our financial awareness of what's happening in our business at all times. Yeah. We've got to get better. And those dealers, those will be your twenty, twenty seven dealers. Yeah. Stephen, thank you. Love it. I, and, and I, I would suggest that as an industry, especially with the kind of weather that we're experiencing in the industry, turbulence, that we stop withholding our cards next to our chest about what's working because you know it's it's it's you know when it comes to what is data showing that is not something that should be held behind uh uh anything i mean it's like that's that's one of the things that i've really loved about what you've chosen to do with data that we're starting to see from v-eight It's like we're collecting data and this is what we're seeing. And it's valid data. And I just, I really, really want to see any of those that have things that are really working or that are collecting data or whatever. It's like, it is time for radical transparency. How can we help this industry? So how can we, because I can promise you There are people that have information that could help, and they are choosing not to just freely share. Well, and we have that. I mean, we certainly have that, at least in a V-Aid ecosystem. Listen, I get it. I hear what you're saying. I also know that dealers worked very hard to build their business, and they're reluctant to share with people that are in their own competitive market. They're nervous about that. And so I think they're resistant to that for some of what you're talking about. I've seen that for a long time. But I think in a V-Aid environment, we've created a situation where people can speak freely. They can certainly help one another in that environment. And that's part of what we try to do is stimulate conversation and draw out the folks who have answers, right? And so this is part of what I think can be, you know, helpful. But I think the first thing is just getting... making sure that we're, we don't have all the stuff in our V eight thing. We don't track debt. We don't look, we have conversation around it. We have some information about it, but it's not in our actual summary report that we review each month. So, you know, there's, we never expected to be everything to everybody when we put together this kind of summary. But it's meant to give high-level indications of certainly portfolio performance, and now we're looking at cash flows. And it helps dealers get a better perspective of what's happening with other dealers so they can get a feel for what's achievable and which one of my wheels is wobbling in my business so I can begin to take some corrective action. But you've got to first know. You've got to string the data together and let the – don't don't put the mission ahead of the math make sure they fit together yeah and uh and that that you know that that it can support that that um strategy so i think what's what's the uh like the takeaway biggest what are the biggest things that this kind of teaches us I would say, you know, as far as what we can know, let's, first of all, let's not speculate because that doesn't help anybody. That doesn't, we're just guessing. It doesn't help anybody when we're guessing what happened there. So I would say instead for my takeaway for today would be, let's recognize that mostly when a buy here, pay your operation struggles and falters in a way that this one has tricolor file chapter seven. So now let's, Generally, what we can conclude from just in general of businesses, not tricolor, is that either the portfolio started, the wheels started to wobble on the portfolio. Charge-offs got high, and the debt, it wouldn't support the debt, okay? Mm-hmm. um overhead got either high or was too high for the relative cash flows and and earnings or profit and this business listen it's different like today's profit is tomorrow's cash flow and so it's typically like a three-year tail on on today's contracts and so it's it's got a layer of complexities that some businesses don't have but i would say that If there's a takeaway, so let's just make sure that we're one, that we know how our portfolio performance is. What's the real results of our portfolio? Maybe how does that compare to other dealers in a similar stage of business? And then the other would be profitability. How's my profit look? relative to my operating expenses operating expenses we're not exempt from that by your payer we're if i could point to one thing that causes dealers to and go to youtube and look up the conversation that brent garmichael and i had three years ago four years ago around why dealerships fail and we talked a lot about that thing yeah and so it's overhead thing so um is often you know where people get in trouble so we got to be able to know those things and be able to adjust And then, you know, this thing about the mission is we got to be able to put aside ego and put aside the mission and study the math and just get to a place where we can make corrections. And to me, that's that's being transparent. I would say the thing that you're talking about being transparent with the team, I think that's. You got to be careful about how you do that with the team. Certainly if I'm a dealer and I'm aware, I expect to involve my team. I just have to be thoughtful and make sure that I have enough equity with the team to address that properly. Well, you can't have equity with a team if you have not, or you've been withholding all along. Yeah, that's true. It's just that there's always going to be, and I would say this for myself, I would say that I feel like there's always going to be things that dealer principal would not share with the team. Now that that's my approach. Now I know there's others who are totally transparent with their team in all areas. And I would say there are going to be elements that I think a team does not have to know. There are going to be elements that dealer can reserve. But if we're talking about actual strategic, strategic, Things, you know, that we have to act as a team to solve this problem, this problem to execute a plan to correct whatever problems we're having. Now we got to involve the team. We got to, we got to come in there with a good plan and they got it. That's, that's on us as leaders, right? That's me as a founder owner. I got to come in and I got to lead the team. And I got to get some buy in from them to show them this is the way forward. And I can share with them that if we don't, you know, we're all in trouble. Well, and it just to me, the the idea of not being transparent and because I. Known and narrated. Yeah, just. It could not have been a surprise to the C-level people in the company. Not this company this big. No, it could not have been a surprise at all. It was a surprise to everyone that was the blue collar that was working in the business. It was an absolute surprise. But even the C-level folks, Michelle, are probably not there when the documents are signed with the bank. Okay. True, true. But there should be an awareness when you're going through your financials and where are we at with some of these different things. When you say... Do we let everybody know so that we can work together and run the risk of losing people? Or do we drive this stagecoach off the cliff as fast as we can and then pick up whatever's left over? yeah i mean that's absolutely true and for whatever reason i'm thinking in this context about so so last night aside but you know that there's a there's a there's a football coach inside of me that comes out once in a while and for those who had a minute to watch last night there was a heck of a football game between two forty year old quarterbacks you got aaron rogers from he's now with the pittsburgh steelers you got joe flacco who's now with the the bangles And so my point in all of that is that if your team, your team can see the scoreboard. And if the team can say, hey, it's early fourth quarter and we're down two scores. As an example, that wasn't the situation last night. But it's like if the team can see the scoreboard, And they can see. So now what happens? We either fold. We either say, well, we might as well go home. It's practically over. Or we're like, yeah, let's phone it in. Yeah. Let's just kind of get onto the locker room. Right. It's this, this mindset. Like this is the part that I think is the fascinating part about sports and, and football in particular. It's like, Do we have buy-in? Do they believe in our ability to execute? Because do they believe we can make up the two scores and we keep playing hard and we keep pushing forward and we believe we can execute? Because it does take the team. So I think that's the only question is, how much of the scoreboard can the team see? Well, and how much have you exercised as a team? right right so a team trusts each other because they've learned to trust each other because they work with each other and they're you know they're they're they're working as a team to overcome certain challenges as a team yeah and so like in the sports analogy when there's a when there's a problem i bet you every member of that team has a voice No, you can't. You can't. So here's an example. This is a good way to break it down from a management standpoint. It's like, There's a problem. We're fourth and four, and we've got to have this conversion or the game is over. And so the team is lined up. We've broken the huddle. So now the offensive coordinator is probably on headgear inside the quarterback's helmet. So now it's between really maybe the head coach is involved, but it's probably the offensive coordinator and the quarterback. who are reading the defense, making the call. And so the teammate who's already lined up in their position, they've just got to believe that the coach and the offensive coordinator know what they're doing and I'm going to run my route. And if they throw the ball, I'm going to do my part, but they're just, they're, they're players. Okay. in a in a strategy uh-huh and there are others that are driving the strategy and that's the way it's going to be there's a trust element of we've we've worked together as a team and we've seen difficult things happen in the past and we trust that they're because we've watched them do it we've watched them do it trust is the key word they've established trust established trust With their team. And one quick thought is that Joe Flacco, who's won a Super Bowl, I think, with the Ravens, if I remember right. But anyway, the point is that that team was bought in, and they won, and he's barely been with the team for like two weeks. So he didn't, he didn't establish a lot of trust there. He established trust probably by the look in his eyes and the huddle and based on all the stuff that they knew that about his career before he ever walked into the field house. But my point is really all of this stuff, like as a, as a, as a buyer payer operation, we still get to be football coaches and we still get to sell our team on the mission and we still get to solve the problems, but we just got to decide who gets to have what puzzle pieces and, And so this is the part that I think is can be debated. I would love to have this conversation with people about what they do and don't share with their team. So I think it's it's part of what I feel like in all this stuff and solving it. It's like it takes a team to solve the kind of stuff that happened at Tricolor. It takes a team to solve what's going on with most of the dealers that we work with. And I think as dealers, I would just say, let's be prepared to not be married to the mission. And let's put aside a little bit of ego and be prepared to say, I could have been wrong about some of this stuff. It might not be working the way I thought it was going to work. And so, because just continuing to do the same thing, back to our football, if I've been running the ball on fourth and four and it's not working, I got to make corrections. And so I got to admit that I got to do something different. Yeah. Team trust and transparency. Yeah, amen. Well, that was a fun conversation. It was helpful, I hope, for some. I hope some will take from that what we intended. Yeah, I hope so, too. Let me see what we have here. Jeff, we'll be in touch. Yeah, for sure. I'd love to kind of just kind of, some of the things you've been putting out on social, it's just, it's intriguing. We've shared some of Jeff's remarks on the podcast before, but I look forward to having him on. Absolutely. All right, everybody. Thanks so much for joining us. Happy Friday. And I hope y'all are getting outside and enjoying the leaves, colors, changes, all of that. Because even though it may not be warm enough to wear shorts, it's just beautiful outside right now. Thanks for tuning in, folks. All right. Have a great day, everybody. See you. Appreciate it.
