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. Goodness. Good morning. Hope our audio is intact. We had a little bit of a snag at the last minute, ready to go live and found out our audio was still not quite right. Still sound like we got a little bit of an echo when the intro was playing there, but we'll just kind of do trial and error. We're really kind of the first time. mostly set up in the new studio for those who haven't been involved may not know that we have recently relocated to oklahoma we're in the process still of setting up and so this is um this is all part of a kind of a the whole track michelle of moving to the new spot you know getting set up is kind of a restart for us in a lot of areas kind of a fresh start in some in some ways, and so it's nice. We've been able to set up fresh and kind of redo some things. And we might just, if we got folks tuned in, you might just give us a quick audio check on the chat thread there so that you can let us know that you're hearing us just fine. Everything looks okay on our side. Well, yeah, before we get started, Those of you who have ever tried to play mahjong like the real mahjong. Oh, yeah Got together with some of our friends here yesterday It was we videotaped the whole thing because it was hilarious. It is it's well Why can't we see because I don't own the video one of the else did the video and For any of you, I mean, I played Solitaire Mahjong on my device. Not the same thing at all. And so it was really fun. We laughed and laughed and laughed because none of us could... like what does this look like what is this what is this it was really fun but um you know if any of you all are are trying to learn how to play mahjong let me know because i or our our experts because i could use all the help i'm like thinking i need to find a mahjong for dummies try to so when you played it solitaire did you also drink a lot of wine so again audio test just say hello if you're listening in let's make sure you're hearing our audio okay and if we make sure we don't have an echo Sometimes the way it sounds in studio, it's not the way it broadcasts or streams. So we just want to make sure we're good. So again, for those of you that are joining us, welcome from our new and continuing to be set up studio in Guymon, Oklahoma, Jim's hometown. Yeah, it's been different to be back here. You know, this is the town I grew up in. When I played football here in the fall in November, it was not this warm. Oh my gosh, it was like eighty degrees yesterday. And it's November... Yeah. Twelve. Is it twelve? Twelve, I think. And it's supposed to be eighty again like on Friday. And I'm... Like, we're not in Florida. And so, yeah, all the gals were saying, it's been unusually warm-er than normal. Yeah, it's been different. Who knows? We should get on to our subject of the day. We've got, this is going to be kind of the first, we touched on a few weeks ago this idea of a customer journey. Now we're stepping into what we call the buy here, pay here journey. And this will be an ongoing thread in all of our podcasts in that You know, it's something that we all know and we all experience, but we don't maybe think about it in the way that we're going to talk about it in the context of the buy here, pay here journey. So we're going to talk about the journey for the customer, you know, as a collective, like, you know, how that experience looks for the customer. We'll talk about the journey of the dealer, which we already talk a lot about dealer experience and the way things work in a dealership, but we're going to work to tie all those threads together here and And obviously from a White Hat Way perspective, we're on a White Hat Wednesday today and we're going to certainly uh drip in the the white hat elements where appropriate and then we'll eventually get to the the journey for the vendors especially that are new to the space of buy here pay here and kind of what that journey looks like for them as they learn how our business is different and it's it's been it's been a fun thing um i guess because of the exposure that we have that we have a lot of new people in the space there that will reach out and say hey Would you look at the thing? And, and there's, you know, Jim's always giving some different advice about, uh, you know, Hey, we considered this. Right. Hey, have you thought about that? Because this of the industry, cause it is a very different industry, but, um, you know, part of this buy here, pay here journey is, Again, White Hat Way is about the long game. And the long game is a group community game. And so it's not just about the dealer. It's not just about the customer. And it's not just about the team. And it's not just about your neighborhood. It's about all of it. And that is part of what the whole premise of White Hat Way is, is like building relationships all around you. Um, and by doing that, that you, you create an environment that people, um, enjoy working there and also enjoy, um, also enjoy, uh, participating in events and, or coming in and, uh, you know, as a customer or as a, as a community person. Today we're going to start a little bit about what brings people into this journey as the customer. We have a few different things to chat about and some scenarios to keep in mind. We know that we have listeners that are old hats in this space and we have listeners that are new. And, you know, we try to keep as much of the basics as we possibly can. So this gives great primer, great reminder of those things. So the first one is the buyer pair landscape today is two journeys, one purpose. And that was kind of what I was talking about. It's like long game. It's, it's everything combined. And so, you know, it's the, we, we recognize Jim's been a dealer for um you know worked with customers is that the that part of this is acknowledging both what the dealer is trying to go through and what the or what the dealer is doing and what the customer is doing so like his dealer is operational financial culture all of that that that that's their role in this whole journey and the customers is basically they're now a participant and they bring on their own bag of things that they are working from credit challenges transportation needs second chances and one of the things we'll be able to identify as we go through this we talked about it some and I think some of these things will be highlighted as we bring in guests to talk about these different elements but one of the things that's really amplified here is this thing that we call friction between dealers and consumers and so if you think about a singular customer who comes to you from whatever their journey is and they come into a buy here pay here situation maybe for the first time they're in a subprime situation and they're shopping financing and it's a new world for them so we can think about that in a singular context with a singular customer right now if you think about what does that look like then when you start to just identify the friction points where are the friction points and i think we'll start to examine i have some of my own ideas i certainly want to bring guests and dealers in to talk about these parts because i my sense is that we've got um some things that are solvable very solvable in terms of the friction points and i think it starts with understanding the journey of the customer and so this is part of why we want to dig into that today yeah and we you know we find we'll be talking about some of the different scenarios a little bit later um and there are there there are people that are um that don't know anything other than this working with a buy hair, pay hair dealership. And then there are quite a few out there that this is a new thing. This is not something that they have experienced in the past. Where we kind of want to start with this is, what the journey is of a customer before they even land on the lot. And like I just said, there's some of our customers that have been in this for a long time. Jim uses the expression. It's like there are customers that always expect their car to smoke and always expect their car to leave an oil stain on their driveway. That's the paradigm. That's what they've always driven. They don't know anything different. Um, and so, you know, we, we, that they're just, they are a lot of times just the they're working hard, they're trying, but they may not have the education. They may not have the background. They don't know any better because maybe their parents were also always expected their car to smoke and to, you know, oil and all of that. And they may also be believing that that's all that they can afford. Whether that's true or not, they have limited incomes. They may be believing that's my budget. That's what I can afford. So I, you know, to, to just briefly about this, and I think we see this every once in a while, my, um, my youngest son, um, their car died and they are like, mom, I'm going to have to go get a car. And I think I'm going to have to go to a buyer pair. And I'm like, why do you feel like you need to go to a buyer pay here? And so it was like, because I've only been on the job for this amount of months and I don't have, I have to keep my payment low and I don't have. you know, I don't have down payment and everything. And we talked about credit and he was, he's like, he's got a. Seven hundred credit score. And I'm like, yeah, but you know, I think that we see people that, that are experiencing to a downturn in their circumstances or they're listening too much about being the underdog. And that's kind of my son. He's like, I am disadvantaged. Because I don't have a high income, all of those things. And I was like, you are not. You just haven't taken advantage of what you can take advantage of. But that we see that we see people that are landing that come from. I know that I can take advantage of good credit and all of that, that they're being punted down further and further into buy here, pay here. And so it's something that they're not. know they're they're not used to so we have like yeah yeah i think we should talk first about the kind of what i would call the facts of life and i see michael clear chimed in says it's a cycle like anything else and i think um we can ask for interpretation on that but i think what i think can be different about the buy here pay here segment is there are customers i've certainly known them as dealers and all the years of coaching there are customers who seem to sort of accept that this is their lot in life. Just like what I'm saying is that's the kind of car they expect to drive, whatever. Like there are customers who just kind of seem like they're not focused on improving their credit. They're just kind of, they're okay where they are. It's what they know. It's what they think their life is going to look like tomorrow. And so in that way, they're kind of in that rut and they're not necessarily all of them looking to get out. Now, in recent polling, a couple of years ago, we did some polling and sixty, seventy percent of customers that we polled said, yes, improving my credit is important to me. Well, but yes, but I look at at I there's a lot of education and I and I am to blame for not talking to my son about what credit is and why it's important and what you can leverage when you have a good credit score, because he didn't understand it. well you're among the parties that could have contributed to that education school could do better there could be all you know social media could do better for us uh other family members whatever there's there's other places to get education besides parents yeah but my but the point too is is that we we many of our customers want to improve their credit um sixty percent the other forty percent if they don't want to they probably don't understand what better credit can get them right And they probably, you know, are, feel really defeated. And so it's like, meh, I really don't care. So there is this level of education as well, besides changing the credit. Let's pause for a minute and talk about this thing. And I wish I could draw it up on a board like I do typically when I'm meeting with clients, especially those that are new. Michelle's seen me draw this a few times. When you think about a pie chart that is our customer base, there are going to be that sixty to seventy percent of the customers that we talk about they are and i'm just picking numbers here i'm just ballparking based on you know general experience but there's going to be a high percentage of customers that are rarely a problem they do what's expected not to say that they don't require occasional reminder on a phone call or whatever but they pretty much do what is expected then there's that five percent sliver that is kind of these troublemaker customers right they they are kind of out to take advantage of people and sometimes we We don't catch that in underwriting and we can tell right away that we've got a problem customer, a problem situation. And so you read about those in social media all the time. And then that other sliver, roughly thirty percent I didn't talk about, is what I would call high maintenance. They're customers that maybe they're stressed on income, maybe there are other circumstances around that. I see that we're having some technical trouble with maybe our stream, but hopefully folks in Facebook can find us elsewhere. But anyway, the reality is that we want to be able to recognize that most customers, and we'll talk mostly about the rule rather than the exception in this conversation about the customer journey. We're talking about most customers are in this category. Of course, there are exceptions, but I think we don't want to spend a lot of time talking about those exceptions. Let's talk about the next point, and that is culture as a success lever. The culture of your dealership is part of the success. One of the points was that trust is built at the curb. This is about how values and tones set by the leadership do change or shape or they shape the customer experience from the first interaction of the loan. You know, one of the things with White Hat Way is we teach how to greet, how to bring in, how to all of those, how to get someone into the building how to you know what is their what is their experience like and so you know this customer journey is like when when we're looking at the uh the culture the culture is not just your team it's also part of like what does your environment feel like what does your environment look like what does your environment smell like how how the um inviting it is on the lot but it's also about when um this this you know teaching our team members that we've been at dealerships where they just sit in the building and they don't even go out on the lot to greet anybody or they're out on the lot and they're already asking disqualifying questions. Yeah. So let's back up and think about that in the context of the customer journey and the dealer journey. How did the dealer get here? In other words, we got a customer on the lot. Maybe this is the first time that the customer has been on a buy here, pay here lot. And maybe the salesperson is greeting a buyer, payer, customer for the first time. So the question becomes, how did we get here? And what is the mindset of the salesperson? What have they been, you know, when I worked in sales, you know, as a salesperson with the expression that sometimes used by the trainers was, You load the lips like the sales managers would load the lip of the. So what does the training look like? What what is the mindset approach of the salesperson when they walk out to greet this customer? Because I think this is part of where we talk about that in a white hat, in a white hat lined dealership, the. The approach would be quite different. It's going to be long mindset. It's going to be focused on winning trust of the customer, being transparent. It's all these things. Whereas if you think about traditional sales training, they may be embedded with certain skills that are designed to do what? Get the customer in the building, get more down payment, blah, blah, blah. Things that serve us as dealers. and so you know it's maybe aimed at our success and our profitability so this is where i think early on let's set the tone for this whole thing about how the the journey of the customer and the journey of the dealer intersect because if if the focus is on this is where i think it becomes adversarial and where the friction starts well and it's you know we talked about like we have two purposes and we're you know this is this is the this is the customer coming in and so it's like now the customer and the dealer meet and that is such an essential piece to you know they talk about first impressions and it's so true your first impression and so what is the first impression and I don't know you know we I use the analogy frequently I don't know if you guys remember the movie Matilda where Danny DeVito played Matilda's father and he was used car sales person. And it's, it honestly is. And one of the reasons why there is a distrust and I mean, it's with car salesmen in general, but it just kind of seems to compound and thicken with buy here, pay here is that it's they're shysters. Um, and so when someone lands on your lot and your first communication with them, It should be about the customer. It should be about what are your needs? How did you hear about us? What brings you in today? Are you thinking about paying cash or financing? And really getting to know the customer because if you start asking those disqualifying questions first, that leads down that same track of like, they're just here, they just want... But when you make it about someone, people love to talk about themselves anyway. But when you ask and you are engaging with them as a person, and what's the situation? Why are you here? Have you been here before? Have you been to a different buy here, pay here? And really get to know them. You know, I'm sorry, but we're not that busy most of the time that we can't take ten minutes to ask questions about who someone is, what landed them there. And then after you get them in the building, that's when you start talking about the deal. But it's like you don't do that when you're meeting someone that you're wanting to have a relationship with. You know, you meet someone new at some kind of a function where you're, you know, a connector function and you're not all of a sudden saying, you know, who are you? What do you do? Then here's the, here's the, uh, this is how can you help me? Yeah. You engage and you learn and people like to be, I call it being seen. People like to be seen. They like to be heard. They like to be able to tell someone about themselves because people like to talk about themselves. But they first have to be invited to do so. And part of that for me back, we can back up a little further. It's like it's about respect, Michelle. It's about do we and you can hear it. You can hear in the attitude of the people on social media and some of the stuff is like you can hear that. the tone of disrespect and disregard for the customer that they serve. And look, I think I can kind of see a recipe for how that ends, but it's like, I think this is the part that we want to talk about with respect to the journey of the customer. So again, if this customer is being treated with respect and we're doing what I call, and we think about this training, I want to think about this thing I call a lifetime handshake. So what I mean by that is because it encompasses a lot. If you think about when I go out and I greet a customer for the first time and I shake their hand like they're going to be with me for a very long time as a customer, potentially a lifetime. And if they're not with me a lifetime, it won't be because I stopped trying. Right. Okay. So that just means when I bring that mindset to every customer, that means I'm going to approach them on the lot for the very first time. I'm just meeting for the first time today. My training, what's embedded in the training is a show of respect to a fellow human being and an attitude that I used to always train our people and anybody I've worked with in training. It's like we bring the attitude that if anybody within fifty miles of this building can help you, it's me. It's going to be me. It's me. Yeah, and I hear from some of the things that we've, you know, as we've talked to different dealers, it's like I don't want to waste my time on. And it's like, Every single person that walks onto your law is a member of a community. And if you are playing the pong game and want to be able to become a positive part of your community, then every interaction is a neighbor. And you may not be able to help the person. So you get to know someone and then you may not be able to help them. but don't please don't look at someone as a waste of time because that person if they can't be helped but they feel like they've been respected they feel like they've been hurt they're gonna let other people know too and and or when their situation improves they're gonna come back because it's like I was treated like a human that's key yeah especially people want to be treated as as equals it's not subhuman it's not surprising that you and i landed here like this is where we live and work this is most of what white hat way is about and really kind of getting down to the interpersonal parts of these relationships i want to take a moment to back up and let our listeners know that in this ongoing thread around the buy here payer journey we're going to back up and also talk about how does a dealer decide to get in business like people that are contemplating buy here payer there will be people that will see the opportunity in this uh changing climate that we'll see void that we'll see opportunity step in and get in the buyer so we'll talk about how that journey that part of the journey works to even get to be a buy here payer dealer to where we are standing here greeting customers today So I think this is part of where we want to talk about how these things intertwine the journey of the customer The journey of the dealer. How did we come to be standing on the same lot? And then eventually we're going to bring in the vendor side and all the technology and how all these touch points with customers affect us. Because I think, again, it goes back to respect. Like I think when I think about the sales process and a couple of threads here. So bear with me. I'm going to try to get both of them. that there's there's a tone of disrespect we sometimes bring to the sales process especially early on and and maybe it's intentional maybe it's unintentional but we tend to ask a lot of qualifying disqualifying questions instead of learning what the customer's needs are learning what their story is and bringing that attitude that if anybody can help it's us and we'll make the x's and o's work the dollars and cents work if there's a way to get there doesn't mean that every single customer qualifies Everything you're hearing me talk about recognizes full well that I may spend a fair amount of my time as a salesperson working with a customer who ultimately won't qualify. I get it. It's going to happen. Again, don't look at it as a waste of time because you're building relationships with your community. You're building relationships with your neighbors. And let me just ask, I'll pose the question for our dealers that are listening. How many of your salespeople on your team are closing more than twenty deals a month? And especially strong deals. Like just if you think about it, this is being strong deals. How many are closing more than twenty deals a month? So let's imagine that I'm a salesperson and I have a day off during the week. So I'm working five days a week. That means in order for me to approve, for me to get twenty deals approved a month as a salesperson, I need to be able to work about, I need to close about one deal per workday. Right? Which probably means I'm going to speak to... Or two if you have a slow day, but that's not... hard i realize this is old school i'm talking about the people in the building whether we met them through the crm and we invited them and they showed up in a point i'm talking about the people who come to the building if i'm a salesperson really just working with customers at the building and not a bdc then This is the part that I'm saying, if I close one out of three, like if I just expect to speak to on the lot, two or three customers per day, probably six or seven on a Saturday, whatever, then how many will I close? And so my approach would be, and the reason this matters in the context of what we're talking about is because when I... have that approach, and I work every deal, I accept that I spend a good chunk of today, my Wednesday, with a customer who will buy, and I may start today, we may finish tomorrow, I may spend a good deal of my time, and there may be some work to be done to make it all fit, but that's the business we're in. We're in the relationship business. So, yeah, because again, so what's the lifetime value of that customer? If I win that customer, and it's a strong deal, and the customer has a chance to be successful, Wouldn't, shouldn't I have gone slow? Isn't that worth it to us that I have gone slow and made the necessary investments in getting that deal? And of course I lost the other track, but maybe it'll come back. Well, okay. So let's go on to the next one. And this is, it's called the mirror effect and it says customers reflect what customers reflect about dealer processes. i you know um i self-improvement whatever um i've been taught many times that when something is irritating you um or making you angry or creating friction the best thing to do is to turn a mirror around to yourself and understand that your irritation is a reflection of something that you're doing too. Um, and so it's like, if a customer is failing, you know, you're watching this thing. It's a good time to turn that mirror around and then look at where it's, you use this thing, somebody messed up. So like when someone fails, It's like somebody messed up. And so doing a postmortem, which is like when a deal fails and you pull your sales manager and your collections manager and all of that. And it's like, let's talk about what was done in this deal so that we can learn from the things. But it really is. It's a great opportunity. Dealership systems, there's a friction in a relationship with one of your customers. That's a really great opportunity to turn that mirror around and look at how is our communication. That's the best. biggest thing, you know, we can have collection, uh, uh, we can have collection, uh, policies and procedures and, and, you know, onboarding, which is the cells and all of that communication is usually key. It's like, where have we not communicated? And I'm not talking about, we read the contract I'm talking about, are you communicating with them? and keeping open communication with them and keeping connected to them. That it's like, if someone's just dropping off and it's like, that's a big thing to look at yourself. It's like, how are we keeping a communication with our customers? Yeah. And before that, Michelle, before they're ever a customer, you have to win them as a customer before you ever have that problem. So I think when we go back up and look at the BDC and the CRM side of what we do, and when I say BDC, I just mean greeting customers online, whether that's through an actual separate department with cubicles that are dedicated to that role or not, when we greet customers in the sales process, because they're making an inquiry online or whatever, that's a chat thread. However, I think we also have to look at, we have to look at that process too, to make sure, because I think this is the part, when you think about the facts of life, the reality of the customer that we serve in the buy here, pay here space, and what are the common threads about them, then when we meet them, then we understand that they don't know everything about financing, they certainly don't know everything about our program and how our program works and what can be done and what can't be done and so it becomes an opportunity for us to first of all approach customer with respect um anticipate that they're going to be a buyer like the thing about assuming the sale i assume they're going to buy i'm gonna i assume they're qualified buyer and i'm gonna find a way to do business even if it's income we can talk about a co-buyer we can talk about ways to to, you know, ultimately have the customer do business. And if I don't win the customer today, I'm thinking about making an impression upon them so that if they refer a co-worker or a cousin or they decide to come do business with us next month, that they will choose to come do business with me. So this is me, this is Jim, this is me being a salesperson, this is me being a dealer, this is me When I say me, it's all of that. It's like, who are we as a culture, as a team? And why would the customer choose to do business with me? And so this is the part that I'm trying to emphasize. So I think when we also can bring in this mirror effect to say, where did we lose customers back here? This customer seemed to be qualified and we missed them somewhere. They were talking to us not to buy a ham sandwich. Yeah. But to get financing in a tough credit situation, and yet they didn't move forward. We did not do business with them. So we have to analyze that. So that can also be a postmortem thing. And I think what I would be looking for is disrespect. I would be looking for any indication that we have disrespected the customer. So obviously we're getting pretty deep into some of these threads, and I'm moving back out a little bit. Well, and I want to, with communication and... that mirror part too is it's a really important piece and we've talked about this the last couple of weeks especially in the climate of the economy and all of those things. Are we communicating ways that we can help that might not be directly like, we can help you with a car, but it's help you with other things. And I use Candice Price out of Omaha, Nebraska. Great, great operator that part of their sales process It's to find one problem that they can solve that is not about a car. And so it's like they communicate, they talk, and it's like, yeah, I'm struggling with this. And it's like, oh, here's a phone number. Do you want to call right now? I can help you or whatever. But solve a problem. and win a customer for life yeah and i feel like i remember enough about candace's approach that they're very much like in the mindset of what i'm talking about you focus on the customer that's in front of you you expect to win them if not today you'll win them tomorrow and this is about making trust deposits that deal about helping solve a problem it's like it's it's really as simple as where are the people you want to do business with even if it's not today okay so this is kind of the mindset that i would urge people to bring and so this is Again, the white hat thread of everything we're talking about, but we can continue. We get too deep in the weeds here. The next one is when a dealer improves or grows, the customer wins and vice versa. Because when you're making improvements, when you're learning, when you're growing... does help that that that relationship and so you know the impetus is not always just on the customer it's it's us and then offering opportunities to the customer to be able to grow and improve as well so whether that be you know improving their credit score because you're doing credit if that whether that be like you're doing a monthly little get together in your dealership for your customers on one-on-one and budgeting and you know or like pathways to home ownership or you know some kind of something that you can that you're you're helping them but you're also um so that's like the impetus is on the dealer to help educate the customer um but on the dealer side it is it's every time we learn something new helps us become better at what we do at our craft and and it's it also reminds us you know we go to a class we go to a conference we go to a you know whatever it is and we're doing a training and we're we're constantly teaching new new ways new new yeah it's like keeping yourself super fresh and it actually, one, it will help keep the energy of the team, you know, the team appreciates, oh, this is a new approach, let's try it, you know, let's enjoy this new approach or whatever. But it just so that it improves the energy of the team members when they're interacting with the customers. And by constantly being open and available, open to learning new things. It's like that mirror. If you're seeing something, hey, we're deficient in this. It's so easy to find a podcast, YouTube, you know, something around whatever it is. It's so easy to find things that are uplifting, that help you change your mindset, that help you grow. You know, we love like our influencers. One of our big ones is Simon Sinek. And the things that he talks about are just like it's it's in business. It's an interpersonal, you know, I love Bernie Brown. Same thing. You know, it's it's if you're constantly improving and learning and growing and improving your systems and writing down your processes and making it easier for your team to to do their job. that it does trickle down to the customer quite a bit too. That's the part I want to drill down to is like, and we don't have to spend a lot of time there. This is just about planting a seed. Dealer goes to a conference. Dealer learns some techniques and they get back. And then the course of the next twelve months, they will reduce their charge off substantially. Now the dealer looks up and realizes those are the numbers. They're driving home one night. Question in the dealer's journey. Does the dealer decide to keep all that improvement and profit in their pocket or do they decide to adjust their interest rate a little bit because they're now more efficient they're experiencing fewer charge-offs and they're able to pass them a lot that along to the customer so think about that in terms of the customer journey and the dealer journey when and listen i'm a business coach so when you hear that you say gosh jim you're trying to tell me to be less profitable as a dealer no that's not what i'm saying i'm saying you're going to hear me when when all things being equal We tend to work with dealers who are building a sustainable business, thinking long term, going to be around, be an asset to the community for a very long time, which means I'm going to ask dealers to think about if we pass them a lot along to the customers and we can adjust it if we need to. But if we pass them a lot along to the customers, how does that improve our sustainability? So you could use that in this example and lots of other examples. The question is, are we just focused on our own profitability? And if we are, do we understand why we might lose some customers? i agree and and you know what if you listen to those that are out there that are feeling like they're the disadvantaged it's it's them and the wealthy and so and so there's there's this automatic cultural friction point of of people that are wealthy and they're going to look at a dealer like they're wealthy. But this automatic friction point of the have and the have nots you have. And, you know, I don't. And so when we do things like that and it doesn't necessarily it doesn't necessarily have to be the interest rate. It could be, you know, your Christmas, you know, you're you're giving you're doing all these things to help or it could be like special bonuses. within your team too it's it always spreads out and all of these things are culture yeah and so this is and when culture affects sustainability and and how we're perceived in the community and so when i talk about of course we expect our dealers to be successful and one of the things i look forward to bringing back to the podcast one day soon is an updated definition on what does real success look like yeah provide your pay right this is i've got it formulated all in my head But everything that we want a dealer to enjoy positive cash flow, have extraordinary profitability, have a good standing in their relationship with their lenders if there's capital in the picture. and be able to sleep well and have low stress. All these kind of things are important to me. And I want them to do that for years and years and years. So there's a quick example of what I think about it. So there's nothing that I'm describing here that is meant to suggest give it all to the customers. That's not what I'm really suggesting. But I am saying that there will come a point in the dealer's journey where they've got to look at and they've got to measure and balance their own success. And are they going to include the success of the customer? Yes or no. We can stop there. Is the success of your customer important to you, yes or no? We can move on. Yeah, I love it. So this is kind of just a preview of some of the stuff that's coming ahead for the Buy Here, Pay Here journey track. So we're going to be talking about dealers, customers, and the vendors, too, will be added. And we were talking a little bit about just some scenarios. So we just wanted to, again, go back to who our customer is before they land on the lot. And so I want to just talk about a couple of these before we sign off today. One is... Tasha, these are just scenarios. The nurse aide who lost her wheels. Twenty-nine-year-old certified nursing assistant in Baton Rouge. She's working night shifts in a senior care facility, supporting her two kids since her divorce three years ago. Does this not sound familiar? Mm-hmm. Honestly, does this not sound familiar? A few months ago, her car broke down for good and the cost of repairs exceed its value. Is this not something we hear every single day? So let me just say, this was prepared by ChatGPT, our thread. So we prompted a lot of things this morning around this particular thread and there's a ton of content that will drive this whole journey. But this is... This is actually a fictitious scenario created by ChatGPT, which gives you an indication of how well they understand the thing. So the credit challenge is, is Tasha fell behind on payments during a short medical leave two years ago. The repossession that followed tanked her credit score. So, you know, we know. And it's, that's like another thing that I, we talk to dealers and it's like, if they've got a repo, no. Mm-hmm. That's a lot of times why they land here is because they have had a repossession. So why buy her pay here? Because no traditional lender would approve her for a new loan. She needs reliable transportation to continue working night shifts, and she walks into a buyer-dealer dealership exhausted, hopeful, and determined to prove herself again. Yeah, that's, you know, I've talked about that. And those adjectives there, I mean, she's exhausted, she's determined to prove herself, right? She's hopeful. That can all be true. It's also typical that the customer in the conversation, they're just focused on, man, I'm in a tough spot. I don't have a lot of income. I don't have a lot of down payment. Can you help me? We don't often talk about the fact that we got two kids and why we're in a tough credit spot, but those things become relevant. And so this is the part that I would say is this customer, when we met Tasha, all she's really talking about is how much down payment would I need? What would it take to be approved? It would be on us to get to more of the story, understand the circumstances, because we as underwriters have to make a judgment at some point you know, do we believe in Tasha versus the customer last week with eight hundred down and whatever the payment? You get the point. We have to make a judgment about is Tasha, you know, somebody that that can be successful in our program. And so this is why this stuff becomes important. Absolutely. Absolutely. And it's not it's again, that's it's a very seen scenario. Next one. Kayla, a single mom who survived a shutdown. So Kayla is a forty one year old single mom and a government contractor in San Antonio during a federal shutdown, which is what we're experiencing right now. We've had it before. She missed two months of paychecks. Rent came first. Her car loan did not. Okay. So, you know, it's rent, groceries, all of those things. So her credit score dropped from six twenty to five ten after she missed payments and an eventual charge off. Though she returned to work, the damage was already done. Right. And she's the same person she was then. This is the part that I think is the respect piece. She's the same person she was. Yes. Her credit score is reflecting a change in our credit circumstances perhaps our income but now we're in the position of having to make a judgment about you know and judgment's an interesting word by itself it's like we're having to make a determination about whether or not this this person uh kayla is qualified for our program and is it somebody that we can help And, you know, if you if you meet someone with disqualifying questions from the get from the gate, you don't learn these kind of things. You know, it's that she's a single mom. Well, how old are your kids? And are they are you know, do you need to have a four door or is a two door? You know, all of those things is if we're coming in and we're saying, how much down do you got? And that's what happens on the BDC side too often. There are none of those kind of questions, but it's more structural. What's your down payment? Can you do this? And so as a result, the customer feels... very much like a number, like they've got to meet the financial qualifications or don't bother. And so you can understand why they would jump off of that track. If they don't fit the box, then the customer's going to jump off and we're going to lose that customer. And so I think this is touching on some scenarios that are commonplace. They're good. They're very representative of the kind of customer we can expect to meet in the buy-your-pay-your dealerships on a day-to-day basis. And so this is why the journey of buy here, pay here overall becomes really important for us to talk about. And of course we've talked about it, but just not in this way. So I think what you're going to see us do is stay on this track and be able to weave these things together and begin to understand how they affect us operationally, culturally, financially, all these things become considerations. So was there another one you wanted to share? One more, Ramon, and this is something that I've seen in working with dealers before. Twenty-three-year-old Ramon has custody of his two-year-old son after his ex-partner entered a treatment program or prison or whatever it is. He works full-time in a warehouse logistics in Charlotte but has little credit history. Right. Traditionally doing business on cash. He's credit invisible. Right. No credit cards, no loans, just cash always. Now he needs to establish credit, build a life for his son, and get to daycare and work reliably. Well, does he need to establish credit or does he just need to buy a car? I mean, he just started getting some wheels. Yeah. So he may or may not be thinking about establishing his credit as much as he just needs credit today. Yeah. Because he needs wheels besides what he can pay cash for, right? So that's kind of the, but anyway, you can paint that picture and think about how you would handle that situation. But there's one after another like that. And I think, you know, for today, we just wanted to have a chance to, and I do want, I've got Sage teed up in the background. We've got our chat GBD agent. Let me bring Sage in just kind of, because Sage is very much going to be a part of these threads going forward. And so if you want to bring that up, Michelle. I will as soon as we get her up. okay um let's do that and um i'm ready to tee up if you want to show the screen then i will then i will tee up the all right the audio hello are you there sage I'm right here, loud and clear and ready to help out. If there's anything else you want to test or run through, just let me know. Now we've completed our testing. We actually just ran through all the bullet points for today's podcast. We're still live. And so I just wanted to have a chance before we wrapped up to have you share with our listeners, perhaps just an overview of how you see this mission or this project of embarking on the BHPH journey conversation. Absolutely. I'd be happy to. So to all the listeners out there, the way I see it is that this BHPH journey conversation is really about shining a light on both sides of the road, the dealer's journey and the customer's journey and how they intersect. It's not just about financing cars. It's about building trust, understanding each other's stories and navigating that journey together in a way that's respectful and supportive. So this whole project is about opening up that dialogue, shedding insights and ultimately making the BHPH world a little more human. Thanks for letting me share that. That's great. I also want to make mention that we step into this BHBH journey, we will have our new sponsor for White Hat Way, DCS, the software folks out of New Jersey will be part of these conversations and they will be able to speak to the this track of this that is the provider or the vendors relationship to dealers and ultimately the customers and then obviously our founding sponsors will be part of these conversations as well and so you're you're familiar you might just list for our listeners the founding sponsors from right halfway yeah the actual companies Of course, it's fantastic to have those partnerships on board. So just for everyone listening, as we dive into this BHPH journey, we do have our new sponsor at KCS, the software team out in New Jersey, who will be adding their perspective on the vendor and provider side of things. And of course, we have our founding sponsors who have been with White Outweigh from the start. Those include our cornerstone companies who have really shared the vision and values of the White Outweigh. So a big thank you to them, and you'll be hearing their names and their insights as we move forward. So she missed the opportunity to mention that our founding sponsors are, in the order they joined us, LHPH Capital, Dealer Re, and Pastime. So we'll be inviting them to come and contribute to these conversations, wherever they may occur, on the Wednesday episodes of the morning show. We're also moving into the TechWatch podcast and beyond. And so we're going to bring this customer journey thread along the way. And all of those people have their own perspective on this journey between, you know, that is The customer journey, the dealer journey, and of course the vendor side of it as well. Absolutely. All right, everybody. Thanks so much for joining us today as we start this whole buy here, pay here journey. Including the customer, the dealer, and the vendor. The perspectives of those things and how they all intersect. And as we learn how to better ourselves and apply the White Hat Way principles that everyone's going to rise and it will be an improvement for all. Thank you so much again to our sponsors for White Hat Way, Pastime, Dealery, and LHPH Capital, and also our annual sponsor for DCS. Looking forward to seeing you guys on Friday. Thanks so much for joining, and we will sign off. Yep, see you back here Friday. Thanks, guys.
