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From Dead Weight to Cash Flow: The Transfer Fix for Aging Cars | Industry Spotlight
From Dead Weight to Cash Flow: The Transfer Fix for Aging Cars | Industry Spotlight
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About this episode
A deep dive into how Kelly Automotive Group is thriving without a traditional aging policy for used vehicles. Trent Wabri, VP of Used Vehicle Operations, shares insights on utilizing analytics to strategically transfer aging cars to stores where they can achieve optimal sales. The discussion highlights the importance of data-driven decision-making, the challenges of rising market costs, and innovative strategies that have led to increased revenue. Patrick James from Viotto also contributes by explaining how their tools enhance inventory management and streamline the transfer process.
Topics:
used vehicle operations
inventory management
data-driven decision making
aging policy
vehicle transfers
market costs
analytics
profit generation
sales strategies
Cars:
Toyota Supra
Welcome to Industry Spotlight—a focused series hosted by Sam D’Arc, highlighting standout dealerships and innovative companies, and exploring the trends driving success in today’s automotive market.
Today, Sam sits down with Trent Waybright, Vice President of Pre-Owned Operations for Kelley Automotive Group, and Patrick Janes, AVP of vAuto Inventory Solutions.
This episode of the Car Dealership Guy Podcast is brought to you by vAuto:
vAuto - As the industry’s premier provider of end-to-end inventory management solutions, vAuto gives every dealer—from a single point store to the largest groups—the data, insights and tools they need to maximize returns from the new and used vehicle inventory investments. Known for its game-changing inventory management innovations, vAuto provides AI-powered predictive data science to help dealers see their future and consistently make the right, ROI-minded decisions with every vehicle they appraise, acquire, price and retail. Discover why 96 out of the top 100 used vehicle retailers trust vAuto to help them achieve greater success. Check out vAuto here: https://carguymedia.com/vauto
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Topics:
01:20 How has used car ops evolved?
03:27 Best used car sales strategies?
06:33 Current market challenges?
10:16 Innovative inventory solutions?
20:37 Setting up car transfers?
21:54 Analyzing transfer results?
22:50 Optimizing transfer strategies?
25:20 AI in used car ops?
29:53 Future used car innovations?
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Toyota A90
"And the average wholesale loss was about $800 on those cars. So again, we sat on them for a 90 day cycle, tried two stores, then wholesaleed them and lost $800."
How has used car ops evolved?
Best used car sales strategies?
Current market challenges?
Innovative inventory solutions?
Setting up car transfers?
Analyzing transfer results?
Optimizing transfer strategies?
AI in used car ops?
Future used car innovations?
Select text to request an explanation
Hey, everybody, welcome to another episode of the Cardiola Ship Guy Industry Spotlight.
I'm your host, Sam Dark.
Coming up today, learn how one dealer group is surviving without a used vehicle aging rule.
In fact, they're thriving by placing aging vehicles in stores with the best shot at optimal grosses.
And most interesting of all that decision about where to put the vehicles
is based on analytics, not on gut.
Joining me today is Trent Wabri, Vice President, Used Vehicle Operations for Kelly Automotive Group
and Viotto AVP of Inventory Solutions, Patrick James.
Props to Viotto's for supporting today's show.
Let's get into it.
Hey, so Trent, for our audience, give a little bit of background on Kelly Automotive Group
and who you are and what you do inside of Kelly.
I work for Kelly Automotive Group in Fort Wayne, Indiana.
I started selling cars for Tom Kelly in May of 1999.
Wow, long time ago.
Therefore, I've been with the company for a long time.
Yeah, and how long have you been in this director role?
I've been VP of Used Car Operations for the past 12 years or so.
Wow, so a long time.
You've seen a lot of change not only during the course of your career,
but also just in your period of time, you've been there long enough as VP
of Used Vehicle Operations to have seen a lot of change.
A ton of change.
And at one dealership.
How would you describe the change over the past decade in Used Cars?
Oh man, I'd say it's been a roller coaster from my perspective.
It's an ever-changing environment.
We've had to figure out how to adapt.
I've been with our company in the lows and in the highs.
And you've got to just take it day by day and figure it out as you go.
You've got to work your butt off.
That's all you can do.
You're in an interesting position because you've been with one group your entire career,
which is not unusual.
It shows loyalty.
It shows they're a great place to be.
How do you figure out how to be the best Used Car VP in the country, right?
Like having grown up inside one auto group, where do you get your best practices from?
So many different ways, I think, but it is getting to know people throughout the country.
I'm privileged to be in a bi-auto NCM20 group, which we started, I believe, in 2014.
So roughly 11 years.
I've been in that group.
We meet three times a year.
The auto NCM group.
What does that mean?
Well, it's a Used Car group.
So we have a wide range of people in our groups.
We don't have just the owners or just the GMs or just Used Car managers.
We get kind of a wide range, but the primary focus of our group meetings is Used Cars.
And so we're constantly, when we go to these things, trying to figure out how we can improve,
look at all the changes in the environment.
And I come back every single time, 11 years later, with at least a page full of notes
and things that I want to get hanged before I go back.
All right. So the old joke is for anybody that goes to a 20 group, you come back,
you want to make changes, you spend some time implementing it.
You spend time until everybody gets frustrated and says, that's crazy.
It's not going to happen.
What are some of the specific key takeaways that you are able to implement that have
helped generate more revenue for the Kelly Auto Group?
Well, I think one of the first major takeaways, and I'm talking about maybe eight years ago,
was our PBA indicator program, public before auction.
And so back then, the biggest priorities was to figure out how to sell these little
cheap cars that we have, that we all take in on trade that we're afraid to sell,
that should we just take them to the auction?
And so you focus on your ratio of used to wholesale.
We're under 20% at any given amount.
But it's because we take these cars that have 100,000 miles or more most of the time,
and we send them from our Fort Wayne campus to our Decatur location,
which we have three dealerships on the same property.
The average medium income is a little bit lighter down there.
And it is a prime opportunity for those cheaper cars.
And how did you see that as an opportunity?
How did that become evident?
Hey, it's a better idea to dispose of those vehicles outside of our main footprint
in Fort Wayne. You're sending it out of town.
Yeah. Again, it was that idea for us came from Moorys.
They were in my 20...
From Moorys?
Yeah. Way back in the day, they were in my 20 group.
And we had a couple dudes in there that had tried it.
And I was thoroughly intrigued, looking at our wholesale ratio.
Back then, we were probably 50, 1 to 1 or 1 to 0.5.
And I thought, man, we could do better.
You know, we could free us out.
We always seemed to be short of the cars that we really needed at our Decatur campus.
They retailed a low-costed unit in most cases,
and we struggled to get those cars down there.
So it just all made sense to provide those cars to them.
So you came back from this 20 group meeting.
You're the VP of used vehicle operations.
You're like, I got a great idea.
We're going to take all of our used cars over 100,000 miles or X dollars.
We're going to move them to Decatur.
What was the biggest obstacle you got 8, 10 years ago to that change?
And how'd you overcome it?
You know, truthfully, it wasn't that difficult.
The structure of our company probably provides that a bit of easier situation in that regard.
But we have an executive team.
We have a couple of VPs in the company.
We all meet and talk about these things.
Our company is fairly big, but it's not that big.
And so it's just a lot of meeting with the stores, meeting with the managers,
making them understand or trying to get them to understand the decision is for the company.
You're holding a buy-in that way.
Yep, trying to get the buy-in that way.
So moving ahead a decade later, you had success with this one strategy.
Tell us today, Trent, what's on your mind as a VP of used vehicle operations?
What worries you most or what's the biggest obstacle or problem you're working on today?
I think one of the biggest challenges of the last couple of years is our cost of market.
You know, what you're having to pay for these used cars, which I think everybody can
probably agree with, shrinking margins.
We're trying to take it day by day and find other methods,
find other avenues of creating growth in our deals.
So what's your best source for used vehicle acquisition?
We ask that a lot on the daily dealer live.
Where do you get your best used cars today?
Saldi Kelly acquisitions.
We do have our own websites, so our customers can go there and start the process.
We acquire 40 to 50 units a month from customers that are fairly local.
And so that's a big source for us.
We do still buy from the auctions some.
We try not to, but we do.
And we have really, really, really worked hard in the last year at that trade win percentage.
And what's the trade win percentage?
Well, they say that the goal for the used car side is 40% for the new car side, 60%.
So we're in a unique advantage that we have franchises, right?
So we sell a lot of new cars.
If we can capture 60% of the cars that we sell that have a trade in,
and 40% of the used car side, we're doing a really, really strong job.
Collectively, we're exceeding those targets.
Therefore, we're generating all the time more trade ends than most.
Yeah, yeah.
We had Brian Kramer on the show recently, and he talked about a ratio.
He said, hey, if you sell 500 used cars in a month, you should figure out how to sell,
how to quote or put bids on three times that number of vehicles.
So you should bid 1500 vehicles.
So service lane, used cars.
What do you think of that ratio?
And are you guys doing anything interesting in the service drive to help get there?
I think that's a good target.
I'd say historically have struggled a bit in the service drives.
We've never had a ton of success at it.
It's a challenge because to have it work, you got to do it 100% of the time.
You almost have to have separate staff, and you really got to be all in.
So it's an interesting trend as a used car VP for a large group like Kelly.
How many stores do you have again?
We have nine roof tops.
So you've got nine roof tops.
You've probably got an aging policy.
What's your policy as it relates to aged used?
We really don't.
So I've been in my position, I've mentioned 12 years,
but I've been involved in the used car operations.
I was the first person to log in to the auto back in 2007 in my company.
So my train of thought has always been if you take good care of the inventory from day one,
you merchandise it, you price it aggressively or where it needs to be in the market,
and you do that consistently, that the aging will take care of itself,
and you won't have to grow.
So at the moment, we've got roughly 30 cars over 60 days old in the group
out of about 400 retail.
So a very small percentage.
And again, it's just managing and managing and managing on a daily basis.
Yeah, very cool.
So Grave Partners help make automotive even better.
And so without an age policy,
you found an interesting solution to an age old problem of,
where's the best place to get a used piece of inventory?
Is it the auction?
Is it a customer?
Is it from another store?
You're able to answer that in a unique way.
Tell us about that and how you arrived at a solution to
trade inventory store to store in your launch group.
I mentioned earlier, I really struggled historically with buying into transfer
an inventory among our dealerships.
I just always felt like if we took care of the cars at the stores,
and we did the merchandising price and everything effectively,
that we wouldn't have a problem.
Those guys took the cars in in most cases,
so they should have the chance to retell them for a bit,
let's say, before we worry about doing something else.
And so obviously times have changed a little bit here in the last couple years.
And so as the cost of market has risen,
as it has become more and more difficult to buy cars at auctions
or anywhere, it just seemed to start making sense to look at our own inventory
and maybe use a bit of engineering and a bit of data to help us determine
where could this car be best in our group,
rather than us having to go buy a car.
And so Viato approached me, I feel like it was late last year,
they had an idea concept about transfers and what they were seeing in their tool.
And so I thought it was very intriguing from my perspective,
a couple of different ways for the inventory management side,
but also the pure accounting, the efficiency of the transfers,
just provided a whole different way to look at it.
What's your motivation to transfer if you have no aged inventory policy?
There's no reason to transfer it.
Like if I'm a GM and I have P&L responsibility for a store
and nobody cares if something gets old,
like what's my motivation to get rid of it?
I want to retell out of it, right?
That's why most groups have an age policy.
What's a GM's motivation to move that inventory to another store, Trent?
Here's my perspective, it's not really up to him.
I'm in a very unique role in my company,
and so I'm kind of bizarre over the used car.
So you tell them and then that's the way it goes, right?
That's exactly right.
Okay, so enter Patrick James with Viotto, right?
Patrick brought you some reports that made the argument that,
hey, there's no age policy, but you're going to actually make more money
if you transfer that vehicle elsewhere.
Patrick, maybe share with us a little bit
the insights you brought to Trent that helped force fun in this case.
Yeah, yeah, Sam, I love the authoritarian quality.
That is truly centralized inventory management though, like he owns the,
he has the checkbook, the owner being the checkbook, and by gosh,
this is how we're going to do it.
It's not a bad thing sometimes, right, when you're looking out for the owner.
It doesn't happen everywhere though, it doesn't.
I get it, I get it.
And honestly, I think, you know, Viotto, we've tried to cater to both
of those approaches, right?
One that is totally centralized like Trent, Trent makes that call
and he optimizes the inventory everywhere.
Well, we also understand that there are GMs that, you know,
aren't going to give the car up.
So we put a process in place or in the technology
where we've got kind of a transfer list.
So hey, you've got cars on the transfer list,
they're going to transfer at the end of the month.
So there is that sense of urgency.
Like I know someone has made a decision to move these cars
and I've got a window of opportunity to get rid of those,
but I also see a transfer list of cars that are coming in
from another store.
And so therefore I see what I'm going to get,
assuming, you know, the month ends
and those don't get retailed at the other store.
So we try to build in some of those things
to provide some flexibility,
depending on the centralization efforts of the group.
But I think, Sam, there's a couple of stats I'll share with you.
One is about a year ago,
we started looking inside of the AutoTool.
We saw in a monthly basis,
and I know we weren't capturing it all,
but we saw about 9,000 units being transferred
into a group, store to store, right?
That was in the Auto.
We also found, based on track and stock numbers,
that there are about 9,000 units a month
that will be transferring outside of the Auto.
Like we could see that those cars were moving,
but they weren't being...
We were using our tool to transfer the inventory.
So they were probably going through the DMS
and then showing back up again.
That's a lot of cars.
And we said, so this activity is popular
amongst our client base,
and we figured that there's a need
for us to be able to support that.
And then we thought, we got a lot of insights, right?
We should be applying our insights
in a platform where they can make better decisions
about moving those cars.
And the other stats I'll share with you,
which these ones, this is not Trent's store,
because Trent's way ahead of the curve on this,
but we found that, on average,
across groups, the average age of a car
being transferred was about 45 days old.
And when it got wholesale, that was 90 days old.
So we gave it two shots, right?
We sent it to two stores.
We did it basically after it aged,
rather than looking at the quality of the car being,
you know, moved to a store that could use it right away.
And the average wholesale loss was about $800 on those cars.
So again, we sat on them for a 90 day cycle,
tried two stores, then wholesaleed them and lost $800.
And you know, there are a lot of groups out there
that are making money on wholesale
because they're making that decision earlier
in the life cycle of the vehicle.
So this gave us the challenge of saying,
how do we help dealers optimize this inventory,
perhaps transfer the vehicle a little bit sooner
in the life cycle?
It's a depreciating asset.
And then to make it more seamless
just from a accounting perspective
and being able to get the car from one inventory
to another without a whole lot of brain damage.
So you've got this tool.
Let's go back to the aging policy that we talked with.
So at Trent's Group, he's got the authority.
He can force it.
Patrick, what do you see as a best practice
from Beato's standpoint, right?
Aging policies across auto groups
are what are forcing the inner store transfers, right?
And then ultimately the wholesale loss
is an age policy and used
in our crazy used car marketplace today.
Still a good idea.
You know, 60 days is the number, right?
That we used to always hear.
And I was a V auto performance manager
before I got into my current role.
So I worked closely with dealers, you know,
like Trent inside the app.
And you know, most of them had an aging policy of 60 days
and then we sent it for wholesale.
I believe the way Trent's approaching things,
if you're truly, you know, optimizing the insights
where the best chance, the highest probability
of sale of that car is early in its life cycle,
we can, yeah, perhaps Trent can get away with
and he does because he does a really good job
without an aging policy, right?
Because he still sees life and opportunity left
with that car before we're, you know,
sitting there with a 60 plus day unit going,
oh, let's just try it in another store
and see what happens, right?
I think he's thinking through that much earlier
in the life cycle and the cars are gone at that point.
Now, you know, we've kind of pivoted a little bit
on our philosophy around, you know, the idea of velocity,
which every car, you know, has got to go, you know,
after at a certain date.
We have found again through insights
that there are cars that you can sit on longer
and they actually, you know, will depreciate slower
and they will make you the money.
So we have tried to build those insights into the tool
so that, you know, we don't necessarily
have this hard turn policy on every car
regardless of the ROI opportunity of the vehicle.
So I think those new insights are changing the way things
are starting to change that age policy a little bit.
It's a fascinating argument because really good
find to use car managers right now would say,
hey, inventory goes up in some cases it comes down.
It's tough to get like recon is expensive.
If I get a used car from a customer,
let me hang on to a longer, let me hang on to it
through the seasonality.
So this reporting tool that gives you these stats,
what's it called?
It's in the V auto solution, right?
Yeah, I mean, we're just kind of throwing a name
out there or centralized inventory management.
It is a platform that we layered on top of the groups
at the enterprise view.
There's no extra charge to it.
This is just an enhancement that we came out and said,
we can do a better job helping our dealers,
one with the transfer piece, but two, just better reporting.
So, you know, you're talking about dealer 20 groups earlier
and you know, you don't always have to go
to a really great destination.
Although I'll bet you've had a couple of good ones.
So probably a few favorite places you've gone to,
but you know, we don't have to do that,
you know, to get some insights on how store by store
is accomplishing the goal.
And I think we're bringing better insights into the tool
to let a C suite, let's call it, centralized operator
be able to see things across each store and compare better.
Okay. Okay.
So Trent, break this down for us then.
All right.
So how many used cars approximately give or take
do you have in inventory currently?
In retail inventory, we've got 400, roughly 400 used cars.
Okay.
So yeah, 400 used cars.
And you said you've got 10 rooftops, right?
Nine rooftops.
Nine rooftops.
And you've got no turn policy, which could be dangerous
unless you've got a good resource to help you figure out
how to turn it.
So as you look at those 400 used cars,
how do you engage with the reporting to figure out
a car that needs to move?
How do you set it up to make it ready to move?
How does it proactively move?
And then what's the result?
Does it end up with a better profit margin flat?
Do you end up with a loss what?
But first, let's start with how you set it up.
It's a huge, huge question.
It's a long question.
Do you break it down however you want?
I'm just excited.
I want to get to the answer.
So yeah, there's a lot.
There's a lot there.
But for us, how do we set it up?
What do we look at to kind of help determine?
Yeah.
Well, I think I'm still in the midst of doing that,
truthfully.
Okay.
We just started going kind of full in on these transfers
roughly for two months, June and July.
Prior to that, I'd never really transferred much.
The only cars that we ever transferred prior to June
were Highline CPO cars.
So if our Chevy store took in a Highline BMW
that could be certified, then we have to transfer that.
That's our company policy.
Yeah.
Therefore, that sales manager has to reach out
to the BMW sales manager.
They praise the car together,
make a decision on the ACV when it comes in.
We transfer it immediately to that store.
It's just the last couple of months here,
June, July, that we have made the decision to start
kind of utilizing this tool, Enterprise Transfer Tool in Beato,
to help us kind of determine what makes sense to do this
and go ahead and do it.
So do you have a couple of examples of specific vehicles
that you've transferred from one store to another
and then the net result versus the aging out?
Oh, yeah, I do.
I kind of cheered us with the old bit ago.
But in June, so for instance, in June,
we transferred 26 units that were strategy transfers,
we call them.
So we have CPO transfers, we have strategy,
and then we have our PBA 2 Decatur.
So we really have three buckets at this moment.
I like the PBA 2 Decatur.
That sounds like a bus.
PBA 2 Decatur, man.
Kind of what it is.
Well, we've sent them 160 PBAs this year.
They've retailed 123 of them so far.
Wow.
Indicator.
So it's an amazing program at three grand a car.
37 just sitting there.
So it is putting the best vehicle in the best spot
for the best possible chance for success.
So in June, those 26 vehicles that you transferred
using this report, what triggered the transfer?
How did you identify these are the vehicles
that have to shift?
At that moment, heading into June,
we had made the decision as an executive committee
to target our over-inventory.
Okay.
So that's where it started.
Anything over 45 days?
45 days.
Okay, very good.
So we transferred 26 of those cars and then go into July.
We transferred 22 in July.
In June, our average days to sail on the cars
that we had transferred was 33.6.
Forward to July, 12 days.
Wow.
How did you get it so skinny on in July?
What would you do different in June versus July?
I mean, the guys are selling them.
Yeah.
It's somewhat baffling to me,
but we really worked hard at perfecting the process.
The tool makes it extremely nice
because when you go into the Enterprise Transfer Tool,
you hit a button.
It immediately transfers the car and the system
from the original store to the new store.
Prior to that, it's a lot of copy and appraisals.
There's a lot of accounting.
There's a lot of emails that fly back and forth.
It's not a very efficient process.
We would have to physically bring the cars
from the original store to the new photo booth
at the new store, retake the photos.
You know, there's just a lot to it.
In the tool, when you hit the button now,
it does all that for you.
Immediately goes into that store and an email gets...
So do you tell the GM after the fact
or do you tell them as you're doing it?
Do you just say, hey, I just took this vehicle
because I think it's got a better shot somewhere else?
Yeah, that's something I'm working on,
providing good reporting.
The last couple of months, we've done it.
We actually... I send an email out the prior week
and say, this is our list.
This is what we're contemplating.
You know, do your best to sell these this week,
but if you don't get it done,
this is what's going to happen next week.
And so Patrick, he's setting up that transfer in advance
so the GM can see it's going to go.
So that creates an emergency behind it.
Is your report showing...
Is it showing Trent?
Is it saying, hey, this vehicle has a better opportunity
at this other location because of X-Factor?
What does the report tell Trent?
Yeah, so in the platform,
you can click on a car and say,
all right, here's a car that I'm considering transferring.
All right, now there's some filters
in the platform like brand mismatch, right?
Like Trent mentioned that about the whole CPO idea
or, hey, I've got a Ford and I have a Ford store,
but the Ford's at the Kia store.
I mean, those are the wall hanging fruit, right?
That we're seeing that guys are able
to do some brand mismatching
and be pretty effective with that.
But as I click on that car,
it will show based on the metrics, right?
Market day supply, average days of sale.
Have you had one of these before in that store?
Did it sell?
What did you make on that car, et cetera?
You can click on that car
and it will show you what that car would look like
in the remaining stores.
So that is a insight that you can say, oh, well,
and sometimes it might look like,
ah, it looks pretty good at a couple of stores.
Sometimes it might be, oh my gosh,
this is no brainer, right?
So I think, and I think that's where Trent sat today, right?
He's just starting to pick up those insights.
He's doing the obvious stuff.
Hey, let's move some age inventory around,
which a lot of guys have done historically.
And then you start to refine that to say,
hey, let me start looking at some additional insights.
And once you get the rhythm,
you know, you see a lot of success.
How's it getting those insights?
So we, through our profit time module,
we do have, that is AI driven.
So we are actually looking at probability of sale
of that car at each store.
If you have the original provision platform,
then it is multiple insights, right?
So we kind of differentiate profit time and provision as,
provision is the insights everybody's used to, right?
Cost of market, profit market, market day supply.
We have an algorithm behind,
an AI driven algorithm behind profit time,
which uses probability of sale,
which just sophisticates that a little bit more.
So you can kind of choose between the two.
Trent, as you transferred the 26 vehicles in June,
22 vehicles in July,
and you used these analytics to make that transfer,
did the prediction come true?
Like was it pretty accurate in the opportunity?
So far, and that's what's been amazing.
It's what I was going to mention is
you talked about buy-in a little bit ago.
I mean, they are, so the guys right now at our stores
are asking me to start doing this on a weekly basis.
Yeah, you're a rock star now.
This is what everybody wants.
They want a tool that works really well
that you say it's going to happen and then it does.
That gives you a ton of credibility as an executive leader.
Yes, sir.
Yep.
And we have done tremendous with it.
So average days to sale in July 12,
average gross on those cars,
round $5,500.
Wow.
So all of a sudden, you're getting the buy-in
because of the results.
And does the selling GM or the selling manager
of the selling store, they get some sort of,
there's not profit share,
but they just don't take a loss on that unit, right?
You're transferring it out at its true cost.
I'm not in the selling store, gets it.
Oh, you know, I'm re-appraising that car.
Okay.
Before I make a decision on what store
I'm going to put it at too.
So we used the analytics that Patrick was talking about
and then I actually appraised the car in the
potential store that it's going to.
And then they will take a little bit of a wholesale loss
if necessary.
But so that's the urgency.
It is.
The goal is though, if we can transfer them sooner
and get them to the right stores,
the cost of market is way lower
when it first comes in inventory, right?
So we're trying to engineer it a bit better.
So that works where you have
centralized decision-making on used cars,
but also works where you have fragmented
because you could still have an operations guy
in a group like ours say,
hey, I'm going to make this prediction.
If you take this Cadillac
and you move it from Cadillac over to Benz,
it has a better chance to sell it a higher gross at Benz.
And then as that happens, you're a hero, right?
So Patrick, how long has this tool existed?
It's literally been out for months, all right?
We introduced it shortly after NADA.
We were in pilot with some dealers.
Transpend with us for a while,
helping us build it out and get it better.
Like any tool, add more insights,
making the usability better.
So it's literally been out for months,
which is why when Trent says,
hey, the last two months, I'm really digging in beyond,
that's where our dealers are today.
So this is very fresh, very new.
I want to add one thing, Sam,
because I got to go on the thread of what Trent said about
the centralized approach,
him being the overseer or whatever.
As a V-auto PM, I was with a very large notable dealer group
who wanted to do this same thing.
Now, this is back five years ago, all right?
We're going to move cars around.
And the solution was,
and I know a lot of stores were doing this,
the solution was, let's just have an auction, right?
We'll just take the aged inventories
and we'll put them in a private store
and we'll let everybody bid on them and so on and so forth.
And I remember the leader of this group,
stepping in and saying, this is not working.
And we did what they told us to do, right?
He said, basically what's happening is,
I got guys who don't have cars, they need cars,
and they're just buying anything they can
and they're outbidding each other.
It didn't have a strategy behind it
in terms of they needed the car
or they historically have done well with the car
or they have a whole inventory
that this would fit perfectly.
None of that was in place.
So we completely stopped it.
And we put a lot of energy in this thing
where you're like, boom, it was over in like 30 days.
Made so much sense, right?
And I kind of learned from that,
back when we worked that way and said,
you know what, somebody has got to be looking
at the bigger picture and making these decisions.
And so when you hear, try and say, hey, I transfer them.
That's just the way it is.
This is how it works.
You know, I think that is the better way of managing it
because I've seen it the other way where we have the auctions
and we end up truly just kind of kicking the can down the road
and the car ends up in another store
in another store in another store
and we finally wholesale it and take a beating, right?
So, and I'm not saying there are guys
that are successful with that model.
I'm not going to say that they haven't been good with that.
I just think that this opens up another avenue to look at.
It's a more data-driven way to make decisions
that ultimately yield greater profit results.
And again, like I know this trend,
that the more as an executive, as a leader in a company,
you give advice and then that advice is correct,
the more credibility you have
and the more ability you have to get things done in the future,
whether you have total command control or not, right?
So here's my question, Patrick.
In a world littered with all these AI tools and technologies
and things are evolving so blasted fast,
how does a used car director like Trent
or anybody out there listening to this show,
how do you decide, well, A,
how do you decide what evolutions
make most sense to implement and use?
And then B, how do you stay on top of this?
Like Cox and Viato have had this for two months.
Like if it's something you wanted now,
how would you advise people to stay on top of it?
So I define this, this is my own little lingo here,
but I consider what we've built the playground, right?
We just wanna get dealers to the playground, right?
It is a chance for a group to look at
all their inventory in one place.
Now, dirty little secret I spent
before I got into a more broader role in Viato,
I worked on the Stockway product, right?
Auction acquisition software, right?
Where we aggregate all the auctions across the country
and we tell dealers, even though we own one of the biggest ones,
we tell dealers, go find cars, don't go find auctions.
That's the best way to shop.
And so we built that tool,
and I considered that the playground back in the day,
which was, hey, here's all the auction cars, have at it.
You gotta find what you need,
and we have a series of filters
to be able to find the right cars.
This is really just a duplicate of that playbook, right?
Here is the playground.
All your cars in the group are there.
If someone will look at it with some insights and some filters
to be able to rationally look at some inventory
that may make sense somewhere else
and someone is monitoring that,
I bet that we will come out with a better result.
Just like buying a car that you really need,
regardless of the auction,
you might be able to rip one out of the auction
once in a while, which everybody dreams of, right?
And I think it's the same concept that we've applied here.
So to your question of, okay,
now all this stuff's moving, AI and all that,
if we can get dealers to the playground,
now we just want to iterate
and give them more and more insights on the playground
to look at and make decisions from, right?
We can build more AI,
we can build more decision-making in the playground.
This isn't even an AI question, though, I think, Patrick.
This is a question of, we got a lot of vendor partners,
there's a lot of people out there with industry knowledge
and expertise and best practices.
If something is great and works,
how can I find out about it fastest?
People ask me, they're like, hey, you're CEO of a large group.
Why do you do this show three times a week?
Well, I do it because it helps me keep up on the stuff
that is the best.
And it's fascinating to me,
there's constant evolution in our industry.
You can't do everything,
but you got to find those few things that work
and are really good, and then you got to lean into those.
And I just think we're in an industry
where we're always looking for the sparkly new thing,
we're trying to find that new toy.
There's people jump companies, people jump tools.
On a whim, it sometimes seems when sometimes
the existing tools, if you lean into a more
or if you evolve something together better,
you can lean into a partnership and be great.
And I think you've shown us an example of this.
Trent, you've got a tool that helps you with a problem
that's a big problem, which you don't really have
because of you don't have an aging policy,
but you're creating gross without a policy
that again, you're a freaking rock star.
So then it's kind of like, all right, what else,
what other evolutions could you do if you collaborate
together rather than just jump ship
to go find the next shiny tool?
Here's my shameless plug for a job that I did.
It was very near and dear to me when I,
so I worked for an OEM for a number of years,
and then I did retail for about 10 years.
And I came to Viato as a performance manager,
right, out there with a portfolio of clients
like Trent, rolling up my sleeves in the software.
I've heard Yossi mention, give kudos
to his old performance manager before on the show.
And so I think, we have consciously,
at Cox Automotive and Viato made an investment
to say, we're going to give you someone
with the software, right?
We're going to give you someone who is hearing
across the industry what the best practices are,
what's working, what's not working.
And it's not always just inventory management, right?
They're hearing things about,
M and CRM innovations and all these different things.
And I do think that's helpful for the dealer.
And I always tell dealers that, hey,
if you're not engaging with that person,
you're missing an opportunity,
at least just to kind of chat a little bit
and say, hey, what are you seeing out there?
Just like we're doing on the podcast,
like what's working, what's happening in the industry?
They can share a lot of those innovations
that are happening out there,
and they run across them while they're in some software,
in a process, trying to help a deal with a process.
And they're just great resources.
So I would say that's kind of our secret weapon.
Beyond that, I guess you got to, you know,
go to the cardio ship guy podcast.
And take it for sure, it's plugged for us as well.
So yeah, I do believe that's true.
You got to surround yourself with the best people
in the industry.
And that's why the best companies,
tech driven, AI driven, whatever they are,
they've still got to have great people
to help plug that back in
and provide those valuable insights.
So Trent, as we wrap up,
what else keeps you up at night in today's economy?
Is there anything else that you're thinking about
over the next six to 12 months
that you're trying to innovate for
or any big problems you're trying to solve
as we wrap up today?
I'm just trying to finish strong.
We're trying to finish strong.
We've got a great year going.
July was an amazing month.
A new end use cars for our company.
I live in my own little world, obviously.
I've been here for 27 years.
But yeah, just focusing every month
and every day on getting better.
I'm excited about this tool.
I think it's huge for us.
And I'm excited to continue to build the trust
and faith in the tool and what we're doing.
And we're just trying to get better.
That's all.
Well, you found a very cool profit center.
So Trent Waybright,
vice president, used vehicle operations,
Kelly Automotive, Patrick,
James, AVP, Inventory Solutions at Viado.
Appreciate you both being on the show.
Sharing your best practice,
sharing this innovation.
And I look forward to learning more about it.
So thank you.
Thank you.
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