White Plains Honda in New York has purchased exactly zero used cars from auction in the last three years.
That's because partner and general manager Jason Graciano built the dealership's lease-return strategy and service drive into a used-car powerhouse.
Driving the news: Graciano said White Plains Honda ranks in the top 15 in the country for certified pre-owned vehicles. His group sourced 70 used cars from its service drive in April (where they also set all-time records in new and CPO sales).
"Our vehicle exchange program over in the service lane is the best place to hunt," Graciano told Daily Dealer Live host Sam D'Arc. "If you're able to source the vehicles, you have a great opportunity to support the manufacturer in the certified pre-owned program."
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How it works: Graciano said that higher lease volume creates a more predictable return pipeline, which then feeds the service drive team a steady flow of customers.
The night before the next slate of service appointments, Graciano's team uses the CRM, DMS, or other equity-mining tools to pull every scheduled customer's equity position, remaining payments, and vehicle value.
From there, they build a proposal to lease a newer version of what that customer drives.
"It all starts off with these initial conversations where you make a presentation, the presentation leads to an appraisal, an appraisal leads over to a proposal, and then that proposal leads over to whether you have a deal or not a deal," Graciano said.
The staffing flip: Traditionally, Graciano said dealers get the service drive wrong by staffing it with underperformers as a last-ditch effort.
His approach is the opposite: put the best-trained, highest-personality salesperson in the service drive, because that's where the volume is.
His drive has a dedicated sales manager and six-person sales team.
"You sell 100, 200, 300 cars out of the new car showroom, but you're gonna be meeting with 1,000, 1,500, almost 2,000 customers in the service drive in the course of a month," Graciano said. "Where do you want to have the person that has the highest batting average?"
Zooming out: Graciano said he trusts his leaders to do their jobs, especially on days he's not in the store. And it works. Fixed ops is on a record pace so far, with hours per RO climbing from 1.6–1.7 to 2.3–2.4.
Service effectiveness is at about 95 percent indexed, almost twice the standard.
In April, his staff really stepped up after he set what he called an aggressive goal of 40 to 50 percent above the store's normal sales rate.
Graciano had somewhere special to be: Welcoming his first son into the world. (He has three daughters, too.) His staff told him they had his back.
"I had tons of people pouring out and reaching out to me and telling me, 'We got this for you, boss,'" Graciano said.
The takeaway: Graciano's service drive isn't a fallback for struggling salespeople. It's the place where the best salespeople go to keep the dealership's used-car pipelines and return-customer pipelines full.
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