I don't believe any set of entrepreneurs could have gotten more out of a government program than car dealers did with the recent Cash for Clunkers, and they should be applauded for making the most of it. I wonder if any group of entrepreneurs from any other industry could have made so much out of this opportunity. Dealers fully maximized this government subsidy opportunity with most not even understanding fully how the program worked or when they would actually receive their funding. You have to acknowledge these entrepreneurs for knowing how to make the most of an opportunity.
As soon as cash for clunkers was announced and car dealers could get their heads (partially wrapped) around the program, auto dealers immediately went on a full court press with TV, radio, print and direct mail marketing to activate the program with their customer base. Most of these dealers are still waiting on their money and don't know when they will get it which makes it a little tough on cash flow predictions but they aren't complaining, just grateful for the action. Entrepreneurial as they are, they operate with the attitude of, "commit first, figured the rest out later and trust the money will come."
This is a good example for all entrepreneurs -- move with speed and execute, figure the details later. And notice these guys didn't go back to Washington begging for more money they used the first 1billion dollars so successfully and so quickly that Mr. Obama approved them for another $2b because of their performance. I like this idea of rewarding those that did something positive with a program! This is an interesting and radical concept of rewarding those that are successful and cutting off those that cannot make a program work.
I have spoken with hundreds of dealers who are grateful for the activity this program created. Some dealers that didn't even sell one unit under the program told me they while they didn't use the it stimulated activity, interest and traffic. Other than pundits on TV, not one car dealer I spoke with was concerned about robbing future sales. Who worries about future sales when you are trying to make the month other than a 'talking head' on TV. In the real world of commerce when you are trying to make the third quarter profitable you aren't worried about whether the sales you make today steal from tomorrow. The reality is retailers are trying to make the most of a tough situation and that means you do whatever is necessary to make every sale you can.
The only complaints about the program I have heard were dealers that didn't want to send some of the 'old sleds' to the junk yard and felt like this was great inventory for them to resell. Also some independent used car dealers felt like they saw a drop in traffic because they didn't have the program to offer their clients but the truth is they were complain the banks not lending two months ago and six months before that they were complaining about unemployment and before that it was $5 gas.
Car dealers have done an exemplary job with Cash for Clunkers and should be applauded for their 'can do' spirit and making the most of a handout! At least this actually stimulated activity with a customer getting a car, an old vehicle being removed from the streets, banks loaning money, car dealer moving inventory, sales people make a commission and the economy starts to move. Compare what the banks did with their money where they got billions of dollars that never went anywhere and what the car dealers should be awarded economic congressional medals.
Grant Cardone, Author of Sell to Survive.
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