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Old 02-08-2008, 12:15 PM   #1
XDCX
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Default What's up with Dave Smith - Kellogg, ID?

I just saw a January Sales Report for Chrysler/Jeep/Dodge that showed Dave Smith dropping to second place in the West Business Center and either fourth or fifth for the county overall. They reported 236 sold units for the month - a surprisingly low number based on their history.

In fairness, they had a killer December - 731 units. Maybe they just ran out of inventory?

Are the January results just a one month fluke or are they an indication of what's going to happen for the rest of 2008? Is Dave Smith losing market share in the Northwest?
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Old 02-08-2008, 01:58 PM   #2
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Wow. Growing up in Oregon, I've seen Dave Smith commericals for as long as I can remember. They will even pay for your tickets to fly to Spokane and purchase a vehicle. They are going to be in trouble when Chrysler gets rid of VPA.
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Old 02-08-2008, 02:21 PM   #3
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Wow. Growing up in Oregon, I've seen Dave Smith commericals for as long as I can remember. They will even pay for your tickets to fly to Spokane and purchase a vehicle. They are going to be in trouble when Chrysler gets rid of VPA.
Excellent point - Chrysler killed VPA on 12/31/07.

I've got to admit that I'm biased - I've met Ken Smith on several occasions and had a chance to work with some of his managers - they're really great people and they definitely deserve their success.

That said, VPA may have tilted the field in their favor.

It always used to amuse me how complicated the VPA formula was - in fact, I don't think I ever found anyone who could reliably calculate a dealer's VPA objective from one month to the next. I'll never forget, however, that one of the variables was MSR - Minimum Sales Responsibility.

It seemed like most metro stores could only go so long before they "hit the wall" and their VPA was too high to hit. I don't think the smaller stores with 1,000%+ MSRs ever had this problem.

Granted that one month does not signal a trend, but it will be interesting to see how Dave Smith does the rest of this year.
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Old 02-11-2008, 01:15 PM   #4
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Default How many days has the Pass been closed this year?

I was watching a news report over the weekend where they indicated that I-90 has been closed for several days due to the excessive snowfall and the threats of avalanche. In fact, they mentioned that it was the first time in recent memory that all three Washington Passes were closed at the same time.

I wonder how much of an impact that has on Dave Smith's sales?

I know that a lot of the Dave Smith customers come from Western Washington. Even if they flew into Spokane, they would still have the hassle of trying to get their new car/truck through the Pass.

It will be interesting to see February's sales results.
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Old 02-21-2008, 10:43 AM   #5
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Default Maybe there's a recession?

As I've stated before, you cannot draw any conclusions based on a one month sales report. With February quickly coming to a close we'll know have a better indication of what's happening in the market in nine days.

That said, it's interesting to note that Lithia's Management Team indicated that they felt the market was in a recession and that their floor traffic was down "measurably" in the Fourth Quarter. Lithia had their Conference Call yesterday and reported disappointing results.

Any input on how February's shaping up?
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Old 03-10-2008, 03:06 PM   #6
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Default In response to my own question....

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Originally Posted by XDCX View Post
As I've stated before, you cannot draw any conclusions based on a one month sales report. With February quickly coming to a close we'll know have a better indication of what's happening in the market in nine days.

That said, it's interesting to note that Lithia's Management Team indicated that they felt the market was in a recession and that their floor traffic was down "measurably" in the Fourth Quarter. Lithia had their Conference Call yesterday and reported disappointing results.

Any input on how February's shaping up?
In response to the question about February - the answer appears to be that it was very soft.

The headlines indicated that Chrysler was down 14% in February but there was no way to determine if that was due to retail demand or fleet sales.

Dave Smith regained their #1 Ranking in the West Business Center with 368 sales but finished #2 in the Nation.

To me, the biggest surprise was the performance of some of the C/J/D stores in the Portland Area. Some stores that used to sell 60 - 80/month reported less than 20 units in February.

Hopefully, March will be a better month - time will tell.
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Old 05-07-2008, 10:42 AM   #7
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Default No longer #1 Selling Dodge Dealer in the Nation

I just noticed the April Sales Results - Dave Smith is still #1 in the West Business Center but has dropped to #4 or #5 for the Nation.

I wonder if their sales decline is a reflection on the Economy in the West or a byproduct of VPAs elimination?

Regardless, even with their lower sales numbers it's still a very impressive operation.
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Old 06-17-2008, 05:47 PM   #8
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Default Dave Smith ?

The latest rumor says that 50-60 salespeople were let go recently from the sales staff at Dave Smith Motors.Is there any truth to this ? Our relationship with them was cut off when we must have done something to offend them about a dealer trade. Has anyone else had a similar experience?A comment was made once by their dealer trade person about a book that they keep with info concerning all dealer trades.Also, heard that they had 3500 vehicles inbound.
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Old 06-17-2008, 07:24 PM   #9
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I worked with a person who worked at Dave Smith. He always said they were very particular about the dealers they went into business with. As far as cutting sales people, I wouldn't be surprised they cut so many. Frankly I'm surprised they have so many salespeople. Damn!
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Old 06-18-2008, 08:03 AM   #10
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Originally Posted by dalej View Post
The latest rumor says that 50-60 salespeople were let go recently from the sales staff at Dave Smith Motors.Is there any truth to this ? Our relationship with them was cut off when we must have done something to offend them about a dealer trade. Has anyone else had a similar experience?A comment was made once by their dealer trade person about a book that they keep with info concerning all dealer trades.Also, heard that they had 3500 vehicles inbound.
Dalej - Thanks for the information.

I checked some old sales reports and calculated that Dave Smith's CJD sales were down 36% for the month of May and 31% YTD.

At first glance it appears that the results are much worse than Chrysler's overall sales performance, but when you factor in that 80%+ of their sales are probably Ram Trucks it most likely mirrors the sales trend across the country.

Concerning the 3,500 inbound units - for their sake let's hope that's a bad rumor. That would be a ton of inventory given that their CJD sales last month were 376 units.
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Old 06-18-2008, 08:13 AM   #11
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Originally Posted by SHACOS View Post
I worked with a person who worked at Dave Smith. He always said they were very particular about the dealers they went into business with. As far as cutting sales people, I wouldn't be surprised they cut so many. Frankly I'm surprised they have so many salespeople. Damn!
I think it's smart for all dealers to keep a journal concerning Dealer Trades. I remember doing a Dealer Trade for a Chrysler Pacifica and when it arrived it had over 3,000 miles on the odometer. We had already done all of the paperwork using that VIN number - it was a real mess. That dealer was definitely off of our "A-list."

On a different note, I saw an ad for BBC Dodge in the Seattle Times a few weeks ago - they had a caption "Dave Smith buys their cars from us, so you should too."

I wonder if BBC Dodge is still on Dave Smith's list of approved dealers for Dealer Trades?
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Old 07-09-2008, 10:40 AM   #12
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Default Dave Smith's June Sales off by 53%

I just noticed the June sales results were available and I was curious to see how Dave Smith was doing compared to the rest of the dealers.

I was surprised to see that June sales were down 53% compared to June of last year.

Given that the vast majority of their volume is Dodge Ram Trucks I guess these results are probably in line with the rest of the country.
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Old 07-11-2008, 11:39 AM   #13
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Default Interesting article on Dave Smith Motors

I was surfing the Internet and ran across the following interview with Ken Smith, Dealer Principal of Dave Smith Motors.

Here's the link to the interview: http://www.dealer-magazine.com/index.asp?article=820

The article is dated August, 2003 so the information may be a little old but it still provides some insight on how the dealership became a large volume operation.
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Old 07-14-2008, 12:19 PM   #14
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Originally Posted by dalej View Post
The latest rumor says that 50-60 salespeople were let go recently from the sales staff at Dave Smith Motors.Is there any truth to this ? Our relationship with them was cut off when we must have done something to offend them about a dealer trade. Has anyone else had a similar experience?A comment was made once by their dealer trade person about a book that they keep with info concerning all dealer trades.Also, heard that they had 3500 vehicles inbound.
I was wondering about Dave Smith's inventory the other day and went to the Dodge.com website to check it out.

I added up the total available inventory for all of the Dodge Trucks and came up with over 1,100 units - including 86 Sprinters.

If you figure that they might have another 400 Chryslers and Jeeps that would put them at 1,500 units. Figure an average Invoice of $30K and that's $45 Million in flooring. ($30K/unit seems high but the vast majority of their trucks are high end units with the Cummins Diesel)

If you assume $45 Million in flooring and a 7% Flooring Rate - that's over $260K/month in interest charges.

In fairness, I've never checked their inventory levels before - maybe this is the level that they always have.
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