Saturday, April 22, 2017

6 Business Lessons from 4 Generations of Car Dealers

Starting a business is actually pretty easy.  It only takes an idea for a product (or products) or a service, and with some start-up capital in hand, a new business is born.  Given the Internet, starting a business is further facilitated since entrepreneurs no longer need to worry about having a brick and mortar spot to get underway.  Unfortunately, although the act of starting a business is as exciting as a new romantic relationship, things can quickly turn stressful like a divorce with kids in the picture.

The boys looking at a new Civic LX

According to, today you have slightly less than a 50-50 chance of still being in business after four years.  Incompetence (46%) is the leading cause of business failure.  Things these days are vastly different then they were back in 1928, when Theodore W. Hoehn founded Hoehn Chevrolet.  If you recall your U.S. History, a thing called, The Great Depression, began in 1929 and lasted until 1939.  Did Mr. Hoehn have perfect timing or what?  He must have been one determined man because his business survived through the Great Depression and then some.

In fact, the Hoehn family is still in the car business.  Their fourth generation of extended family work the business in Carlsbad, CA and represent eleven brands: Acura, Audi, Buick, Cadillac, GMC, Jaguar, Land Rover, Porsche, Sprinter, Mercedes-Benz and Honda.  Now I had the pleasure of taking my entrepreneurship and financial literacy elective class to the Hoehn Honda dealership as a field trip.  One that my (7th-8th) students raised transportation funds for, selling their small business products to their peers at school.  Hoehn's Corporate Chaplain happens to be a member of our school's Site Council and he, along with Hoehn's volunteer program manager (not her official title), arranged and planned a great tour.

Susanah Hoehn talking to the boys about the Service department

We toured the entire premises from the floor down to the service department, 9 stops in all.  These are the business lessons my students came away with that I felt needed to be shared here for all aspiring business owners or current owners who want to keep their business alive for four generations or more.

1.  Hire people who understand the importance of communication.  This is the mantra out on the sales floor.  Listen to the customer, know everything about your product (in this case, cars), and answer all questions with the goal of providing solutions, not being pushy.  The techniques of showing off the car will only get you so far.  You make the sale when the customer trusts he or she is making the right decision.

2.  Allow new hires to shadow the best worker in the department that you have.  We learned from the General Manager, Susanah Hoehn, the great-granddaughter of Theodore, that their top salesman (I should say, salesperson) is a woman who broke the dealership record with over 30 cars sold in one month.  She wasn't around at the time for us to talk to her.  But I did get insight from another employee as to her secret for selling so many cars: take copious notes on your customer, their needs, reservations, etc. and then follow-up numerous times.  The average sales employee gives up after three follow-ups, btw.

3.  Let people make as much money as they want.  When there is a culture that rewards hard work and initiative (wash a car without being told to, e.g.) with upward mobility, pay increases, and bonuses, businesses thrive.  Susanah Hoehn proudly shared the stories of several employees who have been with the company for many years and have remained committed to putting their best out there for customers and each other.  Starting as a cashier and working your way through the years to running an entire department isn't far fetched at Hoehn.  (Even with zero college i.e. fresh out of high school).

A technician shows the boys under the hood.

4.  Nepotism is bad for business.  Although Susanah and her sister, General Manager at another Hoehn dealership, could've been given their positions by their father, they had to earn it like any other employee.  I was told by a Hoehn employee that Susanah has worked in every department and learned how the business operates.  This has given her the experience she needs to make the right calls for the Hoehn Honda dealership.  This has also given her the respect of the workers.  They can't say she doesn't know what she's talking about, right?

5.  Be a servant as much as a leader.  While we were having lunch, I struck up a conversation with another Hoehn Honda employee.  She told me her story.  When she first arrived at Hoehn Honda, she felt out of place.  The company had a barbecue (as many often do) and she was made to feel like part of the Hoehn family by others there.  She was struck by the service the employees received, having their burgers cooked and served by none other than the Hoehn family.  For leaders out there, this is called showing your people you're there to serve as much as they are.

6.  Hire a spiritual leader.  The Hoehn dealerships have a corporate Chaplain whose job is to help all employees get through hardships, e.g., the loss of a loved one.  I'd never heard of such a thing until I met the Chaplain myself back at my school.  It's just another way the Hoehn family shows their employees they care about them and their families.        

It was clear from my vantage point that the Hoehn dealerships are in great hands and will continue to offer great service (and products) to consumers for years to come.  We were treated incredibly well despite my boys being a tough audience from time to time.  This blog post is one way I can return the favor for all of the learning and hospitality that took place on that day.

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