Dealership Participation/Reinsurance Lunch and Learn

We had a packed house at our Dealership Participation/Reinsurance Lunch and Learn at Firestone Country Club.

We had the pleasure of hosting dealers from around the country to learn from Greg Petrowski and his associate Jeremy Elsberry of GPW and Associates.

They offered insights on a variety of different structures, up-to-date tax information, and a forecast on the future of the F&I space.

ADS and GCADA Partnership

The Greater Cleveland Auto Dealers Association and Advanced Dealer Solutions are teaming up to offer dealers F&I Training and Development

In the month of August, The GCADA announced ADS as the Preferred Provider for F&I Training and Development and awarded them the coveted GCADA approved badge!

Words from GCADA

‘We look forward to providing our members with a comprehensive resource for F&I training and development.’

Words from ADS

‘At ADS we are proud to offer dealers an unbiased approach to their F&I decision-making process.’ – stated Ryan Nelson, EVP of ADS ‘There are so many options for dealers today it sometimes becomes difficult to discern what is best for their specific and unique business. ADS enjoys the opportunity to present dealers with a variety of options which are all catered around exceeding the dealer’s goals and objectives.’ Nelson added.

‘We were impressed with the amount of due diligence the GCADA performed on our team, sales process, training platform, and the relationships we have with our dealers.’ – says Bob Mancuso President of ADS ‘To be awarded the Preferred Provided status for F&I Training & Development validates what we have been doing for our dealers over the last eight years.’ Mancuso went on to say.

About GCADA

The Greater Cleveland Automobile Dealers’ Association (GCADA), represents over 265 new motor vehicle dealerships in a 21-county region of Northern Ohio, including franchised new car and truck, motorcycle, and recreational vehicle (RV) dealers.  GCADA provides products, programs, and services to its members and produces the Cleveland Auto Show.

About ADS

Advanced Dealer Solutions is a premier dealer development agency specializing in F&I training and development, product structure, and reinsurance management.

Women In Leadership

Gina Cocking is the CEO of Colonnade Advisors and represents the 2% of women who are CEOs at financial institutions. She brings 20+ years of experience in investment banking and executive leadership to the table including experience as a CFO in multiple companies.

When Gina was recently interviewed by Ryan Nelson of the Advanced Principles Podcast, Ryan asked Gina what advice she might have for other women looking to enter the competitive and male-dominated industries like automotive, technology, and investment banking.

Gina (23:00)

“I think 15 years from now, 20 years from now, the guys better watch out. Women are going to college at a higher rate than men. Something like 60 to 65 percent of the incoming college class is female.” 

The pandemic was extremely challenging to the women’s leadership movement. With schools closed and much of the infrastructure for working women disrupted, many families had to make tough decisions and compromises. Homeschooling became the norm, and many women had to shift their schedules.

So what is Gina’s top advice for women that want to make it to the top echelon of the career ladder?

Gina: (28:00):

Marry well. And I don’t mean marry wealthy.

Find a partner who supports you, who gets that your career is just as important as his career. 

Throughout your lives together, know that you’re going to have to make trade-offs. There are some things that are not going to be fun, but you do them together.

If your partner supports you, you can get through it. It’s important that your partner does not feel like their career path is more important. That is the number one key to success.  

About the podcast episode featuring Gina Cocking

Advanced Dealer Solutions is a premier F&I development agency specializing in the automotive, RV, and powersports industries. Advanced Dealer Solutions works to maximize the purchasing experience as well as increase F&I sales and profits as well as increase service sales and retention.

Advanced Dealer Solutions has assembled one of the most sought-after F&I training platforms in the industry. We have a passion for increasing dealer profits by providing industry-leading technology and implementing an F&I selling system that is guaranteed to elevate performance. Advanced Dealer Solutions is driven to provide dealers with products and solutions that result in increased production, profitability, customer retention, and most importantly, customer satisfaction.

Advanced Principles Podcast was created to be an outlet for like-minded individuals to share in the broader conversations on leadership, retail market updates, and incredible success stories.

Colonnade Advisors has deep experience in the automotive dealership services industry. Please see the pre-event interview series here for more information about Colonnade in the industry, M&A drivers, and more.

Colonnade Securities is a leading investment banking firm that has completed over $9 billion in M&A transactions for clients in the business and financial services industries.

View the full interview here, Episode 34 With Gina Cocking.

ADS Receives “Agency Growth Award” From Axiom

We are delighted to announce Advanced Dealer Solutions was presented the 2021 Agency Growth Award from Axiom Product Administration. We were able to spend some time working with part of the Axiom team learning about different product updates and going through processes. We also found ourselves taking some time to get to know each other a little better through friendly and competitive gaming.

August Newsletter

It is hard to believe we are already in the month of August! The recent heat waves across the country surely reminded everyone we are in the dog days of summer! Hopefully, everyone was able to find some comfort near a pool, lake or in the comfort of their air-conditioned home. 

ADS is excited to make a few big announcements… 

View our newsletter to see all the exciting things happening soon!

https://mailchi.mp/advdealer.com/august-newsletter

July Newsletter

This weekends celebration of America comes at a time when we may need to celebrate the birth of our independence and unity more so than in years past. 

The courage our Founding Fathers showed 246 years ago by forging ahead for what they believed in, as a better and more equal way for Americans to live and prosper, leaves us awestruck and inspired still to this day. Their courage and resilience continues to pay dividends for all of us fortunate enough to live in this amazing country. 

Although much has changed over the last quarter of a millennium in terms of technology, social norms, communication, etc., the core tenants and beliefs the Founding Fathers fought for are still relevant, alive and vibrant today. 

God Bless America!

We hope you all have a safe and enjoyable weekend!

To view our full newsletter https://mailchi.mp/advdealer.com/july-newsletter.

Gina Cocking interviewed by Ryan Nelson

Ryan Nelson interviewed Colonnade Advisors CEO and Managing Director Gina Cocking on Advanced Principles Podcast. Colonnade Advisor’s provided a summary of the first episode together to hit the highlights of the conversation.

This interview highlights the important role that Colonnade Advisors plays for their clients when they embark on the process of selling their company, raising capital, or seeking to acquire another company.

Colonnade Advisors has deep experience in the automotive dealership services industry. They publish Quarterly Updates on the Auto F&I sector with information on dealer profitability and recent transactions.

In this most recent interview, Gina and Ryan cover the following questions:

  • What makes Colonnade unique as an Investment Bank/Advisor? (6:00)
  • How Colonnade Advisors brings specific value to the transaction process (13:00)
  • What is the difference between a Private Equity firm and an Investment Bank? (15:00)
  • How the pandemic created shifts in the auto industry and auto-related M&A (20:00)
https://youtube.com/watch?v=gKSTeLmGX50%3Ffeature%3Doembed

What makes Colonnade unique as an Investment Bank/Advisor? (6:00)

Their focus is on industry dynamics, business models, valuation metrics, accounting issues, and participants. They maintain a dialogue within their extensive network of owners, investors, and buyers in their target sectors.

Gina: Our focus goes back over decades. In the early 2000s, we worked with Mepco on its sale to Independent Bank. Mepco had two lines of business: 1) insurance premium finance and 2) vehicle service contract (VSC) finance. We worked closely with Mepco on both lines of business to create a successful outcome for their owners and team.

We became experts in the insurance premium finance industry and the leading advisor on transactions in this space. We are the leading investment bank in the United States in insurance premium finance. We’ve done 28 transactions in the insurance premium finance industry.

Through our work with the team at Mepco, we also got to know the vehicle service contract (VSC) space. After a decade of working with our clients at Mepco and Independent Bank, we assisted with the sale of Mepco’spayment processing business to Seabury Capital Group.

Eventually, that took us into the overall Auto F&I (Finance and Insurance) space where we’ve had the opportunity to work with direct marketers, agencies, and administrators. (Read more about the F&I ecosystem here).

We also work with finance companies in the automotive sector: subprime lenders, near-prime lenders. We closed a transaction last fall for OpenRoad Lending, a direct-to-consumer marketer of auto loan refinancing. 

We’ve been doing a lot in auto finance. This has taken us into data analytics, especially on the direct-to-consumer side. Direct-to-consumer marketing is all about data and data analytics. We have now worked with a number of data analytics companies and marketing companies associated with the automotive space.

How Colonnade Advisors brings specific value to the transaction process (13:00) 

Gina: We have pattern recognition, and we’re rarely surprised. 

Every transaction’s different. There’s always something new. When things are new and different, we have the skill set to navigate the situation.

What differentiates us from our competitors in this space is the tenure, institutional knowledge, and experience of our senior bankers.

At other Investment Banks, team members float through the different groups. They don’t stay long enough to develop industry and institutional knowledge. Their junior teams turn over. More importantly, they don’t have anything but transactional experience.

Clients, especially entrepreneurs or family-owned businesses, need more than just the transactional experience. They are looking for long-term relationships like we provide at Colonnade.

What is the difference between a Private Equity firm and an Investment Bank? (15:00)

Gina: The Private Equity (PE) firms have a pool of capital to invest in one or more companies. Their goal is to become the owner of a company. They’ll negotiate and buy a company so that the company is then part of their portfolio, which they’ll eventually sell and hope to make two to three times their money.

Most private equity folks have gone through investment banking at some point in their careers. What’s different about what they do is that they’re managing other people’s money. 

In investment banking, we are advisors on either the buy-side or the sell-side. Sometimes I’ve had people say, “Well, you’re kind of like a real estate agent.” My answer: “Not really.” There are business brokers that are more like real estate agents, however.

We are there to work with the (client) company side-by-side. If they’re selling, we help them prepare for the sale and go through the process. That includes getting to know the company so well that we can tell their story almost as well as they can. We help them to articulate their story: Where they have been, where they are today, and where they’re going. 

We then prepare written documentation, called a Confidential Information Memorandum (CIM). We identify the potential buyer universe. We contact those buyers. We negotiate with buyers. We answer all their questions. We deal with thousands of documents in the data room

We negotiate the terms of the transaction. We work closely with the attorneys on all the transaction documentation. We’ll provide our industry perspective and our business knowledge, but we’re not attorneys. We help get the deal to close. One of the important things is we keep the deal on task. It’s all about not letting people lose focus, keeping the deal going, and getting it to close.

In investment banking, we are paid a success fee upon the close of the transaction. Whereas a private equity firm is buying the company (and gets paid on the subsequent sale of the company after growing its value).

How the pandemic created shifts in the auto industry and auto-related M&A (20:00)

Gina: Everybody freaked out in the Spring of 2020. But we’ve worked with some visionary companies where we’ve been able to create some fantastic win-wins.

We had a deal that was supposed to close at the end of March 2020. The buyer put it on hold but worked with us to restructure the deal with an earnout. The transaction closed, the seller hit all their earnouts, and it was a fabulous deal for all.

Let’s talk specifically about the Auto F&I side: administrators and agencies. While everyone dipped in the spring of 2020, performance improved in the second half of the year, and then 2021 was a fantastic year. This was not as predicted, considering the supply chain issues. Fewer cars were being sold. 

Why the fantastic year?  The dealers are hyper-focused on making money when they can. The dealerships realized that F&I is uber important to the long-term profitability of the dealership. Dealers are selling more F&I products with every car. That has benefited the administrators.

Consumers have also had great experiences with these products. They’ve had claims paid out on their vehicle service contracts. They’re telling their family and neighbors, “It’s really a good product.” We have finally seen the maturity in the F&I industry that this is a peace of mind product. It’s not just a product that a dealership is trying to push onto a consumer; it’s a valuable product.

2022 has been a great year for Administrators. The dealerships are profitable, and they’re also getting better at selling products. We’ve started a new phase.

Colonnade Securities is a leading investment banking firm that has completed over $9 billion in M&A transactions for clients in the business and financial services industries. 

Advanced Dealer Solutions is a full-service, dealer development agency focused on automotive, RV, and powersports dealers across the United States. Please contact 844-320-3722 or info@advdealer.com for any inquiries.

June 2022 Newsletter

We hope everyone had a safe and enjoyable Memorial Day Weekend and found time to honor and recognize all who have, and are serving this great country of ours! 

The more things change, the more they stay the same…

Another month has come and gone and it feels like the story of the last year and a half just continues to repeat itself.

– Inventory concerns, check.
– Staffing issues, check.
– EV adoption rate questions, check.
– Inflations concerns, check.
– Industry consolidation, check
– Global/social unrest, yep, check that one as well! 

Dealers persevering and finding ways to win, CHECK, CHECK and CHECK! 

To read our full newsletter follow the link https://mailchi.mp/advdealer.com/june-newsletter.

Advanced Dealer Solutions May Newsletter

The month of May brings us to the eve of summer, and later this month, many Americans will celebrate Memorial Day with friends and family around a lake, at a barbecue or watching a parade. 

For a huge swath of the country that endured a long, cold, wet winter, summer cannot come soon enough and hopefully May brings us the sunshine and warmth we have been anxiously awaiting since late October 2021. 

Typically the warmer weather and sunshine bring increased vehicle sales. Summer sales, new model introductions, etc. all lead to more customers purchasing new, or new to them, vehicles. Although most dealers are still dealing with little to no inventory, there have been some signs of improvement. Many questions remain about what the new normal will be, and when we will all settle into it. For now, dealers continue to enjoy demand outweighing supply.

With increased volume, specifically F&I production, means dealers are generating more F&I reserve dollars than ever before. And for many dealers, participation in their F&I underwriting profit, or reinsurance, is seen as a retirement plan, or a method to generate capital to help fund their business. We have worked with too many dealers through our careers who are placed into structures that are clearly not the best option for them and their goals. Please take a moment to read through the article on navigating the myriad of options available to dealers today. 

And last, but not certainly not least, Happy Mothers Day to all the amazing and wonderful mothers in each of our lives. 

To read our full newsletter follow the link https://mailchi.mp/advdealer.com/may-newsletter

EV’s Here, EV’s There, EV’s Everywhere

EV’s here, EV’s there, seemingly EV’s are everywhere… except on the actual roads, for now.

Based upon the headlines, commercials, recent IPO’s, and tweets from a certain celebrity CEO, you would think EV’s are as common on the road as an IC (internal combustion) powered F-150. To anyone outside of the industry, it comes as a big surprise to hear that EV’s only make up about 3% of the market share. A number that is expected to grow exponentially over the coming years, but we are not quite there yet.

If you were part of the 112.3 million viewers of ‘the big game’ in February, then you were a part of the population that was inundated with EV commercial after EV commercial. Certainly, a sign of where the market is headed. The question then becomes, how quickly do we get there?

Most people think Elon Musk kicked off the electrification craze when the Tesla unveiled a dynamic, all-electric roadster in in 2006 (officially released as a 2008 model). Actually, the first electric vehicles were produced well over 100-years before the Tesla Roadster turned motoring enthusiasts onto electrification. Here in the United States the first electric vehicle is credited to William Morrison, a chemist who lived in Des Moines, IA. In 1890 he created a six-passenger electric vehicle that was capable of a top speed of 14 miles per hour.

Over the next decade the industry saw several manufactures produce their versions of electric vehicles, reaching a pinnacle around 1900 when New York City had a fleet of 60 electric taxis and charging stations every few blocks to meet the rising demand.

As electric vehicle sales were climbing due to the easy, clean, and quiet operation, a true disruptor burst onto the scene, Henry Ford, and the Model T! The Model T car cost only $650 ($18,500 in today’s dollars) while the electric roadster of the day cost $1,750 ($50,000 in today’s dollars). The explosion (pun intended) caused by the internal combustion engine, the popularity of the Model T, and the access to cheap gasoline, led to a sudden and swift decline in electric vehicles.

Throughout the decades, there were a variety of inventors, tinkerers, and manufactures who dabbled in electric vehicles, but the demand for expensive, limited range and often odd-looking vehicles just didn’t justify production at any level of scale.

Although Elon Musk and Tesla get most of the headlines for the current hysteria around EV’s, credit should also be paid to Toyota who paved the way with the daring release of the Prius. In 2000, Toyota released to much fanfare and success, the hybrid-electric Toyota Prius. Although, Honda released the Insight first, it did not receive near the acclaim the Prius did.

Fast forward to today, when almost every CEO is racing to update their talking points to claim they will be first to convert their fleet to fully electric. The bold declarations have ranged from 10-years to 3-years, all of which are purely speculative talking points at this time.

There are many unanswered questions about the reality of a fully electrified fleet roaming the highways and byways of this great nation and the rest of the world. A few certainties we can count on, the cost for an EV will continue to come down as more manufactures fight for market share and ranges will continue to be extended as technology improves and battery costs lower.

One big unknown is the capacity of the power grid and how it can handle a sudden surge (another intended pun). Most Americans have experienced some type of power outage in their lifetime, and many experience power-outages annually during storm season. What happens to your EV when you cannot access power due to inclement weather? Another unknown is how to handle a vehicle running out of charge on a remote section of turnpike. There are many bells and whistles to alert the driver they need a charge. Ironically, my gas light goes off like its DEFCON 1 if I don’t pull over immediately. In spite of that, I have run out of gas and have been stuck on the side of an interstate. Who hasn’t played a game of mileage chicken with their gas light? The good thing is gasoline can easily be delivered in a little red can by most anyone. How many rest stops in middle-America have portable charging packs on hand to loan out or sell?

Lastly, what is the long-term impact all these battery packs are going to have on our environment? Almost every component of an IC vehicle can be salvaged and recycled at a reasonable rate. You can head to most auto-recycling centers and grab a ‘new to you’ engine, etc. Do Pull N Pick Auto Parts Centers sound familiar to anyone? In the future will we be able to wander through row after row of Tesla Model S, Chevrolet Bolts, and Ford Lightings to grab a ‘new to you’ inverter, low voltage DC-DC converter, etc.?

There is no question where we are headed, and after a bit of review, it is back to a place we have already been. A city filled with electric vehicles, charging stations readily accessible to everyone needing a bit of juice, and the sound of, or lack thereof, mid-day traffic. That is of course until, the next trip Back to the Future…

  • Ryan Nelson has more than 25 years of experience in the retail industry and is a partner at Advanced Dealer Solutions, a leading independent agency specializing in dealership development in the auto, RV and powersports industries.