Who Taught Your Staff The Rules?


Smart Advice from Dealer Compliance Consultants

The automotive industry is changing dramatically and will become even more heavily regulated in the future. Dealerships who continue to operate without being compliant will invariably struggle. Lack of legal compliance is not an option for dealers who want to stay in business and prosper. Today’s dealers need to be proactive and creative enough to change their processes so they can be more profitable as well as compliant.  It just makes good business sense.

A number of long-standing dealership practices are not necessarily legal or ethical any longer. Unfortunately, in many cases the old-timers have taught the new hires the “old school” way of doing business and the problem goes on and on.  Many dealership employees have never been properly trained in compliance matters, so they simply rely on doing business the way it’s always been done.

Some of the practices which have evolved in the automotive industry are now considered to be unethical or illegal.  As a result, the government has increased it’s regulation of retail transactions in order to help protect consumers and law firms have found a tremendous opportunity to rake in massive judgments against dealerships. To them, it’s like shooting fish in a barrel. Education is the first and most vital step towards employee accountability. After all, if employees don’t know or understand the rules, how can they be expected to follow them? Ignorance is not an excuse for breaking the law and it certainly won’t mitigate potential damages. Dealers are entirely responsible for making certain that these laws and regulations are followed.

Does your staff have sufficient knowledge to avoid potential lawsuits?

To protect themselves, dealerships should follow defined processes and employ a consistent training program.  The most successful dealers use compliance as a way to ensure consistency and transparency in their sales process, thus increasing both sales and profitability. Well-trained people not only portray a more desirable image, but they will produce better results for their organization. In addition to shielding your company from liability, training can also reduce exposure to punitive damages. The Supreme Court held in 1999 that companies can be protected against an award of punitive damages if they make good faith efforts to comply with laws.  If a dealership can prove that it took appropriate steps to educate, audit and supervise employees, it will have a much stronger defense against any claims.

Don’t put the business and the reputation that you have worked years to build at risk. Take compliance seriously, put a comprehensive compliance plan in place, and act quickly to address failures and deficiencies. An investment in compliance programs and training will protect your assets, your employees, your customers and your good name.

More good advice from the folks at Dealer Compliance Consultants can be found on their website. Read more articles here.