Rick Jones ran into his former business associates, Ivette Dominguez and Mike Drawe, at Super Bowl XLIX in Arizona in early 2015. Dominguez and Drawe own Alpine Buick GMC in Denver, Colo. The three have remained friends since Jones worked at the dealership two decades ago.
“We started talking [and] we said we should do something together,” says Jones.
The three recently acquired a Buick GMC dealership in Illinois. Jones runs the dealership, now called Cardinal Buick GMC. He sees a lot of upside potential for the business.
“The nearest competitor, 13 miles away, is the is the number two Buick GMC store in the country,” Jones tells Automotive Buy Sell Report. “This was one of the most under-performing stores in the country.”
He acquired the dealership, previously called Oliver C. Joseph Buick GMC, from Brad Joseph, who was “ready to sell,” says Jones. A broker approached Jones with the opportunity, but “I did the whole deal myself,” he says.
Already, Jones has tripled the number of employees to some 40 people. Before he even reopened under the new name, Jones hired a new service manager, controller, operations and F&I manager, and added an internet sales manager. All relocated with Jones from his previous job as General Manager of Mike Shaw Toyota/Scion in Corpus Christi, Texas.
“If you have a good team, you do what you gotta do to keep ‘em together,” he says. “That’s how you win.”
He has hired 10 new sales people, most of them from non-automotive backgrounds. Then Jones trained them in his preferred sales method, which is based on limited negotiation, transparency, and ease of purchase.
That boosts customer retention, he says. Jones has already been recognized for his ability to keep customers coming back. He was listed in the Automotive News 40 Under 40 list in 2013 while GM at the Corpus Christi store.
“Shaw was one of the top performers in customer retention in the five-state Gulf States Toyota distribution region,” wrote Automotive News.
Cars as a career
Jones, 39, turned to selling cars straight out of high school in Phoenix, Ariz., where he got a job selling Toyotas at age 18. He has also worked at Don Massey Cadillac in Denver; and as a sales manager at Alpine Buick GMC, where he worked for 14 years.
From there, he moved to Corpus, where he managed Toyota, Scion, Buick, GMC, and Kia franchises for six years.
“All I have done is sell cars,” says Jones.
He and his wife have four boys – a 15-year-old, a 12-year old, and 15-month old twins. He is already introducing the twins to the family business – his wife sometimes brings them to the story on Saturdays “so they can see their dad,” says Jones.
At Cardinal GMC Buick, growing the used car department is a focus because it “allows for the overall health of the dealership,” says Jones. That doesn’t mean new car sales will be left to languish.
“We believe in a pre-owned focus, but our goal is to double our new car business immediately,” he adds.
Strong used car sales provide a cushion when the market fluctuates, as it is now, says Jones.
“With the proper focus on fixed ops and expense management in the used car department, you can weather a lot of new car dips,” he says.
His goal is to sell 150 to 160 new and used units a month by year’s end, with a little over one-third being new.
Jones is already making good progress – in April he expects to sell 130 units and to double fixed operations income. The dealership sold only 35 cars in February.
Besides adding the internet sales department, Jones is boosting advertising across other channels, as well. He will make facility upgrades and double his inventory to 400 units.
Jones won’t say how much he paid for Oliver C. Joseph Buick GMC. Property values and rents in the dealership buy sell sector are high, he says, and Blue Sky values are also still high because the market has been so good the last few years.
But, “you pay based on performance,” says Jones. “[This dealership] wasn’t a huge performer, we feel we got a good deal.”
Jones isn’t looking too far ahead as far as more acquisitions are concerned, at least not right now. His long-term goal, he says, is to help his employees.
“I have the ability to create generational change for their families,” says Jones. “You get to see that. That is more of a reward for me today than any dollar I ever made.”