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By Phil Villegas

Read the WardsAuto Article here

For auto retailers, monthly sales reports (as required by automakers) paint a somewhat inefficient and non-representative financial picture.

Last year, General Motors was the first major manufacturer to cease reporting sales on a monthly basis and shift to quarterly reporting.

Ford followed suit this year and Fiat Chrysler recently announced it would too.

Prior to that, Tesla was the only mainstream automaker to report quarterly, not monthly.

The move essentially gives the OEMs some latitude in having to explain monthly spikes and/or drops that can be seasonal or tied to fleet sales, allowing them to gain better control of the message when reporting quarterly.

While I agree with the shift, I can only wish this would trickle down to dealers.

For dealers, monthly sales reporting paints a somewhat inefficient and non-representative financial picture. It can misrepresent the broader operating environment.

If you look at the actual lifespan [...]

By Phil Villegas

The WardsAuto 2017 Megadealer 100 seems remarkably similar to 2016’s list of major dealership groups.

Yes, there was the occasional jostling of positions across the rankings, but it was minimal in the top 25, and even less so within the top 10.

The main observation of this year’s ranking is also a kind of trick question: What’s missing?

Here’s the point. If you look to the list as a strict barometer of the industry’s health, you would believe there is a decline. The combined WardsAuto  Megadealer 100 revenues were $192 billion in 2014, up to $206 billion in 2015.

But in reviewing 2016, revenues declined to $194 billion. In reality, however, the industry is just fine. The main reason for the decline is that CarMax, (with its approximately $16 billion in revenue) chose not to report this go-around. The used-car megadealer had been a regular participant in past years.

Also missing in [...]

By Phil Villegas

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A client and I recently debated the pros and cons of building a new, exclusive Acura dealership.

While this multi-brand client has enjoyed success selling Acuras, I nevertheless advised him to consider either retro-fitting an existing facility or selling off the franchise.

By Phil Villegas

If you’re like me, you use the WardsAuto Megadealer 100 to gauge which dealer groups are in a growth mode and which aren’t.

In facilitating the buying and selling of dealerships, my firm, Axiom Advisors, takes a due-diligence approach that it’s not always what you see on the books that will get you, it’s what you don’t see that can ultimately sneak up on you.

By Phil Villegas

This is an attractive time to be a car dealer. Dealership profitability is up across the board, automaker are producing great vehicles and the upswing looks like it will last for the next few years.

Accordingly, we’re once again seeing activity brewing from outside speculators looking to enter and redefine the dealership arena. It’s similar to 2004 through 2007 when individuals and entities new to the industry vied to buy dealerships.

  • 09/09/2013
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  • Comments Off on Dealers Beware – Fraudulent Shell Companies may be Eroding the Sands of the Dealership’s Beach

By Marilou C. Vroman, CPA, CFE

Dealerships are viewed as cash cows with deep pockets with substantial assets and revenues flowing through the operation.

As ocean waves subtly carry grains of sand away from the beach, diversion of cash and physical assets may occur in small increments over the course of time, and go virtually undetected. There are many ways a dealership may fall victim to fraudulent activity. With the high volume of transactions in typical dealerships, false billing schemes and fraudulent disbursement schemes paired with the creation of shell companies present a high risk of loss.

  • 09/09/2013
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  • Comments Off on That’s How We’ve Always Done It – Embracing Microsoft Excel to Promote Accounting Department Efficiency and Productivity

By Lucian Bacallao, CPA

An easy way to identify when a change may be needed is to ask why things are done a certain way. If the response given is, “that’s how we’ve always done it,” then there may be a need for change. Throughout my time working with auto retailers, I have noticed one of the biggest opportunities for improvement in business offices is addressing the underutilization of Microsoft Excel (“Excel”) for accounting transactional postings, and operational and financial analyses. Excel is the predominant spreadsheet and financial analysis tool used in almost every accounting office, but it’s also the most underutilized accounting tool available to dealership employees.

  • 09/09/2013
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  • Comments Off on As the Retail Automotive Industry Surges Look Out for Industry Outsiders and Private Equity Firms Driving Up Blue Sky Values

By Phil Villegas

This is a very attractive time to be a car dealer. Regardless of the franchise or region, sales and dealership profitability are up across the board, manufacturers are producing great and attractive vehicles, and by all indications, this solid trend is certain to last throughout the next few years.

Here are some quick payroll and personnel tests to stay better informed of potential risk areas:


Is the company withholding properly in accordance with IRS guidelines? Is any of the withholding being charged to the company? Divide withholding amount into gross earnings by employee. Are any percentages too high or too low? Is there a W-4 on file to support the number of withholding allowances claimed?

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