The look on my face when the 54 year old dealer told me that he was promoting his 28 year old son to be the GM was a dead give away. “Why is that a problem? – I was a GM at that age!, he said.” And obviously it worked out great for this dealer, so why was I questioning his decision to promote his son? The issue I told him is that he grew up in an entirely different set of circumstances than the world his son experienced and the maturity levels created by such are hard to replicate. 

I explained, “when you started out you didn’t have two extra nickels.” “Yes, he said, I sold my house and invested every dollar I had in getting my first store.” That’s my point, “you had to succeed, you didn’t have a choice – there was no safety net if you failed!” As a result, you were handling your finances with mirrors, hoping the receivables could keep up with the payables. You worked in every part of the dealership, with your hands on everything. You didn’t question staying late, working extra hours, doing whatever it took to find a way to sell one more car, so that you could make payroll.” You trained all your people to watch expenses and to complete the paperwork correctly the first time so that banks responded quickly. Everyone knew that there was no sugar daddy to rely on if times got tough and sales began to slide. 

Over time, due to hard work, some luck, the development of solid business practices and more hard work, your store began to make money. Being conservative, you plowed most of your profits back into your company, knowing that this was the only way to grow and to build financial strength so that you could survive adversity. Over time, your capital accounts began to grow and one day, your accountant even remarked that you are definitely over-capitalized! 

One day, along comes your son, eager to follow in your footsteps. You are immensely proud and excited that your dream of working together appears to be fulfilled. You want him to learn the business, but there is a part of you that is conflicted. On the one hand, you know that most learning is caught, not taught and that he will have to pay his dues. But, you don’t necessarily want him to have to struggle as much as you did. He wants more family time and that makes sense to you since you have some guilt about the long hours you put in when he was growing up. You rationalize that he is a bright guy and can learn the business faster than you did. As a result you tend to short circuit the training process, moving him through the departments over months, not years. You even send him to the NADA Dealer Academy, because you have heard how effective this training is for potential dealers. So the next thing you know, he moves through the ranks as a manager – three months in used cars, six months in F&I, then the GSM quits so you decide to let your son have a shot at it – he’s energetic and full of confidence! Before too long you have convinced yourself that he can run his own store – at age 28! 

So, what’s wrong with this picture? Maybe nothing, as anyone in the car business can point to many success stories that started out this way. But what was different between Dad’s situation and his son’s? As stated above, Dad had to be successful because there was no safety net. But his son knows that Dad is right behind him and isn’t going to let him fail. The store that Junior is running is well capitalized so there is a lot of money and some strong managers to prop him up when needed. Based on this he may seem to succeed at least while times are good and the money is plentiful. But the car business is tough and sooner or later Junior is going to face tough times – when that happens, will he be ready? Will he have the emotional toughness to be able to make the hard decisions, to watch the expenses closely, to be creative and work extra hours and do whatever it takes to succeed in a tough economy or with a less than stellar brand. 

So, in promoting Junior to be the GM before he has been thoroughly trained, all too often I see the children of dealers who think they know what they are doing, but obviously lack the maturity created by learning the old fashion way – by earning their position. When looking at the training necessary to be effective as a dealer for the long haul, don’t short circuit your children by promoting too quickly. Some very important lessons are learned in the trenches, getting their hands dirty, paying their dues. Especially with employees, they respect hard work and knowing that their boss knows what he is talking about because he’s been where they are. It’s easy to give in and bend our rules when dealing with issues regarding your children working in your business. But in the end, if your legacy is going to continue successfully through the next generation, your children are going to have to EARN it.

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